Polasa Ravi Kumar, Vs The State of Telangana — Cheating and Forgery | Telangana HC (2025)

Polasa Ravi Kumar, Vs The State of Telangana — Cheating and Forgery | Telangana HC (2025)

What the court decided

AI extract

Outcome

Criminal petition allowed; proceedings against the petitioner in C.C. No.6035 of 2022 on the file of the I Additional Metropolitan Magistrate, Cyberabad at Malkajgiri quashed; observations confined to deciding this case only; miscellaneous applications, if any, stand closed.

Issue for consideration

Whether the criminal proceedings in C.C. No.6035 of 2022 against the petitioner/accused (arising from Crime No.562 of 2022, offences under Sections 406, 420 and 506 IPC) are liable to be quashed under Section 482 Cr.P.C., the dispute being essentially civil in nature with a parallel civil suit O.S. No.598 of 2022 pending for the same amount. +1 more

Court's answer

Both the criminal complaint and the civil suit arise from the very same set of allegations, namely payment of money said to be due by the petitioner to respondent No.2; the dispute is therefore essentially civil in nature, and respondent No.2 has already filed civil suit O.S. No.598 of 2022, which is pending.

Ratio / Principle

On perusal of the complaint dated 26.05.2022, there is no specific allegation against the petitioner that he borrowed the amounts from respondent No.2 with a dishonest intention or committed cheating; hence no offence of cheating under Section 420 IPC is disclosed.

Key takeaways

Whether the petitioner had paid the entire amount and whether he is liable to pay the amount claimed by respondent No.2 has to be adjudicated in the above pending civil suit.ratio¶52
Continuation of the proceedings in C.C. No.6035 of 2022 on the file of the I Additional Metropolitan Magistrate, Cyberabad at Malkajgiri against the petitioner would amount to abuse of the process of law.ratio¶69

Detailed headnote1 paragraphs

Criminal Petition (CRLP No.10320 of 2023) under Section 482 Cr.P.C. before the High Court for the State of Telangana (Sri Justice J. Sreenivas Rao) seeking quashing of proceedings in C.C. No.6035 of 2022 (I Additional Metropolitan Magistrate, Cyberabad at Malkajgiri), arising from a private complaint dated 26.05.2022 of Sri V.K. Johny (respondent No.2) referred under Section 156(3) Cr.P.C., registered as Crime No.562 of 2022 (Neredmet Police), with charge sheet filed 30.07.2022 for offences under Sections 406, 420 and 506 IPC. The complaint alleged hand loans during 2019 totalling Rs.72,50,000/- with promissory notes and deposit of the original sale deed (Doc. No.24299 of 2018) as security, dishonoured cheques of January 2022, and an acknowledgment on a Rs.50/- stamp paper promising settlement of Rs.12,36,000/- on or before 14.02.2022. The petitioner contended repayment of Rs.10,24,622/- (online, 09.04.2019 to 24.02.2022); respondent No.2 contended total dues of Rs.22,60,622/- and had filed civil suit O.S. No.598 of 2022 (Junior Civil Judge, Medchal-Malkajgiri District) for the same Rs.12,36,000/-, pending. Held: (i) no specific allegation of borrowing with dishonest intention at inception, so no offence of cheating under Section 420 IPC is disclosed; (ii) the complaint and the civil suit arise from the very same money claim - the dispute is essentially civil in nature; (iii) whether the amount was paid is a question for the pending civil suit; (iv) continuation of the criminal proceedings would be an abuse of the process of law. Relying on State of Haryana v. Bhajan Lal and Vesa Holdings (P) Limited v. State of Kerala, the Court exercised its Section 482 Cr.P.C. powers and quashed the proceedings; the criminal petition was allowed, with observations confined to this case.

rN rHE^{HrGH couRrfs[rtJtlBt^TEoF TELANGANA}

"',i?AL]85Si'Y^'^fi""?l'i,??-5YE'-

PRESENT

THE HONOURABLE^{SRIJUSTICEJ SREENTVAS RAO} CRIMTNALP^{ETITI ONNO:10320OF2023}

Between:

