JUDGMENT /COMMON ORDER : Criminal Petition No.5568 of 2020 under Section 482 of Code of Criminal Procedure, 1973 (for short 'Cr.P.C.'), has been filed by the petitioners/accused Nos.1 and 2, seeking quashment of the proceedings against them in Crime No.216 of 2020 on the file of Amaravati Police Station, Guntur District registered for the offence under Section 420 read with 34 of the Indian Penal Code 1860 (for short 'IPC'). Criminal Petition No.5569 of 2020 under Section 482 of Cr.P.C., has been filed by the petitioners/accused Nos.1 and 2, seeking quashment of the proceedings against them in Crime No.217 of 2020 on the file of Amaravati Police Station, Guntur District registered for the offence under Section 420 read with 34 of IPC. Criminal Petition No.5568 of 2020 : 2. The contents of the complaint, in brief, are as follows : (a) Petitioner/accused No.1, who is the Proprietor of M/s. Sri Sai Lalitha Devi Poultry had taken a term loan of Rs.32,64,000/- on 04.02.2011 under Loan Account No.3106459099 and a Crop loan of Rs.5,00,000/- on 27.08.2012 under Loan Account No.3198965585 from Central Bank of India, Lakshmipuram Branch, Guntur by depositing his property documents and the petitioner/accused No.2, Sri Modepalli Venkateswarlu and Smt. Modepalli Padmavathi stood as guarantors for the said loans. (b) Petitioner/accused No.1 had executed two registered mortgage deeds vide Doc.Nos.134/2011 and 1940/2012. (c) Respondent-Bank came to know that the petitioner/accused No.1 sold the mortgaged property of an extent of Ac.1.30 cents in Sy.No.475/43 of Muthayapalem, to the Government of A.P., by executing a Form G-III agreement and as such, they approached the Tahsildar, Amaravati and Revenue Divisional Officer, Guntur for initiation of necessary action and requested to stop the payment of sale proceeds to the petitioner/accused No.1. (d) RDO Office provided the respondent-Bank the copies of Form G-III executed between the Government of A.P. and petitioner/accused No.1 and bank payment details to which the sale proceeds were credited. However, respondent-Bank has not received any further communication from either of the two offices on the course of action taken on this incident. (d) RDO Office provided the respondent-Bank the copies of Form G-III executed between the Government of A.P. and petitioner/accused No.1 and bank payment details to which the sale proceeds were credited. However, respondent-Bank has not received any further communication from either of the two offices on the course of action taken on this incident. (e) Petitioner/accused No.1 sold the said mortgaged property to the Government of A.P., without the knowledge of respondent-Bank and without getting the mortgage deed released, which was held by the Bank as a security towards the entire loan facility and thereby cheated respondent-Bank and the Government of A.P. (f) As such, respondent-Bank lodged a complaint against petitioners/accused Nos.1 and 2, which was registered as a case in Crime No.216 of 2020 for the offence under Section 420 read with 34 IPC. Criminal Petition No.5569 of 2020 : 3. The contents of the complaint, in brief, are as follows : (a) Petitioner/accused No.1, who is the Proprietor of M/s. Sri Hanuman Poultry Farms had taken a term loan of Rs.32,27,000/- on 04.02.2011 under Loan Account No.3106457069 and a Crop loan of Rs.5,00,000/- on 27.08.2012 under Loan Account No.3198960224 from Central Bank of India Lakshmipuram Branch, Guntur by depositing his property documents and the petitioner/ accused No.2 and Sri Modepalli Venkateswarlu stood as guarantors for the said loans. (b) Petitioner/accused No.1 had executed two registered mortgage deeds vide Doc.Nos.135/2011 and 1941/2012. (c) Respondent-Bank came to know that the petitioner/accused No.1 sold the mortgaged property of an extent of Ac.1.60 cents in Sy.No.475/43 of Muthayapalem, to the Government of A.P. by executing a Form G-III agreement and as such, they approached the Tahsildar, Amaravati and Revenue Divisional Officer, Guntur for initiation of necessary action and requested to stop the payment of sale proceeds to the petitioner/accused No.1. (d) RDO office provided the respondent-Bank the copies of Form G-III executed between the Government of A.P. and petitioner/accused No.1 and bank payment details to which the sale proceeds were credited. However, respondent-Bank has not received any further communication from either of the two offices on the course of action taken on this incident. (d) RDO office provided the respondent-Bank the copies of Form G-III executed between the Government of A.P. and petitioner/accused No.1 and bank payment details to which the sale proceeds were credited. However, respondent-Bank