{"id":150433,"date":"2003-09-04T00:00:00","date_gmt":"2003-09-03T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/devi-padmanabhan-vs-state-on-4-september-2003-2"},"modified":"2016-09-22T05:05:48","modified_gmt":"2016-09-21T23:35:48","slug":"devi-padmanabhan-vs-state-on-4-september-2003-2","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/devi-padmanabhan-vs-state-on-4-september-2003-2","title":{"rendered":"Devi Padmanabhan vs State on 4 September, 2003"},"content":{"rendered":"
Madras High Court<\/div>\n
Devi Padmanabhan vs State on 4 September, 2003<\/div>\n
       \n\n  \n\n  \n\n \n \n IN THE HIGH COURT OF JUDICATURE AT MADRAS\n\nDATED: 04\/09\/2003\n\nCORAM\n\nTHE HONOURABLE MR.JUSTICE V.KANAGARAJ\n\nCRIMINAL ORIGINAL PETITION No.22438 OF 2003\nAND\nCRL.M.P.No.6397 OF 2003.\n\nDevi Padmanabhan                                       ... Petitioner\n\n-Vs-\n\nState, rep.by\nThe Inspector of Police,\nEOW-II (Headquarters)\nChennai-600 002.                                        ... Respondent\n\n        Criminal Original Petition filed under Section  482  of  the  Code  of\nCriminal Procedure for the relief as stated therein.\n\nFor petitioner :  Mr.K.Rajasekaran\n\nFor respondent :  Mr.A.N.Thambidurai,\n                Govt.Advocate (crl.side)\n\n:O R D E R\n<\/pre>\n
                The  petitioner, who is the first accused, has filed the above
\ncriminal original petition under Section 482 of the Code of Criminal Procedure
\npraying to call for the records and quash the F.I.R.  in Crime No.8 of 2003 on
\nthe file of the Inspector of Police, E.O.W.( Headquarters), Chennai.\n<\/p>\n
                2.  The petitioner would allege that on  a  private  complaint
\nfiled  by one P.Venu, Personnel Manager of Amaravathi Finance and Investments,
\n30,  Kutchery  Road,  Mylapore,  Chennai-4  alleging  commission  of  offences
\npunishable  under  Sections 420 and 506(II) IPC on the file of the Court of XI
\nMetropolitan Magistrate, Saidapet, Chennai-15 against the petitioner  and  her
\nhusband Padmanabhan, the said Court forwarded the same to the respondent under
\nSection 156(3)  Cr.P.C.    with  an  endorsement  to  register  the  case  and
\ninvestigate into; that on receipt of the same, the respondent  has  registered
\nthe FIR in his Cr.No.8\/2003, dated 6.6.2003 and started investigating into, in
\nwhich the petitioner and her husband moved this Court for anticipatory bail in
\nCrl.O.P.No.18 616 of 2003, which was dismissed by this Court on 25.6.2003.\n<\/p>\n
                3.   The  petitioner  would  further  submit  that the private
\ncomplaint for civil dispute per se is ill-motivated; that the highlight of the
\ncomplaint is that the petitioner and her husband have borrowed a sum  of  Rs.1
\ncrore  on  promise  that they would create a charge on the property situate at
\nRamanathan Street, T.Nagar, Madras;  that  the  complainant  being  a  leading
\nnon-banking  finance  company,  without verification of the title deeds of the
\nproperty and without even looking into the same  and  the  relevant  documents
\nrelating  to  the  transaction,  would not have parted with such huge amounts;
\nthat the E.O.W.  being an organisation specially created to  investigate  into
\nmatters  relating  to  NonBanking Finance Companies, who had accepted deposits
\nfrom the general public under pretext of  deceiving  the  general  public,  no
\naction  could  be initiated against the petitioner since no depositor has come
\nforward to lodge the complaint and in fact  the  complaint  should  have  been
\nreferred only to the Central Crime Branch, Egmore, for their investigation and
\nreport;  that  the  complainant  did  not file any complaint before any police
\nstation and  that  the  Magistrate,  without  even  verifying  the  same,  has
\nforwarded the private complaint to the respondent under Section 156(3) Cr.P.C.