P rivate p orasa Rav rynel Slia;' H?fi[,r"[,?f, ;,.ifl ",T4I?,? EU?3i Employee'^{R/o H No}

"'PETlrloNER/soLE^ACcusED

AND

N ered^{met'Rachakond a' Rep}

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2 if JUIJ,:*,,!1!lut#!''ft^{3!Xf,3o'?'1""ft li'?""-S:Jffi$''ilB!ffi'} Malkajgiri^District

"'RE'P.NDENT'/..MPLAINANT

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I.A.^NO:1 OF 2023

in the^{circumstances} Petition^{underSection 482 ol Cr'P'C'play-inP that} . the^{High Court may-} ol 2022^{on the file ot} stateo'iriinltue;"':lgy:;."J,?i|::::d:?J'3I3:,15".1'lT Malkaigiri^including the above^Criminal ?:,',ii:i,":",i,il"fl[:ll#^{"M;;;;ilcvn;11!aaat} appearance^{of PetitroneilAt""t?l'p"taingdisposalof} Petition. This^{Petition coming on for hearing' upon perusing the Memorandum of} i""'nn^{the arguments of Sri P Giri} Grounds^{of Criminalt"'i*'""0'""n} Krishna,^{Advocateto' tnt pltitioner'iri M VivekanandaReddy' Assistant Public} prosecutor on beharf^{,irl"'''*".oondent No. 1 and of Sri Gaddam srinivas'} Advocate^{for the ResPondentNo 2'}

The Court^{made the following:ORDER}

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TITE IrON'BLE StrIr JI.ISTTCE J.SREENI/AS RAO CRIMI NAL PETITIONNo. 1 o32Oo f20 23

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ORDER:

This Criminal petition has been fiied under Section 482 of the Code of Criminal procedure, 1973 (for short, 'Cr. P. C. ) by the petitioner/ accused seeking to quash the proceedings in C.C. No.6O3S of 2C/22 on the file of the I Additional Metropolitan Magistrate, Cyberabad at Malkajgiri.

Heard Sri P.Giri Krishna, learned counsel for the petitioner, Sri Gaddam Srinivas, Iearned counsel for respondent No.2, and Sri M.Vivekananda Reddy, Iearned Assistant pubiic prosecr_rtor, appearing on behalf of respondent No. 1 _State.

Brief facts ofthe case:

3.1. The compiainant Sri V.K. Johny filed a private complaint before the I Additional Metropolitan Magistrate at Malkajgiri on 26.C.5.2022 alleging that the accused had borrowed a total amount of Rs. 72,SO,OOO/ _ on various occasions, namely Rs.S,OO,OOO/_ on l7.O2.2Olg, Rs.3,OO,O0O/- on C,4.O4.2O79, Rs.2,oo,ooo/_ on 14.O5.2019 and Rs.2,5O,OOO/_ on 21.O8.2O19, and on

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each^{time he executedpromissorynotes and deposited the} original^{sale deeddocurnent bearing No' 24299 of 201.8'} as security,^{with anagreementtopay 2"h monthly} interest-^{The accused initially paid interestbut failed to} repay^{the principal amo\rnt' Despite repeated demands'} he issued^{three ckleques in January 2022 for an amount} of Rs.S,OO,OOO/-'^{Rs 3'OO'OOO/-and Rs'2'50'OOO/-'which} 11,.O3.2O22,^{tkre accused} were^{never encashed' On} on a^{Rs.SO/- starnp Paper} executed^{an acknowledgment} or^before prornising^{to settleRs 12'36'OOO/- on} promise,^he 14.(,4.2022'^{Instead of fulfillingthe said} against^the lodged^{acomplaintat P'S'Kushaiguda} him in^false cornplainant^{and threatenedtoimplicate} CASCS

the comPlainant'^the grievance^of 2. Acttng^onttre matter^{r:.nder Section} referred^the learned^Magistrate 156(3)^{Cr-P.C', to the Neredmet Police and ttre same was} as Crime^{No' 562 of 2022 foroffences} registered punishable^{underSections 4Cr6, 42O and 506 IPC' and} after investigation^{a ctrarge sheet was frled on 3O'O7 '2022} before^{the Court of ttre IAdditionalMetropolitan} Magistrate,^{Cyberabad at Malkajgili' 2nd the} same^was nrrmbered^{as C'C' No' 6035 of 2022'}

