High Court of KeralaSingle Judge2019-02-27Crl.MC allowed; quashed final report and procee...

Arumukhan v. State of Kerala and Sulaiman

Case / Petition Number:Crl.MC.No. 5325 of 2016

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: B. Sudheendra Kumar
Judgment Date: 2019-02-27
Court Decision / Holding: In the result, this Criminal Miscellaneous Case stands allowed. The final report and the further proceedings in CC 2088/2015 are quashed in exercise of the inherent powers of this Court under Section 482 Cr.P.C. to meet the ends of justice.
Final Disposition: Crl.MC allowed; quashed final report and proceedings under CrPC 482

Parties to the Case

Appellants / Petitioners

Arumukhan

Respondents

State of Kerala represented by Public Prosecutor, High Court of Kerala, Ernakulam-682 031
Sulaiman

Legal Representation & Advocates

Counsels for Petitioners

• Sri. Prasun S.
• Sri. Paul Mathew (Perumpillil)

Counsels for Respondents

• Sri L. Rajesh Narayan

Case Synopsis & Summary

Arumukhan seeks quashing of the final report and further proceedings in CC 2088/2015 on the file of the Judicial Magistrate First Class-II Palakkad, crime No. 463/2015, Mankara Police Station. The petitioner is charged under Kerala Money Lenders Act, 1958 (Sections 3 read with 17, 13, 18A) and under the Kerala Prohibition of Charging Exorbitant Interest Act, 2012 (Section 3 read with Section 9(a)). The prosecution alleges that in 2014 the petitioner lent Rs 60,000 without a license, collected blank signed cheques and stamp papers, and that the second respondent repaid with interest while the documents were not returned. The petitioner contends that there is no material showing that he is a moneylender or that his principal occupation is lending; under Section 2(7) of the Money Lenders Act, the main or subsidiary occupation must be the business of lending or deposits; a single instance of lending is insufficient, and no document seized supports the allegation. The Public Prosecutor admits lack of material indicating money lending. The court finds no material to prove the ingredients of the offences, and further notes that the counter-complaint by the 2nd respondent shows mala fide intent. Relying on Bhajan Lal and Rajiv Dubey, the court exercises its inherent power under Section 482 Cr.P.C. and quashes the final report and proceedings. The petition is allowed.

Provisions of Law Cited

Kerala Money Lenders Act, 1958, Section 2(7)Kerala Money Lenders Act, 1958, Sections 3 read with 17, 13 and 18AKerala Prohibition of Charging Exorbitant Interest Act, 2012, Section 3 read with Section 9(a)Code of Criminal Procedure, Section 482Negotiable Instruments Act, Section 138

Legal Doctrines & Maxims

Mala fide and/or ulterior motive doctrine (quashing where mala fide) as per Bhajan Lal
Inherent power of High Court under Section 482 Cr.P.C. to meet ends of justice
A single instance of lending money is not sufficient to constitute money lending (Balakrishna v. Babu)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contends that he is not a moneylender as there is no evidence that his main or subsidiary occupation is money lending; a single transaction is not enough to establish money lending; no documents were seized to indicate a money-lending business; hence the offences under the Kerala Money Lenders Act and the Kerala Prohibition of Charging Exorbitant Interest Act are not made out; therefore, the final report and further proceedings should be quashed.

Contentions of Respondents

The State Prosecutor submitted that there was no material showing that the petitioner is a moneylender; the lack of material to support the allegations is acknowledged during proceedings; the court should evaluate the available evidence to determine if the ingredients of the offences are established; however, the dominant finding ultimately rests on the absence of material to prove the offences.

Cited Precedents (3)

