In Brief
Delhi Race Club, a company that purchased horse feed from a supplier, was accused of criminal breach of trust and cheating when it failed to pay invoices totalling Rs. 9.11 lakhs. The magistrate issued summons and the High Court upheld this. The Supreme Court allowed the appeal, setting aside both orders. The Court held that a sale of goods cannot constitute criminal breach of trust as property passes to the buyer and ownership is not retained by the seller. Cheating requires fraudulent inducement at transaction inception, which was absent here. The dispute is purely civil in nature, requiring a civil suit for recovery, not criminal prosecution. Courts must meticulously examine private complaints to determine if specific offence ingredients are genuinely disclosed.
The lawyer headnote and full judgment text are available to registered users.