1

CGHC010323672026 2026:CGHC:38005-DB

NAFR

HIGH COURT OF CHHATTISGARH AT BILASPUR

CRMP No. 2209 of 2026

1.Avinash Jain S/o Naresh Chand Jain Aged About 54 Years R/o B-

38, 3

rd

Floor Manglapuri, Palam, Delhi- 110045

2.Abhishek Jain S/o Sh. Anil Kumar Jain Aged About 36 Years R/o

H.No. H-133, Pocket- 34, Block- H, Sector- 3 Rohini, Rohini

Sector- 14, Rohini Sector- 7, North West, Delhi- 110085

3.Manish Bhardiwaj S/o Sh. Niranjan Nath Bhardiwaj Aged About 47

Years R/o R. No. 005, Nurses Hostel, Batra Hospital, Tughlakabad

Extn., Dr. Ambedkar Nagar, South Delhi, Pushpa Bhawan, Delhi-

110062

... Petitioner(s)

versus

1.State of Chhattisgarh Through Station House Officer, Police

Station Chhawni, District Durg (C.G.)

2.Saket Mohta S/o Jaiprakash Mohta Aged About 39 Years R/o Shri

Enterprises, 6/b, Nandini, Chhawni, Durg, District Durg (C.G.)

...Respondent(s)

(Cause-title taken from Case Information System)

2

For Petitioners : Mr. Alok Nigam, Advocate.

For Respondent/State : Mr. Sumit Singh, Deputy Advocate

General.

Hon'ble Shri Ramesh Sinha, Chief Justice

Hon'ble Shri Ravindra Kumar Agrawal , Judge

Order on Board

Per Ramesh Sinha , Chief Justice

25.08.2026

1.Heard Mr. Alok Nigam, learned counsel for the petitioners. Also

heard Mr. Sumit Singh, learned Deputy Advocate General, appearing for

the State/respondent No. 1.

2.The present petition has been filed by the petitioners with the

following prayer:

“It is, therefore, most humbly and respectfully prayed

that this Hon’ble Court may graciously be pleased to

allow the instant petition and quash/set aside the

entire criminal proceedings arising out from FIR

Registration No. 196 of 2017 registered at P.S.

Chhawni, District Durg (C.G.) (Annexure P/1) and the

Final Report/charge-sheet No. 414 of 2023 filed by

P.S. Chhawni, District Durg (Annexure P/2) and the

order of framing charges dated 22.01.2026 passed by

the learned Judicial Magistrate First Class, District

Durg (C.G.) in RCC No. 5161 of 2024 (Annexure P/7),

against the petitioners for the offence punishable

under Section 420 read with Section 34 of the Indian

Penal Code, in the interest of justice.”

3.Learned counsel appearing for the petitioners submits that the

3

present proceedings arise out of a purely commercial transaction

between the complainant, M/s Shree Enterprises, and Arise India

Limited, pursuant to an Agency Agreement dated 13.10.2014. The

Petitioners were associated with the Company in different capacities,

but the transaction in question was entered into between the

complainant and the Company. The agreement was executed and

notarized at New Delhi and contained specific terms governing the

rights and obligations of the parties.

4.It is further submitted by the learned counsel for the petitioners

that the Agency Agreement itself contemplated the manner in which

damaged or defective goods were to be reported and also contained

provisions relating to indemnification and resolution of disputes. In

particular, Clause 17 of the agreement provided that disputes arising

between the parties would first be attempted to be settled amicably and,

failing such settlement, would be subject to Delhi jurisdiction. The

nature of the agreement and the terms incorporated therein clearly

demonstrate that the underlying dispute is contractual and commercial

in character. He further contended that the complainant itself alleges

that substantial amounts were paid to the Company towards the

business arrangement and that goods were thereafter supplied by the

Company. The complainant subsequently returned goods to the

Company and sought refund of the purchase amount as well as the

security amount. Thus, the dispute essentially concerns the quality and

return of goods, refund of money and performance of contractual

obligations. Such allegations, by themselves, do not constitute the

4

offence of cheating unless the essential ingredients of Section 420 of

the Indian Penal Code are independently established.

