Bombay High Court
Sandip Uttam Shinde And Another vs The State Of Maharashtra And Another on 4 September, 2024
Author: Vibha Kankanwadi
Bench: Vibha Kankanwadi
2024:BHC-AUG:22195-DB
(1) appln-3763-2022.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
CRIMINAL APPLICATION NO.3763 OF 2022
1. Sandip s/o Uttam Shinde,
Age: 39 years, Occu. Actor,
2. Arti w/o Sandip Shinde
Age: 35 years, Occu. Housewife,
Both R/o Jamkhed, Tq. Jamkhed,
District: Ahmednagar. ..Applicants
(Orig. Accused Nos.1 & 2)
Versus
1. The State of Maharashtra
Through Investigating Officer
Jamkhed Police Station,
Tq. Jamkhed, Dist. Ahmednagar.
2. Devidas s/o Bansi Shinde
Age: 52 years, Occu. Business,
R/o Near State Bank Icon City, Jamkhed,
Tq. Jamkhed, District: Ahmednagar. ..Respondent
(Resp. No.2-Orig. Informant)
...
Mr. S. D. Jayabhar h/f Mr. D. R. Jayabhar, Advocate for the
Applicants.
Mr. A. R. Kale, APP for Respondent No.1.
Mr. A. S. More, Advocate for Respondent No.2.
...
CORAM : SMT. VIBHA KANKANWADI AND
S. G. CHAPALGAONKAR, JJ.
DATED : 04th SEPTEMBER, 2024.
JUDGMENT (Per S. G. Chapalgaonkar, J.):
-
1. The applicants seek to quash and set aside criminal
proceeding in S.C.C. No.198/2022 pending before Judicial
Magistrate First Class, Jamkhed, which is arising out of Crime
No.77/2022 registered with Jamkhed Police Station, Dist.
Ahmednagar for offences punishable under Section 39 of the
(2) appln-3763-2022.odt
Maharashtra Money Lending (Regulation) Act, 2014 (for short 'Act
of 2014') and Sections 504, 506 of the Indian Penal Code.
2. The respondent no.2 herein lodged report dated 04.02.2022
with Police Station Jamkhed alleging that he runs sugarcane juice
business at Bus Stand. In the year 2018, he was in need of money
for establishment of hotel business. He had obtained loan of
Rs.1,00,000/- at the interest rate of 10% per month from applicant
no.1-Sandip Uttamrao Shinde. By way of security of loan a cheque
of Rs.1,00,000/- was drawn on account of son of informant in the
name of applicant no.1. On 01.01.2019 total amount of
Rs.1,50,000/- was deposited with Mrs. Arti Sandip Shinde i.e.
applicant no.2 towards repayment of loan alongwith interest.
Although entire amount of loan was repaid, applicant no.1 raised
dispute and pressurized informant to transfer his plot admeasuring
2887 sq. ft.. Accordingly, a notarized document was executed in his
favour. On the basis of aforesaid, Crime No.77/2022 dated
04.03.2022 came to be registered against applicants with Police
Station Jamkhed, Dist. Ahmednagar for offence punishable under
Section 39 of the Act of 2014 as well as Sections 504, 506 of the
Indian Penal Code. The investigation progressed in pursuance of
aforesaid crime and finally charge-sheet has been filed in the Court
of Judicial Magistrate First Class, Jamkhed. It has been
culminated in S.C.C No.198/2022.
3. Mr. S. D. Jayabhar, learned Advocate appearing for the
applicants vehemently submits that applicants have been falsely
implicated in aforesaid crime. The alleged advancement of amount
is of the year 2018. The alleged refund of amount is on 01.01.2019.
However, present FIR is lodged on 04.03.2022. There is no
plausible explanation for such inordinate delay in reporting
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transactions. He would submit that entire case of respondent no.2
is based on false and frivolous allegations. He would submit that
applicant no.1 has instituted criminal proceeding in S.C.C.
