Patna High Court
RAJA SRIVASTAVAversusTHE STATE OF BIHAR
- Decided
- Disposal
- ALLOWED
- Bench
- CHANDRA SHEKHAR JHA
Holding
The Court held that no prima facie case exists for offences under Sections 406, 420, 467, 468 IPC and quashed the order of cognizance.
Summary
The petitioners were accused in a complaint alleging that they induced a complainant to invest Rs 10 lakh for a hand‑pump installation project, of which only Rs 4.5 lakh was returned and the remaining Rs 5.5 lakh was alleged to be misappropriated. The complaint invoked Sections 406, 420, 467 and 468 of the IPC and the magistrate took cognizance. The petitioners filed a quashing petition, arguing that the trust/company was not named as an accused, that the complaint lacked an affidavit under Section 156(3) CrPC, and that no prima facie case of cheating or criminal breach of trust existed. The High Court examined the factual record, noted the absence of documentary evidence for the alleged loss, and relied on precedents establishing that fraudulent intent must be proved at the inception of the transaction. Finding no material to sustain the offences and deeming the proceeding an abuse of process, the Court quashed the order of cognizance and allowed the petition.
Issues considered
- The magistrate's cognizance under Sections 406, 420, 467, 468 IPC is valid despite alleged lack of prima facie case.
- The absence of the trust/company as an accused renders the prosecution untenable.
- Whether a complaint under Section 156(3) CrPC must be supported by an affidavit.
- Do the facts constitute offences of cheating, criminal breach of trust, forgery, and extortion under the cited IPC sections?
- Is the proceeding an abuse of process or malicious prosecution?
Legislation cited
- Code of Criminal Procedure, 1973 — s. 154(1), 154(3), 155(2), 156(3), 482
- Constitution of India — s. Article 142, Article 226
- Indian Penal Code — s. 406, 420, 467, 468
Subjects
- criminal breach of trust
- cheating
- quash
- cognizance
- Section 406 IPC
- Section 420 IPC
- Section 467 IPC
- Section 468 IPC
- abuse of process
- Section 156(3) CrPC
- affidavit requirement
- partnership dispute
- fraud
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
CRIMINAL MISCELLANEOUS No.921 of 2020
Arising Out of PS. Case No.-95 Year-2019 Thana- EAST CHAMPARAN COMPLAINT
District- East Champaran
======================================================
1. RAJA SRIVASTAVA Son of Shashi Bhushan Prasad Resident of Village-
Pankha Toli, P.S.- Mushari, District- Muzaffarpur, At present- Lion Motions
Pictures Pvt. Ltd. Gautam Budh Nagar, P.S.- Gautam Budhh Nagar, District-
Noida (Uttar Pradesh).
2. Awishkar Srivastava @ Awishkar Ashutosh Son of Shashi Bhushan Prasad
Resident of Village- Pankha Toli, P.S.- Mushari, District- Muzaffarpur.
3. Ashish Kumar Son of Hare Ram Prasad Resident of Village- Panchrukhi,
P.S.- G.B. Nagar, District- Siwan.
... ... Petitioners
Versus
1. The State of Bihar
2. Janmejay Kumar Pandey Son of Keshav Pandey Resident of Village-
Aadarsh Nagar Kaurihar, Road No.- 19, P.S.- Raxaul, District- East
Champaran.
... ... Opposite Parties
======================================================
Appearance :
For the Petitioner/s : Mrs. Archana Sinha, Sr. Adv.
Mr. Alok Kumar @ Alok Kr Shahi, Adv.
For the Opposite Party/s : Mr. Shyameshwar Dayal, Adv.
======================================================
CORAM: HONOURABLE MR. JUSTICE CHANDRA SHEKHAR JHA
ORAL JUDGMENT
Date : 25-02-2026
Heard the parties.
2. The present quashing petition has been
preferred to quash the order dated 28.05.2019 passed in
Complaint Case No. 95 of 2019, where learned SDJM, Raxual
at Motihari took cognizance for the offence punishable under
Sections 406, 420, 467, 468 of IPC.
3. The Brief case of prosecution speaks that the
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petitioners induced OP No. 2 to invest money on the
assurance of allotment of hand-pump installation work in Ara
district, Bihar, through a Delhi-based trust. On their
representation, OP No. 2 paid Rs. 10 lakhs as security, partly
in cash and partly through cheques issued by his friend, but
no work as promised was given to petitioners and finally O.P.
No.2 returned only Rs. 4,50,000/- in installments to his
friend. The remaining amount of Rs. 5,50,000/- is alleged to
have been misappropriated by the accused persons under
criminal conspiracy.