5.Learned counsel for the petitioners would submit that the

fundamental requirement for an offence of cheating is the existence of

fraudulent or dishonest intention at the inception of the transaction. In

the present matter, the Agency Agreement was entered into in October

2014 and, according to the complainant's own case, business was

carried on thereafter for a considerable period. There is no specific

allegation demonstrating that, at the time when the agreement was

entered into or when the amounts were received, the Company or the

Petitioners had a dishonest intention to deceive or induce the

complainant to part with its property. The subsequent inability of the

Company to honour the complainant's demand for refund cannot,

without more, be converted into a criminal offence of cheating. The

material placed on record indicates that the Company subsequently

suffered severe financial difficulties, its accounts were declared NPA

and liquidation proceedings were initiated. The subsequent financial

failure of a company may give rise to civil consequences, but it cannot

retrospectively establish dishonest intention at the inception of a

commercial transaction.

6.Learned counsel for the petitioners further stated that an amount

of Rs.20,00,000/- towards security was admittedly refunded to the

complainant prior to registration of the criminal case. This conduct is

wholly inconsistent with the allegation that the Petitioners had entered

5

into the transaction with a predetermined dishonest intention to cheat

the complainant. The surrounding circumstances, therefore, do not

disclose the necessary mens rea for an offence under Section 420 IPC.

He also submits that there is, furthermore, no specific allegation

showing that any of the petitioners personally induced the complainant

to part with money for their own wrongful gain or personally

misappropriated the complainant's property. The payments and

business transactions were between the complainant and Arise India

Limited. Mere designation as a Director or association with the

Company cannot, in the absence of specific allegations and supporting

material, automatically result in criminal liability for an offence of

cheating. The allegation of common intention under Section 34 IPC also

cannot be sustained merely by making a general reference to the

petitioners. There must be material indicating participation pursuant to a

common intention to commit the alleged offence. In the present case,

no specific overt act or material has been pointed out to demonstrate

that the Petitioners shared a common intention to deceive the

complainant at the inception of the transaction.

7.Learned counsel for the petitioners further submits that the

subsequent conduct of the complainant itself demonstrates the civil and

commercial nature of the dispute. After returning the goods, the

complainant pursued its monetary claim against the Company and,

following commencement of liquidation proceedings, raised a claim

before the Official Liquidator. The claim was considered by the Official

Liquidator, subject to production of the requisite original documents. The

6

complainant's pursuit of its monetary claim in the liquidation

proceedings is consistent with the existence of a contractual and

commercial dispute between the parties. He further submitted that the

entire transaction, including the execution and notarization of the

Agency Agreement, was undertaken at Delhi. The agreement itself

contains a Delhi jurisdiction clause. Although questions of territorial

jurisdiction may depend upon the facts constituting the alleged offence,

in the present case the prosecution has not identified any specific act of

deception committed by the petitioners within the territorial jurisdiction of

Police Station Chhawni, District Durg, so as to sustain the criminal

prosecution against them.

8.Learned counsel for the petitioners also draws the attention of this

Hon'ble Court to the fact that certain petitioners, namely Abhishek Jain,

Manish Bharadwaj and Amit Jain, had already left the Company before

execution of the Agency Agreement in question. Their implication in the

present criminal proceedings, despite the absence of a specific role

attributed to them in the transaction, further demonstrates that the

criminal liability has been sought to be fastened upon persons merely

by virtue of their alleged association with the Company. He further

submitted that the petitioners had earlier approached this Hon'ble Court

by filing CRMP No. 882/2017 seeking quashing of the FIR. The said

petition was disposed of on 01.11.2023 at the stage of investigation with

a direction for completion of investigation. The earlier proceedings did

not result in any adjudication on the merits of the allegations.

Thereafter, the investigation was completed, the final report/charge-

7

sheet was filed, and the learned trial Court proceeded to frame charges.