has not received any further communication from either of the two offices on the course of action taken on this incident. (e) Petitioner/accused No.1 sold the said mortgaged property to the Government of A.P. without the knowledge of respondent-Bank and without getting the mortgage deed released, which was held by the Bank as a security towards the entire loan facility and thereby cheated respondent-Bank and the Government of A.P. (f) As such, respondent-Bank lodged a complaint against petitioners/accused Nos.1 and 2, which was registered as a case in Crime No.217 of 2020 for the offence under Section 420 read with 34 IPC. Grounds sought for quashment : 4. Aggrieved by the registration of the above cases against them, petitioners/accused Nos.1 and 2 filed the present petitions seeking quashment of the proceedings against them in both the Crimes, on the following grounds : (i) The allegations levelled by respondent No.2 are not sustainable either in law or on facts. (ii) The petitioner/accused No.1 in both the petitions was unable to resist the acquisition of his land by the Government of A.P. under "Navaratnalu" Scheme. However, on 13.07.2020 petitioner/accused No.1 had cleared the loan irrespective of OTA benefits and paid the entire outstanding amount to respondent-Bank and informed the said fact to the Police and requested to drop the proceedings. However, the present criminal proceedings were not stopped. (iii) There is no question of cheating the Bank since the petitioners are not disputing the availment of loan. Under compelling circumstances, since the petitioner/accused No.1 had no alternative way to safeguard the property, he accepted to surrender his land to the Government. (iv) The land acquisition proceedings are totally different to that of a private sale transaction entered with a private party. 5. Respondent No.2 filed counter in Criminal Petition No.5568 of 2020 by denying the averments made in the petition and by reiterating the contents of the complaint. Arguments Advanced at the Bar 6. Heard Sri P.S.P. Suresh Kumar, learned Counsel for the petitioners. Ms. D. Prasanna Lakshmi, learned Assistant Public Prosecutor for the respondent No.1/State and Sri Dhara Satyanarayana, learned Counsel for respondent No.2 in both the criminal petitions. 7. Arguments Advanced at the Bar 6. Heard Sri P.S.P. Suresh Kumar, learned Counsel for the petitioners. Ms. D. Prasanna Lakshmi, learned Assistant Public Prosecutor for the respondent No.1/State and Sri Dhara Satyanarayana, learned Counsel for respondent No.2 in both the criminal petitions. 7. Learned Counsel for the petitioners would submit that petitioner/accused No.1 in both the petitions had obtained loans from respondent-Bank and petitioner/accused No.2 in both the petitions stood as guarantor for the said loans. It is submitted that due to COVID-19 situation. petitioner/accused No.1 could not pay the E.M.Is., of the loan amount as such, the respondent-Bank introduced OTS Scheme, which was valid upto 30.09.2020. Learned Counsel for the petitioners would submit that the Government of A.P. had initiated distribution of land to the poor people and the scheme of 'Navaratnalu' and had notified the land of petitioner/accused No.1 in both the petitions and initiated land acquisition proceedings. Petitioner/accused No.1 had approached respondent-Bank to clear the loan amount under OTS Scheme. It is further submitted that the Revenue Authorities had obtained the signatures of the petitioner/accused No.1 on Form G-III to surrender the land. Learned Counsel would further submit that petitioner/accused No.1 on 13.07.2020 irrespective of OTS benefits had paid the entire outstanding loan amount to respondent-Bank and requested to drop the criminal proceedings. It is submitted that the petitioner never cheated the Bank and there are no grounds to attract the offence under Section 420 read with 34 IPC against the petitioners in both the petitions. Hence, prayed for quashment of proceedings against the petitioners/accused Nos.1 and 2 in both the crimes. 8. Learned Counsel for respondent No.2 would submit that inspite of giving several opportunities to the petitioner/accused No.1 in both the criminal petitions to discharge the loan amount under OTS Scheme, he failed to comply with the same and as such, the OTS Scheme had become infructuous. Learned Counsel further submits that petitioner/accused No.1 without disclosing the fact of mortgage of his property to the respondent-Bank, offered the same to the Government of A.P. in land acquisition, which is against law. There are specific allegations against the petitioners which would attract the offence alleged against them. Hence, prayed for dismissal of the petitions. 