M/S Shriram Transport Finance Company v. State of Kerala and Marutholi Abdulla

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE T.V.ANILKUMAR** **MONDAY, THE 22ND DAY OF JUNE 2020 / 1ST ASHADHA, 1942** ## **Crl.MC.No.3569 OF 2013** **AGAINST THE ORDER IN C.C.NO.266/2007 OF JUDICIAL MAGISTRATE OF FIRST CLASS,KOYILANDY** ## **PETITIONER/ ACCUSED NO.6:** **M/S.SHRIRAM TRANSPORT FINANCE COMPANY, REPRESENTED BY ITS MANAGING DIRECTOR, SHRIPADAM BUILDING, CHEROOTTY ROAD, KALATHINKUNNU AMSOM, DESOM, KOZHIKODU.** **BY ADVS.SRI.B.RAMAN PILLAI (SR.) SMT.ANUROOPA JAYADEVAN SRI.C.HARIKUMAR** ## **RESPONDENTS/STATE & COMPLAINANT:** - **1 STATE OF KERALA REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM-682 031.** **2 MARUTHOLI ABDULLA, S/O KUNHIPPAKKI, NADUVANNUR AMSOM, MANNANKAV DESOM, KOYILANDY TALUK, REP. BY POWER OF ATTORNEY HOLDER K.V.JANARDHANAN, S/O PACHUKUTTY, VYDOORYAM VALAYANAD AMSOM AND DESOM, KOYILANDY TALUK, KOZHIKODE-673 305.** **R2 BY ADV. JACOB ABRAHAM R2 BY ADV. SRI.JACOB ABRAHAM R1 BY PUBLIC PROSECUTOR SMT.MAYA.M.N** **THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 22-06-2020, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** ## **Crl.M.C.No.3569 of 2013** **:-2-:** **Dated this the 22[nd] day of June, 2020** ## **O R D E R** The petitioner which is a private finance company seeking to quash Annexure A10 private complaint filed by the de facto complainant (2[nd] respondent) is A6. He claims to be the registered owner of a stage carriage which was purchased on availing a hire purchase loan from the 1[st] accused which is a semi government owned financial corporation. It is stated that at the time of availment of loan, the 2[nd] respondent signed a few blank stamp papers, printed forms and other blank papers and entrusted the same with the Manager, A3. He claims to have also repaid substantial amount of loan through 4[th] accused who is said to be the power of attorney holder of A1. Though only an amount of Rs.16,000/- remained to be paid, his vehicle was illegally seized by A8 and A9, the Police Officers, ## **Crl.M.C.No.3569 of 2013** **:-3-:** upon the demand of A7 purportedly acting under the instructions given by A6. It is contended that signed blank papers handed over to A3, the Manager of A1, were forged and misused for constituting A4 as the owner of the vehicle and also for converting the registration of the vehicle to its name. The material part of the prosecution allegation is that all the accused conspired together with an intention to cause wrongful loss to the de facto complainant and cheated him by forging the documents. The de facto complainant filed O.S.No.53/2006 before the Munsiff's Court-I, Kozhikode, seeking a decree for injunction against the seizure of vehicle in which the matter was referred for the decision of the Arbitrator. In short, the entire conduct of the accused in Annexure A10 complaint is stated to have amounted to criminal conspiracy, commission of forgery and cheating of the de facto complainant. ## **Crl.M.C.No.3569 of 2013** ## **:-4-:** 2. The contention raised by the 6[th] accused in support of plea for quashment is that even if the allegations in Annexure A10 complaint are taken as proved also, they are not capable of disclosing any of the offences alleged in the complaint. It is said that in fact the dispute between the parties is one of civil nature requiring adjudication at the instance of the Arbitrator and therefore itself, a criminal proceeding against the petitioner is not maintainable under law. It is contended that since the petitioner did not have any direct deal with the second respondent in the matter of sanction of loan, no sort of criminal liability could be fastened on them. The contention of the petitioner is that it is a non-banking financial institution registered under the Companies Act, 1956 and was amalgamated with A4 as per the order of the Honourable High Court of Madras in Company Petition Nos.191/2005 and ## **Crl.M.C.No.3569 of 2013** ## **:-5-:** 192/2005. It is said that after amalgamation of all assets and liabilities of 4[th] accused, it stood in the shoes of the predecessor company. Allegation of criminal conspiracy against A4 company is said to be not correct since the tie up of the company with A1 is governed by Annexure A1 agreement dated 11.10.2001 under a lending scheme evolved by the Government. As per clause 8 of Annexure A1, A4 is to retain ownership of the vehicles for which sanction for hire purchase loan is sanctioned till the dues are cleared by the borrower. If at all there is any vicarious liability also, in the absence of a statutory legal provision or legal fiction, no vicarious criminal liability could be fastened on the petitioner and in this respect, the learned counsel for the petitioner cited a decision of the Honourable Supreme Court of India in **R.Kalyani v. Janak C.Mehta and others [(2009)1 SCC 516)** . ## **Crl.M.C.No.3569 of 2013** **:-6-:** 3. I heard the learned counsel for the petitioner and also the learned Public Prosecutor. The party respondent was not represented. 