Sanjay Hemantbhai Pandit vs State Of Gujarat
2021 Latest Caselaw 5679 Guj

    R/SCR.A/8769/2019                            JUDGMENT DATED: 09/06/2021




             IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

       R/SPECIAL CRIMINAL APPLICATION NO. 8769 of 2019
                             With
CRIMINAL MISC.APPLICATION (FIXING DATE OF EARLY HEARING) NO.
                          1 of 2019
                              In
       R/SPECIAL CRIMINAL APPLICATION NO. 8769 of 2019



FOR APPROVAL AND SIGNATURE:

HONOURABLE MS. JUSTICE GITA GOPI

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1     Whether Reporters of Local Papers may be allowed
      to see the judgment ?

2     To be referred to the Reporter or not ?

3     Whether their Lordships wish to see the fair copy
      of the judgment ?

4     Whether this case involves a substantial question
      of law as to the interpretation of the Constitution
      of India or any order made thereunder ?

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                        SANJAY HEMANTBHAI PANDIT
                                  Versus
                            STATE OF GUJARAT
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Appearance:
MR S M SOJATWALA (3499) for the Applicant(s) No. 1
NOTICE SERVED BY DS(5) for the Respondent(s) No. 2
MS MONALI BHATT, ADDL. PUBLIC PROSECUTOR(2) for the
Respondent(s) No. 1
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    CORAM:HONOURABLE MS. JUSTICE GITA GOPI

                             Date : 09/06/2021

                             ORAL JUDGMENT

Rule. Learned Additional Public Prosecutor waives service of

R/SCR.A/8769/2019 JUDGMENT DATED: 09/06/2021

notice of rule on behalf of respondent State.

Though served, none appears on behalf of respondent No.2, original complainant. With the consent of learned advocates on both the sides, the matter was taken up for final hearing today.

1. By way of this petition filed under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure (for short, "the Cr.P.C."), the petitioner has prayed to quash and set aside the complaint being C.R. No. I - 119 of 2019 registered with A Division Police Station, Rajkot City for the offences punishable under Sections 5, 40 and 42 of the Gujarat Money Lenders Act, 2011 and Sections 385, 387, 504 and 506(2) of IPC and the proceedings initiated consequent thereto.

2. The facts in a nutshell are as under:-

The petitioner herein is an Advocate by profession and is also running an NGO in the name of "Rajkot Legal Support Services" at Rajkot. It is the say of the petitioner that some time in the year 2016, the respondent No.2 approached the petitioner, through his brother-in-law, seeking financial assistance for some personal reasons. The respondent No.2 assured the petitioner that he would repay the amount of loan as and when the petitioner demands the same. Accordingly, between 2016 to 2019, the petitioner paid different amounts as loan to the respondent No.2. As part of repayment of the amount borrowed from the petitioner, the respondent No.2 issued two cheques, viz. (i) No.000076 dated 16.07.2019 for Rs.3,00,000/- and No.000146 dated 16.07.2019 for Rs.2,50,000/-, in favour of the petitioner in July 2019. The petitioner deposited both the cheques; however, the same were returned with the endorsement of "Insufficient Funds" on 17.07.2019. The petitioner sent a

R/SCR.A/8769/2019 JUDGMENT DATED: 09/06/2021

Legal Notice dated 06.08.2019 to the respondent No.2 calling upon him to repay the amount, which was served upon the respondent No.2 on 07.08.2019.

2.1 It is the say of the petitioner that in spite of service of Legal Notice, the respondent No.2 did not repay the loan amount and instead on 02.09.2019 filed a criminal complaint against the petitioner, which was registered as C. R. No. I - 119 of 2019 with A Division Police Station, Rajkot City for the offences punishable under Sections 5, 40 and 42 of The Gujarat Money Lenders Act, 2011 and Sections 385, 387, 504 and 506(2) of IPC. Hence, this petition.

3. Learned advocate Mr. S. M. Sojatwala appearing for the petitioner submitted that no ingredients of the offence alleged are made out against the petitioner. It is contended that the impugned complaint is an after- thought and a counter-blast to the legal proceedings initiated by the petitioner against the respondent No.2 under the provisions of the Negotiable Instruments Act, 1881 (for short, "the N.I. Act"). The impugned complaint has been filed only with a view to harass and to pressurize the petitioner to withdraw the proceedings initiated by him under the N.I. Act. Hence, the impugned complaint is a sheer abuse of the process of law and it deserves to be quashed and set aside.