4. Mrs. Archana Sinha, learned senior counsel
appearing for the petitioners submitted that the company/
trust has not been arrayed as an accused in present case and,
therefore, on this score alone entire prosecution is liable to be
quashed. In support of her submission learned counsel relied
upon the legal report of Hon’ble Supreme Court as available
through Sanjay Dutt and Ors. vs. State of Haryana and
Anr. reported in 2025 SCC OnLine SC 32.
5. It is also submitted that allegation as raised
through complaint petition is not appearing legally sustainable
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as it is not supported with affidavit and therefore, the
cognizance taken by learned Magistrate is bad in eyes of law
and same deserves to be set aside/ quashed. In support of
her submission, Mrs. Sinha, relied upon the legal report of
Hon’ble Supreme Court as available through Priyanka
Srivastava Vs. State of Uttar Pradesh [2015 (6) SCC
287]. It is also pointed out that even from the complaint
petition no prima-facie case for the offence punishable under
Sections 406, 420, 467, 468 of IPC for which the learned
Jurisdictional Magistrate took cognizance appears made out.
It is submitted that the amount Rs. 4,50,000/- which was
said to be paid by one Jaypraksh Mishra, the friend of
complainant was admittedly returned to his account, whereas
allegation to pay Rs. 5,50,000/- is unfounded without any
documentary support. It is submitted that from this narrations
itself, it can be gathered safely that petitioners were not
under intention to cheat from the very inceptions of business
deal and, moreover, this matter appears more or less qua
recovery of alleged payment of Rs. 5,50,000/- for which
present criminal petition is completely unoccassioned and
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unwarranted. In support of her submissions, learned senior
counsel relied upon the legal reports of Hon’ble Supreme
Court as available through Gulam Mustafa vs. State of
Karnataka and Anr. [2023 SCC OnLine SC 603] and
also upon Inder Chand Bagri vs. Jagadish Prasad Bagri
and Anr. [ 2025 SCC OnLine SC 2529].
6. Learned counsel appearing for O.P. No. 2/
complainant submitted that Rs. 5,50,000/- was not returned
to the complainant and even after the assurance, to give
order for installations of five thousand hand pipe same was
not secured by the petitioners. However, it is conceded that
company/ trust not appears alleged as an accused through
present complaint petition.
7. It would be apposite to reproduce cognizance
order dated 28.05.2019 which is as under:-
“28-05-2019
In the court of the S.D.J.M. Raxaul at
Motihari
C-95/2019
Complainant is in attendance. Record put up
for order. Perused the case record.
Complainant has filed the complaint petition
against the accused persons as named in
complaint petition.
The statement of complainant as solemn
affirmation has been recorded. During the
enquiry, complainant has adduced and
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examined I.W-1 Jay Prakash Mishra and I.W-
2 Amit Upadhyay.
After going through the complaint petition,
statement of complainant on S.A., evidence of
enquiry witnesses and other evidence
available on the record the court comes to the
conclusion that a prima-facie case is made out
again the accused persons as named in the
complaint petition.
Therefore, there are sufficient materials
available on record to summon the all accused
persons named in complaint petition for
committing the offences u/s- 406, 420, 467,
468 of I.P.C. Office is directed to issue
summon on all accused persons as named in
complaint petition after filing of requisites of
summons by the complainant.
Put up on 28-06-2019 for appearance.
Dictated.
S.D.J.M.”
8. It would be apposite to reproduce relevant
Paragraph Nos. 30 and 31 of Priyanka Srivastava case
(supra), which reads as:-
“30. In our considered opinion, a stage has come
in this country where Section 156(3) CrPC
applications are to be supported by an affidavit
duly sworn by the applicant who seeks the
invocation of the jurisdiction of the Magistrate.
That apart, in an appropriate case, the learned
Magistrate would be well advised to verify the
truth and also can verify the veracity of the
allegations. This affidavit can make the applicant
more responsible. We are compelled to say so as
such kind of applications are being filed in a
routine manner without taking any responsibility
whatsoever only to harass certain persons. That
apart, it becomes more disturbing and alarming
when one tries to pick up people who are passing
orders under a statutory provision which can be
challenged under the framework of the said Act or
under Article 226 of the Constitution of India. But
it cannot be done to take undue advantage in a
criminal court as if somebody is determined to
settle the scores.