4. It was brought to my attention that Annexure A10 complaint against A8 and A9, Police Officials, was already quashed by this Court through a common order dated 3.4.2013 in Crl.M.C.No.2429/2007 and Crl.R.P.No.2113/2007, holding that without sanction being obtained under Section 197 of Cr.P.C., the accused who were purportedly acting in discharge of their official duties, could not have been prosecuted for the offences. Learned counsel for the petitioner also brought to my notice an order dated 31.10.2013 of this Court passed under Section 482 of Cr.P.C. in Crl.M.C.No.2286/2007 quashing Annexure A10 complaint as against A4, A5 and A7 also. This Court in paragraph 4 of the order held that criminal proceedings could not be sustained against A4, the ## **Crl.M.C.No.3569 of 2013** **:-7-:** private finance company and also its employees, the co-accused as if the nature of dispute was one of civil nature. 5. It appears to be an indisputable fact that the petitioner herein is an amalgamated company having taken over all liabilities of A4, its predecessor company. Therefore itself, it cannot be said to have had any direct dealing with the borrower or sanctioning of hire purchase loan. Therefore, one fails to understand as to how could a criminal action been brought against it. If at all, there existed any vicarious liability also, it cannot exceed more than for what its predecessor company could have been legally held liable for. It is transparently clear from the order of this Court dated 31.10.2013 that predecessor, A4 company could not be imputed with any criminal liability. I am also of the opinion after having heard the parties that same line of logic or reasoning adopted in the ## **Crl.M.C.No.3569 of 2013** **:-8-:** case of A4, A5 and A7 shall be maintained as in respect of the petitioner as well. A liability different from what was borne by the 4[th] accused cannot be imputed to the petitioner, A6 in Annexure A10 complaint. Resultantly, I am of the opinion that criminal prosecution based on A10 complaint cannot be sustained against the petitioner and it is liable to be quashed so far as it affects him. In the result, this Crl.M.C. succeeds and Annexure A10 complaint against the petitioner is quashed. All pending interlocutory applications are closed. Sd/- **T.V.ANILKUMAR JUDGE** ami/ ## **Crl.M.C.No.3569 of 2013** ## **:-9-:** ## **APPENDIX** **PETITIONER'S EXHIBITS:** **ANNEXURE A1 TRUE COPY OF THE CORPORATE GUARANTEE AGREEMENT DATED 11.10.2001.** **ANNEXURE A2 TRUE COPY OF HIRE PURCHASE CUM GUARANTEE AGREEMENT DATED 21.2.2002 BETWEEN THE PETITIONER AND 2ND RESPONDENT. ANNEXURE A3 TRUE COPY OF THE POWER OF ATTORNEY DATED 5.6.2003.** **ANNEXURE A4 TRUE COPY OF THE FIRST SCHEDULE OF REPAYMENT CHART ALONG WITH THE RECEIPTS OF THE LOAN INSTALLMENTS PAID BY THE 2ND RESPONDENT TOWARDS AGREEMENT NO.SILKTDFC/CLT/L/26179.** **ANNEXURE A5 TRUE COPY OF THE LOAN CUM HYPOTHECATION AGREEMENT DATED 25.8.2004.** **ANNEXURE A6 TRUE COPY OF THE LETTER ISSUED BY THE KTDFC IN THIS REGARD ON 20.9.2004.** - **ANNEXURE A7 TRUE COPY OF THE REPAYMENT SCHEDULE AND STATEMENTS OF ACCOUNTS ALONG WITH THE RECEIPTS OF PAYMENTS UNDER ANNEXURE A3 AGREEMENT.** **ANNEXURE A8 TRUE COPY OF THE PLAINT IN O.S.NO.53 OF 2006 DATED 23.1.2006 OF MUNSIFF COURT-I, KOZHIKODE.** **ANNEXURE A9 TRUE COPY OF THE ORDER DATED 25.8.2006 IN I.A.NO.1717 OF 2006 IN C.R.P.NO.425 OF 2006 BEFORE THE HONOURABLE HIGH COURT OF KERALA.** ## **Crl.M.C.No.3569 of 2013** ## **:-10-:** **ANNEXURE A10 TRUE COPY OF THE COMPLAINT IN CRL.M.P.NO.1443 OF 2007 TAKEN COGNIZANCE AS C.C.NO.266 OF 2007 DATED 9.4.2007 BEFORE THE JFCM COURT, KOYILANDY.** **ANNEXURE A11 TRUE COPY OF THE SWORN STATEMENT OF THE 2ND RESPONDENT IN CRL.M.P.NO.1443 OF 2007 TAKEN COGNIZANCE AS C.C.NO.266 OF 20076 DATED 16.4.2007.** - **ANNEXURE A12 TRUE COPY OF THE ORDER IN CL.M.P.NO.1443 OF 2007 DATED 16.4.2007 BEFORE JFCM COURT, KOYILANDY.** - **ANNEXURE A13 TRUE COPY OF THE ORDER IN CRL.M.A.NO.3648 OF 2007 IN CRL.M.C.2429 OF 2007 DATED 30.7.2007 BEFORE THE HONOURABLE HIGH COURT OF KERALA.** - **ANNEXURE A14 TRUE COPY OF THE ORDER IN CRL.M.P.NO.4031 OF 2008 DATED 16.11.2009 OF JFCM COURT, KOYILANDY.** - **ANNEXURE A15 TRUE COPY OF THE JUDGMENT IN CRL.M.C.NO.2429 OF 2007 DATED 3.4.2013 BEFORE THE HONOURABLE HIGH COURT OF KERALA.** - **ANNEXURE A16 TRUE COPY OF THE JUDGMENT IN CRL.R.P.NO.3864 OF 2010 DATED 25.11.2011 BEFORE THE HONOURBALE HIGH COURT OF KERALA.** ## **RESPONDENTS' EXHIBITS: NIL**