No.97/2019 against son of respondent no.2 under Section 138 of the
Negotiable Instrument Act towards dishonor of cheque of
Rs.1,00,000/-. Consequently, process has been issued against son of
respondent no.2 vide order dated 22.02.2019. Mr. Jayabjhar would
also invite attention of this Court to the notarized agreement to
sale dated 08.02.2021, by which respondent no.2 has agreed to sale
property bearing no.3260/7262 situated in Gut No.1080 at
Jamkhed for total consideration of Rs.9,50,000/-, out of which
Rs.1,00,000/- was paid by applicant no.1 towards earnest amount
and Rs.8,50,000/- was balance that was to be paid at the time of
execution of sale deed within a period of one year. Mr. Jayabhar
would invite attention of this Court to the legal notice served upon
respondent no.2 on behalf of applicant no.1, by which, respondent
no.2 was called upon to execute sale deed in pursuance of
agreement to sale. The said notice was duly replied by respondent
no.2 admitting execution of document and transaction, further,
called upon applicant no.1 to complete the transaction on or before
08.02.2022. Mr. Jayabhar would, therefore, submit that entire
story in FIR in Crime No.77/2022 leading to criminal proceeding in
S.C.C. No.198/2022 is false and improbable. He would, therefore,
urge to quash the proceeding by invoking powers under Section 482
of the Criminal Procedure Code.
4. Per contra, Mr. A. R. Kale, learned APP appearing for the
State and Mr. A. S. More, learned Advocate for respondent no.2
vehemently opposes the prayers in the application. They would
submit that applicant no.1 had advanced loan at the interest rate
of 10% per month. The cheque towards security of such loan was
(4) appln-3763-2022.odt
taken which was drawn on account of son of respondent no.2. On
the basis of such cheque, false criminal case has been lodged by the
applicants. The respondent no.2 was forced to execute agreement
to sale in pursuance of money lending business and recovery of
amount and interest. They would, therefore, submit that there is
sufficient material for trial of applicants for offence punishable
under Section 39 of the Act of 2014.
5. We have considered submissions advanced by learned
Advocates appearing for respective parties. We have carefully
considered contents of FIR and other material placed into service
by parties. We observed that respondent no.2 filed report dated
04.03.2022 with Police Station Jamkhed leading to registration of
Crime No.77/2022. The gist of allegation can be summarized as
under:
The applicant no.1 advanced loan of Rs.1,00,000/- to
respondent no.2. The interest rate of 10% per month was charged.
A cheque towards security of repayment of loan amount was
obtained from respondent no.2. The said cheque was drawn on the
account standing in the name of son of respondent no.2. The loan
amount alongwith interest i.e. Rs.1,50,000/- was deposited with
applicant no.2, who is wife of applicant no.1. The applicants raised
demand of additional amount towards principle and interest. The
applicant no.1 has further insisted for transfer of plot owned by
respondent no.2. Upon such insistence, respondent no.2 has
executed notarized agreement to sale in favour of applicant no.1.
Accordingly, it is alleged that applicant no.1 is dealing in money
lending business and committed offence punishable under Section
39 of the Act of 2014.
(5) appln-3763-2022.odt
6. To test the veracity of aforesaid contents in the FIR, which
according to applicants are palpably false and concocted, we have
considered uncontroverted documents placed on record before us.
It appears that, son of respondent no.2 namely Sudarshan Devidas
Shinde has issued a cheque of Rs.1,00,000/- dated 01.01.2019 in the
name of applicant no.1. On presentation, the said cheque was
dishonored on 11.01.2019. The applicant no.1 issued legal notice
dated 15.01.2019 raising demand of amount under dishonored
cheque. On failure to make payment in terms of demand notice,
the applicants instituted S.C.C. No.97/2019 in the Court of Judicial
Magistrate First Class at Jamkhed against son of respondent no.2.
On 22.02.2019 the process has been issued.
7. On 08.02.2021 respondent no.2 has executed agreement to
sale in favour of applicant no.1 in respect of land bearing no.
3260/7262 situated within the limits of Municipal Council Jamkhed
in favour of applicant no.1. The respondent no.2 agreed to transfer
plot admeasuring 55 ft. x 52 ft. in favour of applicant no.1 for
consideration of Rs.9,50,000/-. The amount of Rs.1,00,000/- is paid
in cash towards earnest money. The balance of Rs.8,50,000/- was
to be paid within a period of one year from the date of agreement,
then sale deed was to be executed. Before execution of sale deed,
measurement of plot was to be carried and after leaving 30 ft. wide
road on Eastern side, the actual possession was to be handed over
to applicant no.1. Since transaction was not completed within
stipulated period, applicant no.1 issued legal notice dated
28.01.2022 calling upon respondent no.2 to execute sale deed. The
respondent no.2 replied said notice on 03.02.2022 and accepted
transaction and shown his readiness to complete transaction on or
before 08.02.2022.
