Bhavesh Dahyabhai Makwana vs State Of Gujarat
2025 Latest Caselaw 6522 Guj

Gujarat High Court

Bhavesh Dahyabhai Makwana vs State Of Gujarat on 12 September, 2025

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                            R/SCR.A/12553/2025                                   ORDER DATED: 12/09/2025

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                        IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
                       R/SPECIAL CRIMINAL APPLICATION (QUASHING) NO. 12553 of 2025
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                                       BHAVESH DAHYABHAI MAKWANA
                                                     Versus
                                          STATE OF GUJARAT & ANR.
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                       Appearance:
                       MR RONITH JOY(9560) for the Applicant(s) No. 1
                       MR ROHAN RAVAL, APP for the Respondent(s) No. 1
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                         CORAM:HONOURABLE MR. JUSTICE HASMUKH D. SUTHAR

                                                           Date : 12/09/2025
                                                            ORAL ORDER

[1.0] By way of present petition under Article 226 of the Constitution of India read with Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (for short "BNSS"), the petitioner has prayed for the following reliefs:

"A. To allow the present petition and quash and set aside the impugned FIR being CR No.11192020250319 of 2025 dated 03.05.2025 registered with Dholka Police Station, District Ahmedabad, along with the consequential proceedings, if any, for the offences punishable under sections 420 & 120(B) of IPC & under section 3 of GPID Act, 2003, annexed with the petition at Annexure-A;

B. To quash and set aside the impugned charge sheet being No.178/2025 dated 09.07.2025 filed in connection with FIR bearing No.11192020250319 dated 03.05.2025, registered with Dholka Police Station, District Ahmedabad, along with the consequential proceedings, if any, for the offences punishable under sections 420 & 120(B) of IPC & under section 3 of GPID Act, 2003, annexed with the petition at Annexure-B;"

[2.0] The impugned FIR is filed at the instance of respondent No.2 alleging therein that the accused persons had opened one "Sainaman Mitra Mandal" and lured the complainant and other

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persons for investing in the same by promising them higher interest rates upon investing. It is further the case that partial amount of their invested money was returned to them as promised with the agreed rates of interest, but afterwards no returns were paid to them and total amount of Rs.31 lakh invested by the complainant has not been returned and in this regard the FIR is filed alleging offence punishable under Sections 409, 420 and 120(B) of the IPC. After investigation, charge-sheet came to be filed for the offences punishable under Sections 406 and 120(B) of the IPC and section 3 of the GPID Act, which culminated into GPID CC No.20/2025, which is pending adjudication before the learned Sessions Court, Ahmedabad.

[3.0] At the outset, it is worth to mention that though the FIR is registered for the offence under Section 420 read with Section 120(B) of the IPC subsequently, the charge-sheet is filed for the offence under Section 406 and 120(B) of the IPC and even the learned Designated Court has registered the case for the offence under Sections 406 and 120(B) of the IPC and section 3 of the GPID Act.

[4.0] Learned advocate Mr. Ronith Joy for the petitioner has submitted that impugned proceeding is filed maliciously by the complainant after an unexplained delay of nearly three years alleging that the petitioner - accused No.1 and his brother (accused No.2) induced the complainant to invest Rs.31 lakh in a local mandal with assurance of good returns however, the allegations are vague, self-contradictory and bereft of any cogent material against the petitioner. There is neither any

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specific role attributed to the petitioner nor any material to suggest dishonest intention from inception which is an essential ingredient to constitute offence under Section 420 of the IPC. Further, section 3 of the GPID Act is wrongly invoked as transaction in question does not involve public at large and even the petitioner's entity is not covered within the statutory definition of a "financial establishment" under the GPID Act and said provision is mechanically added. Even, only the Designated Court notified under Section 6 of the GPID Act and the State Government under Sections 4 & 5 of the GPID Act are empowered to invoke the provisions of GPID Act and the role of police is limited to investigation and submission of a report. In support of his submissions, he has relied on the decision of the coordinate Bench of this Court in the case of State of Gujarat v. Pratikkumar Mohanlal Shah reported in 2013(3) GLR 2296 and Jivrajbhai Khimjibhai Rajput v. State of Gujarat reported in 2015(3) GLR 2472 and submitted that mere addition of section 3 of GPID Act by the police does not confer jurisdiction, unless the foundational requirements of the GPID Act namely collection of deposits from the "public at large" by a "financial establishment" are established. That, the petitioner has settled at Porbandar since last more than 15 years and has never ever collected any amount from the complainant or her mother residing at Dholka nor issued any receipts to them. Even if the allegations made in the impugned FIR are accepted as it is then also there is no any direct or indirect evidence which constitutes the alleged offence against the present petitioner as the present petitioner has not committed any offence of criminal breach of trust and cheating

