Vaibhav Ramesh Kashikar R/O ... vs State Of Mah. Thr. Its Secretary ...
2021 Latest Caselaw 1404 Bom

                                                     1               J-APL-340.2019.odt

      IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
                    NAGPUR BENCH, NAGPUR

             CRIMINAL APPLICATION (APL) NO.340 OF 2019

 1.       Vaibhav S/o. Ramesh Kashikar,
          Aged 33 years, Occ. Business,
          R/o. Malveshpura, Achalpur,
          Tah. Achalpur, Dist. Amravati
          Mob. No. 9890575371.

 2.       Vilas S/o. Rambhau Kashikar,
          Aged 60 years, Occ. Business,
          R/o. Malveshpura, Achalpur,
          Tah. Achalpur, Dist. Amravati,
          Mob. No. 9881854041.                               . . . . APPLICANTS

          VERSUS

 1.       State of Maharashtra through
          its Secretary, Home Department,
          Mantralaya, Mumbai-32.

 2.       The P.S.O., Achalpur Police Station,
          Achalpur, Tah. Achalpur,
          Dist. Amravati.

 3.       Achyut S/o. Shankarrao Ulhe,
          Aged 53 years, Occ. Service,
          Assistant Registrar Co-operative Societies,
          Achalpur, Tah. Achalpur, Dist. Amravati
          R/o. 83H, Om Shivniketan Colony,
          Shegaon Road, Gadgenagar,
          Amravati.                                       . . . . NON-APPLICANTS
 ---------------------------------------------------------------------------------------------
 Shri S.G. Malode, Advocate for applicants.
 Shri N.S.Rao, Additional Public Prosecutor for Non-applicant
 Nos.1 and 2 - State.
 -------------------------------------------------------------------------------------------
                           CORAM: Z.A. HAQ & AMIT B. BORKAR, JJ.

DATED : 21/01/2021.

 ORAL JUDGMENT : (PER AMIT B. BORKAR, J.)





                                             2            J-APL-340.2019.odt

 1.                   Heard.

2. Rule. Rule is made returnable forthwith.

3. By this application under Section 482 of the Code

of Criminal Procedure, the applicant has challenged the

registration of the First Information Report No.FIR No.87/2018

dated 22.5.2018 registered with the non-applicant no.2 - Police

Station, at the instance of the non-applicant no.3. Charge-sheet

no.113 dated 24.12.2018 is filed.

4. The First Information Report came to be registered

against the applicant with the allegation that the applicant had

advanced loans to the persons, who are residing outside the area

of licence granted to the applicant. It is alleged that due to

disbursement of loan to the persons outside area of licence, many

farmers are denied the benefit of loan waiver scheme of the State

Government. With the said allegations, an offence under Section

41 of the Maharashtra Money Lending (Regulation) Act, 2014 (for

short "the Act of 2014") was registered against the applicant.

 5.                   The applicant, therefore, filed           the present

 application challenging registration of the            First Information





                                                  3             J-APL-340.2019.odt

Report. This Court on 1st August 2018 issued notice to the non-

applicants for final disposal.

6. The non-applicant no.3 in pursuance of notice, filed

reply and it is stated that the licence was issued to the applicant

for the purpose of carrying money-lending business in Amravati

district. Therefore, it was obligatory on the part of the applicant

to carry on the business of money-lending within the area of

Amravati district. It is stated that the applicant advanced loan to

borrowers who were not resident of Amravati district.

7. We have carefully considered the contents of the

First Information Report. After meaningful scrutiny of the First

Information Report, in our view, the point involved in the present

application is, whether advancing of loans to the borrowers

residing outside the area of licence, can attract penal

consequences as contemplated by Section 41 of the Act of 2014.

8. To address the question formulated by us and for

better appreciation of the contentions urged by the learned

Advocates appearing for the parties, it would be advantageous to

reproduce the provisions of Section 2 (3) of the Act of 2014,

4 J-APL-340.2019.odt

which defines expression, "business of money-lending" and the

definition of "debtor" under Section 2 (7) of the Act of 2014. The

definition of "business of money-lending" in the Act of 2014,

reads thus:

"Section 2 (3) - "business of money-lending means the business of advancing loans whether in cash or kind and whether or not in connection with, or in addition to any

other business."

The definition of "debtor" in the Act of 2014 reads

thus:

"Section 2 (7) - "debtor" means a person to whom a loan is advanced whether in cash or kind and includes his successor in interest or surety".

