The Allahabad High Court has quashed criminal proceedings against four members of a Bijnor family accused of criminal breach of trust and conspiracy in a land-related loan dispute. The bench of Justice Vikram D. Chauhan delivered the order on 3 September 2025, bringing relief to the applicants after an eight-year legal battle.
Background
The case began in March 2017, when a complaint was lodged by Manju Tyagi at Badhapur police station. She alleged that Shivam Agarwal and his family had purchased agricultural land from her and her relatives, agreeing to clear an outstanding loan of ₹9.65 lakh linked to the property. According to the complaint, the buyers failed to pay the amount, leaving the sellers to face bank notices.
The police investigated and filed a charge sheet in June 2017 under Sections 406 (criminal breach of trust) and 120-B (criminal conspiracy) of the IPC. Cognizance was taken by the trial court later that year.
The Agarwal family, however, maintained that they had been misled about the loan at the time of agreement and later settled it with Punjab National Bank under a One-Time Settlement (OTS) scheme in 2018. They produced bank receipts, settlement documents, and a "no dues" certificate to prove repayment.
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Court's Observations
Justice Chauhan carefully examined whether the allegations amounted to a criminal offence. The court noted that the land was sold through registered sale deeds in 2015, and the buyers had indeed taken responsibility to repay the loan. However, crucially, there was no fixed time frame mentioned in the deed for repayment.
The Judge observed,
"The sale of the property does not create any trust between the seller and the purchaser. If any condition of the sale contract is violated, the liability would be civil in nature, not criminal."
Citing past Supreme Court precedents, the bench stressed that a mere failure to fulfill a contractual obligation cannot automatically be treated as criminal breach of trust. Since the applicants had already cleared the dues and obtained official clearance from the bank, there was no dishonest intent established.
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Decision
Concluding that the dispute was contractual rather than criminal, the High Court quashed the charge sheet and all related proceedings in Criminal Case No. 1702 of 2017.
The order firmly stated:
"In view of the facts and circumstances, the present application is allowed and the criminal proceedings… are hereby quashed."
With this decision, the court closed the matter, effectively ending years of litigation for the Agarwal family.
Case Title: Shivam and 3 Others vs State of U.P. and Another
Case Number: Application U/S 482 No. 15400 of 2018