Case Name	Citation	Treatment	Explanation
Balakrishna v. Babu	1994(1) KLT 947	Positive	Cited to support the proposition that a single instance of lending is insufficient to establish moneylender status.
State of Haryana v. Bhajan Lal	1992 Supp (1) SCC 335	Positive	Used to justify quashing criminal proceedings on grounds of mala fides or ulterior motives.
Mahindra and Mahindra Financial Services Limited v. Rajiv Dubey	(2009) 1 SCC 706	Positive	Affirmed the Bhajan Lal principle regarding quashing mala fide or malicious proceedings; applied to the present case.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE B.SUDHEENDRA KUMAR** **WEDNESDAY,THE 27TH DAY OF FEBRUARY 2019 / 8TH PHALGUNA, 1940** ## **Crl.MC.No. 5325 of 2016** **AGAINST THE ORDER/JUDGMENT IN CC 2088/2015 of JUDICIAL MAGISTRATE OF FIRST CLASS -II,PALAKKAD** **CRIME NO. 463/2015 OF Mankara Police Station, Palakkad** ## **PETITIONER/S:** **ARUMUKHAN,AGED 65 YEARS S/O.APPU, APPU NIVAS, KUNIYANPADAM, MANKARA P.O., PALAKKAD DISTRICT, PIN-678 613.** **BY ADVS. SRI.PRASUN.S SRI.PAUL MATHEW (PERUMPILLIL)** ## **RESPONDENT/S:** **1 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR,HIGH COURT OF KERALA, ERNAKULAM-682 031.** **2 SULAIMAN AGED 33 YEARS S/O.USSNANAR, KUNYAMPADAM HOUSE, MANKARA P.O., PALAKKAD DISTRICT, PIN-678 613.** **BY ADV. SRI.L.RAJESH NARAYAN** ## **OTHER PRESENT:** **SMT.V.SREEJA,PP** **THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 27.02.2019, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **Crl.MC.No. 5325 of 2016** -2- ## **ORDER** The petitioner is the accused in C.C. No. 2088 of 2015 on the files of the court below. The offences alleged are offences under Sections 3 read with Section 17, 13 and 18A of the Kerala Money Lenders Act, 1958 and Section 3 read with Section 9 (a) of The Kerala Prohibition of Charging Exorbitant Interest Act, 2012. 2. Prosecution allegation can be briefly stated as follows: The petitioner lent an amount of Rs. 60,000/- to the second respondent for interest during 2014 without having any license. At the time of lending the money, the petitioner collected blank signed cheques and blank signed stamp papers from the 2[nd] respondent. The 2[nd] respondent paid ## **Crl.MC.No. 5325 of 2016** -3- the interest and also the amount. However, even after repaying the entire amount with interest, the petitioner did not return the documents collected by him. 3. The petitioner has filed this Criminal M.C. praying for quashing the final report and further proceedings against the petitioner in the above case. ## 4. Heard. 5. The learned Public Prosecutor, on instructions, has submitted that the search of the house of the accused did not reveal any material indicating that the petitioner is a moneylender. 6. In order to be a money lender as provided under Section 2 (7) of the Kerala Money Lenders Act, the main or subsidiary occupation of that person must be the ## **Crl.MC.No. 5325 of 2016** -4- business of advancing and realising loans or acceptance of deposits in the course of such business. A single instance of lending money is not sufficient for a person to be a money lender [see Balakrishna v. Babu [1994(1) KLT 947]. In this case, there is absolutely no allegation that the main or subsidiary occupation of the petitioner is the business of advancing and realising loans or acceptance of deposits. There is also no material to indicate that the main or subsidiary occupation of the petitioner is advancing and realising loans or acceptance of deposits in the course of such business. No document as alleged by the second respondent was also seized from the possession of the petitioner. There is absolutely no material before the Court to indicate that the main or subsidiary occupation of the petitioner is advancing and realising loans or acceptance of deposits in the course of such business In view of the above reasons, the petitioner cannot be said to be a money lender. Since the petitioner is not a money lender, it ## **Crl.MC.No. 5325 of 2016** cannot be said that the provisions under the Prohibition of Charging Exorbitant Interest Act are applicable against the petitioner. Having gone through the relevant inputs, I am satisfied that there is no material before the court against the petitioner constituting the ingredients of the offences alleged. For the said reason alone, the final report and further proceedings against the petitioner in the above case are to be quashed. 7. It is not disputed that the prosecution initiated against the 2[nd] respondent at the instance of the petitioner under Section 138 of the Negotiable Instruments Act is still pending before the Magistrate Court concerned. Having gone through Annexure -A3 complaint filed by the 2[nd] respondent against the petitioner, I am satisfied that the said complaint was filed only as a counterblast to shield the prosecution against the 2[nd] respondent initiated by the petitioner under Section 138 of the N.I.Act. Therefore, the ## **Crl.MC.No. 5325 of 2016** -6- registration of the crime and the filing of final report against the petitioner on the basis of Annexure-A3 complaint would amount to abuse of process of Court. 8. The Apex court in Mahindra and Mahindra Financial Services Limited and Another v. Rajiv Dubey [(2009) 1 SCC 706] relied on the decision in State of Haryana v. Bhajan Lal [1992 suppl (1) SCC 335] and held that where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge, proceeding initiated, is to be quashed. 9. In this case, the present complaint was instituted maliciously as a counter blast to shield the proceedings initiated against the second respondent by the petitioner under Section 138 of the N.I.Act. In the said ## **Crl.MC.No. 5325 of 2016** -7- circumstances also, the final report and further proceedings against the petitioner in the above case are to be quashed. Consequently, I am inclined to quash the final report and further proceedings against the petitioner in the abvoe said case, in exercise of the inherent power under Section 482 Cr.P.C., to meet the ends of justice. It is ordered accordingly. In the result, this Crl. M.C. stands allowed. **Sd/- B. SUDHEENDRA KUMAR, JUDGE** ani/ /true copy/ **Crl.MC.No. 5325 of 2016** -8- ## **APPENDIX** **PETITIONER'S/S EXHIBITS:** **ANNEXURE-A1. THE TRUE PHOTOCOPY OF THE FINAL REPORT IN CC NO.2088/2016 OF THE JFCMC-II, PALAKKAD.** **ANNEXURE-A2. THE TRUE PHOTOCOPY OF THE COMPLAINT DATED 17/6/2015 IN CC NO. 1345/2015 OF THE JFCMC-II, PALAKKAD. ANNEXURE-A3. THE TRUE PHOTOCOPY OF THE CMP NO.3402/2015 DATED 14/7/2015 PREFERRED BY THE 2ND RESPONDENT BEFORE THE JFCMCII, PALAKKAD.**