9. Section 4 of the Act of 2014, which puts an embargo on

carrying on of the business of money-lending except in the area

for which the money-lender has been granted a licence. Section 4

of the Act of 2014 reads as under:

"4. Money-lender not to carry on business of money-lending

except for area under licence and except in accordance with

terms of licence - No money-lender shall carry on the business

of money-lending except in the area for which he has been

granted a licence and except in accordance with the terms and

conditions of such licence."

5 J-APL-340.2019.odt

10. The offence registered against the applicant is under

Section 41 of the Act of 2014, which reads as under:

"41.Obtaining licence under fictitious name, carrying on money-

lending at a place not mentioned in licence, etc.

Whoever,-

(a) obtains a licence in the name which is not his true name or carries

on the business of money-lending under the licence so obtained; or

(b) carries on the business of money-lending at any place not

mentioned in the licence authorizing him to carrying on such

business; or

(c) enters into any agreement in the course of business of money-

lending without a valid licence, or under a licence obtained in the

name which is not his true name, shall, on conviction, be punished,-

(i) for the first offence, with imprisonment of either description which

may extend to one year or with fine which may extend to rupees

fifteen thousand or with both, and

(ii) for the second and subsequent offence, in addition to or in lieu of,

the penalty specified in clause (i) with imprisonment of either

description which shall not be less than five years, where such person

is not a company, and with fine which shall not be less than rupees

fifty thousand, where such person is a company".

11. Section 41 of the Act of 2014 creates offence for

carrying on the business of money-lending at the place not

6 J-APL-340.2019.odt

mentioned in the licence authorising him to carry on such

business.

12. The expression "business of money-lending" has

been defined to mean the business of advancing loan. The

expression "carries on business" implies that there must be some

real systematic and organized course of activities or conduct with

a set purpose of monetary profit. There must exist the

characteristic of volume, frequency, continuity and system

indicating an intention to make a profit . No single test is decisive

of the intention to carry on a business. The expression "carrying

on business", has to be interpreted taking into consideration the

object and scheme of the Act of 2014. The Act of 2014 and in

particular, sub-section (3) of Section 2 defines the business of

money lending to mean the business of advancing loans. The Act

has defined word "debtor" but neither Section 41 nor Section 4 of

the Act of 2014 has any reference to the word 'debtor'. The

essential ingredient of offence is the term "carries on business",

which is defined as the business of advancing loans. Therefore the

expression "carries on business" needs to be interpreted in

relation to the place of advancing of loan and not in relation to

where the debtor resides. To constitute a business as contemplated

7 J-APL-340.2019.odt

by sub-section (3) of Section 2 of the Act of 2014, the act of

advancing of loan is necessary. It is not dependent on the

residence of the debtor. The expression "place" mentioned in the

licence in sub-clause (b) of Section 41 of the Act of 2014 cannot

be interpreted in relation to the residence of the debtor since the

business as contemplated in the provisions of the Act of 2014 is

restricted to advancing of loan.

13. In the facts of the present case, the allegations and

the material placed on record by the non-applicants, is not that the

applicant went outside the district and advanced loans to the

debtors residing outside the area of licence. Merely because the

applicant had advanced loans to the debtors residing outside the

area of licence would not attract the provisions of sub-section (b)

of Section 41 of the Act of 2014. Even, in the reply filed by the

non-applicants, it is not the case of the non-applicants that the

applicant has advanced loan by opening a place of business

outside the area of licence.

14. The parameters of exercise of powers conferred on

this Court under Section 482 of the Code of Criminal Procedure

being settled, that in order to prevent abuse of process of Court

8 J-APL-340.2019.odt

and to secure ends of justice, this power can be exercised, then

there is no doubt that this is one case where this power needs to

be exercised. In terms of the decision of the Apex Court in the

case of State of Haryana Vs. Bhajanlal , (1992 Supp (1) SCC 335),

the power under Section 482 of the Code of Criminal Procedure

can be exercised by this Court, where the allegations made in the

First Information Report, even if they are taken at their face value

and accepted in their entirety, do not prima facie constitute an

offence under sub-section (b) of Section 41 of the Act of 2014.

Therefore, the continuance of the proceedings against the

applicant would amount to abuse of the process of Court.

We, therefore, pass the following order:

ORDER

First Information Report No.FIR No.87/2018 dated 22.5.2018

registered with the non-applicant no.2 Police Station and

consequential charge-sheet No.113/2018 are quashed and set

aside.

Rule is made absolute in the aforesaid terms.

                   JUDGE                                            JUDGE



Ambulkar