Quashing of IPC charges requires entrustment and dishonest inducement, while handset code tampering and copyright issues may still go to trial.

Criminal breach of trust and cheating require entrustment of property and dishonest inducement to deliver property; on the allegations stated, those elements were absent, so the IPC prosecution under Sections 409, 420 and 120B was quashed. Allegations that ESN values in mobile handsets were altered were treated as prima facie capable of attracting Section 65 of the Information Technology Act because a handset and its programmed identifiers could amount to computer source code, and that issue was left for trial. Alteration of a protected computer programme was also treated as a triable question under Section 63 of the Copyright Act, so those proceedings were permitted to continue.

---

---

Issues: (i) Whether the criminal proceedings could be quashed insofar as they alleged offences under Sections 409, 420 and 120B of the Indian Penal Code, 1860; (ii) Whether the allegations disclosed an offence under Section 65 of the Information Technology Act, 2000; (iii) Whether the allegations disclosed infringement punishable under Section 63 of the Copyright Act, 1957.

Issue (i): Whether the criminal proceedings could be quashed insofar as they alleged offences under Sections 409, 420 and 120B of the Indian Penal Code, 1860.

Analysis: Criminal breach of trust requires entrustment of property and dishonest misappropriation or conversion, while cheating requires dishonest or fraudulent inducement to deliver property. On the allegations made, the subscribers were free to choose service providers and there was no entrustment of property to the petitioners, nor any dishonest inducement by them to deliver property. The conspiracy allegation, being tied to the substantive IPC offences, also failed on the facts stated in the FIR and remand report.

Conclusion: The proceedings were quashed insofar as they related to Sections 409, 420 and 120B of the Indian Penal Code, 1860.

Issue (ii): Whether the allegations disclosed an offence under Section 65 of the Information Technology Act, 2000.

Analysis: A mobile handset was treated as a computer within the statutory definitions, and the ESN and related programmed identifiers were held capable of constituting computer source code for the purpose of Section 65. The alleged alteration of ESN values to make handsets usable on another network amounted, at least prima facie, to tampering with computer source documents, and the question was one for evidence at trial.

Conclusion: The proceedings were not quashed in respect of Section 65 of the Information Technology Act, 2000.

Issue (iii): Whether the allegations disclosed infringement punishable under Section 63 of the Copyright Act, 1957.

Analysis: Computer programmes are protected as literary works under the Copyright Act, and copyright subsists in such programmes and source code. Alteration of the programme in another's handset may amount to infringement, but the issue depended on proof at trial and could not be finally negatived at the quashing stage.

Conclusion: The proceedings were not quashed in respect of Section 63 of the Copyright Act, 1957.

Final Conclusion: The criminal case was terminated only to the extent of the IPC allegations, while the investigation was permitted to continue for the Information Technology Act and Copyright Act allegations.

Ratio Decidendi: In proceedings for quashing, allegations disclose no offence under criminal breach of trust or cheating unless entrustment and dishonest inducement to deliver property are shown, but allegations of tampering with computer source code or infringement of a protected computer programme may be allowed to proceed where they raise triable questions.

---