Jaydeep Chitlangia vs. State Of Chhattisgarh

Held

The Court allowed the anticipatory bail applications. The primary reasoning was based on the Supreme Court's decision in Uma Shankar Gopalika, which held that not every breach of contract amounts to cheating. Cheating requires deception at the very inception; an intention to cheat developing later does not constitute cheating. The Court noted that the agreement dated June 26, 2021, was for six months with a total sale consideration of Rs. 7 Crores, and the complainant only paid Rs. 2.65 Crores. The Court found no other documents filed by the complainant to show how the applicants obstructed him from performing his part of the contract. Considering the applicants were ready to return the advance amount and without commenting on the merits, the Court deemed it a fit case for anticipatory bail. The applicants were directed to furnish a personal bond of Rs. 1 Lakh with a local surety, return the whole advance amount within 60 days, and comply with other standard bail conditions.

Facts

The applicants, Jaydeep Chitlangia, Mohammad Kamran, and Dharminder Choudhary, sought anticipatory bail in connection with a criminal case registered under Sections 420 and 120-B read with Section 34 of the IPC. The prosecution alleged that the applicants entered into an agreement on October 26, 2021, with the complainant, Mohd. Firoz, for the sale of scraps and other materials for Rs. 7 Crores. The complainant paid Rs. 2,65,00,000/-. Subsequently, without terminating the first agreement, the applicants allegedly executed another agreement on January 17, 2022, with Ameer Enterprises, thereby cheating the complainant. The applicants contended that the dispute was civil in nature, as the complainant failed to fulfill his part of the contract by not making the full payment within the agreed six months. They also stated they attempted to return the advance amount, which was refused.

Key Issues

1. Whether the applicants are entitled to anticipatory bail under Section 438 of the Cr.P.C. given the allegations of cheating and criminal conspiracy? 2. Whether the dispute between the parties is purely civil in nature, or does it disclose criminal intent? Petitioner's Arguments: The applicants argued that they are innocent and falsely implicated. They contended that no offense of cheating is made out as no lawful loss was caused to the complainant. They asserted that the complainant only paid Rs. 2,65,00,000/- out of the Rs. 7 Crores agreed upon and failed to perform the remaining part of the contract. They claimed the dispute is civil, and the complainant is attempting to convert it into a criminal one. They also highlighted that they sent a notice for contract termination and are ready to return the advance amount. They relied on Supreme Court judgments in Sumedh Singh Saini vs State of Punjab and another, and Uma Shankar Gopalika vs State of Bihar and another, and an M.P. High Court judgment in Pawan Kumar Ajmera and others vs State of Madhya Pradesh and others. Respondent's (Objector) Arguments: The objector vehemently opposed the bail application, stating that the applicants breached the contract by executing a second agreement without terminating the first. They pointed out that the GST numbers in the second agreement were the same for M.A. Builders and Madhya Bharat Paper Mill, indicating an intention to cheat from the inception. They argued that the dispute is not purely civil and criminal proceedings should continue. They relied on Supreme Court judgments in K. Jagadish vs Udaya Kumar G.S. and another, and Prem Shankar Prasad vs State of Bihar and another.