9. Learned Assistant Public Prosecutor conceded to the arguments advanced by the learned Counsel for respondent No.2. Point for determination : 10. There are specific allegations against the petitioners which would attract the offence alleged against them. Hence, prayed for dismissal of the petitions. 9. Learned Assistant Public Prosecutor conceded to the arguments advanced by the learned Counsel for respondent No.2. Point for determination : 10. Having heard the submissions of the learned Counsel representing both the parties, now the point that would emerge for determination is : Whether there are any justifiable grounds for quashment of the proceedings against the petitioners in Crime Nos.216 and 217 of 2020 on the file of Amaravati Police Station, Guntur District for the offence under Section 420 read with 34 IPC? Determination by the Court : 11. A bare perusal of Section 482 makes it clear that the Code envisages that inherent powers of the High Court are not limited or affected so as to make orders as may be necessary : (i) to give effect to any order under the Code or, (ii) to prevent abuse of the process of any Court or, otherwise (iii) to secure ends of justice. A Court while sitting in Section 482 jurisdiction is not functioning as a Trial Court, Court of appeal or a Court of revision. It must exercise its powers to do real and substantial justice, depending on the facts and circumstances of the case. These powers must be invoked for compelling reasons of abuse of process of law or glaring injustice, which are against sound principles of criminal jurisprudence. Where the ingredients required to constitute a criminal offence are not made out from a bare reading of the complaint, the continuation of the criminal proceeding will constitute an abuse of the process of the Court. 12. Specific circumstances warranting the invocation of the provision must be present. The decision rendered by the Hon'ble Apex Court in State of Haryana and others v. Bhajanlal and others, AIR 1992 SC 604 , is considered as the guiding torch in the application of Section 482 Cr.P.C. At Paras 102 and 103, the circumstances are spelt out as follows: "102. Specific circumstances warranting the invocation of the provision must be present. The decision rendered by the Hon'ble Apex Court in State of Haryana and others v. Bhajanlal and others, AIR 1992 SC 604 , is considered as the guiding torch in the application of Section 482 Cr.P.C. At Paras 102 and 103, the circumstances are spelt out as follows: "102. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter-XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any Court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised. (1) Where the allegations made in the First Information Report or the complaint, even if they are 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. (2) Where the allegations in the First Information Report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code. (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. (4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. (4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. (5) Where the allegations made In the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge. 103. We also give a note of caution to the effect that the power of guashing a criminal proceeding should be exercised very sparingly and with circumspection and that too in the rarest of rare cases; that the Court will not be justified in embarking upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR or the complaint and that the extraordinary or inherent powers do not confer an arbitrary jurisdiction on the Court to act according to its whim or caprice." (Emphasis supplied) 13. In the case on hand, it is alleged that, petitioner/accused No.1 in both the criminal petitions had obtained a term loan of Rs.32,64,000/- and Rs.32,27,000/- respectively on 04.02.2011 and a Crop loan of Rs.5,00,000/- each on 27.08.2012 from respondent-Bank by depositing their property documents and the petitioner/accused No.2 in both the criminal petitions stood said loans. Thereafter, petitioner/accused No.1 in both the petitions, by suppressing the mortgage of the properties with respondent-Bank, handed over the said properties to Government of A.P. under land acquisition for 'Navaratnalu' Scheme and thereby cheated respondent-Bank and the Government of Andhra Pradesh. 