\nOn such grounds, the petitioners would pray for the relief extracted supra.\n<\/p>\n
                4.   During arguments, the learned counsel appearing on behalf
\nof the petitioners would not only cite an order passed by this Court  reported
\nin 2003 (2)  CTC  270 (M\/s.PASUMAI IRRIGATION LIMITED vs.  M\/s.  MANSI FINANCE
\n(CHENNAI) LIMITED)<\/a> but also two other judgments, the first  one  delivered  by
\nthe  Karnataka  High  Court reported in 1999 Criminal Law Journal 53 (STATE OF
\nKARNATAKA vs.  THAMMAIAH AND OTHERS) and the other judgment of the  Honourable
\nApex  Court  reported in (2001) 3 SCC 333 (CENTRAL BUREAU OF INVESTIGATION vs.
\nSTATE OF RAJASTHAN AND ANOTHER).<\/a>\n<\/p>\n
                5.  So far as the first judgment cited above, passed  by  this
\nCourt is concerned, the learned counsel would lay emphasis on the aspect dealt
\nwith  by  this  Court  to  the effect that the Magistrates, cannot, so easily,
\nusurp the jurisdiction of the civil Court  and  that  of  the  powers  of  the
\npolice, immediately after a private complaint is filed before it and refer the
\nsame under Section 156(3) Cr.P.C.  to any investigating agency for registering
\nthe case and investigating into the complaint.\n<\/p>\n
                6.    In  the  second  judgment  cited  on  the  part  of  the
\npetitioners, reported in 1999 Crl.L.J.53, a single Judge of the Karnataka High
\nCourt, on a petition filed by the Superintendent of  Police,  COD,  Bangalore,
\nquestioning the order passed by the Magistrate in directing the petitioners to
\ninvestigate and report the matter under Section 156(3) Cr.P.C., has held:
\n“It is also reported that large number of Courts are directing the COD without
\nthere being  any  reason whatsoever to investigate under S.15 6(3) Cr.P.C.  It
\nis also noticed that the offences for which  the  Magistrate  direct  them  to
\ninvestigate  by  the COD also are not the offences which come under the scheme
\nto be specially investigated.  Ordinary cases wherein the dispute between  two
\nindividuals  or group of individuals if referred to the COD and if they are to
\nconduct the investigation, their valuable service  and  time  would  be  lost.
\nUnder those  circumstances,  as rightly pointed out by the learned S.P.P.  the
\norder passed by the learned Magistrate directing the  COD  to  investigate  in
\nthis particular case is beyond its jurisdiction is liable to be set aside.”\n<\/p>\n
                7.   In  the  third judgment cited above, reported in (2001) 3
\nSCC 333, while considering the question, `whether the  Magistrate  can  direct
\nthe  CBI  to  conduct  investigation  in  exercise of his powers under Section
\n156(3) Cr.P.C.’, the Honourable Apex Court has held:\n<\/p>\n
“The magisterial  power  cannot  be  stretched  under  Section  156(3)  beyond
\ndirecting   the   officer   in   charge  of  police  station  to  conduct  the
\ninvestigation.”\n<\/p>\n
On such arguments, the learned counsel appearing on behalf of  the  petitioner
\nwould pray for the relief extracted supra.\n<\/p>\n
                8.    On   the   contrary,  the  learned  Government  Advocate
\nrepresenting the respondent would submit that based on the complaint forwarded
\nby the learned Magistrate under Section 156(3)  Cr.P.C.,  the  respondent,  in
\ncompliance  of  the  directions  of the Magistrate, has rightly registered the
\ncase in his Cr.No.8\/2003 for the offences punishable under  Sections  420  and
\n506(II) IPC  and started investigating into the same.  Regarding the judgments
\ncited on behalf of the  petitioner,  the  learned  Government  Advocate  would
\nassail  them  saying  that none of the judgments is applicable to the facts of
\nthe case in hand since under  different  circumstances,  the  judgments  cited
\nfirst  and  second  above have been delivered and so far as the third judgment
\nrelating to the Honourable Apex Court is concerned, it  has  only  discredited
\nthe   Magistrate   directing  the  superior  police  officer  other  than  the
\njurisdictional officer to conduct the  investigation  and  such  investigation
\nwould  be  deemed  to  be one conducted by the Officer in charge of the police
\nstation and it is only meant to supplement the powers of the officer in charge
\nof the  police  station  and  therefore  no  illegality  is  attached  in  the
\nMagistrate  directing  the  very jurisdictional officer, the respondent having
\njurisdiction to take up the investigation and deal with  the  same  since  the<\/p>\n
offence is  one  falling  under  the  purview  of  the  respondent.    On such
\narguments, the learned Government Advocate would seek  to  dismiss  the  above
\ncriminal original petition.\n<\/p>\n
                9.   In  consideration  of the facts pleaded, having regard to