(6) appln-3763-2022.odt
8. The aforesaid sequence of events would clearly reveal civil
dispute subsists between parties as regards to the transfer of land.
Similarly, applicant no.1 has instituted criminal proceeding for
dishonor of cheque against son of respondent no.2. If the contents
of reply given by respondent no.2 to the legal notice of applicant
no.1 is perused, it is evident that nature of transaction to be of out-
and-out sale has been clearly admitted. In this background, it is
apparent that FIR in Crime No.77/2022 is apparently improbable
and patently false. The story of advancement of loan of
Rs.1,00,000/- or repayment of said amount and transfer of land as a
part of such loan transaction is inconsistent with the case of
respondent no.2 put forth in his reply to the legal notice. Further,
pendency of criminal proceeding under the provision of Negotiable
Instrument Act against son of respondent no.2 is conveniently
suppressed in the FIR.
9. In the aforesaid background, if we look to the language
employed in Section 39 of the Act of 2014, it is discernible that
business of money lending without obtaining valid license is made
punishable with imprisonment for five years with fine of
Rs.50,000/-. At this stage, it would be apposite to make reference
to Section 39 of the Act of 2014, which reads thus:
"39. Whoever carries on the business of money-lending
without obtaining a valid licence, shall, on conviction, be
punished with imprisonment of either description for a term
which may extend to five years or with fine which may extend
to fifty thousand rupees or with both."
10. This Court in case of Mandubai Vitthoba Pawar Vs. State
of Maharashtra through Superintendent of Police and
Others1 considered scope of term "business of money lending" as
defined in Sub Section (3) of Section (2) of the Act of 2014 and
concluded that unless there is continuous and systematic activity
1 2016 (1) Bom. C.R. (Cri.) 794.
(7) appln-3763-2022.odt
with a view to earning income, the existence of money lending
business cannot be presumed. It is also observed that isolated
transaction of money lending would not be enough to meet out
requirement of term "business of money lending". In yet another
judgment in case of Anup Niranjan Dodiya and Another Vs.
State of Maharashtra and Another 2 it is observed that the very
foundation of offence of carrying on business of money lending is
regular business activity of advancing loan to different persons and
gain profit or claim some advantage for earning money.
11. Bearing in mind aforesaid parameters of law and
interpretation of term " business of money lending", if contents of
FIR in present case are appreciated, the singular transaction of
lending amount of Rs.1,00,000/- to respondent no.2 would not
constitute business of money lending. From the FIR or other
material, there is nothing to gather that applicant no.1 is
continuously involved in lending money and earning profit out of
such business. In absence of foundation of material to term
activity of applicants as money lending business, the prosecution
under Section 39 of the Act of 2014 cannot be sustained. So far as
offences under Sections 504 and 506 of the Indian Penal Code are
concerned, we do not find specific allegations in the FIR that would
constitute such offences. In that view of the matter, we are
convinced that in light of guidelines laid down by the Supreme
Court of India in case of State of Haryana and Ors. Vs. Ch.
Bhajan Lal and Ors.3 this is a fit case to exercise powers under
Section 482 of the Criminal Procedure Code. Hence, we proceed to
pass following order:
ORDER
a. Criminal Application is allowed.
2 2020 All.M.R.(Cri) 2497.
3 AIR 1992 SC 604.
(8) appln-3763-2022.odt
b. The FIR in Crime No.77/2022 registered with Jamkhed
Police Station, Dist. Ahmednagar for offences punishable under
Section 39 of the Maharashtra Money Lending (Regulation) Act,
2014 and Sections 504, 506 of the Indian Penal Code and criminal
proceeding in S.C.C. No.198/2022 pending before Judicial
Magistrate First Class at Jamkhed, are hereby quashed and set
aside.
c. Criminal Application is disposed of.
(S. G. CHAPALGAONKAR) (SMT. VIBHA KANKANWADI)
JUDGE JUDGE
Devendra/September-2024
