M/S Umrah Developers vs The State Of Karnataka

Karnataka High Court

M/S Umrah Developers vs The State Of Karnataka on 30 October, 2025

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                                     WP No. 15281 of 2024



     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

       DATED THIS THE 30TH DAY OF OCTOBER, 2025

                          BEFORE
            THE HON'BLE MR. JUSTICE M.I.ARUN
       WRIT PETITION NO. 15281 OF 2024 (GM-RES)


BETWEEN:

1.    M/S UMRAH DEVELOPERS
      HAVING ITS OFFICE AT NO.22/1
      MILLERS, TANK BUND ROAD
      KAVERIAPPA LAYOUT
      BENGALURU-560 052
      REP. BY ITS PROPRIETOR
      SRI. YUSUF SHERIFF.
                                             ...PETITIONER
(BY SRI. K.G.RAGHAVAN, SENIOR ADVOCATE FOR
      SRI. GAURAV N., ADVOCATE)

AND:

1.    THE STATE OF KARNATAKA
      THROUGH JAYANAGAR POLICE STATION
      REPRESENTED BY
      STATE PUBLIC PROSECUTOR
      HIGH COURT BUILDING
      BENGALURU-560 001.

2.    SRI. NAVEED MOHAMMED
      AGED ABOUT 51 YEARS
      S/O MOHAMMED ATTAULLA
      R/AT J.SONS DEVELOPERS
      NO.128/3, 19TH 'B' CROSS
      ELEPHANT ROCK ROAD
      3RD BLOCK, JAYANAGAR
      BENGALURU-560 011.
                                          ...RESPONDENTS

(BY SRI. B.N.JAGADEESH, ADDL. SPP FOR SRI. K.NAGESHWARAPPA, HCGP FOR R1;

SRI. ANAND MUTTALLI, ADVOCATE FOR R2) THIS PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA READ WITH SECTION 482 OF THE CODE OF CRIMINAL PROCEDURE, PRAYING TO QUASH FIR DATED 06.04.2019, BEARING CRIME NO.0073/2019, PRODUCED HERETO AS ANNEXURE-A, WHICH WAS REGISTERED BY THE RESPONDENT NO.1 HEREIN, BASED ON A COMPLAINT LODGED BY RESPONDENT NO.2 HEREIN, PRODUCED HERETO AS ANNEXURE-B, IN SO FAR AS THE AS THE PRESENT PETITIONER IS CONCERNED, FOR THE ALLEGED OFFENCES PUNISHABLE UNDER SECTIONS 406 AND 420 OF IPC, ETC.

THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 28.10.2025 AND COMING ON FOR PRONOUNCEMENT OF ORDERS THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:

CORAM:      HON'BLE MR. JUSTICE M.I.ARUN
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                                       WP No. 15281 of 2024



                         CAV ORDER

There were certain financial transactions between the petitioner and respondent no.2. There were disputes between the parties. It resulted in respondent no.2 filing a complaint dated 06.04.2019 with respondent no.1-Police against the petitioner herein. It resulted in an FIR being registered against the petitioner in Crime No.73/2019. The same was challenged before this Court in Crl.P.No.4736/2019 by the petitioner. However, the same was dismissed, reserving liberty to the petitioner to challenge the charge sheet as and when filed. The petitioner challenged the decision passed in Crl.P.No.4736/2019 before the Apex Court which came to be withdrawn.

2. After investigation, respondent no.1-Police have filed a police report which has resulted in C.C.No.10899/2023 being registered against the petitioner on the file of IV Additional Chief Metropolitan Magistrate, Bengaluru. The same is registered for the offences punishable under Sections 406 and 420 of IPC. Aggrieved by the same, the present writ petition is filed.

WP No. 15281 of 2024

3. The case of the petitioner is that, he cannot be charged for the offences under Sections 406 and 420 of IPC simultaneously, as both the offences are mutually destructive. It shows that the jurisdictional police have not applied their mind to the facts of the case and without any investigation, have blindly filed the charge sheet based solely on the complaint averments.

4. This Court while passing the order in Crl.P.No.4736/2019 in paragraph nos.11.8 and 12.2 has observed as hereunder:

"11.8. In that background, I am of the considered view that there is some credence and merit in the submissions made by Sri Aravind Kamath, learned Senior Counsel for the complainant that the termination is only to cheat the developer, of course the same would have to be established during the course of investigation and/or trial.

12.2. In the present case, I am unable to come to a conclusion that there is no criminal offence which has been made out on an ex facie reading of the documents presented. The present proceedings having been filed seeking for quashing of the FIR prior to investigation being completed, in my opinion, does not merit -5- WP No. 15281 of 2024 consideration."

Because of which, the criminal petition was dismissed.

5. Respondent no.2 has made a complaint wherein certain facts have been set out regarding the transaction between petitioner and respondent no.2 and it is alleged that the petitioner has committed criminal breach of trust and cheating in respect of the transaction between petitioner and respondent no.2.

6. A reading of the complaint and police report discloses that a complaint has been made against the petitioner that he was the owner of 8 acres 6 guntas of land in Sy.No.1 and 1 gunta of land in Sy.No.55 (totally measuring 8 acres 7 guntas) situated at Doddabettahalli Village, Yelahanka Hobli, Bengaluru North Taluk. That he entered into a joint development agreement in respect of the property with the complainant and that the complainant spent huge money to get the necessary permissions to develop the property concerned. The complainant had paid huge sums as refundable deposit in respect of the property. However, the -6- WP No. 15281 of 2024 petitioner did not come forward to execute a sharing agreement as required.

