Jharkhand High Court
Sanju Mishra @ Tuntun Mishra @ Sanjay ... vs The State Of Jharkhand on 19 November, 2025
Author: Anil Kumar Choudhary
Bench: Anil Kumar Choudhary
[2025:JHHC:34749]
IN THE HIGH COURT OF JHARKHAND AT RANCHI
Cr.M.P. No.769 of 2021
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Sanju Mishra @ Tuntun Mishra @ Sanjay Mishra, aged about 40
years, son of Jagdish Mishra, resident of Gandhi Nagar,
Jirangatoli, Misirgonda, Kanke Road, P.O. Kanke, P.S. Gonda,
District Ranchi (Jharkhand) ... Petitioner
Versus
1. The State of Jharkhand
2. Ravi Prakash Jaiswal, son of Raj Kumar Choudhary, resident of
C3 NB Enclave, Pandra, P.O. Pandra, P.S. Pandra O.P. District
Ranchi ... Opposite Parties
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For the Petitioner :Mr. Nilesh Kumar, Advocate
Ms. Sonal Sodhani, Advocate
For the State : Mrs. Laxmi Murmu, G.P.-I
Mr. Navneet Toppo, AC to GP-I
For the O.P. No.2 : Mr. Jawahar Sah, Advocate
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PRESENT
HON'BLE MR. JUSTICE ANIL KUMAR CHOUDHARY
By the Court:- Heard the parties.
2. This Criminal Miscellaneous Petition has been filed invoking the
jurisdiction of this Court under Section 482 of the Code of Criminal
Procedure, 1973 with the prayer to quash the entire criminal proceeding
against the petitioner in connection with Sukhdeo Nagar (Pandra O.P.)
P.S. Case No.355 of 2019 registered for the offences punishable under
Sections 406 and 420 of the Indian Penal Code.
3. The allegation against the petitioner is that the petitioner in
several installments took a friendly loan of Rs.13,00,000/- from the
informant and the petitioner issued three cheques of Rs.1,00,000/- each
and the wife of the petitioner issued one cheque of Rs.10,00,000/- as
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security against the loan taken but the petitioner did not pay the loan
taken by him and the informant upon presenting the cheques issued by
the petitioner and his wife for payment, all the cheques were
dishonoured because of insufficiency of funds in the account.
4. Learned counsel for the petitioner relies upon the judgment of
this Court passed in the case of Vikash Kumar @ Bikash Kumar Vs.
The State of Jharkhand & Anr. reported in 2023:JHHC:27680 and
submits that in that case, this Court has relied upon the judgment
passed by the Hon'ble Supreme Court in the case of Satish Chandra
Ratanlal Shah Vs. State of Gujarat & Anr. reported in (2019) 9 SCC
148, paragraph Nos.11 to 13 of which read as under:
"11. Having observed the background principles applicable herein, we need to
consider the individual charges against the appellant. Turning to Section 405
read with Section 406 IPC, we observe that the dispute arises out of a loan
transaction between the parties. It falls from the record that Respondent 2
knew the appellant and the attendant circumstances before lending the loan.
Further it is an admitted fact that in order to recover the aforesaid amount,
Respondent 2 had instituted a summary civil suit which is still pending
adjudication. The law clearly recognises a difference between simple
payment/investment of money and entrustment of money or property. A mere
breach of a promise, agreement or contract does not, ipso facto, constitute the
offence of the criminal breach of trust contained in Section 405 IPC without
there being a clear case of entrustment.
12. In this context, we may note that there is nothing either in the complaint
or in any material before us, pointing to the fact that any property was
entrusted to the appellant at all which he dishonestly converted for his own use
so as to satisfy the ingredients of Section 405 punishable under Section 406
IPC. Hence the learned Magistrate committed a serious error in issuing
process against the appellant for the said offence. Unfortunately, the High
Court also failed to correct this manifest error.
