Kerala High Court
Nishad Mathew vs State Of Kerala on 12 September, 2025
Author: P.V.Kunhikrishnan
Bench: P.V.Kunhikrishnan
Crl.Rev.Pet. No.1281 of 2024
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN
FRIDAY, THE 12TH DAY OF SEPTEMBER 2025 / 21ST BHADRA, 1947
CRL.REV.PET NO. 1281 OF 2024
CRIME NO.320/2013 OF KALAMASSERY POLICE STATION, ERNAKULAM
AGAINST THE ORDER DATED 13.09.2024 IN CMP NO.1362 OF
2024 IN CC NO.319 OF 2016 OF JUDICIAL FIRST CLASS MAGISTRATE
COURT, KALAMASSERY
REVISION PETITIONER/PETITIONER/ACCUSED:
NISHAD MATHEW
AGED 43 YEARS
S/O MATHEW, KATTIVEETTIL HOUSE, KEEZHUR,
THALASSERY, KANNUR DISTRICT, PIN - 670703
BY ADV SRI.SOJAN MICHEAL
RESPONDENTS/RESPONDENTS/COMPLAINANT:
1 STATE OF KERALA
REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT
OF KERALA, ERNAKULAM, KOCHI, PIN - 682031
2 ADDL.2 SREENIVASN
S/O KUMARAN, KALARICKAL HOUSE, CHERUVALOOR DESOM,
KALLOOR VADAKKEMURI, MUKUNDAPURAM, THRISSUR
(ADDL.2ND RESPONDENT IS IMPLEADED AS PER THE ORDER
DATED 12.09.2025 IN I.A. NO.2 OF 2024)
SRI.HRITHWICK -SENIOR PUBLIC PROSECUTOR
THIS CRIMINAL REVISION PETITION HAVING COME UP FOR
ADMISSION ON 12.09.2025, THE COURT ON THE SAME DAY DELIVERED
THE FOLLOWING:
Crl.Rev.Pet. No.1281 of 2024
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P.V.KUNHIKRISHNAN, J
--------------------------------
Crl.Rev.Pet. No.1281 of 2024
-------------------------------
Dated this the 12th day of September, 2025
ORDER
This Revision Petition is filed against the order dated
13.09.2024 in CMP No.1362 of 2024 in C.C. No.319 of 2016 on
the file of the Judicial First Class Magistrate Court, Kalamassery.
2. As per the impugned order, the learned Magistrate
dismissed the application filed by the petitioner for discharge.
Aggrieved by the same, this revision is field.
3. Heard the learned counsel for the petitioner and the
learned Public Prosecutor. Even though notice is issued to the
additional 2nd respondent, there is no appearance.
4. The allegations against the petitioner is that in order
to make unlawful gain to the accused and to cause wrongful loss
to CW1, the accused made to believe him that CW1 will be made
a partner to his 'Sea Gate Bar Hotel'. For that purpose, the
complainant paid an amount of Rs.30,00,000/- (Rupees Thirty
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Lakhs Only) from the house of CW1 at Cheruvandoor. Further in
2008, to purchase High Way Bar Hotel at Amballoor, Thrissur, for
the accused, CW1, who is the complainant handed over deeds of
the property of the wife of CW1, to pledge it as security at Union
Bank of India, Aluva. The property was not released from the
security as agreed. In 2009, Rs.75,00,000/- (Rupees Seventy
Five Lakhs) handed over by the accused for making CW1 as a
partner to the Bar Hotel, being constructed by the accused at
Ernakulam. Towards its 1st installment Rs.40,00,000/- (Rupees
Forty Lakhs) was received by the accused from the house of
CW1. 2nd installment of Rs.25 lakhs received by the accused at
'Sea Gate Hotel at Pathadipalam' is the case. Thus, it is alleged
that the accused obtained a total amount of rs.1,55,00,000/-
(Rupees One Crores Fifty Five Lakhs Only). It is the case of the
complainant that the accused made to believe that the
complainant will be made as a partner to the bar hotels. But the
complainant was not made as a partner. When the money was
demanded back, the accused issued a cheque for Rs.25 lakhs and
70 lakhs of the Syndicate Bank Kalamassery. But, when the
cheque was presented, it was returned with endorsement
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"account closed". The accused neither made CW1 as a partner to
the bar hotel nor had returned the money obtained from CW1 as
agreed and hence it is alleged that the accused committed
offences under Sections 406 and 420 of the Indian Penal Code.
5. This Court perused the final report filed by the police
in this case, which is produced as Annexure 2. A perusal of the
final report would show that the case of the complainant is that
he invested some amount in a business concern on an assurance
that, he will be made as a partner. The accused did not make him
as a partner after collecting the amount and the amount was not
returned also. A cheque was issued for the amount due, but it is
dishonoured, stating that the 'account closed'. Whether the
offence under Sections 406 and 420 IPC is made out is the
question to be decided.
6. The Apex Court considered the ingredients to attract
Section 420 IPC in Subbiah C. @ Kadambur Jayaraj v.
Superintendent of Police [2024 KHC 6288]. The relevant
portion of the above judgment is extracted hereunder:
"40. The complainant has clearly alleged that the accused
caused him monetary loss because the appropriate share of
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profits was not passed on to him after some plots from the
entire chunk had been sold. This Court in the case of Sarabjit
Kaur v. State of Punjab and Anr, 2023 SCC OnLine SC 201
observed that: -
"A breach of contract does not give rise to criminal
prosecution for cheating unless fraudulent or dishonest intention
is shown right at the beginning of the transaction. Merely on the
allegation of failure to keep up the promise will not be enough
to initiate criminal proceedings".