31. We have already indicated that there has to
be prior applications under Sections 154(1) and
154(3) while filing a petition under Section
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156(3). Both the aspects should be clearly spelt
out in the application and necessary documents to
that effect shall be filed. The warrant for giving a
direction that an application under Section 156(3)
be supported by an affidavit is so that the person
making the application should be conscious and
also endeavour to see that no false affidavit is
made. It is because once an affidavit is found to
be false, he will be liable for prosecution in
accordance with law. This will deter him to
casually invoke the authority of the Magistrate
under Section 156(3). That apart, we have
already stated that the veracity of the same can
also be verified by the learned Magistrate, regard
being had to the nature of allegations of the case.
We are compelled to say so as a number of cases
pertaining to fiscal sphere, matrimonial
dispute/family disputes, commercial offences,
medical negligence cases, corruption cases and
the cases where there is abnormal delay/laches in
initiating criminal prosecution, as are illustrated in
Lalita Kumari [(2014) 2 SCC 1 : (2014) 1 SCC
(Cri) 524] are being filed. That apart, the learned
Magistrate would also be aware of the delay in
lodging of the FIR.”
9. It would be apposite to reproduce relevant
Paragraph Nos. 34 of Gulam Mustafa case (supra), which
reads as:-
34. Insofar and inasmuch as interference in cases
involving the SC/ST Act is concerned, we may
only point out that a 3-Judge Bench of this Court,
in Ramawatar v. State of Madhya Pradesh, 2021
SCC OnLine SC 966, has held that the mere fact
that the offence is covered under a ‘special
statute’ would not inhibit this Court or the High
Court from exercising their respective powers
under Article 142 of the Constitution or Section
482 of the Code, in the terms below:
“15. Ordinarily, when dealing with offences
arising out of special statutes such as the SC/ST
Act, the Court will be extremely circumspect in its
approach. The SC/ST Act has been specifically
enacted to deter acts of indignity, humiliation and
harassment against members of Scheduled
Castes and Scheduled Tribes. The SC/ST Act is
also a recognition of the depressing reality that
despite undertaking several measures, the
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Scheduled Castes/Scheduled Tribes continue to
be subjected to various atrocities at the hands of
upper-castes. The Courts have to be mindful of
the fact that the SC/ST Act has been enacted
keeping in view the express constitutional
safeguards enumerated in Articles 15, 17 and 21
of the Constitution, with a twin-fold objective of
protecting the members of these vulnerable
communities as well as to provide relief and
rehabilitation to the victims of caste-based
atrocities.
16. On the other hand, where it appears to the
Court that the offence in question, although
covered under the SC/ST Act, is primarily civil or
private where the alleged offence has not been
committed on account of the caste of the victim,
or where the continuation of the legal proceedings
would be an abuse of the process of law, the
Court can exercise its powers to quash the
proceedings. On similar lines, when considering a
prayer for quashing on the basis of a
compromise/settlement, if the Court is satisfied
that the underlying objective of the SC/ST Act
would not be contravened or diminished even if
the felony in question goes unpunished, the mere
fact that the offence is covered under a ‘special
statute’ would not refrain this Court or the High
Court, from exercising their respective powers
under Article 142 of the Constitution or Section
482 Cr. P.C.”
10. It would be apposite to reproduce relevant
Paragraph Nos. 18, 19, 20, 22,23, 25, 28 of Inder chand
Bagri case (supra), which reads as:-
18. In Inder Mohan Goswami v. State of Uttaranchal,
(2007) 12 SCC 1 : (2008) 1 SCC (Cri) 259 (“Inder
Mohan Goswami”), while dealing with Section 420 of
the IPC, this Court observed thus:
“42. On a reading of the aforesaid section, it is
manifest that in the definition there are two separate
classes of acts which the person deceived may be
induced to do. In the first class of acts he may be
induced fraudulently or dishonestly to deliver property
to any person. The second class of acts is the doing or
omitting to do anything which the person deceived
would not do or omit to do if he were not so deceived.
In the first class of cases, the inducement must be
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fraudulent or dishonest. In the second class of acts,
the inducing must be intentional but need not be
fraudulent or dishonest. Therefore, it is the intention
which is the gist of the offence. To hold a person
guilty of cheating it is necessary to show that he had a
fraudulent or dishonest intention at the time of
making the promise. From his mere failure to
subsequently keep a promise, one cannot presume
that he all along had a culpable intention to break the
promise from the beginning.”
19. In light of the facts and circumstances of the
present case, we find that the
complainant/respondent No. 1 has failed to make out
a case that satisfies the basic ingredients of the
offence under Section 420 of the IPC. We fail to
understand as to how the allegations against the
appellant-accused herein could be brought within the
scope and ambit of the aforesaid section. On a bare
perusal of the complaint, we do not find that the
offence of cheating as defined under Section 420 of
the IPC is made out at all and we do not find that
there is any cheating and dishonest inducement to
deliver any property of a valuable security involved in
the instant case.
