Quash Order

Ans: Dalip Kaur & Ors vs Jagnar Singh & Anr on 7 July, 2009 Author: S Sinha Bench: S.B. Sinha, Asok Kumar Ganguly An offence of cheating would be constituted when the accused has fraudulent or dishonest intention at the time of making promise or representation. A pure and simple breach of contract does not constitute an offence of cheating. The honourable Supreme Court held that held that if the dispute between the parties was essentially a civil dispute resulting from a breach of contract on the part of the appellants for non- refunding the amount of advance, the same would not constitute an offence of "cheating‟ or criminal breach of trust‟.

Ans: Laxmi Narain Kalra vs The State Of Uttar Pradesh on 25 November, 1955. Bench: V Ayyar, Imam In the case of Laxmi Narayan Kalra v. the State of Bihar, AIR 1956 SC 544: 1956 CrLJ 948, the cheque was issued by way of security but was not supported by credit in the bank. The court opined that: under the circumstances, though the action of the accused was highly reprehensible, in absence of any dishonest intention, the charge under section 420 failed, and conviction has to be set aside.

Ans:  Vir Prakash Sharma v. Anil Kumar Agarwal [(2007) 7 SCC 373], it has been held that: Non-payment or underpayment of the price of the goods by itself does not amount to commission of an offence of cheating or criminal breach of trust. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, that is the time when the offence is said to have been committed. The honourable Supreme Court held that In law, only because he had issued cheques which were dishonoured, the same by itself would not mean that he had cheated the complainant. Assuming that such a statement had been made, the same, in our opinion, does not exhibit that there had been any intention on the part of the appellant herein to commit an offence under Section 417 of the Indian Penal Code.

Ans: Vir Prakash Sharma v. Anil Kumar Agarwal [(2007) 7 SCC 373], Bench: S.B. Sinha, Harjit Singh Bedi It has been held by honourable Supreme Court that: Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, that is the time when the offence is said to have been committed. In law, only because he had issued cheques which were dishonoured, the same by itself would not mean that he had cheated the complainant.    Non-payment or underpayment of the price of the goods by itself does not amount to commission of an offence of cheating or criminal breach of trust.

Ans: State Of Kerala vs A. Pareed Pillai And Anr. on 28 April, 1972. Bench: H Khanna, J Shelat In the case of State of Kerala v. A. Pareed Pillai and another, a two-Judge Bench of honourable Supreme Court ruled that to hold a person guilty of the offence of cheating, it has to be shown that his intention was dishonest at the time of making the promise as well as such a dishonest intention cannot be inferred from a mere fact that he could not afterwards fulfill the promise.

Ans: A growing trend is observed by the judiciary in the usage of criminal prosecution as a tool of harassment or to seek personal vendetta or with an ulterior motive to pressurize the accused. This strategy is frequently used to paint matters which are mainly of civil nature with the colour of criminality. There must be the mens rea when such false representation has been made for cheating. 

Ans: The provisions pertaining to the offence of cheating are mentioned in sections 415 to section 420 of the Indian Penal code (IPC). The offence of cheating is established only when all the following elements are to be proved, namely: that the representation which was made by the accused was false, that the accused knew that the representation was false at the very time he made it, that the accused made that false representation with the dishonest intention of tricking the person to whom it is made, and that he thereby caused that person to deliver the property or to do or to omit to do something which he would have otherwise not done or omitted. The phrase "wrongful gain" is broadly defined under Section 23 of the Indian Penal Code as any error, distortion, activity, or exclusion that occurs in any act as well as is regarded as a violation of the law.