41. Similarly, in the case of Vijay Kumar Ghai v. State of
W.B., 2022 (7) SCC 124, this Court while tracing the earlier
decisions on the subject observed as under:
24. This Court in G. Sagar Suri v. State of U.P. (G. Sagar
Suri v. State of U.P., 2000 (2) SCC 636) observed that it is the
duty and obligation of the criminal court to exercise a great deal
of caution in issuing the process, particularly when matters are
essentially of civil nature.
25. This Court has time and again cautioned about
converting purely civil disputes into criminal cases. This Court in
Indian Oil Corpn. (Indian Oil Corpn. v. NEPC India Ltd., 2006 (6)
SCC 736) noticed the prevalent impression that civil law
remedies are time consuming and do not adequately protect the
interests of lenders / creditors. The Court further observed
that : (Indian Oil Corpn case (Indian Oil Corpn v. NEPC India
Ltd., 2006 (6) SCC 736)
"13. ... Any effort to settle civil disputes and claims, which do
not involve any criminal offence, by applying pressure through
criminal prosecution should be deprecated and discouraged."
42. Thus, we are of the firm view that the necessary
ingredients of the offences punishable under S.406 and S.420
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IPC are not made out against the accused appellants from the
admitted allegations set out in the complaint and the charge
sheet. It cannot be doubted that a dispute which is purely civil
in nature has been given a colour of criminal prosecution
alleging fraud and criminal breach of trust by misusing the tool
of criminal law."
7. Similarly in Sharif Ahmed v. State of Uttar
Pradesh [2024 KHC 6251], the Apex Court again considered the
ingredients of Section 420 IPC. The relevant portion of the above
judgment is also extracted hereunder:
"37. The chargesheet states that the offence under S.420 is
not made out. The offence of cheating under S.415 of the IPC
requires dishonest inducement, delivering of a property as a result
of the inducement, and damage or harm to the person so induced.
The offence of cheating is established when the dishonest
intention exists at the time when the contract or agreement is
entered, for the essential ingredient of the offence of cheating
consists of fraudulent or dishonest inducement of a person by
deceiving him to deliver any property, to do or omit to do
anything which he would not do or omit if he had not been
deceived. As per the investigating officer, no fraudulent and
dishonest inducement is made out or established at the time when
the agreement was entered."
8. Keeping in mind the above principle, this Court
perused the final report, I am of the considered opinion that,
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even if the allegations are accepted, no offence under Sections
406 and 420 IPC is made out. To attract the offence of cheating
the prosecution has to prove that, from the beginning there is
dishonest intention. Even if the prosecution case is accepted, it
only shows that, the accused collected some amount, from CW1
and offered to made as a partner. The cheque is returned.
Moreover, no document is produced showing the transaction of
this much amount. I am of the considered opinion that even if
the entire allegations are accepted, no offence is made out.
9. Even though notice is issued to the 2nd respondent,
who is the defacto complainant, there is no appearance for the
2nd respondent. That itself shows that the 2 nd respondent is also
not interested in the case now.
10. In addition to this, the learned counsel for the
petitioner submitted that a prosecution under Section 138 of the
Negotiable Instruments Act was initiated against the petitioner by
the defacto complainant and that was not prosecuted and that
complaint was already dismissed. It is also submitted that a suit
was filed for return of money and that is also not prosecuted and
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the suit was also dismissed. Considering the facts and
circumstances of the case, I think continuation of the prosecution
against the petitioner is an abuse of process of court.
Therefore, this revision is allowed in the following manner:
1. Order dated 13.09.2024 in CMP No.1362 of 2024 in
C.C. No.319 of 2016 on the file of the Judicial First
Class Magistrate Court, Kalamassery is set aside and
the revision petitioner is discharged.
2. The Registry will forward a copy of this order to the
jurisdictional court for closing the proceedings.
Sd/-
P.V.KUNHIKRISHNAN, JUDGE
SMF
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APPENDIX OF CRL.REV.PET 1281/2024
PETITIONER ANNEXURES
Annexure 1 CERTIFIED COPY OF THE FIR IN CRIME NO:
320/2013 OF KALAMASSERY POLICE STATION,
ERNAKULAM DATED 14.02.2013
Annexure 2 COPY OF FINAL REPORT IN CRIME NO:
320/2013 OF KALAMASSERY POLICE STATION,
ERNAKULAM DATED 19.10.2013
Annexure 3 TYPED COPY OF THE RELEVANT PART OF THE
CHARGE IN ANNEXURE-2
Annexure 4 COPY OF THE ORDER IN CRL.M.C NO:
5337/2024 DATED 09.07.2024
Annexure 5 COPY OF THE PLAINT IN OS NO: 219/2013 ON
THE FILE OF SUB- COURT, IRINJALAKUDA
DATED 25.02.2013
Annexure 6 COPY OF THE COMPLAINT FILED BEFORE
JUDICIAL FIRST-CLASS MAGISTRATE COURT,
CHALAKUDY DATED -----MAY 2013
Annexure 7 COPY OF THE FIR IN CRIME NO: 605/2013 OF
KALAMASSERY POLICE STATION DATED
26.03.2013