20. It is settled law that for establishing the offence
of cheating, the complainant/respondent No. 1 was
required to show that the appellant-accused had a
fraudulent or dishonest intention at the time of
making a promise or representation of not fulfilling
the partnership agreement. Such a culpable intention
right at the beginning cannot be presumed but has to
be made out with cogent facts. In the facts of the
present case, there is a clear absence of material on
record to attribute any dishonest and fraudulent
intention to the appellant-accused at the time of
creation of partnership agreement. We must hasten
to add that there is no allegation in the complaint
indicating either expressly or impliedly any intentional
deception or fraudulent/dishonest intention on the
part of the appellant-accused right from the time of
formation of the partnership deed. Nothing has been
said on what the misrepresentations were and how
the appellant-accused intentionally deceived the
complainant/respondent No. 1. Mere allegations that
the appellant-accused dishonestly induced the
complainant/respondent No. 1 to part with the
property of the partnership firm and subsequently
sold the property to a third party does not satisfy the
test of dishonest inducement to deliver a property or
part with a valuable security as enshrined under
Section 420 of the IPC.
22. In the present case, the complainant/respondent
No. 1 has failed to establish ingredients essential to
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constitute an offence under Section 406 of the IPC.
The complainant/respondent No. 1 has failed to place
any material on record to show us as to how he had
entrusted the subject property to the appellant-
accused. Furthermore, the complaint/respondent No.
1 also omits to aver as to how the property, so
entrusted to the appellant-accused, was dishonestly
misappropriated or converted for his own use, thereby
committing a breach of trust. On the contrary, the
bare perusal of the partnership deed dated
01.10.1976 shows that the disputed property was
solely owned and enjoyed by the appellant-accused
wherein as per Clause 4 of the said agreement he
agreed to bring into the partnership the said disputed
property. We must hasten to mention herein that
upon reading of the supplementary agreement dated
03.04.1981, it becomes amply clear that all the
partners including the complainant/respondent No. 1
had agreed that upon expiry of the lease period of 15
years with the Food Corporation of India i.e.
01.06.1993, the said land would revert back to the
appellant-accused along with all the constructions
erected upon it. In the facts of the present case, the
complainant/respondent No. 1 cannot be allowed to
blow hot and cold at the same time wherein on one
hand, through the supplementary deed, he has
agreed upon the reversion of the said disputed
property back to the original owner i.e. appellant-
accused and yet on the other hand has proceeded to
file a complaint alleging cheating and
misappropriation of said disputed property against
appellant-accused.
23. Furthermore, it is pertinent to mention that if it is
the case of the complainant/respondent No. 1 that
the offence of criminal breach of trust as defined
under Section 405 of the IPC, punishable under
Section 406 of the 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 in Section 415, punishable under Section
420 of the IPC. This Court in Delhi Race Club (1940)
Limited v. State of Uttar Pradesh, (2024) 10 SCC
690 : (2025) 1 SCC (Cri) 281 observed that there is
a distinction between criminal breach of trust and
cheating. For cheating, criminal intention is necessary
at the time of making false or misleading
representation i.e. since inception. In criminal breach
of trust, mere proof of entrustment is sufficient. Thus,
in case of criminal breach of trust, the offender is
lawfully entrusted with the property, and he
dishonestly misappropriated the same. Whereas, in
case of cheating, the offender fraudulently or
dishonestly induces a person by deceiving him to
deliver a property. In such a situation, both offences
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cannot co-exist simultaneously. Consequently, the
complaint cannot contain both the offences that are
independent and distinct. The said offences cannot
coexist simultaneously in the same set of facts as
they are antithetical to each other.
25. Furthermore, in Inder Mohan Goswami, it was
held by this Court that the Court must ensure that
criminal prosecution is not used as an instrument of
harassment or for seeking private vendetta or with an
ulterior motive to pressurise the accused. It was
further held by this Court that it is neither possible
nor desirable to lay down an inflexible rule that would
govern the exercise of inherent jurisdiction. In view of
the above and for the reasons stated above, we are of
the firm opinion that to continue the criminal
proceedings against the appellant-accused herein
would cause undue harassment to him because as
observed hereinabove, no prima facie case for the
offence under Sections 406 or 420 of the IPC is made
out.
28. At this juncture, we find it apposite to mention
the observations of this Court in Vishal Noble Singh v.