13. Now coming to the charge under Section 415 punishable under Section
420 IPC. In the context of contracts, the distinction between mere breach of
contract and cheating would depend upon the fraudulent inducement and
mens rea. (See Hridaya Ranjan Prasad Verma v. State of Bihar [Hridaya
Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168 : 2000 SCC (Cri)
786] .) In the case beforeus, admittedly the appellant was trapped in economic
crisis and therefore, he had approached Respondent 2 to ameliorate the
situation of crisis. Further, in order to recover the aforesaid amount,
Respondent 2 had instituted a summary civil suit seeking recovery of the loan
amount which is still pending adjudication. The mere inability of the appellant
to return the loan amount cannot give rise to a criminal prosecution for
cheating unless fraudulent or dishonest intention is shown right at the
beginning of the transaction, as it is this mens rea which is the crux of the
offence. Even if all the facts in the complaint and material are taken on their
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face value, no such dishonest representation or inducement could be found or
inferred." (Emphasis supplied)
wherein it has been held by the Hon'ble Supreme Court of
India that the mere inability of an accused person to return the
loan amount cannot give rise to a criminal prosecution for cheating
unless fraudulent and dishonest intention is shown right at the
beginning of the transaction.
5. It is next submitted that in that case this Court has also
relied upon the judgment passed by the Hon'ble Supreme Court in
the case of Uma Shankar Gopalika Vs. State of Bihar & Anr.
reported in (2005) 10 SCC 336, paragraph No.6 reads as under:
"6. Xxxx xxxx xxxx
It is well settled that every breach of contract would not give rise to an
offence of cheating and only in those cases breach of contract would
amount to cheating where there was any deception played at the very
inception. If the intention to cheat has developed later on, the same
cannot amount to cheating. In the present case it has nowhere been
stated that at the very inception there was any intention on behalf of
the accused persons to cheat which is a condition precedent for an
offence under Section 420 IPC." (Emphasis supplied)
wherein the Hon'ble Supreme Court has held that every breach of
contract would not give rise to an offence of cheating and only in those
cases where there was any deception played at the very inception then
only the offence of cheating will be made out and if the intention to
cheat has developed later on, the same cannot amount to cheating.
6. Learned counsel for the petitioner next relies upon the judgment
of this Court passed in the case of Pawan Kumar Lakhotia & Ors. Vs.
The State of Jharkhand & Anr. reported in 2024:JHHC:17054 and
submits that in that case this Court has relied upon the judgment passed
by the Hon'ble Supreme Court in the case of Vijay Kumar Ghai Vs.
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State of West Bengal reported in (2022) 7 SCC 124, paragraph Nos.28
and 38 of which read as under:
"28. "Entrustment" of property under Section 405 of the Penal Code,
1860 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.
38. There can be no doubt that a mere breach of contract is not in
itself a criminal offence and gives rise to the civil liability of
damages. However, as held by this Court in Hridaya Ranjan Prasad
Verma v. State of Bihar [Hridaya Ranjan Prasad Verma v. State of
Bihar, (2000) 4 SCC 168 : 2000 SCC (Cri) 786] , the distinction
between mere breach of contract and cheating, which is criminal
offence, is a fine one. While breach of contract cannot give rise to
criminal prosecution for cheating, fraudulent or dishonest intention
is the basis of the offence of cheating. In the case at hand, complaint
filed by Respondent 2 does not disclose dishonest or fraudulent
intention of the appellants."
and submits that mere breach of contract is not in itself a criminal
offence and gives rise to the civil liability of damages and fraudulent
and dishonest intention is the basis of the offence of cheating.
7. It is next submitted that in that case this Court has also relied
upon the judgment passed by the Hon'ble Supreme Court in the case of
Binod Kumar & Ors. Vs. State of Bihar & Anr. reported in (2014) 10
SCC 663, paragraph No. 18 of which reads as under:
"18. In the present case, looking at the allegations in the complaint on
the face of it, we find that no allegations are made attracting the
ingredients of Section 405 IPC. Likewise, there are no allegations as to
cheating or the dishonest intention of the appellants in retaining the
money in order to have wrongful gain to themselves or causing
wrongful loss to the complainant. Excepting the bald allegations that
the appellants did not make payment to the second respondent and
that the appellants utilised the amounts either by themselves or for
some other work, there is no iota of allegation as to the dishonest
intention in misappropriating the property. To make out a case of
criminal breach of trust, it is not sufficient to show that money has been
retained by the appellants. It must also be shown that the appellants
dishonestly disposed of the same in some way or dishonestly retained
the same. The mere fact that the appellants did not pay the money to
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the complainant does not amount to criminal breach of trust."
