RICHA BHARGAVAversusSTATE OF U.P.

         HIGH COURT OF JUDICATURE AT ALLAHABAD
         CRIMINAL MISC. BAIL APPLICATION No. - 10363 of 2026

Richa Bhargava
                                                           .....Applicant(s)
                                  Versus

State of U.P.
                                                              .....Opposite
                                                                    Party(s)

Counsel for Applicant(s)        : Mayank Yadav, Saksham Srivastava
Counsel for Opposite Party(s)   : G.A., Manoj Kumar, Saurabh Raj

Court No. - 68
                 HON'BLE ASHUTOSH SRIVASTAVA, J.

Heard Shri Akhilesh Kumar Srivastava, learned Senior Counsel assisted
by Shri Sakhsham Srivastava, learned counsel for the applicant, Shri
Vijendra Kumar, learned A.G.A. for the State as also Shri Manoj Kumar,
learned counsel for the first informant. Perused the record.

The instant bail application under Sections 483 B.N.S.S., 2023 has been
filed seeking the enlargement on bail of the applicant in Case Crime No.
003 of 2026, under Sections 316(5), 318(4) & 61(2)(a) of B.N.S., Police
Station-Chowk, District Varanasi, during the pendency of the trial before
the court below was rejected by learned officiating Additional Sessions
Judge / Special Judge, Anti Corruption Act, Court No. 2, Varanasi and the
applicant is languishing in jail since 07.01.2026.

Learned Senior Counsel appearing for the applicant while pressing the
bail plea has vehemently submitted that the applicant is entirely innocent
and has been falsely implicated in this very case crime number for ulterior
motives. The F.I.R. giving rise to the instant case crime number has been
lodged nominating the applicant and one Sharad Bhargava with the
allegation that the first informant is the authorized representative of M/s
Sarthak Varnigya India Pvt. Ltd. having its registered office at B-38/3A-
2, BDS Complex, Mahmoorganj, Varanasi-221010 and deals in whole
sale business. The applicant along with the co-accused is stated to have
done business with the firm of the informant through their various firms.
The applicant and the co-accused had dues to the tune of Rs. 35 Lacs
                                                         BAIL No. 10363 of 2026
                                2


towards the informant's firm which the applicant and the co-accused did
not pay on demand. Later on, the informant came to know that the
applicant and the co-accused had run away after closing down their
business.

Learned counsel appearing for the applicant contends that as per the
allegations set out in the F.I.R. itself that dispute is essentially a
commercial dispute and only colour of criminality has been given to it. It
is argued that the informant had an issue of payment of the debt against
business transactions a recovery suit ought to have been filed before the
appropriate forum. The lodging of the instant F.I.R. cannot be made a tool
to recover bad debts in cases of business transactions. Reliance has been
placed upon the decision of the Apex Court in the case of Delhi Race
Club Vs. State of U.P. reported in 2024(10) SCC 690 to buttress the point
that the offence of Section 406 and 420 I.P.C. cannot run simultaneously,
where the mensrea to defraud or dishonest intention must be present
which is lacking in the case at hand. It is argued that the applicant is the
sole proprietor of Dhan Laxmi Traders while her husband is sole
proprietor of Ritu Computers and Stationers. Both the applicant and his
husband Sharad Bhargav (co-accused) are partners in a firm M/s Durga
Trading Company. The husband of the applicant runs the entire business
and all the accounts and public dealings is his responsibility. It is argued
that some dispute arose between the informant and co-accused Sharad
Bhargav regarding supply of paper racks. The sale was done but the
informant denied to accept the goods and claimed back the money giving
threats of dire consequences. It is further argued that the criminal
antecedents of the applicant have been duly disclosed in Para No. 21 of
the bail application. She is not a flight risk and undertakes to co-operate in
the trial and shall not misuse the liberty of bail. It is also argued that the
applicant being a lady is also entitled to the benefit of Section 480(1) of
B.N.S.S. Hence, the bail has been prayer for.

Per contra, the bail plea has been opposed by learned A.G.A. as well as
counsel for first informant. It is contended that the applicant and her
husband (co-accused) dishonestly induced the first informant to part with
huge sums of money thereafter absconded and thus committed cheating
and criminal breach of trust. The applicant is a habitual offender and is
                                                               BAIL No. 10363 of 2026
                                   3


not liable to be enlarged on bail. Accordingly, the rejection of the bail
pleas has been prayed for.