State of Uttar Pradesh, (2024) 14 SCC 112 wherein
it was observed that in recent years the machinery of
criminal justice is being misused by certain persons
for their vested interests and for achieving their
oblique motives and agenda. Courts have therefore to
be vigilant against such tendencies and ensure that
acts of omission and commission having an adverse
impact on the fabric of our society must be nipped in
the bud. We say so for the reason that while the
complainant/respondent No. 1 has made grave
allegations against the appellant herein, he has failed
to justify the same before this Court. Such actions
would create significant divisions and distrust among
people, while also placing an unnecessary strain on
the judicial system, particularly criminal courts.
11. It would be appropriate to reproduce the
paragraph no. 102 of Apex Court decision in the case of
State of Haryana v. Bhajan Lal [1992 Supp (1) SCC
335], which reads as under:-
“102. In the backdrop of the interpretation of the
various relevant provisions of the Code under Chapter
XIV and of the principles of law enunciated by this
Court in a series of decisions relating to the exercise of
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the extraordinary power under Article 226 or the
inherent powers under Section 482 of the Code which
we have extracted and reproduced above, we give the
following categories of cases by way of illustration
wherein such power could be exercised either to prevent
abuse of the process of any court or otherwise to secure
the ends of justice, though it may not be possible to lay
down any precise, clearly defined and sufficiently
channelised and inflexible guidelines or rigid formulae
and to give an exhaustive list of myriad kinds of cases
wherein such power should be exercised.
(1) Where the allegations made in the first
information report or the complaint, even if they are
taken at their face value and accepted in their entirety
do not prima facie constitute any offence or make out a
case against the accused.
(2) Where the allegations in the first
informant report and other materials, if any,
accompanying the FIR do not disclose a cognizable
offence, justifying an investigation by police officers
under Section 156(1) of the Code except under an
order of a Magistrate within the purview of Section
155(2) of the Code.
(3) Where the uncontroverted allegations
made in the FIR or complaint and the evidence
collected in support of the same do not disclose the
commission of nay offence and make out a case against
the accused.
(4) Where, the allegations in the FIR do
not constitute a cognizable offence but constitute only a
non-cognizable offence, no investigation is permitted by
a police officer without an order of a Magistrate as
contemplated under Section 155(2) of the Code.
(5) Where the allegations made in the FIR
or complaint are so absurd and inherently improbable
on the basis of which no prudent persons can ever reach
a just conclusion that there is sufficient ground for
proceeding against the accused.
(6) Where there is an express legal bar
engrafted in any of the provisions of the Code or the
concerned Act (under which a criminal proceeding is
instituted) to the institution and continuance of the
proceedings and/or where there is a specific provision in
the Code or the concerned Act, providing efficacious
redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is
manifestly attended with mala fide and/or where the
proceeding is maliciously instituted with an ulterior
motive for wreaking vengeance on the accused and
with a view to spite him due to private and personal
grudge.”
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12. In view of aforesaid factual and legal
submissions and upon perusal of record it appears that the
present complaint case was registered prima-facie for the
recovery of Rs. 5,50,000/-. Admittedly, Rs. 4,50,000/- was
returned to bank account of the friend of the complainant
when business deal could not finalized. It also appears that no
chit of papers are available on record in support of payment of
Rs. 5,50,000/- which was said to be made in cash and,
therefore, these allegations as set out through complaint
petition prima-facie not appears to made out a case for the
offence punishable under Section 406, 420, 467, 468 of
I.P.C., as there is no breach of trust in the present matter.
Admittedly, return of money to friend of O.P. No. 2, as
discussed aforesaid, categorically suggest that payment was
not received with criminal intention to cheat the complainant
from very inception of business deal and, therefore, the
present criminal case was lodged only to harass the
petitioners with oblique motive to set out private vendetta.
13. In view of aforesaid, the impugned
cognizance is bad in eyes of law and, therefore, same appears
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set aside as prima-facie no case for the offence punishable
under Section 406, 420, 467, 468 of IPC appears made out
particularly in view of Inder chand Bagri case (supra),
accordingly, impugned order of cognizance dated 28.05.2019
with all its consequential proceedings, qua all above named
petitioners arising thereof as passed in connection with
Complaint Case No. 95 of 2019, by learned SDJM, Raxual at
Motihari is hereby quashed and set aside.
14. Hence, this application stands allowed.
15. TCR (Trial Court Records), if any, be
returned to learned trial court alongwith the copy of this
judgment.
(Chandra Shekhar Jha, J)
Sudha/-
AFR/NAFR AFR
CAV DATE NA
Uploading Date 11.03.2026
Transmission Date 11.03.2026
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