While quashing the proceedings under Sections 406 and 420 of the Indian Penal Code, the Calcutta High Court has held that merely because payment has not been made or accounts have not been settled, it does not constitute an offence of criminal breach of trust & cheating.

The High Court was considering a Criminal Revisional application preferred under Section 482 of the Code of Criminal Procedure, 1973, by the petitioner seeking quashing of the proceedings under Sections 406 and 420 of the Indian Penal Code.

The Single Bench of Justice Ajay Kumar Gupta held, “Merely because payment has not been made or accounts have not been settled, it does not constitute offences punishable under Sections 406/420 of the Indian Penal Code. The disputes between the parties are purely civil in nature, and criminal proceedings in a civil case should not be allowed to be continued any further against the present petitioner; it would be an abuse of process of law. To secure the end of justice, the proceeding deserves to be quashed.”

Advocate Tanmoy Chowdhury represented the Petitioner, while APP Anasuya Singh represented the Respondent.

Factual Background

The petitioner was running a small business of selling chicken and poultry feed under the name and style of Loknath Feed Centre. The petitioner was buying feed from the second Opposite Party regularly since 2012, and both parties had a long and smooth business relationship. The supplier usually supplied goods on credit, and the petitioner made payments regularly, in cash, by cheque, and through bank transfer, and the supplier gave receipts for the same.

During the period from April 1, 2013, to March 31, 2014, the total business transaction that took place between them was of Rs 1,02,22,252. Out of this, the petitioner had paid an amount of Rs 75,61,200, and the remaining amount was indicated in the supplier’s ledger as due. Problems started when the supplier began using some security cheques given by the petitioner without informing him. The police one day picked up the petitioner from his house at night. Later, the petitioner came to know that the supplier had filed a police complaint falsely claiming that anamount of ₹40 lakh was due for more than one year and the petitioner had cheated the Opposite party. Based on this complaint, an FIR was registered under Sections 406 and 420 of the IPC (criminal breach of trust and cheating).

After completion of the investigation, the investigating agency submitted a charge sheet under Sections 406 and 420 of the IPC against the petitioner. The petitioner was later released on bail by the Court. The petitioner contended that the claim of ₹40 lakh was completely false and frivolous. Being aggrieved by the illegal action of the police and proceedings being initiated by the second opposite party without any fault of the petitioner, the petitioner filed the revisional application.

Reasoning

On a perusal of the facts of the case, the Bench noted that it was nowhere stated that at the very inception, there was any intention on behalf of the petitioner to cheat, which is a condition precedent for an offence under Section 420 of the Indian Penal Code. There was also nothing in the complaint to show that the petitioners had dishonest and fraudulent intentions at the time, when the opposite party had supplied feed to the petitioner from time to time, between 2012 and 2016.

“Even assuming the allegations to be correct for the sake of argument, any alleged dues recoverable from the purchaser would, at best, give rise to a dispute civil in nature, amenable to adjudication before a competent Civil Court. The complaint petition does not disclose the essential prima facie ingredients of the offences punishable under Sections 406 and 420 of the Indian Penal Code”, it added.

The complaint indicated that there was no fraudulent or dishonest inducement or deception by intentional practiced by the petitioner right from the beginning of the transaction. “If subsequent payment has not been made, that will not tantamount to deception, fraudulent or dishonest inducement, nor would it amount to deception by intentional means right from the beginning of the transaction. Therefore, the case under Sections 406/420/ of IPC in the facts of this case has not been made out”, it held.

Thus, holding that the disputes between the parties were purely civil in nature, the Bench quashed the proceedings under Sections 406 and 420 of the Indian Penal Code.

Cause Title: Pradyut Samanta v. The State of West Bengal & Another (Neutral Citation: 2026:CHC-AS:244)

Appearance

Petitioner: Advocates Tanmoy Chowdhury, Ritoprita Ghosh, Sulagna Sarkar

Respondent: APP Anasuya Singh, Advocate Sujan Chatterj

Click here to read/download Order




Calcutta High CourtJustice Ajay Kumar Gupta

Tulip Kanth

Assistant Editor

Tulip Kanth is an Assistant Editor at Verdictum having over 5 years of experience in the field of legal journalism and editing. She extensively covers judgments of the Supreme Court, High Courts as well as Tribunals. She has previously worked with a legal publishing website where she oversaw the work of other editors and has also created updates on notifications of different Government Ministries. She holds an English Honours Degree from SGTB Khalsa College, Delhi University and has completed her LLB course with specialisation in Corporate Law from Amity University.