2 days ago
‘Easy money is a trap': Delhi HC quashes cheating case against man
Those driven by greed knowingly accept the risks involved and must also bear the consequences, the Delhi High Court said while quashing a ₹2 crore cheating case filed against a man accused of luring investors by promising monthly returns at 24% per annum. The case originated from an FIR filed by the Delhi Police in 2019 under Section 420 (cheating) of the Indian Penal Code. (HT Archive)
Justice Arun Monga, in his 35-page, strongly worded verdict released on Monday, termed 'easy money' as a 'trap' and warned against chasing unrealistic returns. Individuals lured by unrealistic financial returns cannot later claim to be a victim of fraud, the court said.
'Those who gamble with impractical promises must own their risks. People, lured by unrealistic returns, first willingly dive into financial traps and later cry foul, running to seek State help. An uncomfortable, but necessary reality is that if you choose to chase extraordinary gains, you must be prepared for extraordinary losses,' justice Monga said in his August 13 verdict.
He added, 'If you choose greed, you choose risk, and if you choose risk, you choose consequences. But such victims ought not to pretend that they were duped by magic when they walked willingly into the illusion. So every dreamer chasing quick riches– it is a wake-up call. Easy money is a trap. If the return sounds unbelievable, believe this instead: you are the next in line to pay the price.'
The case originated from an FIR filed by the Delhi Police in 2019 under Section 420 (cheating) of the Indian Penal Code. The three complainants alleged that the accused had promised to pay interest at 24% annually for six months on an investment of ₹1.5 crore in a company, but later failed to return both the interest and the principal amount. They also claimed the man had induced them to buy a 1.25% stake in a company for ₹43.66 lakh, which was never refunded.
Ultimately, the court quashed the case, observing that even after six years, the police had failed to file a complete chargesheet. It noted that the allegations in the FIR lacked the essential elements of the offence of cheating, stating that what was essentially a civil dispute had been disguised as a criminal case. The investigating agency's conduct, the judge said, reflected 'gross negligence' and 'lack of due diligence.'
'What is essentially a civil dispute has been camouflaged as a criminal case. No satisfactory explanation has been offered for the six-year delay, which vitiates the sanctity of the entire process and raises serious doubts about the bona fide of the prosecution,' the court maintained.
The judge, in his verdict, also emphasised the ripple effects caused by investors pumping money into unsustainable ventures, saying that the same has the likelihood of harming genuine end users and distorting market equilibrium.
'Greed is not just a personal flaw, it creates ripple effects. When investors pump money into unsustainable ventures, they inflate bubbles that harm genuine end users and distort market equilibrium. And when the bubble bursts, they expect the law to paint them as victims, absolving them of all responsibility. The allure of easy money is a dangerous illusion. Investors who ignore prudence and succumb to unrealistic promises must understand that their choices carry consequences. The law must punish fraud, but it cannot shield people from the fallout of their avarice,' the court maintained.