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Submissions of learned counsel for the petitioner: 4.I Learned counsel submitted that the petitioner has not committed any offence and he was falsely implicated in the present case. He further submitted that responclent No.2 filed a private complaint before the J Additional Metropolitan Magistrate, Cyberabad at Malkajgiri, and the learned Magistrate, without verifying the allegations made in the complaint and without assigning any reasons, referred the matter to the police. Basing upon the sarne, a case in Crime No.S62 of 2022 Investigating was registered Officer, without properly by the police, Neredmet p.S. conductingThe investigation, filed charge sheet and the Iearned Magistrate without assigning any reasons taken cognizance and the same is contrary to law. Even according to the aliegations made in the complaint and in the charge sheet, the ingredients of Sections 406, 42O and 506 of IpC does not attract against the petitioner.

4 .2 He further su bmitted that the petitioner had executed promissory notes while availing the hand loan from respondent No.2, and also deposited the original sale deed pertaining to his proper[z towards security. The

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petitioner^{has repaidthe entire amount' out of whictr' an} arnount^{of Rs'10,24} '622^{l-was paid ttrrough online from} Og.O4.2OLg^{to 24 'O2 '2022 to respondentNo'2'However'} respondent^{No 2 lodged a private complainton 26 'O5 '2022} for Rs.12,36,000/^{- and wittr the same allegations he also} lrled a^{suit in O'S'No'59a of 2CJ22 ' on the hle of the Jr-rnior} Civil^{Jr-rdge,Medchal-Malkajgiri District and the same is} pending.

4.3^{He also subrnittedttrat there is no allegation against} the^{petitionerinthe complaint that he availed the loan} witkr a^{diskronestintention and the propertydocurnent} which^{was pledgedby himtowards secr'rrity' isnot} Hence,^{the initiationof crirninal proceedings} gerlulne ttre^{petitioneris a clear abuseof the process of} against law.^{Insupport of hiscontention'he relied upon a} judgment^{of theHon'ble Apex Court in Vesa Holdings(P|} Limited^{v. State of Keralal'}

5 Srrbmissions^{of learned counsel for respondeotNo'2:}

5.1 LearnedcounselforrespondentNo.2srrbmitted borrowed^{a total arnountof} that^the Petitioner from^{respondent No'2'} In sPite^of Rs.22,60,622/'

1 (2015) B SCC 293

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repeated demands, he failed to repay the said amount and shown his dishonest intention and when respondent No.2 vrsrted the petitioner's house for demanding money, he threatened him and also warned him that if respondent No.2 demands the amount, he will file a case agarnst him. 5.2 He further submitted that there are specific aliegations agalnst the petitioner in the cornplaint. The Investigating Officer after recording ttre statements of the wrtnesses filecj charge sheet, wherein the role of the pe ti tioner was specifically mentioned to attract the offences punishable under Sections 406, 42O and,506 of IPC. The allegations made in the complaint rn C.C.No.6O3S of 2022 and the relief sought in O.S.Ncr 598 of 2022, are different ancl distinct. Basing on the pendency of the civil suit in respect of the other amount, the petitioner is not entitled to seek quashing of the proceedings in the present crirninal petition.

5.3 He also submitted that the petitioner has raised several disputed facts in the present petition and the same have to be decided after full_fledged trial only and there are no grounds to quash the proceedings against the petitioner in C.C.No.6O35 of 2022.

