Gauhati High Court - Kohima
Sri Jagdish Singh vs State Of Nagaland And Anr on 6 February, 2026
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GAHC020000022025 2026:GAU-NL:45
THE GAUHATI HIGH COURT
(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
KOHIMA BENCH
Case No. : Crl. Pet./1/2025
SRI JAGDISH SINGH
S/O SRI DULU SINGH
R/O NO.1 BANGALIGAON
P.O/ P.S. DULIAJAN
DIST.- DIBRUGARH, ASSAM-786602
VERSUS
STATE OF NAGALAND AND ANR
KOHIMA NAGALAND
2:MR AHMED HUSSAIN CHOUDHURY
S/O MR GOLAM AKBAR CHOUDHURY
R/O PURANA BAZAR
DIMAPUR
P.S. DIMAPUR
DIST- DIMAPUR NAGALANBD-79711
Advocate for the Petitioner : NURUL HASAN, MEDO VERO
Advocate for the Respondent : P.P, NAGALAND,
BEFORE
HON'BLE MRS. JUSTICE YARENJUNGLA LONGKUMER
ORDER
06.02.2026 Heard Mr. Nurul Hasan, learned counsel for the petitioner. Also heard Mr. Kitoka Sumi, learned counsel for the respondent no. 2 (R/2) and Mr. Page No.# 2/14 Veto V. Zhimomi, learned Public Prosecutor for the State respondent.
2. The present application under Section 528 of the BNSS has been filed praying for quashing of the impugned FIR dated 28.11.2024, which is registered as Diphupar PS Case No. 74/2024, under Section 406/418 IPC.
3. The petitioner's case is that the R/2, as complainant, lodged an FIR before the Diphupar Police Station on 28.11.2024 alleging that the petitioner had entered into a written agreement cum Memorandum of Understanding on 28.08.2014 with him for execution of a contract work awarded to the petitioner for construction of a 16.65 Km road from NEC road near Upper Hidipi L.P. School to Dhillai Sarihajan road near St. Thomas English School in Bokajan, Karbi Anglong, Assam. The total contract value was Rs. 1,18,96,993/- (Rupees One crore Eighteen Lakhs Ninety-six thousand Nine hundred Ninety-three only).
4. The agreement was executed between the petitioner and the R/2 stating that the R/2 would execute the entire contract work at his own risk and cost, while the petitioner would receive all the payments in his bank account but would promptly release 98% of the payment to the complainant/R/2 and retain the remaining 2% for himself.
5. Thereafter, the R/2 executed the work and the contract was successfully completed. It was alleged in the impugned FIR that the final payment of Rs. 84,95,529/- (Rupees Eighty-four lakhs Ninety-five thousand Five hundred Twenty-nine only) was issued via cheque No. 0065089, by the PWD department, Assam, which was deposited in the Page No.# 3/14 bank account of the petitioner.
6. It was also alleged in the FIR that despite multiple assurances, the petitioner did not release the payment to the R/2. The R/2 also stated in the FIR that he filed Money Suit No. 2/2023 before the Civil Judge (Senior Division), Karbi Anglong at Diphu, Assam and a Complaint Case No. 2/2023 before the Judicial Magistrate, First Class, Dimapur for dishonouring of the cheque issued by the petitioner. The Complaint Case is still pending but the Money Suit was returned by the Civil Judge (Senior Division), Karbi Anglong at Diphu stating that the Court did not have jurisdiction and further directed that the Suit should be filed before the competent court in Dibrugarh, Assam.
7. It was further stated in the FIR that the petitioner had come to Dimapur on 23.09.2024 and a Declaration was executed between the petitioner and the R/2 on 23.09.2024 at Chumoukedima. In the Declaration dated 23.09.2024, the petitioner admitted his liability and agreed that after necessary deduction, the total liability of the petitioner, including the penal interest towards the R/2 since 27.03.2020 was Rs. 1,48,04,336/- (Rupees One crore Forty-eight lakhs Four thousand Three hundred Thirty-six only). However, at the request of the petitioner, the amount was further relaxed to Rs. 1,32,00,000/- (Rupees One crore Thirty-two lakhs only) Further, in the Declaration, the petitioner agreed to make the payment to the R/2 on 15.10.2024. However, the petitioner, again, failed to honour the Declaration and did not discharge his liability. The R/2/complainant, therefore, filed the impugned FIR dated 28.11.2024.