\nthe materials placed on record and upon hearing the learned  counsel  for  the
\npetitioner  and the learned Government Advocate contra, what could be assessed
\nby this Court is that the defacto-complainant viz.    Amaravathi  Finance  and
\nInvestments,  said  to be a non-banking finance institution, lending financial
\nassistance to several prospective parties under various  heads,  has  filed  a
\nprivate  complaint  before  the Court of XI Metropolitan Magistrate, Saidapet,
\nChennai on allegations that taking into confidence of the false representation
\nmade on the part of the accused, they have parted with huge sums of  money  to
\nthe  extent  of  Rs.1  crore  without  even  emphasizing the production of the
\noriginal documents on the collateral security  offered  and  on  verification,
\nthey  came  to  know  that  the  properties  were  not at all belonging to the
\naccused, thus  both  the  accused  have  made  false  promises  to  cheat  the
\ncomplainant  and  thus  have  requested  the learned Magistrate to forward the
\ncomplaint to the Superintendent of Police, EOW-II, Madras under Section 156(3)
\nCr.P.C.  and the learned Magistrate, on receipt of  the  said  complaint,  has
\nforwarded  the  same  to  the  respondent,  based  on which the respondent has
\nregistered the case for the offences punishable under Sections 420 and 506(II)
\nIPC against the petitioner and her husband and have  taken  up  the  case  for
\ninvestigation.\n<\/p>\n
                10.   In  such a situation, the first accused in the said case
\nhas come forward to file the above criminal original petition praying to quash
\nthe above proceeding on grounds extracted supra  particularly  on  the  ground
\nthat the Magistrate should not have either received or forwarded the complaint
\nwithout the  complainant approaching the jurisdiction police.  They would also
\ncite the above three judgments, the first one delivered by this Court  itself,
\nthe second one by a learned single Judge of the Kerala High Court and the last
\none  by  the  Honourable  Apex Court, the relevant portions of which have been
\nextracted while discussing the  arguments  of  the  learned  counsel  for  the
\npetitioner.\n<\/p>\n
                11.   So  far as the first order passed by this Court reported
\nin 2003 (2) CTC 270 is concerned, it must be clarified that  the  attitude  of
\nthe  complainant  therein  in  filing  the  private complaint before the Court
\nwithout recoursing to file the complaint of such sort before the  jurisdiction
\npolice,  was  discredited therein since, in the normal course, the complainant
\nshould have filed the complaint before the jurisdiction police and only if the
\npolice either refuse to receive the complaint or on receipt of  the  complaint
\nand  registering  a  case  referred  the  same  on  grounds  known to law, the
\ncomplainant if aggrieved, could resort to file a private complaint before  the
\njurisdiction  Magistrate,  testifying  the  stand  taken  by the police either
\nrefusing to register the case or on registering the case  referring  the  same
\nfiling a referred charge sheet.\n<\/p>\n
                12.   What  this Court observed in the said order is that such
\nan attitude or procedure followed in directly approaching the Magistrate on  a
\nprivate  complaint  without  resorting  to the jurisdiction police is improper
\nsince bypassing the jurisdiction Police who have got every right to  entertain
\nthe complaint or register the case and investigate into the same need not have
\nto  be routed through the Magistrate without any reason offered on the part of
\nthe complainant to have resorted to the Magistrate’s Court  praying  to  refer
\nthe same to the Police under Section 156(3) Cr.P.C.  in which this Court never
\nheld  that entertaining such complaints by the Magistrate is either illegal or
\nin excess of its  jurisdiction.    It  is  ascertained  that  in  the  general
\nparlance,  there  could be no such restrictions imposed by law restraining the
\nMagistrate from entertaining any private complaint  filed  under  Section  200
\nCr.P.C.  direct.\n<\/p>\n
                13.   What  this  Court  emphasizes is that in adopting such a
\nprocedure, bypassing the regular procedure prescribed by law,  it  would  only
\ngive  a  wrong  signal  that  the  police  are  put under such pressure by the
\nMagistrate in forwarding the complaints under  Section  156(3)  Cr.P.C,  since
\nonce  such  complaints  are  forwarded,  the  police  have  to  carry  out the
\ninstructions of the Magistrate wherein the  independence  of  the  police  are
\noften  curtailed  and  sidelined but at any cost, such practice cannot be held
\neither illegal or irregular or even acting in excess of  the  jurisdiction  of
\nthe  Magistrates  and  such a procedure adopted could only be termed improper.