Emphasis supplied)
wherein the Hon'ble Supreme Court of India has reiterated the
settled principle of law that to make out a case of criminal breach of
trust, it is not sufficient to show that money has been retained by the
accused persons but it must also be shown that the accused person has
dishonestly disposed of the same in some way or dishonestly retained
the same.
8. Learned counsel for the petitioner next submits that the allegation
of criminal intimidation is specifically against the co-accused and there
is no allegation of criminal intimidation against the petitioner. Hence, it
is submitted that the prayer, as prayed for in the instant Cr.M.P., be
allowed.
9. Learned counsel for the State and learned counsel for the opposite
party No.2 on the other hand vehemently oppose the prayer of the
petitioner and jointly submit that that there is sufficient material in the
record to make out both the offences punishable under Section 406 and
420 of the Indian Penal Code as the petitioner was having the intention
to cheat since the beginning of the transaction between the parties.
Hence, it is submitted that this Cr.M.P. being without any merit be
dismissed.
10. Having heard the rival submissions made at the Bar and after
carefully going through the materials available in the record, it is
pertinent to mention here that the undisputed fact remains that the
petitioner took friendly loan of Rs.13,00,000/- from the informant. Later
on, the petitioner also gave cheques in discharge of the loan but the
cheques were dishonoured for which a separate complaint case has been
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instituted by the informant. Under such circumstances, in view of the
settled principle of law in the case of Satish Chandra Ratanlal Shah
(supra) where the Hon'ble Supreme Court of India held that the mere
inability of the petitioner to return a loan amount cannot give rise to a
criminal prosecution for cheating; in the absence of any dishonest
misappropriation of the entrusted property and in the absence of any
evidence in the record regarding any entrustment was made to the
petitioner by the informant or anyone else, this Court is of the
considered view that even if the entire allegations made against the
petitioner are considered to be true in their entirety still the offence
punishable under Section 406 of the Indian Penal Code is not made out.
11. So far as the offence punishable under Section 420 of the Indian
Penal Code is concerned, as already being referred to above in this
judgment, it is a settled principle of law that in order to constitute the
offence of cheating, deception of the victim since the beginning is a sine-
qua-non. Therefore, this Court is of the considered view that even the
entire allegations made against the petitioner are considered to be true
in their entirety still the offence punishable under Section 420 of the
Indian Penal Code is not made out; in the absence of any deception
having been played by the petitioner since the beginning of the
transaction between the parties.
12. In view of the discussions made above as none of the offence in
respect of which cognizance has been taken by the Magistrate is made
out against the petitioner; even if the entire allegation made against the
petitioner are considered to be true in their entirety, hence this Court is
of the considered view that continuation of this criminal proceeding
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against the petitioner will amount to abuse of process of law. Therefore,
this is a fit case where the entire criminal proceeding of Sukhdeo Nagar
(Pandra O.P.) P.S. Case No.355 of 2019, be quashed and set aside qua the
petitioner named above.
13. Accordingly, the entire criminal proceeding of Sukhdeo Nagar
(Pandra O.P.) P.S. Case No.355 of 2019, is quashed and set aside qua the
petitioner named above.
14. In the result, this Criminal Miscellaneous Petition is allowed.
15. In view of the disposal of this Cr.M.P., the interim relief granted
earlier vide order dated 02.07.2021, is vacated.
16. Registry is directed to intimate the Court concerned forthwith.
(Anil Kumar Choudhary, J.)
High Court of Jharkhand, Ranchi
Dated the 19th of November, 2025
AFR/ Madhav
Uploaded on 26/11/2025