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8. Thereafter, the impugned FIR dated 28.11.2024 was registered as Diphupar P.S Case No. 74/2024 under Section 316(2)/318(3), BNS. Subsequently, on 02.01.2025, the Investigating Officer of the case filed a petition before the learned Judicial Magistrate, First Class, Dimapur praying for alteration of the Section from 316(2)/318(3) BNS to Section 406/418 IPC on the ground that the offence was committed prior to the implementation of the BNS.
9. Accordingly, the learned Judicial Magistrate, First Class, Dimapur was pleased to alter the sections from Section 316(2)/318(3) to Section 406/418 IPC.
10. Learned counsel for the petitioner submits that the FIR has been lodged with ulterior motives and simply to harass the petitioner. He submits that even if taken on their face value, the allegations made in the FIR do not constitute any offence under Section 406/418 IPC.
11. It is also submitted that the contents of the FIR, taken in its entirety, at best makes out a civil dispute for which the remedy lies before the civil court and, therefore, the continuation of the criminal proceedings will be an abuse of the process of law.
12. Learned counsel for the petitioner submits that the entire cause of action arose in Karbi Anglong, Assam as the first agreement between the petitioner and the R/2 was executed on 28.08.2014 in Karbi Anglong, Assam. The payment for the contract work was also made in Assam. Therefore, the Diphupar Police Station does not have the jurisdiction to Page No.# 5/14 register the instant case inasmuch as no cause of action has arisen within the jurisdiction of the Diphupar Police Station. Learned counsel further states that the Investigating Officer, in his petition before the learned Judicial Magistrate, First Class, Dimapur stated that the offence occurred prior to the coming into force of the BNS but in the impugned FIR, the date of occurrence is given as 28.08.2024, and hence, by mentioning that the offence occurred prior to the coming into force of the BNS, it is indicated that the FIR is with regard to the initial cause of action which allegedly arose when the terms of the Agreement dated 28.08.2014 was violated by the petitioner. And if the violation of the said Agreement is taken to be the cause of action, the jurisdiction would lie in the concerned police station at Bokajan, Karbi Anglong and not the Diphupar Police Station. At best, the Diphupar Police Station could have registered a Zero FIR and subsequently transferred the same to the concerned police station.
13. Learned counsel for the petitioner submits that even assuming but not admitting that there was a violation of the contract between the petitioner and the R/2, the R/2 has the remedy of approaching a civil court for specific performance of contract or for recovery of the amount due to him.
14. Learned counsel for the petitioner also submits that Section 406 and 418 IPC cannot co-exist simultaneously in the same set of facts. He submits that in a case of cheating under Section 418 IPC, the intention to cheat has to be present at the very inception when the Agreement was entered into. Whereas, in respect of the offence of criminal breach of trust under Section 406 IPC, the ingredient of the Section is that the accused Page No.# 6/14 person should be in possession of the property or should have dominion over the property and, thereafter converts it to his own use or misappropriates the same. In other words, under Section 406 IPC, the intention develops only later, after the accused is in possession of the property concerned. Relying on the case of Delhi Race Club (1940) Ltd And Others Versus State of Uttar Pradesh And Another reported in 2024 INSC 626, learned counsel submits that both the offences are independent and distinct and the Diphupar Police Station could not have clubbed the two Sections, i.e., 406/418 IPC together.
15. Another submission made by the learned counsel for the petitioner is that even after the FIR was lodged, the petitioner had paid an amount of Rs. 20 Lakhs to the R/2, which has shown that he had no intention of committing any breach of trust and also indicates that there was no intention to cheat at the time when he executed the Declaration on 23.09.2024.