\nFor adopting such improper procedure  particularly  without  assigning  proper
\nreasons  and  setting  at  naught  the  powers of the police to entertain such
\ncomplaints, at  no  stretch  of  imagination  it  would  become  erroneous  or
\nirregular  nor would it warrant quashing of the FIR as it has been resorted to
\non the part of the petitioner\/accused.\n<\/p>\n
                14.  So far as the second judgment of the learned single Judge
\nof the Karnataka High Court is concerned, this Court, even though  is  of  the
\nsimilar  thinking  in condemning the attitude of the complainants in bypassing
\nthe regular procedure of lodging the complaints before the police in spite  of
\nit  being  a  case  of  such  nature,  and directly filing the case before the
\nMagistrate as a private complaint, still, this Court is not in agreement  with
\nthe  Karnataka  High  Court  holding  that  the order passed by the Magistrate
\ndirecting the police to investigate under Section 156(3) Cr.P.C.   is  ‘beyond
\nits  jurisdiction and the same is liable to be set aside.’ Though an irregular
\nprocedure is adopted by the  Magistrate,  the  same  would  not  lead  to  the
\nconclusion  holding  that  the  same  is either beyond the jurisdiction of the
\nMagistrate or would the  same  become  liable  to  be  set  aside  since  such
\nprocedural  irregularity  is  a  remedial one and there is no such restriction
\nimposed on a Magistrate by law.  But for  practice  and  procedure,  they  are
\nadvised to exercise utmost restraint in admitting such complaints and to avoid
\nentertaining  the  same  normally  unless under exceptional circumstances, for
\nreasons to be recorded in writing.\n<\/p>\n
                15.  So far as it is concerned with the third judgment by  the
\nHonourable  Apex  Court, the approach of the Honourable Apex Court is entirely
\non a different footing wherein the Magistrate has directed a  superior  police
\nofficer or  a  special  establishment viz.  CBI, wherein it has been held that
\nthe Magisterial power cannot be stretched  beyond  directing  the  officer  in
\ncharge  of  a police station to conduct the investigation whereas in the given
\ncase since the Magistrate has directed  only  the  respondent  over  whom  the
\nMagistrate  has  jurisdiction, the facts of the case decided by the Honourable
\nApex Court do not apply to the facts of the case in hand and hence this  Court
\nis not in a position to apply the said proposition to the facts of the case in
\nhand.\n<\/p>\n
                16.   Again  coming  to  the  facts  of  the case in hand, the
\ntransaction that the complainant had with the accused  since  being  purely  a
\ncivil  transaction, they should be resorted only to file a suit before a civil
\nCourt having jurisdiction to entertain the same for the recovery  of  the  sum
\nlent   in  favour  of  the  accused  based  on  such  materials  such  as  the
\nhypothecation of properties or the  collateral  securities  or  the  guarantee
\nobtained from  the  lonee  in  proof of their case.  But, since they failed in
\ntheir duties in getting proper security, to cover up their follies,  giving  a
\ncriminal coating for the civil transaction either taking shelter under Section
\n406  or  420  IPC,  as though in spite of their diligence exercised, they have
\nbeen cheated playing fraud on them, which is beyond their control or capacity,
\nthey have lodged the criminal complaint against the accused, so as to make use
\nof the criminal Court and the Police to initiate prosecution with the view  to
\ncreate fear psychosis in the minds of the lonees keeping them under the threat
\nof  arrest  and  detention and ultimately with conviction and sentence thereby
\ncollecting the money lent on a civil transaction often times making use of the
\nMagistrates and  the  Police  as  their  collecting  agents.    Some  of   the
\nMagistrates  and  Police  are  also falling prey in the evil net spread by the
\nfinanciers wherein the net result  will  be  erosion  of  the  values  of  the
\ninstitutions such as the judiciary and the police establishments and therefore