7. It is also discloses that petitioner was the owner of 4 acres 24 guntas of land in property bearing No.21, Block 1, Harappanahalli Village, Jigani Hobli, Anekal Taluk and in respect of the said land also he entered into a similar joint development agreement with the respondent, by receiving certain money towards refundable deposit and thereafter did not come forward to execute a sharing agreement as agreed upon.

8. It also discloses that the petitioner intended to purchase certain government lands sold in public auction situated in Sy.No.2, Doddanagamangala Village, Near Electronic City Phase-2, Bengaluru South. He received a sum of Rs.1,32,50,000/- from the complainant on the promise that he would give the land for joint development to the complainant. But he refused to do so.

9. Further, it is alleged that the dispute between the petitioner and the complainant went into arbitration and has -7- WP No. 15281 of 2024 ended in favour of complainant but the petitioner has not honoured the arbitral award.

10. It is also alleged that in the meanwhile the petitioner voluntarily issued a demand draft for a sum of Rs.6.00 crores which is dated 16.08.2016 and it was issued towards the refundable deposit received by him towards the joint development agreement in respect of two properties mentioned above, but to the shock and horror of the complainant he had got the same cancelled on the same day.

11. The case of the respondents is that the complaint is not given in respect of one particular act which constitutes an offence but is in respect of three different transactions and in all the transactions the act of the petitioner has given rise to both a civil cause of action and a criminal cause of action. It is further submitted that, the first two transactions (in respect of the properties situated in Doddabettahalli Village and Harappanahalli Village), the acts done by the petitioner constitute an offence under Section 406 of IPC (punishable for criminal breach of trust) and the act of the petitioner done in respect of the property situated at Doddanagamangala Village -8- WP No. 15281 of 2024 constitutes an offence under Section 420 of IPC. It is submitted that for the said reason, complaint is lodged and the police report is filed under Sections 406 and 420 of IPC. It is submitted that if both the offences were to pertain to one single act, then it would be mutually destructive and not otherwise.

12. Section 415 of IPC defines 'cheating' and it reads as under:

"415. Cheating.--Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to "cheat"."

13. Section 420 of IPC pertains to 'cheating and dishonestly inducing delivery of property' and it reads as under:

"420. Cheating and dishonestly inducing delivery of property.--Whoever cheats and thereby -9- WP No. 15281 of 2024 dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine."

14. Section 405 of IPC defines 'criminal breach of trust' and it reads as under:

"405. Criminal breach of trust.--Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits "criminal breach of trust"."

15. Section 406 of IPC pertains to 'punishment for criminal breach of trust' and it reads as under:

"406. Punishment for criminal breach of trust.--Whoever commits criminal breach of trust shall

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be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both."

16. Thus, in cheating the accused is required to fraudulently or dishonestly induce a person to deliver the property. The mens rea is at the time of receipt of the property by the accused from the person who is being cheated.

17. In criminal breach of trust, a person who has been legally entrusted with the property dishonestly misappropriates the same. In this case, there is no dishonest intention or mens rea at the time of receiving the property but the mens rea is found at the time of appropriating the property.

18. Thus one single transaction cannot constitute cheating as well as criminal breach of trust, but it can be either cheating or criminal breach of trust. The Hon'ble Apex Court in Delhi Race Club (1940) Limited. and Others v. State of Uttar Pradesh and Another reported in (2024) 10 SCC 690 in paragraph 38 has held as under:

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"38. In our view, the plain reading of the complaint fails to spell out any of the aforesaid ingredients noted above. We may only say, with a view to clear a serious misconception of law in the mind of the police as well as the courts below, that if it is a case of the complainant that offence of criminal breach of trust as defined under Section 405 IPC, punishable under Section 406 IPC, is committed by the accused, then in the same breath it cannot be said that the accused has also committed the offence of cheating as defined and explained in Section 415 IPC, punishable under Section 420 IPC."

19. Thus, when the prosecution alleges criminal breach of trust as well as cheating and dishonestly inducing delivery of property for one single act of the accused, the charges become mutually destructive.

20. However, in the instant case, there are three separate transactions and in respect of two of them (properties in Doddabettahalli Village and Harappanahalli Village), reading of the allegations constitute an offence under Section 406 of IPC, as there is no allegation insofar as it relates to dishonestly inducing the complainant to deliver the property to the petitioner. The allegation is only in respect of,

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subsequent misappropriation of the benefits accrued to the petitioner.

21. Insofar as the allegation pertaining to the property situated at Doddanagamangala Village, there is an allegation regarding the petitioner dishonestly inducing the complainant to pay him the money on false promise that the same will be utilized for the purchase of the property which would thereafter be given for joint development to the complainant. If proved, it satisfies the ingredients of Section 420 of IPC.

22. Thus, in my opinion, the complaint and the chargesheet pertain to three different transactions each constituting a separate offence alleged to have been committed by the petitioner, with two of them pertaining to the offence under Section 406 of IPC and the other pertaining to Section 420 of IPC. Thus, in the instant case, the judgment of the Apex Court passed in Delhi Race Club's case (cited supra) does not come to the rescue of the petitioner herein.

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For the aforementioned reasons, the writ petition is hereby dismissed.

In view of disposal of main petition, pending interlocutory applications, if any, stand disposed of.

Sd/-

(M.I.ARUN) JUDGE PGG