16. Learned counsel, therefore, prays that the impugned FIR dated 28.11.2024 in Diphupar PS Case No. 74/2024 under Section 406/418 IPC should be quashed and set aside by exercising the inherent power of this Court under Section 528 of the BNSS.
17. Learned counsel for the petitioner relies on the following authorities in support of his submissions:
(i) Naresh Kumar And Another Versus The State of Karnataka And Another reported in 2024 INSC 196, Page No.# 7/14
(ii) Paramjeet Batra Versus State of Uttarakhand And Others reported in (2013) 11 SCC 673,
(iii) Delhi Race Club (1940) Ltd. And Others Versus State of Uttar Pradesh And Another reported in 2024 INSC 626.
18. Learned counsel, Mr. Kitoka Sumi appearing for the R/2 submits that the argument of the petitioner regarding the jurisdiction of the Diphupar Police Station has not been raised in the petition and it is not the pleaded case of the petitioner and, therefore, this Court may not take the same into consideration. Learned counsel also submits that the Declaration dated 23.09.2024 is a subsequent cause of action which arose within the jurisdiction of the Diphupar Police Station and in the Declaration dated 23.09.2024, the entire sequence of events starting from 2014, with regard to the award of the Work Order, the execution of the agreement between the parties, and the payment of the contract amount have all been taken into consideration. Learned counsel, therefore, submits that the Declaration dated 23.09.2024 is simply a continuation of the first cause of action, i.e., the violation of the Agreement dated 28.08.2014 between him and the petitioner and therefore the Diphupar P.S has the jurisdiction.
19. Learned counsel has taken the Court to the Agreement cum Memorandum of Understanding dated 28.08.2014, which was executed between the petitioner and the R/2. In the said Agreement dated 28.08.2014, the petitioner being the first party has declared that as and when payments would be released in his favour by the PWD Department against the work executed by the second party/R/2, the same would be deposited in his account and, immediately after clearance of payment, the same would be reimbursed to the R/2, subject to the deduction of 2% Page No.# 8/14 from all such payments as his share of the commission. It was also agreed between the parties that the R/2 shall execute the work by inducting necessary finance and manpower of his own. It was further declared that the R/2 is entitled to receive 98% of the payments against the contract value. Learned counsel, therefore, submits that the ingredients of the offence of criminal breach of trust under Section 405 IPC punishable under Section 406 IPC is clearly present in the instant case. He has submitted that the ingredients of Section 405 IPC has arisen when the contract amount was credited in the account of the petitioner but he converted it to his own use and misappropriated the same. Learned counsel, relying on the case of M. Krishnan Versus Vijay Singh And Another reported in (2001)8 SCC 645, submits that in all cases of cheating and fraud there is generally some element of civil nature. If mere pendency of a suit is made a ground for quashing the criminal proceedings, the unscrupulous litigants apprehending criminal action against them would be encouraged to frustrate the grounds of justice and law by filing suits.
20. Learned counsel also states that an act can result in both civil and criminal liability. Therefore, merely because the act has civil liability does not mean that it cannot also have criminal liability. Even if a civil remedy is availed, he is not precluded from setting in motion proceedings under criminal law. Learned counsel also submits that the test to be applied in a petition under Section 482 CrPC/528 BNSS is whether allegations in the complaint prima facie establish the ingredients of the offence alleged. And in such proceedings, this Court cannot test the veracity of the allegations nor proceed in a manner that a judge conducting a trial would, on the basis of evidence collected during trial.
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21. Learned counsel, accordingly, submits that the petitioner has not been able to make out a case warranting the interference of this Court under Section 528 BNSS and prays that the petition may be dismissed with cost.
