IN THE HIGH COURT FOR THE STATE OF TELANGANA

AT HYDERABAD

THE HONOURABLE SRI JUSTICE N.TUKARAMJI

CRIMINAL PETITION No.13159 OF 2026

(CNR No. HBHC010553562026)

DATE: 02.09.2026

Between :

D. Naresh Chowdary.

… Petitioner/Accused.

AND

The State of Telangana rep., by its Public Prosecutor,

High Court for the State of Telangana, Hyderabad,

Through Inspector of Police, EOW Team-V, Central

Crime Station, CCS-DD, Hyderabad.

… Respondent.

ORDER:

This petition is filed under Section 482 of Bharatiya Nagarik

Suraksha Sanhita, 2023 (for short, “BNSS”), seeking the relief of

anticipatory bail.

2. The petitioner is arrayed as Accused in FIR No.178 of 2026 on

the file of Central Crime police station, CCS-DD, Hyderabad for the

offences punishable under Section 318(4), 316(5), 111(1) read with

Section 3(5) of the Bharatiya Nyaya Sanhita, 2023 (for short, “BNS”).

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3. Heard Mr. M. Pratab Reddy, learned Senior Counsel appearing

on behalf of Mr. Shreyas Reddy, learned Counsel for the petitioner,

and Mr. Syed Yasar Mamoon, learned Additional Public Prosecutor,

appearing for the respondent-State and Mr. T. Pradyumna Kumar

Reddy, learned Senior Counsel appearing for respondent No.2.

4.1. The prosecution case, in brief, is that the petitioner, who is the

Managing Director of DNC Infrastructure Pvt. Ltd., entered into a

commercial property transaction with the complainant in respect of Sri

Harsha Complex, situated at Malakpet, Hyderabad. It is alleged that

the petitioner purchased the subject property for a sale consideration of

Rs.17.10 crores under registered Sale Deed Document No.8963 of

2024, dated 26.11.2024. According to the complainant,

notwithstanding the execution and registration of the sale deed, the

entire sale consideration was not paid. It is alleged that the petitioner

initially issued cheques towards the sale consideration, which were

dishonoured. Thereafter, he entered into an MoU dated 24.02.2025

and issued fresh cheques towards the outstanding amount. The said

cheques were also allegedly dishonoured on the ground of insufficient

funds. It is further alleged that the petitioner subsequently paid a sum

of Rs.2.10 crores, while a substantial portion of the sale consideration

remained unpaid.

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4.2. The complainant further alleges that, despite non-payment of

the sale consideration, the petitioner mortgaged the subject property in

favour of Punjab National Bank under registered MODTD Document

No.0367/2025 and obtained financial facilities of approximately Rs.25

crores. It is alleged that the said loan facilities were sanctioned in

collusion with certain officials of Punjab National Bank and without

proper physical verification of the property, valuation, legal due

diligence, documentation, and KYC compliance. According to the

complainant, the acts complained of resulted in wrongful gain to the

accused and corresponding wrongful loss to the complainant and the

bank. It is also alleged that the petitioner, along with his company and

the concerned bank officials, acted pursuant to a criminal conspiracy

with the intention to deceive and dishonestly obtain financial facilities

by creating a mortgage over the subject property. The complainant has

further referred to certain previous criminal cases allegedly pending

against the petitioner involving offences relating to cheating, criminal

breach of trust, forgery, and criminal intimidation. On the basis of the

complaint and the allegations contained therein, the crime came to be

registered for the alleged commission of cheating, criminal conspiracy,

and related offences by the petitioner, his infrastructure company, and

the concerned officials of Punjab National Bank.

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5.1. Learned Counsel for the petitioner would submit that the dispute

arises out of a commercial and contractual transaction relating to the

sale of the subject property and is essentially civil in nature. It is

submitted that the complainant has already instituted proceedings

under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) in

respect of the same transaction and that the present proceedings are

therefore an attempt to give a criminal colour to a contractual dispute. It

is further submitted that the registered sale deed records payment of

the sale consideration through cheques and delivery of possession to

the petitioner. The allegations contrary to the recitals contained in the

registered documents, particularly with regard to payment and

possession, involve disputed questions of fact requiring adjudication in

civil proceedings. The petitioner also relies upon subsequent payments

made through RTGS and submits that the civil suit itself seeks

recovery of the alleged balance sale consideration, thereby

demonstrating the essentially contractual nature of the dispute.

5.2. Learned Counsel would contend that the offence of cheating

requires dishonest or fraudulent intention at the inception of the

transaction, which cannot be inferred merely from the subsequent non-

payment of the alleged balance sale consideration. As regards criminal

breach of trust, it is submitted that the property was transferred to the

petitioner under a registered sale deed and was never entrusted to him

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in any fiduciary capacity. Hence, according to the petitioner, the

essential element of entrustment is absent. It is further submitted that

the mortgage in favour of Punjab National Bank was created after

execution of the sale deed and is supported by documentary records,

including title documents, mortgage valuation, and banking records,

which are available with the concerned authorities or the bank. The

petitioner contends that the allegation of conspiracy under Section

111(1) of the BNS is without any basis and that no specific

independent overt act has been attributed to him. The petitioner also

points out that the alleged dishonour of cheques occurred in 2025 and

that thereafter proceedings under Section 138 of the NI Act and civil

remedies were initiated, whereas the present complaint was filed only

on 30.07.2026. According to the petitioner, the delay supports his

contention that the criminal proceedings have been initiated to exert

pressure in a predominantly civil dispute.