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and has submitted that impugned proceedings are nothing but abuse of process of Court and law and hence, has requested to allow the present petition.

[4.1] Learned advocate has also relied on the decision of the Hon'ble Supreme Court in the case of Deepak Kumar Shrivas & Anr. vs. State of Chhattisgarh & Ors. reported in 2024 INSC 117 and argued that there is no any evidence for deposit of Rs.31 lakh and that too in cash by Aanganwadi workers. As the dispute is civil in nature, only with a view to show that there is no chance or it could be difficult to establish the same in the civil proceeding as payment was entirely in cash and hence, cloak of criminality is given to the civil dispute.

[5.0] Learned APP has vehemently opposed the present petition and submitted that the present petitioner and co-accused Hitesh Makwana (accused No.2) both are involved in the offence as they have pocketed the money. The accused persons have lured the complainant and her mother to invest amount in Sainaman Mitra Mandal with an assurance that they shall get good returns of their amount. Being lured by such assurance, complainant invested Rs.31 lakh with the firm "Sainaman Mitra Mandal" and even other persons also deposited different amounts in the said Mandal and in total an amount of Rs.65,98,600/- was deposited in the said Mandal claiming to be running fixed savings, annual saving and daily savings schemes and thereafter, did not return the amounts to the complainant and other victims and hence, prima facie involvement of the petitioner is there. He has therefore submitted that no case is made out to quash the impugned FIR as the investigation is

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over and charge-sheet is already filed and prima facie involvement of the present petitioner is found.

[6.0] Having heard learned advocates for the respective parties and going through the allegations leveled in the complaint, it appears that impugned complaint is filed at the instance of respondent No.2 wherein it is alleged that the present petitioner and co-accused Hitesh Makwana (accused No.2) both are involved in the offence as they have pocketed the money. The accused persons have lured the complainant and her mother to invest amount in Sainaman Mitra Mandal with an assurance that they shall get good returns of their amount. Being lured by such assurance, complainant invested Rs.31 lakh with the firm "Sainaman Mitra Mandal" and even other persons also deposited different amounts in the said Mandal and in total an amount of Rs.65,98,600/- was deposited in the said Mandal claiming to be running fixed savings, annual saving and daily savings schemes and thereafter, did not return the amounts to the complainant and other victims.

[6.1] Section 405 defines 'criminal breach of trust' which 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 willfully suffers any other person so to do, commits "criminal breach of trust".

The essential ingredients of the offense of criminal

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breach of trust punishable under Section 406 of the IPC are: (1) The accused must be entrusted with the property or with dominion over it, (2) The person so entrusted must use that property, or; (3) The accused must dishonestly use or dispose of that property or wilfully suffer any other person to do so in violation, (a) of any direction of law prescribing the mode in which such trust is to be discharged, or; (b) of any legal contract made touching the discharge of such trust.

[6.2] "Entrustment" of property under Section 405 of the IPC is pivotal to constitute an offence under this. The words used are, 'in any manner entrusted with property. So, it extends to entrustments of all kinds whether to clerks, servants, business partners or other persons, provided they are holding a position of 'trust'. A person who dishonestly misappropriates property entrusted to them contrary to the terms of an obligation imposed is liable for a criminal breach of trust and is punished under Section 406 of the Penal Code.

The definition in the section does not restrict the property to movables or immoveable alone.