3.1 Learned advocate Mr. Sojatwala took the Court through the averments made in the impugned complaint to submit that the respondent No.2 has admitted the factum of receipt of loan amount from the petitioner as also the issuance of cheques in favour of the petitioner. It is submitted that the petitioner is an Income-Tax Assessee and that the amount lent by the petitioner to respondent No.2 is reflected in his

R/SCR.A/8769/2019 JUDGMENT DATED: 09/06/2021

Income Tax Returns. The respondent No.2 has not given any reply in response to the Legal Notice dated 06.08.2019 issued by the petitioner. If at all, the petitioner had recovered exorbitant amount as interest, the respondent No.2 had the remedy to file criminal complaint against the petitioner; however, no such steps were taken by the respondent No.2. Further, the impugned complaint is also a step for halting the payment of interim compensation under Section 143A of the N.I. Act. It was, accordingly, urged that the impugned complaint filed by respondent No.2 deserves to be quashed and set aside in exercise of the inherent powers under Section 482 of the Cr.P.C.

4. Learned Additional Public Prosecutor Ms. Bhatt submitted that the petitioner has criminal antecedents inasmuch as a complaint for offences punishable under Sections 409 and 120B of IPC was registered against the petitioner vide C.R. No. I - 128 of 2013 with P. Nagar Police Station. The petitioner is into the activity of lending money on interest at exorbitant rates. Though the respondent No.2 had repaid the entire amount of loan with interest, the petitioner had claimed additional interest, which was declined by respondent No.2. Keeping grudge against such refusal, the petitioner deposited the cheques given by respondent No.2 as surety without informing the respondent No.2 and ultimately, the cheques were dishonored. Considering the allegations made in the impugned complaint as also the criminal antecedent of the petitioner, it was submitted that this Court may not exercise the inherent powers under Section 482 in favour of the petitioner.

5. Heard learned advocates on both the sides. It appears from the record that the petitioner had lent Rs. 5,50,000/- to the respondent No.2 by way of hand loan, which fact is established from the Audited Balance-

R/SCR.A/8769/2019 JUDGMENT DATED: 09/06/2021

sheet of the petitioner for the Financial Year 2018-2019 produced on record vide Annexure-H Collectively. For the repayment of said loan, the respondent No.2 had issued two cheques in favour of the petitioner on 16.07.2019 totaling Rs.5,50,000/-. However, the said cheques got dishonored on the ground of "Insufficient Funds". The petitioner had, therefore, sent a statutory Notice dated 06.08.2019 to the respondent No.2.

6. It is pertinent to note that the respondent No.2 did not give any reply to the statutory Notice sent by the petitioner but, filed the impugned complaint on 02.09.2029. If the respondent No.2 was aggrieved by the fact that the petitioner had charged exorbitant amount of interest, then it was always open to him to file a complaint in that regard at the relevant point of time and not after the issuance of the statutory Notice on 06.08.2019; however, no such steps were taken by the respondent No.2, which casts serious doubts about the veracity of the allegations made in the impugned complaint.

7. Section 118 of the N.I. Act draws the 'presumption' that the cheques issued were duly signed and delivered. Therefore, the burden to prove the contrary is on the respondent No.2, which could be done by leading evidence before the competent Court. The respondent No.2 could raise all defences in the proceedings initiated by the petitioner and which are pending before the Special Court under the N.I. Act. If the respondent No.2 believed that the petitioner had played mischief or had committed fraud as regards the cheques issued by him, then it was always open to him to instruct his Bank for the "stop payment" of such cheques; however, no such action was taken by the respondent No.2. Considering the above aspects, this Court is of the opinion that the impugned

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complaint is nothing but, a counter-blast to the legal proceedings initiated by the petitioner against the respondent No.2 under the N.I. Act.

8. In State of Haryana V. Bhajan Lal and others, AIR 1992 SC 604, the Apex Court made the following observations:-

"8.1. In the exercise of the extra-ordinary power under Article 226 or the inherent powers under Section 482 of the Code of Criminal Procedure, the following categories of cases are given by way of illustration wherein such power could be exercised either to prevent abuse of the process of any Court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guide in myriad kinds of cases wherein such power should be exercised:

(a) where the allegations made in the First Information Report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused;

(b) where the allegations in the First Information Report and other materials, if any, accompanying the F.I.R. do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code;

(c) where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused;

(d) where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code;

(e) where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is

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sufficient ground for proceeding against the accused;

(f) where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and / or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party;

(g) 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."

9. Having considered the allegations made in the impugned complaint in light of the principle laid down by the Apex Court in the above decision, this Court is of the opinion that the impugned complaint filed by the respondent No.2 is a clear misuse and abuse of the process of law and deserves to be quashed and set aside in exercise of the inherent powers under Section 482 of Cr.P.C.

10. For the foregoing reasons, the petition is allowed. The impugned complaint being C.R. No. I - 119 of 2019 registered with A Division Police Station, Rajkot City and all the proceedings initiated pursuant thereto are hereby quashed and set aside. Needless to say that the proceedings pending between the parties under the N. I. Act shall be decided on its own merits, without being influenced by any of the observations made by this Court in this judgment and order. Rule is made absolute. The Civil Application stands disposed of accordingly.

( GITA GOPI, J )

PRAVIN KARUNAN