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./ Analvsis:

Having^{consideredthe rival submissionsrnade} by the^{respectiveparties and after pemsal of the material} available^{on record' itreveals that the petitioner availed} hand^{loan from respondent No'2 and executed promissory} notesandalsodeposited.hisoriginalsaledeedbearing document^{No'24299 ol 2Ol8 towards security'According} to ttre^{averments of the complaint'the petitioner is due an} he executed amount^of Rs.12,36,OOO/-^and on Rs-SO/-^{non-judicialstarnp Paper} acknowledgrnent on or^before prornising^{to pay the abovesaid arnount} 14.O2.2022'^{However' thesaid amount was notPaid'} Hence,^{resPondentNo'2 filed aprivate comPlaint} on 26.()5.2()22^{and the learned Magistrate referredttre sarne} to the^{police' Basing on the sarne' Crime No'562of 2022} was registered^{by N eredmet Police and the Investigating} Offi.cer^{filedcharge sheet and thesarne was taken} was cogrrizarrce by the^{learned Magistrate andit} mlmbered as C.C.No-6O35^{of 2022'Accordingto} the arr arnount^ofRs'1O'24 '6221-^on petitioner,^tre Paid from O9.O4.2O19^{to24'02'2022 to} various^occasions respondent^No'2

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7 The record reveals that respondent No.2 filed a suit in O.S.No.59g of 2022 before the Junior Civil Judge, Medchal-Malkajgiri District, for recovery of the very same amount of Rs.12,36,000/- and the said suit is pending. During the course of hearing, learned counsel for the petitioner submitterl that the petitioner filed written statement denying the averments made in the suit and he had already paid the entire amount claimed in the above said suit. Hence, this Court is of the considered view that r.r,hether the petitioner had paid the entire amount and whether he is liable to pay the amount claimed by respondent No.2 has to be adjudicated in the above pending suit.

a. Insofar as the contention raised by the learned counsel for respondent No.2 that the petitioner is due an amount of Rs.22,6o,622/_ and the allegations made in the complain t and the relief sought in the suit are dirferent are concerned, respondent No.2 has not stated in the complaint dated 26.05.2Cr22 tinat the petitioner is drle an amount of Rs.22,6o,622/ -. He specifically made an allegation that the petitioner is dlre an amount of Rs.12,36,O0O/- and. he had executed an acknowledgment

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onaRS.so/-non.judicialstamppaperpromisingtopay the said^{arnount towards full and fina1 settlement' and he} had agreed^{to pay the same on or before l4'O2'2O22'} However,^{he has not repaid the said amotlnt'}

g. It is^{pertinent to rnention that there is no specific} allegation^{against the petitioner that tleborrowedthe} amounts^{from respondent No'2 with a dishonest intention} and committed^{cheating' On pen'rsal of the complaint'} dated^{26.05.2fJ22, itrevealsthatrespond'ent No'2 tras} given hand^{loans to thepetitioneronll'O2'2O19'} 04.O4.2OLg,^{14'Os'2(Ig and 2L'O8'2O19 on executing the} deposited^the prornissory^{notes and petitionerhad} 20 18^towards original^{sale deed bearingNo '24299 of} sectlritYAccording^{to thelearned counsel forthe} petitioner ,^{the vah-re of the securedpropertyis more than} and^{it is notthe case of resPondent} One Crore^rupees the^{documentwhich was deposited with} No.2^that No.2^{towards security is notgenuine and} respondent there^{is cloud on ttre said property and also value o[ the} property^{is less than the due amountto him'}

1O. In^{Vesa Holdings (Pl Limited(supra)' theHon'lcle}

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Supreme Court held that not every breach of contract arnounts to cheating Cheating is rnade ot.rt only when there is fraudulent or dishonest intention at the very beginning, at the tirne of making the promise or repre sentation. If such intention arises later, it cannot be treated as cheating under Section 42O IpC. Even if civil remedies are availabie, that alone is not a ground to quash criminal proceedings; however, if the a egations do not show dishonest intention from the inception, then no offence of cheating is disclosed. Continuing investigation in such cases would be an abuse of process, and courts should exercise powers under Section 4g2 Cr.p.C. to quash proceedings where cornplaints are rnala hde or fail to disclose a criminal offence.

