Leelamma John and John M. George v. T. George Varghese and State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE V.G.ARUN** **THURSDAY, THE 23[RD] DAY OF MARCH 2023 / 2ND CHAITHRA, 1945** **CRL.MC NO. 5691 OF 2021** **AGAINST THE ORDER CC 2929/2017 OF TEMPORARY COURT OF JUDICIAL MAGISTRATE OF FIRST CLASS, THIRUVANANTHAPURAM (JMFC XII)** ## **PETITIONERS/ACCUSED 1 & 2:** 1 LEELAMMA JOHN, AGED 60 YEARS W/O.JOHN M.GEORGE, PROPRIETRIX ALEPH ENTERPRISES, R/O. KMC 13/1790, PADIPURAKAL, PERATHIBHA JUNCTION, BHAVANAGAR, KADAPPAKKAD, KOLLAM-691 008. 2 JOHN M.GEORGE, AGED 64 YEARS S/O.GEORGE, R/O. KMC 13/1790, PADIPURAKAL, PERATHIBHA JUNCTION, BHAVANAGAR, KADAPPAKKAD, KOLLAM-691 008. BY ADV B.G.HARINDRANATH ## **RESPONDENTS/COMPLAINANT & STATE:** 1 T.GEORGE VARGHESE, AGED 73 YEARS S/O.LATE IDIKULLA GEORGE, MANAGING PARTNER, DELTA STAR GENERAL TRADING LLC, POST BOX NO.117491, DUBAI, R/O. TC NO.2/3310, CHALAKUZHY ROAD, PATTOM P.O., THIRUVANANTHAPURAM-695 004. 2 STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM, PIN-682 031. BY ADVS. P.B.KRISHNAN P.B.SUBRAMANYAN SABU GEORGE MANU VYASAN PETER PP M.C.ASHI; ADV.M.K.SREEGESH FOR R1 THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION ON 16.03.2023, ALONG WITH Crl.MC.5697/2021, THE COURT ON 23.03.2023 PASSED THE FOLLOWING: Crl.M.Cs.5691 & 5697/2021 2 ## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE V.G.ARUN** **THURSDAY, THE 23[RD] DAY OF MARCH 2023 / 2ND CHAITHRA, 1945** **CRL.MC NO. 5697 OF 2021** **AGAINST THE ORDER/JUDGMENT CC 2658/2017 OF TEMPORARY COURT OF JUDICIAL MAGISTRATE OF FIRST CLASS, THIRUVANANTHAPURAM (JMFC XII) PETITIONERS/ACCUSED 1 & 2:** 1 LEELAMMA JOHN, AGED 60 YEARS W/O. JOHN M. GEORGE, PROPRIETRIX-ALEPH ENTERPRISES, R/O.KMC 13/1790, PADIPURAKAL, PRATHIBHA JUNCTION, BHAVANAGAR, KADAPPAKKADA, KOLLAM-691 008. 2 JOHN M. GEORGE, AGED 64 YEARS S/O. GEORGE, R/O.KMC 13/1790, PADIPURAKAL, PRATHIBHA JUNCTION, BHAVANAGAR, KADAPPAKKADA, KOLLAM-691 008. BY ADV B.G.HARINDRANATH ## **RESPONDENTS/COMPLAINANT & STATE:** 1 T.GEORGE VARGHESE, AGED 73 YEARS S/O. LATE IDIKULLA GEORGE, MANAGING PARTNER, DELTA STAR GENERAL TRADING LLC, POST BOX NO.117491, DUBAI, R/O. TC NO.2/3310, CHALAKUZHY ROAD, PATTOM P.O., THIRUVANANTHAPURAM-695 004. 2 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM, PIN-682 031. BY ADVS. P.B.KRISHNAN P.B.SUBRAMANYAN SABU GEORGE MANU VYASAN PETER THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION ON 16.03.2023, ALONG WITH Crl.MC.5691/2021, THE COURT ON 23.03.2023 PASSED THE FOLLOWING: Crl.M.Cs.5691 & 5697/2021 3 ## **ORDER** **[Crl.MC Nos.5691/2021, 5697/2021]** Dated this the 23[rd] day of March, 2023 The petitioners are accused Nos. 1 and 2 in C.C. Nos. 2658 and 2929 of 2017 on the files of the Judicial Magistrate of the First Class-XII, Thiruvananthapuram. The cases originated from complaints filed by the first respondent, alleging commission of the offence under Section 138 of the Negotiable Instruments Act. 2. The essential facts are as under; The first petitioner, in her capacity as the proprietrix of Aleph Enterprises, purchased 335.189 MT of raw cashew from M/s. Delta Star General Trading LLC, UAE under two invoices for $262,656.00 and $189,849.15 respectively. The documents were routed through Canara Bank, Thamarakulam Road, Kollam on 90 days credit. Since the first petitioner was facing financial difficulties, she requested the Canara Bank to extend the time for making part payments. The request was accepted Crl.M.Cs.5691 & 5697/2021 4 by the Banks. Thereupon, part payment of $30000 was made on 07.05.2016 through Canara Bank. The outstanding amount under the invoices was $422505.15. To ensure repayment of the balance amount, the petitioners executed Annexure I agreement on 17.08.2016, agreeing to pay the balance amount within a short period. Pursuant to the agreement, four cheques were issued in favour of the wife of the first respondent. The first two cheques dated 01.04.2017 were for Rs.72,00,000/- each, the third cheque dated 01.05.2017 for Rs.72,00,000/- and the fourth cheque, dated 01.05.2018, was for Rs.71,30,315/-. As the petitioners could not raise the amount for honouring the cheques in time, Annexure II supplementary agreement was executed on 27.06.2017 and four new