Richa Bhargava Vs State of U.P.

HIGH COURT OF JUDICATURE AT ALLAHABAD

CRIMINAL MISC. BAIL APPLICATION No. - 10363 of 2026

Richa Bhargava	Versus .....Applicant(s)
State of U.P.	.....Opposite Party(s)
Counsel for Applicant(s) Counsel for Opposite Party(s)	: Mayank Yadav, Saksham Srivastava : G.A., Manoj Kumar, Saurabh Raj

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Court No. - 68

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HON'BLE ASHUTOSH SRIVASTAVA, J.

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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.

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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.

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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-38/3A2, 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

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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.

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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.

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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

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

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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 DC10 and DC-12 that the total amount due is Rs. 11,39,266/-.

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

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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:-

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" 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, nonpayment 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.

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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 : -

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“18. Let us now examine whether the ingredients of an offence of cheating are made out. The essential ingredients of

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the offence of "cheating" are as follows:

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

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(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

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

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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

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

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(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).”

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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

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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.

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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/-.

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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.

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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

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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."

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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:

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" 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."

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

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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

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court concerned, subject to the following conditions:

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1. The applicant will not tamper with the evidence.

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

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3. The applicant will not pressurize/intimidate the prosecution witnesses and cooperate in the trial.

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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.

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

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(Ashutosh Srivastava,J.)

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April 17, 2026

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Vibha Singh

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

Richa Bhargava v. State of U.P.

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Richa Bhargava v. State of U.P.

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