22. Learned counsel has relied on the following authorities in support of his case:
(i) M. Krishnan Versus Vijay Singh And Another reported in (2001) 8 SCC 645,
(ii) Vitoori Pradeep Kumar Versus Kaisula Dharmaiah And Others reported in (2002) 9 SCC 581,
(iii) N. Devindrappa Versus State of Karnataka reported in (2007) 5 SCC 228,
(iv) K. Jagadish Versus Udaya Kumar G.S. And Another reported in (2020) 14 SCC 552,
(v) Jitul Jentilal Kotecha Versus State of Gujarat reported in (2022) 13 SCC 652,
23. This Court has given due consideration to the submissions made by the opposing counsels and has also perused the pleadings as well as the Case Diary, which is produced by the learned Public Prosecutor.
24. The Hon'ble Apex Court in the case of State of Haryana Versus Bhajanlal, reported in 1992 Supp (1) 335, has established definitive guidelines for quashing FIRs under Article 226 or Section 482 CrPC, ruling that such powers should be used sparingly to prevent abuse of process or miscarriage of justice. The Apex Court laid down 7 specific criteria as to when an FIR or investigation may be quashed, primarily focusing on cases Page No.# 10/14 where allegations are absurd, inherently improbable, or maliciously instituted with ulterior motives.
25. The law is well settled that if the allegations, taken at face value make out ingredients of a cognizable offence, quashing cannot be done. The Court should not examine the probability of conviction at this stage. Unless the case falls within the seven "Bhajan Lal" criteria, this Court cannot cut short a legitimate prosecution.
26. Upon going through the sequence of events in the present case, this Court finds that the initial cause of action arose in the year 2020, when the petitioner violated the terms of the Agreement executed between him and the R/2 on 28.08.2014. Initially the R/2 instituted a Money Suit No. 2/2023 before the Civil Judge (Senior Division), Diphu, Assam. However, after the trial was completed, the plaint was returned to the R/2 to be filed before the appropriate court at Dibrugarh, Assam. It is seen that the petitioner had also issued two cheques for Rs. 10 Lakhs and Rs. 15 Lakhs respectively to the R/2, however, the cheques were dishonoured and, therefore, another Complaint Case No. 2/2023 was filed by the R/2, which is pending disposal before the learned Judicial magistrate, First Class, Dimapur. The petitioner, in his statement before the Investigating Officer, has also admitted that he gave two cheques of Rs. 10 lakhs and Rs. 15 lakhs to the R/2 which had bounced. He also admitted the execution of the Agreement between him and the R/2 in the year 2014 with regard to the construction of a road under the PWD Department, Assam worth Rs. 1,18,96,993/- (Rupees One Crore Eighteen Lakhs Ninety-six thousand Nine hundred Ninety-three only).
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27. Thereafter, as the petitioner did not honour the terms of the Agreement dated 28.08.2014, the petitioner and the R/2 again executed a Declaration Agreement in Chumoukedima on 23.09.2024.
28. On going through the contents of the Declaration dated 23.09.2024, it is observed that the Declaration dated 23.09.2024 is merely a replication and continuation of the first Agreement entered into between the parties in 2014.
29. In respect of jurisdiction it is the view of this Court that if a subsequent event related to the first offence takes place within a new jurisdiction, that police station becomes authorized to take cognizance and begin investigation. In Satvinder Kaur versus State (Govt. of NCT of Delhi), reported in 1999(8) SCC 728, the Hon'ble Supreme Court held:
"12. A reading of the aforesaid sections would make it clear that Section 177 provides for "ordinary" place of enquiry or trial. Section 178, inter alia, provides for place of enquiry or trial when it is uncertain in which of several local areas an offence was committed or where the offence was committed partly in one local area and partly in another and where it consisted of several acts done in different local areas, it could be enquired into or tried by a court having jurisdiction over any of such local areas. Hence, at the stage of investigation, it cannot be held that the SHO does not have territorial jurisdiction to investigate the crime."