5.3. It is further submitted that the principal evidence consists of the

registered sale deed, MoU, mortgage documents, cheques, written

memos, bank records, and civil proceedings, all of which are

documentary in nature and can be secured and examined without

custodial interrogation. The petitioner further pleads that the other

alleged criminal cases registered against him were either closed by the

prosecution by referring to them as civil in nature or false, or are the

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subject matter of compromise or investigation, and that those

proceedings support his contention that civil disputes have been given

a criminal colour with an ulterior motive. He further submits that he is a

permanent resident and undertakes to cooperate with the investigation

and abide by any conditions that may be imposed.

5.4. Learned Counsel relied upon the judgments of Mohammad

Wajid v. State of U.P., (2023) 20 SCC 219, and Delhi Race Club (1940)

Ltd. v. State of Uttar Pradesh, (2024) 10 SCC 690, and pleaded that, in

the light of the said authorities, the allegations must be tested against

the statutory ingredients of the offences invoked. It is contended that a

mere failure to discharge a contractual or financial obligation arising

from a registered sale transaction, particularly where civil proceedings

and prosecution for dishonour of cheques are pending, would not, by

itself, satisfy the requisite ingredients of the alleged offences. On these

grounds, learned Counsel seeks grant of anticipatory bail.

6.1. Learned Additional Public Prosecutor and learned Senior

Counsel appearing for respondent No.2 opposed the petition and

would submit that a prima facie case is made out against the petitioner.

It is alleged that accused No.1 induced the complainant to execute a

registered sale deed for a consideration of Rs.17.10 crores by showing

a sanction letter issued by Punjab National Bank for approximately

Rs.25 crores, without paying the agreed sale consideration. Though

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accused No.1 initially issued cheques towards the sale consideration,

upon their dishonour he entered into an MoU acknowledging the

outstanding liability and issued fresh cheques, which were also

dishonoured on the ground of insufficient funds. According to the

prosecution, these circumstances prima facie disclose dishonest and

fraudulent conduct. It is further submitted that, despite the alleged

non-payment of the sale consideration, the accused mortgaged the

same property with Punjab National Bank and obtained financial

facilities of approximately Rs.25 crores. The alleged role of the

concerned bank officials in sanctioning and disbursing the loan without

proper scrutiny and due diligence is also stated to be under

investigation. Learned Additional Public Prosecutor further submits

that the investigation requires the presence of the petitioner for the

purpose of securing the relevant materials. It is also necessary to

establish the utilisation and ultimate destination of the loan amount

secured by the petitioner.

6.2 Learned Additional Public Prosecutor further submits that the

investigation is at an initial stage and that relevant documents,

including the loan files, sanction proceedings, valuation reports, bank

records, and other connected materials, are yet to be collected and

examined. Further pleaded that custodial interrogation of the

petitioner/accused No.1 may be necessary for verification of the

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transactions. The prosecution also relies upon the alleged criminal

antecedents of accused No.1, involving allegations of cheating,

criminal breach of trust, forgery as relevant in assessing the possibility

of repetition of such conduct and interference with the investigation. He

further pleaded that the pendency of civil proceedings and proceedings

under the NI Act does not bar criminal prosecution where the

allegations disclose independent cognizable offences. According to the

prosecution, the present case involves not merely non-payment of the

sale consideration, but also alleged dishonest inducement, repeated

dishonour of cheques, subsequent mortgage of the property,

procurement of substantial bank finance, and alleged involvement of

bank officials. It is therefore contended that a comprehensive

investigation is necessary and that, if anticipatory bail is granted at this

stage, the petitioner may influence witnesses or interfere with the

evidence, thereby prejudicing a fair and effective investigation. On

these grounds, dismissal of the petition is sought.

7. I have carefully considered the rival submissions and perused

the materials available on record.

8. Having regard to the submissions advanced by the learned

Counsel for the parties and the materials available on record, it

appears that the dispute arises principally out of a registered

commercial transaction concerning the sale of the subject property for

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a consideration of Rs.17.10 crores. The registered sale deed, MoU,

cheques, payments, mortgage documents, bank records, and the

pending civil proceedings and proceedings under Section 138 of the

N.I. Act constitute the principal material in the matter. The extent of

payment made towards the sale consideration and the interpretation of

the aforesaid documents involve disputed questions of fact, which are

matters for appropriate adjudication.

9. However, the pendency of civil proceedings or proceedings

under Section 138 of the NI Act does not, by itself, bar a criminal

prosecution where the allegations disclose the ingredients of a

cognizable offence, as held in Mohammad Wajid (supra), subject to the

requirement that the allegations disclose the basic ingredients of the

offence alleged. Mere allegations, without the necessary factual

foundation, would not be sufficient to constitute the offence.