cheques for a total amount of Rs.2,87,30,350/- were issued. The first respondent presented the first two cheques before the Canara Bank, Kollam Main Branch and the other two cheques, before Federal Bank, Palayam Branch. As all the cheques bounced, the first respondent filed complaints dated 15.09.2017 and 05.10.2017 before the Judicial Crl.M.Cs.5691 & 5697/2021 5 Magistrate of First Class-XII, Thiruvananthapuram. The court took cognizance of the complaints and ordered joint trial. The first respondent filed chief affidavit and was cross-examined at length. During his cross-examination, the first respondent stated that he had not sold cashew on his own behalf and the cheques were issued towards discharge of the liability debts due to M/s. Delta Star General Trading LLC, Dubai. The first respondent admitted that the company M/s. Delta Star General Trading LLC is incorporated under the UAE law and majority shares are held by a UAE national. The above answers given by PW1 during cross-examination is the reason for filing these Crl.M.Cs. 3. Learned counsel for the petitioners contended that under the contract for importing raw cashew nuts from UAE, the amount is payable to M/s. Delta Star LLC, a foreign company. As per Section 3(b) of the Foreign Exchange Management Act (FEMA), no person shall make any payment to, or to the credit of, any person residing outside India. Section 3(c) of FEMA prohibits acceptance of payment for the Crl.M.Cs.5691 & 5697/2021 6 credit of any person residing outside India. Section 2(c) of FEMA defines an 'authorised person' as an authorised dealer, money changer, offshore banking unit or any other person authorised to deal in foreign exchange or foreign securities under sub-section (1) of section 10. The first respondent not being authorized person under the FEMA, is interdicted from accepting money on behalf of the foreign entity namely M/s. Delta Star General Trading LLC. The contention is that, since the amount cannot be claimed by the first respondent, there is no legally enforceable debt or liability between the parties. 4. Learned counsel for respondents 1 and 2 contended that the Crl.M.Cs are liable to be dismissed in limine for suppression of material facts. It is pointed out that, after the institution of the Calendar Case, the dispute was referred to mediation at the instance of the petitioners and a settlement was arrived. As per the terms of the settlement, which the petitioners were to pay Rs.1,20,00,000/- in five instalments within one year from the date of agreement (14.11.2019). The specific dates for payment of each instalment was also Crl.M.Cs.5691 & 5697/2021 7 stipulated. Instead of effecting the payments, the petitioners filed W.P.(C) 3437 of 2020 before this court to direct the Canara Bank to credit the payments that would be made by them, in compliance of the conditions in the mediation agreement, to the account of the first respondent and his wife and not to adjust those payments towards the liability due to the Bank. This Court granted an interim order directing the Canara Bank to credit the amounts paid by the petitioners in compliance of the settlement towards the account of the first respondent. The writ petition was later disposed of as per Annexure R1(b) judgment, making the interim order absolute. It is submitted that instead of remitting the amounts in terms of the settlement, petitions were filed before the trial court seeking permission to examine the Assistant Director, Directorate of Enforcement as a defence witness. That petition was dismissed by Annexure R1(c). In these Crl.M.Cs., those material facts are suppressed. 5. Although learned counsel put forth extensive arguments to refute the contentions of the petitioners based Crl.M.Cs.5691 & 5697/2021 8 on the provisions of FEMA, I do not intend to delve into those contentions in view of the suppression of material facts pointed out. A perusal of Annexure R1(a) copy of W.P.