Criminal Case Quashed for Lack of Entrustment: Why Loan Recovery Cannot Trigger Section 406 IPC

Satishchandra Ratanlal Shah Vs State of Gujarat And Another (Supreme Court of India)

Civil Loan Default ≠ Criminal Offence — Mere Non-Repayment of Loan Does Not Attract Sections 406/420 IPC: Criminal Law Cannot Be Used to Recover Civil Debt: Supreme Court Quashes FIR

Facts

• Complainant (Director of a money-lending company) gave a loan of Rs. 27 lakh to the Appellant (retired bank employee) in January 2008.
• Loan not repaid; complainant alleges threats when demanding repayment.
• FIR registered in 2012 under Sections 406,

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