14. A bare perusal of the material on record would clearly show that there was exchange of notices between petitioners/accused No.1 in both the petitions respondent-Bank. 14. A bare perusal of the material on record would clearly show that there was exchange of notices between petitioners/accused No.1 in both the petitions respondent-Bank. There is no dispute of availment of above-mentioned loans by the petitioner/accused No.1 from respondent-Bank by mortgaging their properties. It is the contention of the learned Counsel for the petitioners that due to COVID-19 situation, petitioner/accused No.1 could not pay the EMIs of the loan amount. In such circumstances respondent-Bank issued a Circular on 22.05.2020 to accept OTS Scheme and the same was valid upto 30.09.2020. It is No.1 tried to repay the OTS Scheme, the respondent-Bank dragged the matter. In the meanwhile, Government of A.P. had initiated the distribution of lands to the poor people under 'Navaratnalu' Scheme and notified the land of petitioner/accused No.1 and issued the land acquisition proceedings. The petitioner/ accused No.1 could not resist the taking of the land by the Revenue Authorities and surrendered the land as per the provisions of Land Acquisition Act, 2013 and also under G.O. Ms. No.487, dated 29.11.2019. However, on 13.07.2020 the petitioner/accused No.1 in both the petitions irrespective of the OTS benefits, paid the entire outstanding amount to respondent-Bank. 15. A fair look at the legal notice dated 11.08.2020 issued by the petitioners/accused No.1 clearly shows that the petitioners/accused No.1 have paid the entire loan amount irrespective of the OTS Scheme and the same was admitted by respondent-Bank in its reply. However, respondent-Bank filed the present complaints on the allegation that, by suppressing the fact of mortgage of the properties, petitioner/accused No.1 had given his land to the Government of A.P. under land acquisition scheme and thereby cheated the Bank. 16. At this juncture it is relevant to refer to Sections 415 and 420 IPC which read as follows : "415. Cheating.-Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to "cheat". 420. 420. Cheating and dishonestly inducing delivery of property.-Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine." 17. In A.M. Mohan v. State Represented by SHO and another, 2024 INSC 233 , the Hon'ble Apex Court culled out the necessary ingredients under these sections as follows; "13. It could thus be seen that for attracting the provision of Section 420 of IPC, the FIR/complaint must show that the ingredients of Section 415 of IPC are made out and the person cheated must have been dishonestly induced to deliver the property to any person; or to make, alter or destroy valuable security or anything signed or sealed and capable of being converted into valuable security. In other words, for attracting the provisions of Section 420 of IPC, it must be shown that the FIR/complaint discloses : (i) the deception of any person; (ii) fraudulently or dishonestly inducing that person to deliver any property to any person; and (iii) dishonest intention of the accused at the time of making the inducement." (Emphasis supplied) 18. Perusal of the above sections would reveal that, to hold a person guilty of the offence of cheating, it has to be shown that his intention was dishonest at the time of making the promise. In the present case, the material available on record would show that there was no intention of the petitioners from the inception to cheat respondent-Bank. It is not the case of respondent-Bank that the petitioner/accused No.1 had received the land acquisition amount and not repaid the loan amount. Since the petitioner/accused No.1 have discharged the entire loan amount and nothing is due to respondent-Bank, the criminal liability cannot be attributed to petitioner/accused No.2 in both the criminal petitions, who the guarantors of the loan availed by petitioner/accused No.1. Even if the allegations made in the complaints are taken at their face value and accepted in their entirety, they do not prima facie constitute any offence or make out a case against the petitioners/accused Nos.1 and 2 in both the petitions. Even if the allegations made in the complaints are taken at their face value and accepted in their entirety, they do not prima facie constitute any offence or make out a case against the petitioners/accused Nos.1 and 2 in both the petitions. In such circumstances, this Court is of the view that there are no tenable grounds to continue the proceedings against the petitioners/accused Nos.1 and 2 in both the criminal petitions and as such, the same are liable to be quashed. 19. Accordingly, Criminal Petition Nos.5568 and 5569 of 2020 are allowed quashing the proceedings against the petitioners/accused Nos.1 and 2 in Crime Nos.216 and 217 of 2020 on the file of Amaravati Police Station respectively, for the offence under Section 420 read with 34 IPC. 20. Pending miscellaneous petitions, if any, shall stand closed.