HARI NARAYAN RAIversusSTATE OF U.P. AND ANOTHER

         HIGH COURT OF JUDICATURE AT ALLAHABAD
                 APPLICATION U/S 528 BNSS No. - 14215 of 2026

Hari Narayan Rai
                                                                   .....Applicant(s)
                                      Versus

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

Counsel for Applicant(s)                          :   Ajay Kumar Singh
Counsel for Opposite Party(s)                     :   G.A.

Court No. - 77
                  HON'BLE SAURABH SRIVASTAVA, J.

1. Heard learned counsel for the applicant and learned AGA for the State.

2. The present application has been preferred for seeking quashing of entire
proceeding of Case no. 3372 of 2018 (State vs. Hari Narayan Rai and others)
arising out of Case Crime no. 2831 of 2017 under sections 419, 420, 467,
468, 471, 406 IPC, PS- Khalilabad, District Sant Kabir Nagar and set aside
discharge rejection order dated 01.12.2025 passed by learned Chief Judicial
Magistrate, Sant Kabir Nagar.

3. Learned counsel appearing on behalf of applicant has challenged the
impugned charge sheet along with cognizance/summoning order, discharge
rejection order and entire proceedings of the present case precisely on the
ground that Sections 420 and 406 IPC cannot go together in the same breath
as per the proposition of law settled by Hon'ble Supreme Court in the case of
Delhi Race Club (1940) Ltd. and others vs. State of Uttar Pradesh and
another reported in 2024 10 SCC 690. The relevant portion of the said
judgment is being reproduced hereinbelow:-

     "38. In our view, the plain reading of the complaint fails to spell out any
     of the aforesaid ingredients noted above. We may only say, with a view to
     clear a serious misconception of law in the mind of the police as well as
     the courts below, that if it is a case of the complainant that offence of
     criminal breach of trust as defined under Section 405 IPC, punishable
     under Section 406 IPC, is committed by the accused, then in the same
     breath it cannot be said that the accused has also committed the offence
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     of cheating as defined and explained in Section 415 IPC, punishable
     under Section 420 IPC.

     41. The distinction between mere breach of contract and the offence of
     criminal breach of trust and cheating is a fine one. In case of cheating,
     the intention of the accused at the time of inducement should be looked
     into which may be judged by a subsequent conduct, but for this, the
     subsequent conduct is not the sole test. Mere breach of contract cannot
     give rise to a criminal prosecution for cheating unless fraudulent or
     dishonest intention is shown right from the beginning of the transaction
     i.e. the time when the offence is said to have been committed. Therefore, it
     is this intention, which is the gist of the offence.

     43. There is a distinction between criminal breach of trust and cheating.
     For cheating, criminal intention is necessary at the time of making a 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 any property. In such a situation, both the offences cannot
     co-exist simultaneously.

     55. It is high time that the police officers across the country are imparted
     proper training in law so as to understand the fine distinction between the
     offence of cheating vis-vis criminal breach of trust. Both offences are
     independent and distinct. The two offences cannot coexist simultaneously
     in the same set of facts. They are antithetical to each other. The two
     provisions of IPC (now BNS, 2023) are not twins that they cannot survive
     without each other."

4. On the other hand, learned A.G.A. has vehemently opposed the prayer
sought through the instant application but unable to dispute the settled
proposition of law as relied upon by the learned counsel appearing for
applicants.

5. Since, only legal argument has been raised at the behest of applicant,
process to issue notice to opposite party no. 2 is hereby dispensed with.
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                                    6. After hearing the learned counsel for the parties, going through the record
                                    of the case and the judgment of the Hon'ble Supreme Court rendered in the
                                    case of Delhi Race Club (Supra), it is crystal clear that both the sections i.e.
                                    Sections 420 and 406 IPC cannot go in the same breath and as such without
                                    interfering in any other merit of the present matter, cognizance order dated
                                    31.8.2018, discharge rejection order dated 01.12.2025 passed by learned
                                    Chief Judicial Magistrate, Sant Kabir Nagar in Case no. 3372 of 2018 (State
                                    vs. Hari Narayan Rai and others) arising out of Case Crime no. 2831 of 2017
                                    under sections 419, 420, 467, 468, 471, 406 IPC, PS- Khalilabad, District
                                    Sant Kabir Nagar, is quashed only in respect of applicant(s) herein. Matter
                                    is hereby remitted back to learned Chief Judicial Magistrate, Sant Kabir
                                    Nagar for passing fresh order of taking cognizance of offence, if required, in
                                    light of the proposition of law settled by Hon'ble Supreme Court in the case
                                    of Delhi Race Club (supra).

                                    7. Accordingly, the instant application stands allowed in part.



                                                                                         (Saurabh Srivastava,J.)
                                    May 7, 2026
                                    Shaswat




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