IN THE HIGH COURT OF KERALA AT ERNAKULAM
Crl.MC.No. 64 of 2010()
1. MANEESH KUMAR V.S., S/O. SOMANATHAN,
... Petitioner
2. K. SOMANATHAN, S/O. KUNJU PILLAI,
3. K. KRISHNAN, S/O.MADHAVAN,
4. LAKSHMIKUTTY,
Vs
1. STATE OF KERALA, REP. BY SUB
... Respondent
2. M/S BELL LEASING AND HIRE PURCHASE
For Petitioner :SRI.RINNY STEPHEN CHAMAPARAMPIL
For Respondent :PUBLIC PROSECUTOR
The Hon'ble MR. Justice M.SASIDHARAN NAMBIAR
Dated :16/09/2010
O R D E R
M.SASIDHARAN NAMBIAR,J.
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CRL.M.C.NO.64 OF 2010
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Dated 16th September, 2010
O R D E R
Petitioners are the accused in
C.C.216/2009 on the file of Chief Judicial
Magistrate’s Court, Ernakulam, taken
cognizance for the offence under Section
420 of Indian Penal Code on Annexure-A5
private complaint filed by second
respondent. Petition is filed under Section
482 of Code of Criminal Procedure to quash
the cognizance taken on Annexure-A7 final
report for the offence under Section 420 of
Indian Penal Code as well as Annexure-A8
order passed by the learned Magistrate, in
a petition filed by the second respondent
under Section 451 of Code of Criminal
Procedure. Second respondent filed
Crmc 64/10 2
Annexure-A5 complaint before the Chief Judicial
Magistrate, Ernakulam against the petitioners
alleging that they committed offence under
Section 420 of Indian Penal Code. Learned
Magistrate sent the complaint for investigation
under Section 156(3) of Code of Criminal
Procedure, based on which Annexure-A6 FIR was
prepared and crime No.1666/2009 of Ernakulam
Central Police Station was registered. After
investigation Annexure-A7 final report was
filed which was taken cognizance by the
learned Magistrate. When JCB, which was
purchased by the first petitioner on the
financial assistance of the second respondent
was seized, both the first petitioner and the
second respondent sought interim custody of the
JCB under Section 451 of Code of Criminal
Procedure. By Annexure-A8 order interim custody
was granted to the second respondent. Case of
Crmc 64/10 3
the petitioners is that even if the entire
allegations in Annexure-A5 complaint as well
as the case in Annexure-A7 final report are
accepted, an offence under Section 420 of
Indian Penal Code is not attracted and
therefore, continuation of the proceedings is
only an abuse of process of the Court.
2. Learned counsel appearing for the
petitioners and second respondent were heard.
3. Annexure-A5 complaint discloses the
case of the second respondent. According to
the second respondent company, first petitioner
approached the company to purchase a JCB on
hire purchase agreement and second respondent
agreed to give financial assistance and first
petitioner as principal loanee and petitioners
2 to 4 as guarantors executed a hire purchase
agreement agreeing to pay the value of JCB in
36 equal monthly installments of Rs.41,560/-
Crmc 64/10 4
each and the JCB was purchased and last
installment is to be paid on or before
28/2/2011. It is alleged that though first
petitioner paid four monthly installments, he
defaulted subsequent monthly installments and
when second respondent contacted the first
petitioner on 7/2/2009 at his residence, he
agreed to settle the over dues on or before
15/3/2009. It is alleged that after 31/3/2008
no vehicle tax was paid and RC book was
surrendered before the company and insurance
taken on 5/11/2007 expired on 4/11/2008 and
insurance policy was not renewed and when the
representative of the company contacted the
first petitioner, he agreed to renew the
insurance policy and agreed to pay vehicle tax
and still it was not done. On 6/2/2009 second
respondent company sent a notice to the first
petitioner to pay installment dues amounting to
Crmc 64/10 5
Rs.3,03,793.72, namely the amount payable in
seven defaulted installments. It is alleged
that first petitioner did not turn up and
therefore, on 17/3/2009 company sent a notice
recalling the entire loan amount advanced as
the first petitioner failed to pay the
installments and clause 4(a) of the
hypothecation Agreement enables the company to
take steps to recall the loan and forfeit the
vehicle and it was intimated to the first
petitioner. It is also contended that
meanwhile, the first petitioner issued a
cheque dated 13/4/2009 for Rs.12,90,000/- and
when it was presented, the same was dishonoured
for want of sufficient funds and in spite of
notice, the amount was not paid and therefore,
proceedings under Section 138 of Negotiable
Instruments Act is initiated as S.T.1978/2009.
It is claimed that the intention of the
Crmc 64/10 6
petitioners is to dismantle the vehicle and
thereby cheat the company and therefore, an
offence under Section 420 of Indian Penal Code
is attracted. Annexure-A7 final report also
shows that an offence under Section 420 of
Indian Penal Code is alleged contending that
though four installments were paid, subsequent
installments were not paid and first petitioner
did not return the JCB to the company and
thereby they committed the offence.
5. As rightly pointed out by the
learned counsel appearing for the petitioners
even if, the entire allegations in Annexure-A5
as such are accepted, so also the allegations
in Annexure-A7 final report, offence under
Section 420 of Indian Penal Code is not
attracted. What is alleged in the complaint is
that first petitioner as the principal debtor
and petitioners 2 to 4 as guarantors obtained
Crmc 64/10 7
loan for purchasing JCB on hire purchase and
the first petitioner agreed to pay the value of
JCB in 36 equal monthly installments at the
rate of Rs.41,560/- and defaulted to pay
subsequent installments after fourth
installment and in spite of notice the amount
was not paid and even insurance policy was not
renewed and the vehicle tax was not paid. None
of these aspects would attract an offence
under Section 420 of Indian Penal Code. When
there is no case for the second respondent that
either when the loan was applied for or granted
or availed, the first petitioner or his
guarantors, petitioners 2 to 4 had a dishonest
intention to cheat or not to pay the value of
JCB to be purchased on hire purchase. At best
it could be said that subsequently they
defaulted to pay the installments due under the
hire purchase agreement. That will not attract
Crmc 64/10 8
an offence under Section 420 of Indian Penal
Code. Hence cognizance taken for the offence
under Section 420 of Indian Penal Code on
Annexure-A7 final report can only be quashed.
When cognizance taken is quashed, Annexure-A8
order granting interim custody of the vehicle
to the second respondent would lapse by
itself.
Petition is allowed. C.C.216/2009 on the
file of Chief Judicial Magistrate’s Court,
Ernakulam is quashed. Annexure-A8 order passed
by Chief Judicial Magistrate, Ernakulam is also
quashed.
M.SASIDHARAN NAMBIAR,
JUDGE.
uj.