Madras High Court
Azhagu Chitra vs State Rep. on 13 September, 2022
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 13.09.2022
CORAM:
THE HONOURABLE MR. JUSTICE N.ANAND VENKATESH
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
and
Crl.M.P(MD).Nos.7988 of 2018
6682 and 380 of 2019
Crl.O.P(MD).No.17989 of 2019
1.Azhagu Chitra
2.C.Palpandi
3.P.Murugeshan
4.M.Rasaiah
5.R.Palpandian : Petitioners/Accused 2 to 4
7&9
Vs.,
1.State rep., by by
The Inspector of Police,
District Crime Branch,
Theni District.
(Crime No.42 of 2018) : 1st Respondent/Complainant
2.R.Raja : 2nd Respondent/Defacto
Complainant
PRAYER: Criminal Original Petition filed under Section 482 of the
Code of Criminal Procedure, to call for the records in FIR in Crime
No.42 of 2018 on the file of the first respondent dated 28.09.2018
quash the same as against these petitioners.
https://www.mhc.tn.gov.in/judis
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
Crl.O.P(MD).No.882 of 2019
1.Lakshmanan
2.Karuppasamy
3.Balamurugan
4.Thangapandian
5.Ganesan : Petitioners/Accused 1,5,8,10 & 11
Vs.,
1.State rep., by
The Inspector of Police,
District Crime Branch,
Theni District.
(Crime No.42 of 2018) : 1st Respondent/Complainant
2.R.Raja : 2nd Respondent/Defacto
Complainant
PRAYER: Criminal Original Petition filed under Section 482 of the
Code of Criminal Procedure, to call for the records in FIR in Crime
No.42 of 2018 on the file of the first respondent dated 28.09.2018
quash the same as against these petitioners.
In Both Petitions
For Petitioners : Mr.R.Maheswaran
For Respondents : Mr.A.Thiravadi Kumar (for R1)
Additional Public Prosecutor
Mr.M.Jagadees Pandian (for R2)
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Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
COMMON ORDER
These petitions were filed to quash the FIR registered in Crime No.
42 of 2018 and pending investigation on the file of District Crime
Branch, Theni District.
2.The sum and substance of the complaint given by the second
respondent, namely, Sakthi Finance Company Limited, is that A1,A5 and
A8 borrowed money for the purchase of vehicles and A2, A3, A4, A6,A7
and A9 stood as guarantors for the repayment of the amount and A10 and
A11 were the persons, who introduced A1, A5 and A8 to the second
respondent company at the time of securing the loan from the company.
The further case of the second respondent is that the borrowers repaid
9-10/10-11 installments and thereafter, failed to repay the amount.
Thereafter, they entered into a conspiracy with the other accused persons
and sold the vehicles to third parties. Thus, according to the second
respondent, the petitioners committed offence under Sections 120 B, 406,
420 and 506(i) of IPC.
https://www.mhc.tn.gov.in/judis
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
3.The learned counsel for the petitioners would submit that it is a
case where the parties were governed by a contract. Even according to
the second respondent, installments were paid initially and there was
default subsequently and at the best will only amount to a breach of
agreement and hence, by no stretch, offence of cheating has been made
out in the present case. The learned counsel further submitted that the
second respondent had initiated three independent arbitration
proceedings against A1, A5, A8 and the guarantors and the properties
that were given as security was attached and final award was also passed
and presently, the matter is pending by way of execution proceedings. In
view of the same, the learned counsel submitted that the criminal
proceedings initiated by the second respondent is an abuse of process of
law, apart from the fact that no offence has been made out against the
petitioners.
4.The learned counsel in order to substantiate his submission relied
upon the judgments of the Hon'ble Supreme Court (1)In the case of Alpic
Finance Ltd., Vs., P.Sadasivan and another reported in (2001) 3 SCC
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Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
513, (2)In the case of V.P.Shrivastava Vs., Indian Explosives Limited
and others reported in (2010) 10 SCC 361 and (3)In the case of
Thermax Limited and others Vs., K.M.Johny and others reported in
(2011) 13 SCC 412.
5.The learned Additional Public Prosecutor appearing on behalf of
the respondent Police submitted that immediately after the FIR was
registered, investigation commenced and statements were recorded from
the witnesses. On going through the same, the learned Additional public
Prosecutor submitted that the fact that the borrowers had alienated the
vehicles even without repaying back the entire amount shows the
culpable mind of the accused persons and the same definitely requires
investigation on the part of the respondent Police. The learned
Additional Public Prosecutor relying upon the judgment of the Hon'ble
Supreme Court in the case of Neeharika Infrastructure Private Limited
Vs., State of Maharastra and other reported in 2021 (2) Madras Weekly
Notes(Crl.,) 90 submitted that this Court must be very slow in interfering
with the investigation, more particularly, where there is scope for
https://www.mhc.tn.gov.in/judis
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
investigation in the present case with respect to the alienation of the
vehicles made by the accused persons even without repaying back the
loan borrowed from the second respondent.
