Dr. Pravin Rustam Rao Borde vs. State Of Chhattisgarh

Facts

The petitioners, Dr. Urvashi Phuljhale and Dr. Pravin Rustam Rao Borde, approached the High Court seeking to quash an FIR registered against them. The FIR was based on a complaint by private respondents alleging cheating and violation of the Chhattisgarh State Upcharyagriha Tatha Rogopchar Sambandhi Sthapanaye Anugyapan Adhiniyam, 2010. The private respondents claimed they were induced to deposit Rs. 23 Lacs for opening a medical store in a hospital, with promises of high profits. They alleged the hospital was misrepresented as a 50-bedded facility when it was only 9-bedded, and that the petitioners failed to provide the necessary license. The dispute arose from an agreement entered into on February 1, 2021, following the initial deposit. The petitioners sought to quash the FIR, final report, and the Magistrate's cognizance order.

Held

The Court held that the dispute between the parties was primarily of a civil nature, stemming from an agreement that could be adjudicated by a competent Civil Court. The Court noted that the private respondents had already filed a civil suit concerning this matter. Consequently, the registration of the FIR and the consequential criminal proceedings were deemed unjustified. Applying the principles from *Ram Jas v. State of Uttar Pradesh* and *State of Haryana and others v. Ch. Bhajan Lal*, the Court found that the allegations, even if taken at face value, did not prima facie establish a case for cheating, especially in the absence of clear evidence of fraudulent or dishonest intention from the outset, as highlighted in *Sarabjit v. State of Punjab*. The Court quashed the FIR, the final report, the Magistrate's cognizance order, and all consequential proceedings relating to the petitioners.

Key Issues

1. Whether the allegations in the FIR and subsequent proceedings, taken at face value, prima facie constitute an offence of cheating under Section 420 of the Indian Penal Code and Section 4 of the Chhattisgarh State Upcharyagriha Tatha Rogopchar Sambandhi Sthapanaye Anugyapan Adhiniyam, 2010, justifying the continuation of criminal proceedings? Petitioner's Argument: The petitioners argued that the dispute was essentially civil in nature, arising from a breach of contract. They contended that criminal proceedings were an abuse of process and should be quashed, citing precedents where criminal proceedings for cheating were not sustainable without evidence of fraudulent or dishonest intention from the inception of the transaction. They relied on the principles laid down in cases like *Ram Jas v. State of Uttar Pradesh* and *State of Haryana and others v. Ch. Bhajan Lal*. Respondent's Argument: The respondents contended that the petitioners' actions constituted cheating by fraudulent inducement, as they misrepresented the hospital's capacity and failed to provide the promised license, leading to financial loss for the private respondents. They argued that the elements of Section 420 IPC and Section 4 of the Adhiniyam, 2010 were met.