Thus, the present petition is founded upon the subsequent stage of the

proceedings and the material now available on record. He also submits

that this Hon'ble Court has also granted anticipatory bail to the

petitioners vide order dated 09.05.2024 in MCRCA No. 501 of 2024 &

batch, wherein the nature of the dispute was noticed as being primarily

commercial/civil. Though such an observation by itself may not finally

determine the merits of the criminal case, it is a relevant circumstance

while considering whether continuation of the prosecution, in the facts

presently before the Court, would amount to abuse of the process of

law.

9.It is submitted by the learned counsel, appearing for the

petitioners that after completion of investigation, the learned Judicial

Magistrate First Class, Durg has framed charges under Sections 420/34

IPC. However, even if the prosecution material is taken at its highest,

the basic ingredients of cheating are not disclosed against the

petitioners. There is no material showing deception at the inception,

dishonest inducement, or any specific act of the petitioners pursuant to

which the complainant was induced to part with its property. He further

stated that the inherent jurisdiction of this Hon'ble Court under Section

528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (for short,

‘BNSS’) is intended to prevent abuse of the process of the Court and to

secure the ends of justice. Where the allegations, even if accepted in

their entirety, do not disclose the commission of the alleged offence,

continuation of the criminal prosecution would serve no legitimate

8

criminal-law purpose. The present case, therefore, is not one where the

petitioners seek a detailed appreciation of disputed evidence at the

threshold. Rather, the admitted and undisputed circumstances, the

contractual nature of the relationship, the absence of allegations

showing dishonest intention at inception, the absence of any specific

overt act against the Petitioners, the refund of a substantial part of the

security amount, and the subsequent liquidation proceedings

cumulatively demonstrate that the dispute is essentially commercial in

nature.

10.In these circumstances, learned counsel for the petitioners

respectfully submits that permitting the criminal proceedings arising out

of the FIR, Final Report/Charge-sheet No. 414/2023 and the order

dated 22.01.2026 framing charges in R.C.C. No. 5161/2024 to continue

against the petitioners would amount to an abuse of the process of law.

The petitioners, therefore, pray that this Hon'ble Court may be pleased

to exercise its inherent jurisdiction under Section 528 of the BNSS and

quash the criminal proceedings against the petitioners in the interest of

justice.

11.Per contra, learned State counsel has vehemently opposed the

petition. It is submitted that the allegations contained in the FIR and the

material collected during investigation disclose the commission of a

cognizable offence against the petitioners. The Investigating Officer,

after conducting a detailed investigation, has collected material and

thereafter filed the charge-sheet before the competent Court. The

9

learned trial Court, upon consideration of the material available on

record, has already taken cognizance and framed charges under

Sections 420/34 of the Indian Penal Code.

12.Learned State counsel further submits that the contentions raised

by the petitioners regarding the nature of the transaction, refund of part

of the amount, the alleged financial difficulties of the Company, the

claim before the Official Liquidator and the respective roles of the

petitioners are matters of defence and involve appreciation of factual

and documentary evidence. Such disputed questions cannot be

conclusively determined in proceedings under Section 528 of the BNSS.

13.It is further contended on behalf of the State that the mere fact

that the dispute has a commercial background does not, by itself,

exclude the possibility of commission of a criminal offence. Where the

allegations and material collected during investigation disclose the

ingredients of cheating, the criminal proceedings cannot be terminated

merely because the transaction also gives rise to civil or commercial

remedies. The question whether the petitioners possessed dishonest

intention and whether they participated in the alleged acts is required to

be determined on the basis of evidence before the learned trial Court.

14.Learned State counsel also submits that the investigation has

already been completed, charge-sheet has been filed and charges have

been framed. At this stage, interference by this Court would amount to

an appreciation of the prosecution material and the defence of the

petitioners, which is impermissible in exercise of the inherent

10

jurisdiction. It is, therefore, prayed that the petition be dismissed and the

petitioners be relegated to the remedy available before the learned trial

Court.

15.We have heard learned counsel for the parties and perused the

material available on record.

16.The legal position on the issue of quashing of criminal

proceedings is well-settled that the jurisdiction to quash a complaint,

FIR or a charge-sheet should be exercised sparingly and only in

exceptional cases and Courts should not ordinarily interfere with the

investigations of cognizable offences. However, where the allegations

made in the FIR or the complaint even if taken at their face value and

accepted in their entirety do not prima facie constitute any offence or

make out a case against the accused, the FIR or the charge-sheet may

be quashed in exercise of powers under Article 226 or inherent powers

under Section 482 of the Cr.P.C. (now Section 528 of the BNSS).

