In Brief
A depositor of Rs. 55,000 with a company sought criminal prosecution under IPC Sections 420, 406, 409, and 120B when the company failed to refund the amount following its liquidation. The Metropolitan Magistrate, Additional Sessions Judge, and High Court all dismissed the complaint, finding no evidence of dishonest intent at inception. The Supreme Court affirmed this dismissal, holding that non-refund by a company in liquidation does not automatically constitute criminal cheating without proof of fraud from the outset. The court, sympathetic to the elderly appellant's plight, persuaded the ex-directors to refund Rs. 3,00,000 including principal, interest, and costs.
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