It was further stated that:
"15. Hence, in the present case, the High Court committed a grave error in accepting the contention of the respondent that the investigating officer had no jurisdiction to investigate the matters on the alleged ground that no part of the offence was committed within the territorial jurisdiction of the police station at Delhi. The appreciation of the evidence is the function of the courts when seized of the matter. At the stage of investigation, the material collected by an investigating officer cannot be judicially scrutinized for arriving at a conclusion that the police station officer of a particular police station would not have territorial jurisdiction. In any case, it has to be stated that in view of Section 178(c) of the Criminal Procedure Code, when it is uncertain in which of the several Page No.# 12/14 local areas an offence was committed, or where it consists of several acts done in different local areas, the said offence can be enquired into or tried by a court having jurisdiction over any of such local areas. Therefore, to say at the stage of investigation that the SHO, Police Station Paschim Vihar, New Delhi was not having territorial jurisdiction, is on the face of it, illegal and erroneous. That apart, Section 156(2) contains an embargo that no proceeding of a police officer shall be challenged on the ground that he has no territorial power to investigate. The High Court has completely overlooked the said embargo when it entertained the petition of Respondent 2 on the ground of want of territorial jurisdiction."
This view was reiterated in Naresh Kavarchand Khatri Versus State of Gujarat, reported in (2008) 8 SCC 300. Applying the decision of the Hon'ble Supreme Court in the cases aforementioned to the facts of the present case, the second police station, i.e., the Diphupar Police Station is within its jurisdiction to initiate the investigation process upon a subsequent cause of action arising out of the first offence.
30. This Court has also examined the Declaration dated 23.09.2024 and the Agreement dated 28.08.2014. Section 405 IPC defines the offence of criminal breach of trust as under:
'405. Criminal breach of trust. - Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits "criminal breach of trust".'
31. Entrustment is the first and foundational element, without entrustment the offence of Section 405 IPC cannot be made out. The entrustment may arise through an express contract, implied relationship or by operation of law. Entrustment means the owner or lawful possessor Page No.# 13/14 has voluntarily placed property under the care or control of the accused. Once entrusted the accused must dishonestly misappropriate the entrusted property or convert it to his own use. Using the property in violation of a contract or agreement is equally significant. As per State of Gujarat Versus Jaswantlal Nathulal, reported in AIR 1968 SC 700, entrustment is the sine qua non of the offence under Section 405 IPC.
32. Thus, criminal breach of trust requires entrustment and subsequent dishonest conversion to own use. Upon considering the offence in the light of the definition of Section 405 IPC, this Court is of the view that a prima facie case arose the moment the contract amount was deposited in the account of the petitioner and he did not transfer the same to the R/2. The contract amount having been deposited in the account of the petitioner, the same had been entrusted to him and he had dominion and possession over the said contract amount, and the petitioner had converted the same to his own use. In cases of breach of trust, there is always the likelihood of elements of civil nature as well as criminal liability. Merely because a certain transaction has civil liability does not mean that it cannot also have criminal ingredients. And, therefore, this Court is of the opinion that there is a prima facie case under Section 405/406 IPC in the instant case.
33. The question as to whether Section 418 IPC could have been registered against the petitioner along with Section 406 IPC, and whether Section 418 IPC is to be dropped in the light of Delhi Race Club (1940) Ltd (supra), will be dealt with by the learned Trial Court at the appropriate stage.
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34. What has emerged from the discussion hereinabove is that this Court should be slow in interfering with the proceedings at the initial stage in an application under Sec 482 CrPC/Section 528 of the BNSS. In the case of Jitul Jentilal (Supra) the Hon'ble Supreme Court has opined that the High Court must exercise its inherent powers under Section 482 CrPC sparingly and with circumspection.
35. In view of the above observations, this Court is of the view that the ingredients of offence under Section 405 IPC are prima facie present in the instant case and, for the reasons aforementioned, this Court finds that the petitioner has not been able to make out a case warranting the interference of this Court under Section 528 BNSS and, therefore, the petition is dismissed.
36. Petition is disposed of.
Registry is directed to return the Case Diary to the learned Public Prosecutor.
JUDGE Comparing Assistant