17.The Hon’ble Supreme Court in the matters of Rupan Deol Bajaj

v. K.P.S. Gill reported in (1995) SCC (Cri) 1059, Rajesh Bajaj v. State

of NCT of Delhi reported in (1999) 3 SCC 259 and Medchl Chemicals

& Pharma (P) Ltd. v. Biological E Ltd. & Ors reported in 2000 SCC

(Cri) 615, the Supreme Court clearly held that if a prima facie case is

made out disclosing the ingredients of the offence, Court should not

quash the complaint. However, it was held that if the allegations do not

constitute any offence as alleged and appear to be patently absurd and

improbable, Court should not hesitate to quash the complaint. The note

11

of caution was reiterated that while considering such petitions the

Courts should be very circumspect, conscious and careful. Thus, there

is no controversy about the legal proposition that in case a prima facie

case is made out, the FIR or the proceedings in consequence thereof

cannot be quashed.

18.In Neeharika Infrastructure Pvt. Ltd. v. State of Maharashtra,

2021 SCC OnLine SC 315 , the Hon'ble Supreme Court has

authoritatively settled the scope of the inherent jurisdiction of the High

Court under Section 482 of the Code of Criminal Procedure, 1973 (now

Section 528 of the BNSS). The Hon’ble Apex Court has held that the

power to quash criminal proceedings is required to be exercised

sparingly, with circumspection and only in the rarest of rare cases. It has

been categorically observed that while considering a prayer for

quashing an FIR or criminal proceedings, the High Court cannot embark

upon an enquiry into the reliability, genuineness or otherwise of the

allegations contained in the FIR, nor can it appreciate the evidence or

conduct a mini trial. The Court is only required to examine whether the

allegations, if taken at their face value, disclose the commission of a

cognizable offence. The Supreme Court further emphasized that

criminal proceedings ought not to be scuttled at the threshold, that

investigation into cognizable offences should ordinarily be permitted to

proceed unhindered, and that the extraordinary jurisdiction under

Section 482 Cr.P.C. must be exercised with great caution and self-

restraint, save in exceptional cases where non-interference would result

in manifest miscarriage of justice.

12

19.Very recently, in Pradeep Kumar Kesharwani v. State of Uttar

Pradesh & Another (Criminal Appeal No. 3831 of 2025, decided on

02.09.2025), the Hon'ble Supreme Court reiterated the aforesaid

principles and further held that while exercising jurisdiction under

Section 482 Cr.P.C. (now Section 528 of the BNSS), the High Court

cannot adjudicate disputed questions of fact or evaluate the evidentiary

worth of the material collected during investigation. The Court reaffirmed

the test laid down in Rajiv Thapar v. Madan Lal Kapoor and observed

that criminal proceedings can be quashed at the threshold only when

the material relied upon by the accused is of sterling and impeccable

quality, completely demolishes the prosecution case, remains incapable

of being refuted by the prosecution, and continuation of the criminal

proceedings would amount to an abuse of the process of Court. Unless

all these parameters are cumulatively satisfied, the High Court ought

not to interfere in exercise of its inherent jurisdiction, leaving the parties

to establish their respective cases before the trial Court in accordance

with law.

20.Having bestowed our anxious consideration to the rival

submissions and upon perusal of the material available on record, this

Court finds that the FIR contains allegations which require consideration

against the petitioners in the context of the material collected during

investigation. The Investigating Officer, after conducting the

investigation, collected material in support of the prosecution case and,

finding sufficient grounds to proceed against the petitioners, submitted

the charge-sheet before the competent Court. Thereafter, cognizance

13

was taken and charges have already been framed by the learned trial

Court.

21.The principal submission of the petitioners is that the dispute is

purely commercial in nature, that there was no dishonest intention at the

inception of the transaction, that part of the security amount was

refunded and that the Company subsequently underwent financial

difficulties and liquidation proceedings. The petitioners have also relied

upon the contractual terms, the jurisdiction clause contained in the

Agency Agreement and the claim raised before the Official Liquidator.