10. As regards the allegation of criminal breach of trust, the

essential requirement is entrustment of property or dominion over

property, followed by dishonest misappropriation or conversion. In

Delhi Race Club (supra), the Hon’ble Supreme Court distinguished

criminal breach of trust from cheating and observed that, in a sale

transaction involving transfer of ownership, entrustment ordinarily does

not arise.

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11. In the present case, the subject property was conveyed to the

petitioner under a registered sale deed, and the dispute principally

concerns the alleged non-payment or short payment of the sale

consideration. There is no specific allegation of independent

entrustment of the property to the petitioner in a fiduciary capacity. The

allegation of criminal breach of trust, therefore, requires careful

scrutiny.

12. The allegation of cheating, however, stands on a different

footing. The prosecution relies not merely upon the alleged non-

payment of the sale consideration, but also upon the issuance and

dishonour of cheques, the subsequent execution of MoUs

acknowledging the outstanding liability, the issuance of fresh cheques

followed by their dishonour, and the subsequent mortgage of the

property and obtaining of financial facilities from the bank. These

circumstances warrant investigation.

13. At the same time, whether these circumstances establish

dishonest or fraudulent intention at the inception of the sale

transaction, as opposed to a subsequent failure to fulfil the payment

obligation, is essentially a disputed question of fact which cannot be

conclusively determined at the stage of consideration of an application

for anticipatory bail.

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14. The subsequent mortgage and the bank loan transaction,

including the sanction process, valuation, legal scrutiny, mortgage

documentation, the role of the concerned bank officials, and the

utilisation and flow of the loan proceeds, also require investigation.

Nevertheless, the relevant material is substantially documentary in

nature and is stated to be available with the bank and other concerned

authorities.

15. The magnitude of the financial transaction, by itself, does not

make custodial interrogation indispensable. Although economic

offences are required to be viewed seriously and custodial interrogation

may be justified where it is genuinely necessary for a fair and effective

investigation, anticipatory bail cannot be refused merely because the

allegations involve substantial financial amounts. The requirement is to

balance the seriousness of the allegations and the legitimate

investigative needs with the petitioner’s right to personal liberty.

16. In the present case, the petitioner has undertaken to cooperate

with the investigation and to produce documents before the

Investigating Officer as and when required. No specific material is

presently placed before this Court to demonstrate that the custodial

arrest of the petitioner is indispensable for the purposes of

investigation. The alleged criminal antecedents of the petitioner may,

no doubt, be taken into consideration as a relevant circumstance.

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However, the mere registration or pendency of previous cases, without

examining their nature, stage, and outcome, cannot be treated as proof

of guilt in the present case.

17. On an overall consideration of the matter, while the allegations

relating to the sale transaction, subsequent mortgage, and bank

finance require investigation, the dispute concerning payment of the

sale consideration remains substantially intertwined with the registered

commercial transaction and the pending civil proceedings and

proceedings relating to dishonour of cheques.

18. Accordingly, without expressing any final opinion on the merits

of the case or the culpability of the petitioner, and having regard

particularly to the documentary nature of the material, this Court is of

the considered view that custodial interrogation has not, at this stage,

been demonstrated to be indispensable. The interests of the

investigation can adequately be safeguarded by imposing appropriate

conditions requiring the petitioner to cooperate with the investigation

and remain available as and when required.

19. Accordingly, the Criminal Petition is allowed, subject to the

following conditions:

a) Petitioner/Accused shall surrender before the Station House Officer,

Central Crime Station, CCS-DD, Hyderabad, on or before 08.09.2026.

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Upon such surrender, or in the event of his arrest, the Station House

Officer shall release them on bail upon each of them executing a

personal bond for a sum of Rs.50,000/- (Rupees Fifty Thousand only),

with two sureties for a like sum each, to the satisfaction of the said

officer.

b) The petitioner shall appear before the Station House Officer every

Tuesday and Friday between 10:00 a.m. and 3:00 p.m. for a period

of ten (10) weeks from the date of his release on bail and shall

cooperate with the investigation in all respects.

c) The petitioner shall furnish their complete residential addresses and

contact details to the Investigating Officer and shall keep the same

updated throughout the proceedings before the trial court.

d) Additionally, the petitioner shall remain available as and when

required by the investigating officer during the course of

investigation.

e) The petitioner shall neither directly nor indirectly induce, threaten,

influence, nor contact any prosecution witness, nor shall they tamper

with the prosecution evidence in any manner whatsoever.

f) In the event of breach of any of the aforesaid conditions by the

petitioners, the prosecution shall be at liberty to take appropriate steps

seeking cancellation of bail.

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20. It is made clear that any observations made herein are confined

solely to the adjudication of the present application for anticipatory bail

and shall not be construed as an expression on the merits of the case.

Pending miscellaneous applications, if any, shall stand closed.

_______________

Date: 02.09.2026 N.TUKARAMJI, J

MRKR

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THE HON’BLE SRI JUSTICE N. TUKARAMJI

CRIMINAL PETITION No.13159 OF 2026

02.09.2026

MRKR