6.The learned counsel appearing on behalf of the defacto
complainant submitted that sufficient allegations have been made in the
complaint and this case involve d conspiracy between the accused
persons, which will get finally established, only if the respondent Police
is permitted to complete the investigation. The learned counsel
submitted that the initiation of Arbitration proceedings will have nothing
to do with the initiation of a criminal case, since the culpable mind of the
accused persons is apparent with the very fact that the vehicles were
alienated even without repaying the amount borrowed from the defacto
complainant. The learned counsel therefore submitted that these
petitions are liable to be dismissed and a direction may be given to the
respondent Police to complete the investigation within a stipulated time.
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Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
7.This Court has carefully considered the submissions made on
either side and perused the materials on record.
8.This Court bears in mind the caution given by the Hon'ble Apex
Court in the judgment cited by the learned Additional Public Prosecutor,
wherein it has been categorically held that this Court must be very slow
in interfering with investigation in a case, while dealing with a petition
seeking to quash the FIR. The Hon'ble Apex Court has made it clear that
the investigation agency must be given a free hand to proceed further
with the investigation even if there is some element of culpability
involved in a given case. In short, the Hon'ble Apex Court has held that
allowing investigation must be the Rule and interference with the same
must be an exception.
9.In the present case, the element of cheating has been brought out
by the defacto complainant by pointing out two factors. The first factor
is that the borrowers did not repay back the entire loan amount and they
paid only the initial installments. The second factor that has been
https://www.mhc.tn.gov.in/judis
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
pressed into service by the defacto complainant is that the borrowers
even without repaying back the loan amount, had proceeded to sell the
vehicle to the third parties and that clearly shows the culpable mind.
According to the defacto complainant, the borrowers had done this in
conspiracy with all the other accused persons.
10.In the considered view of this Court, even if the allegations
made in the complaint are taken as it is, there will be nothing against the
guarantors that requires any investigation irrespective of the vehicles are
sold or not, by the principal borrowers. Ultimately, when it comes to
recovery of the amount, the guarantors will have to fulfill the liability.
Hence, the alienation of the vehicles by itself does not take the
guarantors to any advantageous position. Even while reading the
complaint, except general allegations, there is absolutely no material to
show that the guarantors will have to be prosecuted in this case. In view
of the same, this Court is inclined to interfere with the investigation
insofar as A2, A3, A4, A7 and A9 are concerned. A6 was also a
guarantor and since he died during the pendency of this case, the
proceedings abated as against A6 automatically.
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Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
11.Insofar as the principal borrowers, namely, A1,A5,A8 and the
role played by A10 and A11, the allegations made in the complaint
requires investigation by the respondent Police. Initiation of Arbitration
proceedings by itself will not be a bar for the Police to investigate the
case in order to find out if there was any criminal intent on the part of the
accused persons to cheat the defacto complainant.
12.In view of the above discussion, this Court is inclined to quash
the FIR in Crime No.42 of 2018, on the file of the first respondent,
insofar as A2,A3,A4,A7 and A9 are concerned. Insofar as
A1,A5,A8,A10 and A11 are concerned, there will be a direction to the
respondent Police to continue with the investigation. The investigation
shall be completed and final report or closure report as the case may be,
shall be filed before the concerned jurisdictional Court within a period of
three (3) months from the date of receipt of a copy of this order.
13.It is made clear that any observation made by this Court in this
order shall not have any bearing on the respondent Police and it is left
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Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
open to the Investigating Officer to independently proceed further
strictly in accordance with law and come to a conclusion.
14.In the result, Crl.O.P(MD)No.17989 of 2018 is allowed and
Crl.O.P(MD)No.882 of 2019 is dismissed. Consequently, connected
Miscellaneous Petitions are closed.
13.09.2022
Index:Yes/No
Internet: Yes/No
Rmk
To
1.The Inspector of Police,
District Crime Branch,
Theni District.
2.The Additional Public Prosecutor,
Madurai Bench of Madras High Court,
Madurai.
https://www.mhc.tn.gov.in/judis
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
https://www.mhc.tn.gov.in/judis
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
N.ANAND VENKATESH, J.,
Rmk
Crl.O.P.(MD)Nos.17989 of 2018 and 882 of 2019
and
Crl.M.P(MD).Nos.7988 of 2018
6682 and 380 of 2019
13.09.2022
https://www.mhc.tn.gov.in/judis