(C). No. 3437 of 2020 reveals that the writ petition was filed pointing out the settlement arrived at between the petitioners and the first respondent regarding payment of the balance amount. The averments were to the effect that the petitioners were desirous of acting in terms of the settlement, but were apprehensive that the amounts, if remitted in the Bank for the purpose of payment to the first respondent and his wife, will be appropriated towards the liability due to the Bank. Taking into account the settlement arrived at and finding merit in the apprehension expressed, this Court had rendered Annexure R1(b) judgment, restraining the Bank from appropriating the amounts remitted for payment to the first respondent. The petitioners have thus acknowledged the first respondent's authority to receive the amount due to M/s. Delta Star General Trading LLC. Surprisingly, this crucial fact is suppressed in the Crl.M.C. As a result, the Crl.M.Cs have Crl.M.Cs.5691 & 5697/2021 9 been pending with interim orders for more than a year. 6. A writ remedy is an equitable one. A person approaching a superior court must come with a pair of clean hands. There should not be suppression of any material fact and recourse to the legal proceedings should not be taken over and over again. If a person acts against these basic principles, the litigation at this instance would amount to an abuse of the process of law. (See **Advocate General, State of Bihar v. M/s. Madhya Pradesh Khair Industries and Another** [(1980) 3 SCC 311]. In this context, it is also apposite to refer to para 12 of **Prestige Lights Ltd. v. State Bank of India** [(2007) 8 SCC 449] extracted below; "12. It is well-settled that the jurisdiction exercised by the High Court under Article 226 of the Constitution of India is extraordinary, equitable and discretionary and it is imperative that the petitioner approaching the writ court must come with clean hands and put forward all facts before the Court without concealing or suppressing anything. A litigant is bound to state all facts which are relevant to the litigation. If he withholds some vital or relevant material in order to gain advantage over the other side then he would be guilty of playing fraud with the court as well as with the opposite parties which cannot be countenanced." (emphasis supplied) Crl.M.Cs.5691 & 5697/2021 10 The above principle is equally applicable to proceedings under Section 482 Cr.P.C. also, where this Court is called upon to exercise its inherent power to secure the ends of justice. As material facts are seen suppressed in these Crl.M.Cs, I refuse to consider the arguments on merits. In the result, Crl.M.Cs are dismissed. Sd/- **V.G.ARUN** **JUDGE** sb Crl.M.Cs.5691 & 5697/2021 11 ## **APPENDIX OF CRL.MC 5697/2021** ## PETITIONER ANNEXURES |Annexure|1|TRUE COPY OF THE AGREEMENT EXECUTED BY THE| |---|---|---| |||PETITIONERS DATED 17.8.2016.| |Annexure|II|TRUE COPY OF THE SUPPLEMENTARY AGREEMENT| |||DATED 27.6.2017 EXECUTED BY PETITIONERS.| |Annexure|III|TRUE PHOTOCOPY OF THE COMPLAINT IN| |||C.C.NO.2658/2017 ON THE FILE OF JUDICIAL| |||MAGISTRATE OF THE IST CLASS, XII| |||THIRUVANANTHAPURAM DATED 15.9.2021.| |Annexure|IV|TRUE COPY OF THE CHIEF AFFIDAVIT DATED| |||25.2.2020 AND DEPOSITION OF THE IST| |||RESPONDENT IN C.C.NO.2658/2017 DATED| |||16.8.2021 ON THE FILE OF JUDICIAL MAGISTRATE| |||OF THE IST CLASS, XII THIRUVANANTHAPURAM.| |Annexure|V|TRUE COPY OF THE FEDERAL LAW NO.2 OF 2015 OF| |||UAE.| Crl.M.Cs.5691 & 5697/2021 12 ## **APPENDIX OF CRL.MC 5691/2021** |PETITIONER ANNEXURES|| |---|---| |Annexure I|TRUE COPY OF THE AGREEMENT EXECUTED BY THE| ||PETITIONERS DATED 17.08.2016.| |Annexure II|TRUE COPY OF THE SUPPLEMENTARY AGREEMENT| ||DATED 27.06.2017 EXECUTED BY PETITIONERS.| |Annexure III|TRUE COPY OF THE COMPLAINT IN CC NO.2929/2017| ||ON THE FILE OF JUDICIAL MAGISTRATE OF THE 1ST| ||CLASS, XII THIRUVANANTHAPURAM DATED| ||05.10.2021.| |Annexure IV|TRUE COPY OF THE DEPOSITION OF THE 1ST| ||RESPONDENT IN CC NO.2658/2017 DATED| ||16.08.2021 ON THE FILE OF JUDICIAL MAGISTRATE| ||OF THE 1ST CLASS, XII THIRUVANANTHAPURAM.| |Annexure V|TRUE COPY OF THE FEDERAL LAW NO.2 OF 2015 OF| ||UAE.| |RESPONDENT ANNEXURES|| |Annexure -R1(a)|A TRUE COPY OF THE MEMORANDUM OF WRIT| ||PETITION IN W.P.(C) NO.3437 OF 2020 DATED 05-| ||02-2020| |Annexure R1(b)|A TRUE COPY OF THE JUDGMENT OF THIS HON'BLE| ||COURT IN W.P.(C) NO.3437 OF 2020, DATED 16-| ||11-2022| |Annexure-R1(c)|A TRUE COPY OF THE ORDER OF JFCM XII,| ||THIRUVANANTHAPURAM IN CMP NO.6579 OF 2022| ||DATED 28-09-2022|