I have heard the learned counsel for the parties and have given my
thoughtful consideration to the respective consideration. Prima facie, the
court is of the opinion that the dispute is essentially a commercial dispute
and the grievance of the informant is non payment of the outstanding
amount. In the F.I.R., a sum of Rs. 35 Lacs has been claimed as
outstanding amount, however investigation reveals as is evident from DC-
10 and DC-12 that the total amount due is Rs. 11,39,266/-.

Be that as it may, the dispute is non recovery of monetary dues.

The Apex Court in Lalit Chaturvedi and Other Vs. State of U.p. &
Others reported in 2024 (12) SCC 483 while dealing with a similar issue
was pleased to quash the F.I.R. and resultant proceedings treating the
same as an abuse of the process of law observing in Paras 5,6,7, 9 & 10,
which are reproduced here under:-

     " 5. This Court, in a number of judgments, has pointed out the clear
     distinction between a civil wrong in the form of breach of contract, non-
     payment of money or disregard to and violation of the contractual terms;
     and a criminal offence under Sections 420 and 406 of the IPC. Repeated
     judgments of this Court, however, are somehow overlooked, and are not
     being applied and enforced. We will be referring to these judgments. The
     impugned judgment dismisses the application filed by the appellants
     under Section 482 of the Cr.P.C. on the ground of delay/laches and also
     the factum that the chargesheet had been filed on 12.12.2019. This
     ground and reason is also not valid.

     6. In “Mohammed Ibrahim and Others v. State of Bihar and Another”
     MANU/SC/1604/2009:2009:INSC:1110:(2009) 8 SCC 751, this Court
     had referred to Section 420 of the IPC, to observe that in order to
     constitute an offence under the said section, the following ingredients are
     to be satisfied : -

            “18. Let us now examine whether the ingredients of an
            offence of cheating are made out. The essential ingredients of
                                                         BAIL No. 10363 of 2026
                              4


      the offence of "cheating" are as follows:

      (i) deception of a person either by making a false or
      misleading representation or by dishonest concealment or by
      any other act or omission;

      (ii) fraudulent or dishonest inducement of that person to
      either deliver any property or to consent to the retention
      thereof by any person or to intentionally induce that person
      so deceived to do or omit to do anything which he would not
      do or omit if he were not so deceived; and

      (iii) such act or omission causing or is likely to cause
      damage or harm to that person in body, mind, reputation or
      property.

19. To constitute an offence under section 420, there should not only be
cheating, but as a consequence of such cheating, the accused should have
dishonestly induced the person deceived

      (i) to deliver any property to any person, or

      (ii) to make, alter or destroy wholly or in part a valuable
      security (or anything signed or sealed and which is capable
      of being converted into a valuable security).”

7. Similar elucidation by this Court in “V.Y. Jose and Another v. State of
Gujarat and Another”. MANU/SC/8460/2008:2009:INSC:1312:(2009)3
SCC 78, explicitly states that a contractual dispute or breach of contract
per se should not lead to initiation of a criminal proceeding. The
ingredient of ‘cheating’, as defined under Section 415 of the IPC, is
existence of a fraudulent or dishonest intention of making initial promise
or representation thereof, from the very beginning of the formation of
contract. Further, in the absence of the averments made in the complaint
petition wherefrom the ingredients of the offence can be found out, the
High Court should not hesitate to exercise its jurisdiction under Section
482 of the Cr.P.C. Section 482 of the Cr.P.C. saves the inherent power of
the High Court, as it serves a salutary purpose viz. a person should not
undergo harassment of litigation for a number of years, when no criminal
                                                            BAIL No. 10363 of 2026
                               5


offence is made out. It is one thing to say that a case has been made out
for trial and criminal proceedings should not be quashed, but another
thing to say that a person must undergo a criminal trial despite the fact
that no offence has been made out in the complaint. This Court in
V.Y.Jose (supra) placed reliance on several earlier decisions in “Hira Lal
Hari Lal Bhagwati v. CBI” MANU/SC/0371/2003:2003:INSC:275:(2003)
5   SCC     257,    "Indian    Oil    Corporation     Vs.    NEPC      India
Ltd."MANU/SC/3152/2006:2006:INSC:452:(2006) 6 SCC 736, "V.
Prakash          Sharma        V.       Anil        Kumar         Agarwal"
MANU/SC/7743/2007:(2007):(2007) 7 SCC 373 and "All Cargo Movers
(I)(P)       Ltd.         V.         Dhanesh        Badarmal           Jain"
MANU/SC/8047/2007:2007:INSC:1063:(2007) 14 SCC 776.