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It is a trite law that in order to constitute the offence of cheating under Section 42O IpC, there must be fraudulent or dishonest intention at the very rnception of the transaction. The Hon'bie Slrpreme Court in State of Ifaryana v. Bhajan Lalz, held that where the dispute between parties is predominantly civil in nattrre, giving it a criminal colour would amount to abuse of the process of law. It has further been laid down that when payments are

2 (199211 scc 33s

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rnade^frorn time to^{time and the grlevance} essentia-llY lies in^civil pertains^to recovery^{of rnoney,the remedy} and not^{in crirninalProsecution'} proceedings

the present^{case in light of these settled} 12. Exarnrnrng principles,^{itbecomes clear that both the complaintand} the civil^{suit arise from ttre very same set of allegations} narnely,^{payment of money said to be due by the petitioner} to respondent^{No'2 'The petitioner had depositedttre} original^{sale deed assecurity and also made sorne} payrnents^{frorn O9'O4' 2019 to 24'O2 2022' The dispute'} therefore,^{isessentially civii in nature andalready} respondent^{No'2 filed a civil suit in O'S' No'598 of 2022} and the^{sarne is} Pending'

Hence,^{this Courtis of the considered view that} continrration^{of the proceedings i'e' C'C'No'6O35 of 2Cl22 '} on the^{file of the IAdditional Metropolitan Magistrate'} Cybera-bad^{a.t 'Ma1kaj giri'against the petitioner'would} arnount^{to abr.rseof the process of law'}

1 4. For the^{foregoing reasollsas well asthe} principles laid^{down by the Hon'ble Apex Court in Bhaian} Lal (supral^{and Vesa Holdings(Pl Limited (supral ' ttris Court} is inclined^{toexercise ttre powers conferred r.nder the}

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provisions of Section 4a2 of Cr.p.C., to quash .the proceedings against the petitioner.

1 5 ' In the result, the crirninar petition is alrowed. The proceedings against the petitioner in C.C.No.6035 of 2022, on the file of I Additional Metropolitan Magistrate, Cyberabad at Malkajgiri, are hereby quashed. It is made clear that any of the observations made in this order are con{ined for the pltrpose of deciding this case only.

As a sequel thereto, miscellaneous applications, if any, pending in this petition stand closed.

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Note: As directed, tht :fl^,,,,3"_*:t^.#"[.T5""1t?[]&,oiin"

.-^This corr t,[i{,1.:ilrT[1if^{:s,ru;ny:l"i,.x",.,',u,}

SD/- MOHD. ISMAIL
DEFUTY REGISTRAR II
//TRUE COPYII
t'i
SECTION OFFICER
One Fair Copy to the Hon,ble Sri Jus
tice J Sreenivas Rao
(For His Lordshipt kinJ
eerusal)

To,

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The 1st Additional tvletropolitan Magistrate, Cyberabad at Malkajgiri

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2 11 LR^CoPies

3 The Under^{Secretary,Union of lndia' tvlinistryof Law' Justice and Company} Affairs,^{New Delhi}

The Secretary,^{Telangana High Court-AdYo:ale'slssociationLibrary'High}

court for^{the State o'} 't''niJX''^{il[ii C"'"t sJildingsat Hvderabad} The Station Station^{House Officer' Neredmet Police Station' Rachakonda'Officer' Neredmet Police Station' Rachakonda'Neredmet Police Station' Rachakonda'}

4

t The Station Station^{House Officer' Neredmet Police Station' Rachakonda'Officer' Neredmet Police Station' Rachakonda'Neredmet Police Station' Rachakonda'}

6 Two ccs^{to the pubricprosecutor,High courtfor the state of reranganaat} Hyderabad lOUTl

One CC^{to Sri P. Giri Krishna' Advocate [OPUC]}

7

One CC^{to Sri Gaddam Srinivas' Advocate[OPUCI}

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Two^{CD CoPies}

VH/PSLM/

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HIGH COURT

DATED: OgtOgtzO2S

ORDER

CRLP.No.1O32O of 2O2g

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ALLOWNG THE CRIMINAL PETITION

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