Based on your situation, it would seem that you might have two obvious choices: a complaint to a higher police authorities and litigation under civil law. If you felt that the officers at the district crime branch hadn't been very fair or neutral or even taken a bribe, then certainly you may contact higher police administration. You can also lodge a complaint with the Commissioner or the DIG . Let them know you are concerned that the case has been mishandled. Attach all relevant documents, such as bank transfer records showing the money you transferred to the borrower and any communication or promises made by the borrower about repayment. Higher authorities will be responsible to see that complaints are dealt fairly and if they feel that corruption or negligence has been done, they can reassess the case.
However, the police also have advised that you file a civil case for the recovery of your money since the issue primarily relates to the loan you provided to the borrower. This is a civil issue in Indian law. You can file a suit for recovery of the money you lent in the context of your bank transfer records. If the borrower has defaulted, the court can issue an order of repayment of the amount. Moreover, if there was some fraudulent intent on the part of the borrower, you can file a suit for fraud under the Indian Contract Act.
If you feel cheated by the borrower, you might also file for criminal action using Section 420 of the IPC, which describes cheating and dishonestly inducing a delivery of property. You could prove that it was done as a result of deceitful or false promises he made to repel your entire debt. But this is risky, and very few people tend to have complete evidence, as in written evidence or witnesses in court.
As far as recovering your money goes, it is largely a matter of the strength of your evidence. If you have solid documentation such as bank statements proving the transfer and any written evidence of the agreement, your case in civil court should be strong. The criminal case, on the other hand, may take much longer to resolve and the outcome less predictable. But if the borrower is found guilty of cheating, that could further support your claim in civil court.