However, whether these circumstances completely negate the

allegations of cheating, whether the petitioners had the requisite

dishonest intention, and what role, if any, was played by each of the

petitioners are matters which require appreciation of the material

collected during investigation and the evidence to be led before the

learned trial Court.

22.At this stage, this Court cannot enter into an appreciation of the

evidentiary value of the defence material relied upon by the petitioners

or record any conclusive finding regarding the correctness of their

explanation. The contention that the dispute is purely civil or commercial

in nature cannot, in the facts of the present case, be conclusively

accepted so as to terminate the criminal proceedings at the threshold.

The existence of a contractual or commercial relationship does not by

itself bar criminal prosecution where the allegations and the material

collected during investigation disclose the ingredients of a criminal

14

offence.

23.The contention regarding territorial jurisdiction also does not, at

this stage, furnish a ground for quashing the entire criminal

proceedings. The question whether any part of the alleged offence was

committed within the jurisdiction of the concerned police station would

depend upon the allegations and evidence available on record and

cannot be conclusively determined in the present proceedings merely

on the basis of the jurisdiction clause contained in the agreement.

24.So far as the contention regarding the petitioners Abhishek Jain,

Manish Bharadwaj and Amit Jain having allegedly left the Company

before execution of the Agency Agreement is concerned, the same is

also a matter which would require examination of the relevant

documentary and other evidence. At the stage of exercising inherent

jurisdiction, this Court cannot undertake a detailed examination of such

disputed factual aspects or substitute its assessment for that of the

learned trial Court.

25.It is also significant that the investigation has already culminated

in filing of the charge-sheet, cognizance has been taken and charges

have been framed. At this stage, the petitioners have an adequate

opportunity to raise all their factual and legal defences before the

learned trial Court and to demonstrate, on the basis of the evidence

brought on record, that the essential ingredients of the alleged offence

are not established against them.

26.Applying the principles laid down by the Hon'ble Supreme Court in

15

Neeharika (supra) and Pradeep Kumar Kesharwani (supra), this

Court is of the considered opinion that the present case does not fall

within the exceptional category warranting interference under Section

528 of the BNSS. The material relied upon by the petitioners cannot, at

this stage, be held to be of such sterling and impeccable quality as

would completely demolish the prosecution case. The defence sought

to be raised by the petitioners cannot be accepted at this stage so as to

terminate the criminal proceedings at the threshold. It is made clear that

this Court has not expressed any opinion on the ultimate merits of the

allegations against the petitioners. The observations made herein are

confined to the question as to whether the extraordinary jurisdiction

under Section 528 of the BNSS ought to be exercised at this stage. The

petitioners shall be at liberty to raise all such grounds and defences

before the learned Trial Court, which shall consider the same in

accordance with law and on the basis of the evidence brought on

record, without being influenced by any observation made in the present

order.

27.In view of the aforesaid discussion, this Court is of the considered

opinion that no case for exercise of the inherent jurisdiction under

Section 528 of the BNSS is made out. The investigation has culminated

in filing of the charge-sheet and charges have already been framed

against the petitioners. At this stage, this Court finds no justification to

interdict the criminal proceedings in exercise of its inherent jurisdiction.

28.Accordingly, the present petition, being devoid of merit, is hereby

16

dismissed.

29.Since the criminal case is pending before the learned trial Court

and charges have already been framed, the learned trial Court is

directed to proceed with the trial expeditiously and make every

endeavour to conclude the same at the earliest, in accordance with law.

However, the learned trial Court shall ensure that adequate opportunity

is afforded to the parties to conduct the trial fairly and that the trial is not

prejudiced by any observation made in the present order.

30.It is, however, clarified that the observations made herein are only

for the purpose of deciding the present petition and shall not influence

the learned trial Court while deciding R.C.C. No. 5161 of 2024 on its

own merits and in accordance with law.

Sd/- Sd/-

(Ravindra Kumar Agrawal) (Ramesh Sinha)

Judge Chief Justice

Brijmohan