Cheating and Criminal Breach of Trust Can't Co-Exist on Same Facts: Andhra Pradesh High Court Grants Bail to Retired Forest Official Accused Under BNS

“Where entrustment is alleged, there can be no simultaneous allegation of fraudulent inducement,”  In a significant interpretation of the Bharatiya Nyaya Sanhita, 2023 (BNS) and Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), the Andhra Pradesh High Court allowed the bail petition of a 63-year-old retired government officer, arrested for alleged misappropriation of ₹19.25 lakhs from departmental funds. The Court ruled that when a case rests on allegations of criminal breach of trust, the simultaneous invocation of cheating on the same facts is legally impermissible, thereby lending weight to the petitioner's argument for bail.

Justice Dr. Y. Lakshmana Rao emphasized that the statutory distinction between criminal breach of trust and cheating must guide bail adjudication when both offences are alleged based on identical facts.

Misappropriation Case Against Retired Officer: 110 Days in Custody, No Interrogation Sought

The petitioner, A.S. Chand Basha, a retired Office Superintendent from the Forest Department, was arrested in connection with Crime No. 67 of 2025 registered at Atmakur Police Station, Nandyal District. He allegedly diverted ₹19,25,993 from government accounts to unknown third-party accounts during his tenure as in-charge of accounts. The police filed a final charge sheet, but it had not yet been numbered at the time of the bail hearing.

The petitioner voluntarily surrendered on 10.09.2025 and had been in judicial custody for over 110 days. Notably, no application was filed by the investigating agency seeking custodial interrogation, and the State did not object to the factual assertion that he had a fixed place of residence and posed no flight risk.

Court Notes Legal Incompatibility Between Cheating and Breach of Trust

The Court observed that although the allegations involved serious financial irregularities, the legal foundation of the case—Section 316(5) of the BNS, 2023, which corresponds to criminal breach of trust and cheating under the IPC—required scrutiny in light of established legal principles.

Quoting the Supreme Court’s authoritative ruling in Arshad Neyaz Khan v. State of Jharkhand, 2025 SCC OnLine SC 2058, Justice Rao underscored:

“In such a situation, both offences [cheating and criminal breach of trust] cannot co-exist simultaneously in the same set of facts as they are antithetical to each other.”

Further, relying on Delhi Race Club (1940) Ltd. v. State of U.P., (2024) 10 SCC 690, the Court held:

“Without entrustment of property, there cannot be any criminal breach of trust… there can be a civil remedy for the non-payment of the consideration amount, but no criminal case will be maintainable for it.”

Justice Rao clarified that Section 406 IPC (now reflected in Section 316 of BNS) requires entrustment followed by misappropriation, while Section 420 IPC (cheating) requires fraudulent inducement at the inception. These two mental states are mutually exclusive, and simultaneous charges on the same set of facts are inherently flawed.

Judicial Discretion Guided by Custody Length and Non-Requirement of Further Interrogation

The Court held that prolonged incarceration, in the absence of custodial interrogation, especially for an aged person with a fixed residence, was not justified under the new BNSS framework. Emphasizing Sections 480 and 483 of the BNSS, 2023, which empower courts to exercise discretion in granting bail with or without conditions, the Court noted:

“There is a fat chance for the Petitioner to escape from the clutches of law, if he is enlarged on bail as he has got fixed abode at Atmakur… No application was filed seeking custodial interrogation… The period of custodial interrogation is also completed.”

Therefore, continuing detention served no purpose of justice and violated the principles of proportionality in bail jurisprudence under the new criminal codes.

Bail Granted with Stringent Conditions to Ensure Attendance

The High Court allowed the bail petition subject to the following conditions:

1. Furnishing a personal bond of ₹50,000 with two sureties of like amount to the satisfaction of the Judicial Magistrate of First Class, Atmakur.

2. The petitioner must report to the Station House Officer every Saturday between 10:00 AM and 5:00 PM until the filing of the charge sheet.

These conditions were imposed to strike a balance between the rights of the accused and the interests of investigation.

Early Signals on Bail Standards Under BNS/BNSS

This decision marks one of the early judicial interpretations of Section 316(5) of the Bharatiya Nyaya Sanhita, 2023, alongside BNSS provisions on bail, and signals a measured but rights-oriented approach to bail under the new regime. The Court’s heavy reliance on Supreme Court precedents under IPC to interpret analogous BNS sections also reinforces continuity of constitutional safeguards, despite the legislative overhaul.

Date of Decision: 29.12.2025