[7.0] So far as offence under Section 120(B) of the IPC is concerned, it is pertinent to note that, to establish criminal conspiracy charges under section 120 of the IPC, there must be an agreement, either expressed or implied. And for that, no proof of direct meeting or communication is needed. There must be active cooperation. In other words, joint evil intent is mandatory. When any act is done even though it is lawful but done by illegal means, it constitutes criminal conspiracy.

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[7.1] The first ingredient of criminal conspiracy is agreement between two or more persons. This agreement is the crux of the offence and can be explicit or implicit, written or oral. The second essential component is the intention to commit an illegal act or a legal act by illegal means. The intent should directly related to the outcome that the conspirators plan to achieve.

[7.2] The essential ingredients of criminal conspiracy are: (i) An agreement between two or more persons; (ii) The agreement must be related to doing or causing to be done either (a) an illegal act and (b) an act that is not illegal in itself but is done by illegal means; (iii) The agreement may be expressed or implied or partly expressed and partly implied; (iv) As soon as the agreement is made, the conspiracy arises, and the offence is committed and (v) the same offence is continued to be committed so long as the combination persists.

[7.3] In view of the above, as the petitioner is facing charge under Section 120(B) of the IPC, actual presence of the petitioner everyday is not required. There is specific material and evidence collected which clearly suggests that the petitioner is the President of Sainaman Mitra Mandal and said entity is registered as a Public Trust and present petitioner is the President of the said Trust. The registration certificate of the said Trust is in the name of the petitioner and co-accused, who is real brother of the petitioner and in the pretext of Trust, in the name of social service, they have lured the people, collected moneys and explained the scheme to poor people for hefty returns and there is specific allegation in the complaint

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itself that alongwith co-accused present petitioner had visited home of depositors and lured them to deposit or invest in the Sainaman Mitra Mandal. It is needless to say that illiterate villagers having no sufficient knowledge about the entity or the nature of institute. In the pretext of registration or government recognition, accused persons have collected the moneys and real brother of the petitioner has issued receipts also. Thus, question of cash transaction does not arise, once accepted the money and thereafter, fixed deposit receipts are also issued in the name of said Mandal / Trust and in the pretext of financial establishment the petitioner and his real brother have fraudulently collected the money and defrauded the witnesses and the complainant and they have lured them under the assurance of hefty returns, bonus and profit and given false promises which clearly reveals the involvement of the present petitioner and considering the object of GPID Act and explanation in the ordinary course of business of alleged Trust, without any authority or object of the Trust, fully aware of the said fact, they have lured the people, received security deposits and Trust is also registered in the name of association. Hence, prima facie, it appears that offence is made out as defined under Section 2(c) and 2(c)(v)(vi) read with section 3 and explanation of the GPID Act. Hence, question does not arise to say that transaction is in cash but herein once the FD receipt is issued, it clearly is proof of transaction. Other witnesses have also stated before the police during the investigation about the involvement of the present petitioner and brother of the petitioner as they have given assurance of 80% of return and under the daily scheme they have collected

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money and issued diaries. Hence, prima facie involvement of the petitioner is there.

[7.4] It is needless to say that so far as the allegation of conspiracy is concerned, it is very difficult to collect any direct evidence of conspiracy. From the material collected or the evidence adduced on record, inference of conspiracy is required to be drawn. The Investigating Officer has collected voluminous documentary evidences which clearly establishes that huge amount of Rs.65,98,600/- was deposited in the said Sainaman Mitra Mandal claiming to be running fixed savings, annual saving and daily savings schemes and thereafter, did not return the amounts to the complainant and other victims.

[7.5] Even, the act on the part of the accused prima facie appears to be false. Section 23 of the IPC defines "Wrongful gain", which provides that "wrongful gain" is gain by unlawful means of property to which the person gaining is not legally entitled and due to such act, wrongful loss is caused to the complainant for which complainant is legally entitled to recover dues. Thus, as per section 24 of the IPC, whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing "dishonestly". Herein, only with intention of getting unlawful gain and to cause loss to the complainant and other witnesses, act is committed.

