In a significant ruling on the misuse of criminal law in business disputes, the Calcutta High Court has quashed criminal proceedings against a small poultry feed trader accused of cheating his supplier of ₹40 lakh.
Justice Ajay Kumar Gupta held that a disagreement over unpaid dues, by itself, does not amount to cheating or criminal breach of trust. “Merely because payment has not been made or accounts have not been settled, it does not constitute offences,” the Court observed while allowing the revision petition.
Read also:- Bombay HC Disposes Unmarried Woman’s Abortion Plea, Cites Supreme Court Ruling on MTP Rights
Background of the Case
The case arose from a long-standing business relationship between Pradyut Samanta, who runs a poultry feed shop under the name Loknath Feed Centre, and his supplier.
According to court records, the business dealings between the two began in 2012 and continued smoothly for several years. During the financial year 2013–14 alone, transactions between them crossed ₹1 crore. Payments were made in cash, through cheques, and via bank transfers.
The dispute surfaced when the supplier claimed that around ₹40 lakh was outstanding for over a year and lodged a police complaint at Arambagh Police Station in 2016. An FIR was registered under Sections 406 (criminal breach of trust) and 420 (cheating) of the Indian Penal Code.
Samanta was picked up by police at night, later released on bail, and eventually charge-sheeted.
He moved the High Court seeking quashing of the criminal case, arguing that the dispute was purely commercial and should not have been given a criminal colour.
Read also:- Calcutta High Court Refuses to Quash Forgery Case Linked to 1963 Land Deed, Orders Police Prob
Arguments Before the Court
Counsel for the petitioner argued that the transactions were entirely business-related. Payments had been made regularly over the years, including the last payment in July 2016. If any amount remained unpaid, the proper remedy was a civil suit for recovery - not a criminal prosecution.
The lawyer contended that the complaint was an attempt to “convert alleged breach of contractual obligations into a criminal complaint.”
On the other hand, the State argued that dues remained unpaid despite assurances and that sufficient materials were collected during investigation to make out a prima facie case under Sections 406 and 420 IPC.
Notably, the complainant supplier did not appear during the final hearing.
Read also:- Bombay High Court Flags Flawed Tree-Felling Notices, Closes Pune Coconut Trees Case
Court’s Observations
Justice Gupta closely examined whether the basic ingredients of cheating were present. For an offence under Section 420 IPC, the Court noted, there must be dishonest intention at the very beginning of the transaction.
Citing Supreme Court precedents, the Court reiterated that failure to fulfil a promise later does not automatically mean the promise was made with fraudulent intent.
“There is nothing in the complaint to show that the petitioner had dishonest or fraudulent intention at the time of the transaction,” the Court said.
The judge pointed out that business between the parties continued for years and payments were made from time to time. Even assuming some amount remained due, that would give rise to a civil dispute — not a criminal offence.
The Court also referred to earlier rulings of the Supreme Court, which have consistently drawn a distinction between breach of contract and cheating. Criminal law, it stressed, should not be used as a pressure tactic in commercial disagreements.
“It was purely business transactions of a civil nature,” the bench observed, adding that allowing the prosecution to continue would amount to an abuse of the process of law.
Read also:- Kerala High Court Orders Probe Into ₹14 Lakh Sabarimala Staff Transfers During Mandala
The Decision
Allowing the criminal revision petition, the High Court quashed the proceedings arising out of Arambagh P.S. Case No. 1066 of 2016.
The criminal case pending before the Additional Chief Judicial Magistrate at Arambagh under Sections 406 and 420 IPC was set aside insofar as it concerned the petitioner.
All connected applications were also disposed of, and interim orders stood vacated.
With that, the Court brought the criminal proceedings to an end.
Case Title: Pradyut Samanta vs The State of West Bengal & Another
Case No.: C.R.R. 933 of 2017
Decision Date: 11 February 2026
