The Supreme Court of India, in a significant ruling, has quashed criminal proceedings under Section 420 of the Indian Penal Code (IPC), holding that an offence of cheating is not made out if the alleged false representation was not a material fact that could have induced the complainant to act. A bench comprising Justice B.V. Nagarathna and Justice Joymalya Bagchi set aside an order of the High Court of Andhra Pradesh, which had refused to quash a criminal case against an office-bearer of an educational society accused of using a forged fire safety No-Objection Certificate (NOC).
Case Background
The case originated from a written complaint filed on July 13, 2018, by the District Fire Officer of Kurnool. The complaint alleged that Jupally Lakshmikantha Reddy’s educational society, JVRR Education Society, had obtained a recognition certificate from the School Education Department by submitting a forged NOC purportedly issued by the Assistant District Fire Officer, Kurnool.
Following the complaint, a First Information Report (FIR) was registered under Sections 420 (Cheating), 465 (Forgery), 468 (Forgery for purpose of cheating), and 471 (Using as genuine a forged document) of the IPC. However, upon conclusion of the investigation, a chargesheet was filed solely under Section 420 IPC. The chargesheet alleged that the appellant had created and used a forged NOC to “play fraud on the Education Department and District Fire Office, Kurnool.”
Crucially, the educational institution was run from a building with a height of 14.20 metres. According to Rule 4.6.1.4 of the National Building Code of India, 2016, an NOC from the Fire Department is not necessary for educational buildings below 15 metres in height.
Prior to the criminal complaint, the appellant’s society had successfully instituted writ proceedings (WP No. 14542/2018) before the High Court. By an order dated April 25, 2018, the High Court had directed the Education Department to renew the society’s affiliation without insisting on a fire NOC. The appellant contended that the criminal case was initiated as a “counter-blast” after contempt proceedings were initiated against the Education and Fire Departments for non-compliance with the High Court’s directions.
Despite these facts, the High Court of Andhra Pradesh, in its order dated April 18, 2024, dismissed the appellant’s petition to quash the proceedings, stating that the issue of whether the NOC was required was a matter for trial. This led to the present appeal before the Supreme Court.
Court’s Analysis and Findings
The Supreme Court undertook a detailed examination of the essential ingredients of the offence of cheating as defined under Section 415 of the IPC. The judgment, authored by Justice Joymalya Bagchi, emphasized that deception by itself is insufficient to constitute cheating.
The Court observed, “To attract penal consequences, it must be shown that the false representation was of a material fact which had induced the victim to either part with property or act in a manner which they would not otherwise do but for such false representation.”
Applying this principle, the bench found that since the fire NOC was not legally required for the renewal of affiliation, the submission of an allegedly forged NOC could not be said to have “induced” the Education Department to grant the recognition. The Court stated, “In the absence of such vital link between the alleged false representation and the issuance of recognition/renewal of affiliation, the essential ingredient of offence is not satisfied.”
The bench cited its previous decision in Dr. Sharma’s Nursing Home v. Delhi Admn. & Ors., which held that “mere deception by itself would not constitute cheating unless the other essential ingredient, i.e., dishonest inducement is established.”
The Court also rejected the respondent’s argument that offences related to forgery were made out. Referring to Section 465 IPC (Punishment for forgery), the bench noted that a sine qua non for the offence is that the accused must have manufactured the fake document. In this case, there was no material connecting the appellant to the making of the document, and the original fabricated document had not even been recovered.
Similarly, the Court held that offences under Sections 468 and 471 IPC were not attracted because the requisite mens rea—a dishonest intention to cause wrongful loss or gain—was absent. Since the recognition was not dependent on the production of the NOC, there could be no such dishonest intention.
Decision
Concluding its analysis, the Supreme Court held that the High Court had failed to consider these critical legal aspects. The bench ruled that the uncontroverted allegations in the chargesheet, when read in light of the High Court’s own earlier order in the writ petition, did not disclose the essential ingredients of either cheating or forgery.
“Accordingly, we set aside the impugned order of the High Court, quash the proceedings in CC No. 303/2020 under Section 420 IPC and allow the appeal,” the Court ordered.