[8.0] So far as the argument canvassed by the learned advocate for the petitioner that the dispute is civil in nature which has been cloak of criminality is concerned, it is pertinent to note that

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herein, receipts have been issued to the complainant and witnesses and hence, said argument is not accepted and the authority relied upon by the learned advocate for the petitioner would not avail any assistance to the petitioner. Even otherwise, it is needless to say that the precedents are never Euclid theorem. The criminal cases are required to be decided on its own merit. At this stage it is worth to refer to the decision of the Hon'ble Apex Court in the case of Parasa Raja Manikyala Rao And Anr vs State Of A.P reported in AIR 2004 SC 132, wherein it has been observed and held as under:

"...Each case, more particularly a criminal case depends on its own facts and a close similarity between one case and another is not enough to warrant like treatment because a significant detail may alter the entire aspect. In deciding such cases, one should avoid the temptation to decide cases (as said by Cordozo) by matching the colour of one case against the colour of another. To decide therefore on which side of the line a case falls, the broad resemblance to another case is not at all decisive."

[8.1] Further, under Section 528 of the BNSS, Court should not hold a mini trial and should not go into evidence or statements recorded by the police during investigation. In this regard, reference is required to be made to the decision of the Hon'ble Apex Court in the case of Manik B. vs. Kadapala Sreyes Reddy & Ors. reported in 2023 Live Law 642 wherein it is held that High Court should not elaborately discuss the statement of the witnesses recorded under Section 161 of the Cr.P.C. and whether statements are trustworthy or not is required to be decided while witness stands in the witness box at the stage of such trial and such exercise is not permissible while exercising

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jurisdiction under Section 528 of the BNSS. It is also appropriate to refer to the decision of the Hon'ble Supreme Court in the case of Central Bureau of Investigation Vs. Aryan Singh etc. reported in 2023 SCC Online SC 379 (Para

10), wherein it is held that scope under Section 528 of the BNSS is very limited and High Court cannot conduct a mini trial.

[8.2] Further, while exercising jurisdiction under Section 528 of the BNSS, the Court would not ordinarily embark upon an enquiry into whether the evidence is reliable or not or whether there is reasonable possibility that the accusation would not be sustained. In this regard, reference is required to be made to the decision of the Hon'ble Supreme Court in the case of Ramveer Upadhyay and Anr. vs. State of U.P. and Anr. reported in 2022 OnLine SC 484.

[8.3] This Court court also deems it proper to refer to the judgment of the Hon'ble Apex Court in the case of Neeharika Infrastruecture Pvt. Ltd. vs. State of Maharshtra, reported in 2021 SCC Online SC 315 wherein, the Apex Court has observed that:

"iv) The power of quashing should be exercised sparingly with circumspection, in the 'rarest of rare cases'. (The rarest of rare cases standard in its application for quashing under Section 528 BNSS is not to be confused with the norm which has been formulated in the context of the death penalty, as explained previously by this Court);

v) While examining an FIR/complaint, quashing of which is sought, the court cannot embark upon an inquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR/complaint;

vi) Criminal proceedings ought not to be scuttled at the initial stage;

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vii) Quashing of a complaint/FIR should be an exception and a rarity than an ordinary rule;"

[8.4] Further, the case on hand does not fall in the category of cases set out by the Hon'ble Supreme Court in the case of State of Haryana and others vs. Bhajan Lal and others reported in [(1992) Supp (1) SCC 335] in which the inherent power under Article 226 of the Constitution and section 528 of the BNSS can be exercised.

[8.5] Even otherwise, once the charge-sheet is filed and evidence is collected then it is expedient to relegate the accused to file the discharge application. In this regard, it would be apposite to refer to the decision of the Apex Court rendered in case of Iqbal Alia Bala and Others vs. State of Uttar Pradesh and Others reported in (2023) 8 SCC 734.

[9.0] In wake of aforesaid discussion, present petition being devoid of any merit stands dismissed. It is made clear that the observations made herein are tentative in nature. Rule is hereby discharged.

(HASMUKH D. SUTHAR, J.) Ajay