8. Having gone through the complaint, which was registered as an FIR
and the assertions made therein, it is quite clear that respondent no.
2/complainant – Sanjay Garg’s grievance is regarding failure of the
appellants to pay the outstanding amount, in spite of the respondent no.
2/complainant – Sanjay Garg’s repeated demands. The respondent no.
2/complainant – Sanjay Garg states that the supplies were made between
the period 01.12.2015 and 06.08.2017. The appellants had made the
payments from time to time of Rs. 3,76,40,553/- leaving a balance of Rs.
1,92,91,358/-.

9. We will assume that the assertions made in the complaint are correct,
but even then, a criminal offence under Section 420 read with Section 415
of the IPC is not established in the absence of deception by making false
and misleading representation, dishonest concealment or any other act or
omission, or inducement of the complainant to deliver any property at the
time of the contract(s) being entered. The ingredients to allege the offence
are neither stated nor can be inferred from the averments. A prayer is
made to the police for recovery of money from the appellants. The police
is to investigate the allegations which discloses a criminal act. Police
does not have the power and authority to recover money or act as a civil
court for recovery of money.

10. The chargesheet also refers to Section 406 of the IPC, but without
pointing out how the ingredients of said section are satisfied. No details
                                                                 BAIL No. 10363 of 2026
                                    6


     and particulars are mentioned. There are decisions which hold that the
     same act or transaction cannot result in an offence of cheating and
     criminal breach of trust simultaneously. For the offence of cheating,
     dishonest intention must exist at the inception of the transaction, whereas,
     in case of criminal breach of trust there must exist a relationship between
     the parties whereby one party entrusts another with the property as per
     law, albeit dishonest intention comes later. In this case entrustment is
     missing, in fact it is not even alleged. It is a case of sale of goods. The
     chargesheet does refer to Section 506 of the IPC relying upon the
     averments in the complaint. However, no details and particulars are
     given, when and on which date and place the threats were given. Without
     the said details and particulars, it is apparent to us, that these allegations
     of threats etc. have been made only with an intent to activate police
     machinery for recovery of money."

In Delhi Race Club (1940) Ltd. & Others vs. State of U.P. & Others, the
Apex Court has reiterated the aforesaid principles. It would be apposite to
quote paragraph no. 31 of the said judgment, which is reproduced
hereinbelow:

     " 31. At the most, the court of the Additional Chief Judicial Magistrate
     could have issued process for the offence punishable under Section 420 of
     the IPC i.e. cheating but in any circumstances no case of criminal breach
     of trust is made out. The reason being that indisputably there is no
     entrustment of any property in the case at hand. It is not even the case of
     the complainant that any property was lawfully entrusted to the
     appellants and that the same has been dishonestly misappropriated. The
     case of the complainant is plain and simple. He says that the price of the
     goods sold by him has not been paid. Once there is a sale, Section 406 of
     the IPC goes out of picture. According to the complainant, the invoices
     raised by him were not cleared. No case worth the name of cheating is
     also made out."

In view of the above, a case for bail is made out. Application stands allowed.

Let the accused-applicant, Richa Bhargava, involved in above mentioned
case crime number be released on bail, on her executing a personal bond
and two reliable sureties each, in the like amount to the satisfaction of the
                                                                                                       BAIL No. 10363 of 2026
                                                                         7


                                    court concerned, subject to the following conditions:

                                    1. The applicant will not tamper with the evidence.

                                    2. The applicant will not indulge in any criminal activity.

                                    3. The applicant will not pressurize/intimidate the prosecution witnesses and co-
                                    operate in the trial.

                                    4. The applicant will appear regularly on each and every date fixed by the trial court,
                                    unless her personal appearance is exempted through counsel by the court concerned.

                                    In the event of breach of any of the aforesaid conditions, the court below
                                    will be at liberty to proceed to cancel her bail.



                                                                                                  (Ashutosh Srivastava,J.)
                                    April 17, 2026
                                    Vibha Singh




Digitally signed by :-
VIBHA SINGH
High Court of Judicature at Allahabad