\nit  is  high  time  that the Magistrates and the Police were cautioned against
\nsuch a cunning and crooked move made by the financiers.\n<\/p>\n
                17.  Yet another aspect that requires attention and discussion
\nis the Managers of the financial institutions, whether the private or  public,
\ncolluding  with  undeserving  persons on illegal terms with the view to obtain
\nkickbacks or percentage in freely releasing lumpsums of money in their  favour
\nwithout  even  observing  the basic norms in lending such money thus betraying
\ntheir own financial institutions for promoting  their  personal  ends  without
\neither  emphasizing or receiving proper guarantee or hypothecation of property
\nsecurity while lending such huge amounts, as it has been done in the  case  in
\nhand  wherein both the loaner and the lonee would be committing criminality as
\nit is evident in the case in hand.  The  defacto-complainant  officials,  with
\nthe  dishonest  intention  of  entering  into  the  criminal  nexus  with  the
\npetitioner\/accused herein and  without  even  observing  the  basic  norms  of
\nobtaining  proper  and  enforceable security, have thrown more than a crore of
\nrupees at  the  feet  of  the  accused  thus  not  only  betraying  their  own
\ninstitution  but  also exposing themselves for criminal prosecution along with
\nthe accused in which event, the Managers of  such  financial  institutions  in
\nreleasing  such  lumpsums  knowingly  in favour of undeserving persons without
\nproper security or safeguard for the recovery of the same  as  one  which  has
\nhappened  in  the  case  in  hand in the whole of such operation, the ultimate
\nloser is the magisterial institution and the police force.   Having  committed
\nall  such illegalities, knowingly and for personal gains, acting hand-in-glove
\nwith the loanees,  those  who  are  occupying  responsible  positions  in  the
\nfinancial  institutions  for  the  release  of the funds as loans in favour of
\nparties like the accused in the case in hand, the complainants commit no  less
\noffence  than  the accused and they equally become liable to be prosecuted and
\npunished.\n<\/p>\n
                18.  In the above circumstances, it could only be decided that
\nthe officials of the defacto-complainant, who are  responsible  for  releasing
\nthe  loan  amount  in favour of the accused have connived with the accused for
\ntheir personal gains and acting hand-in-glove with each other,  betraying  the
\ntrust  and  confidence  entrusted with them by the institution and the general
\npublic thus all of them jointly indulging in  such  manipulations,  fraud  and
\ncheating  of  the  defacto-complainant  institution  in  setting at naught the
\nregular safeguards and safety measures provided for lending  and  recovery  of
\nthe sums   transacted.    Having  done  all  such  activities,  the  officials
\nresponsible for the commitments of the defacto-complainant company  have  also
\nattempted  to  burden  the  police  officials and the Court in their scheme of
\ncollecting the money back giving a criminal colour  for  their  money  lending
\nbusiness  as  though  it  is  none of their business to get all such materials
\nnecessary to be obtained from the borrower thus forcing the  police  officials
\nand the criminal courts to act as their collecting agents, often making use of
\nSections  406  and 420 IPC, forgetting the fact that they are at the bottom of
\nthe criminality, without whom,  in  the  scheme  of  things,  perpetration  of
\ncriminal act, in the manner alleged herein, is an impossibility.\n<\/p>\n
                19.   In  such  circumstances,  this Court is of the firm view
\nthat the net of prosecution has to be spread still wider so as to cover up the
\ncriminal  acts  perpetrated  on  the  part  of  of  the   officials   of   the
\ndefacto-complainant  also, who were responsible for lending the said amount of
\nmore than a crore of rupees in favour of  the  present  accused  in  the  case
\nwithout proper security obtained, as discussed supra, and therefore it is only
\ndesirable  to  issue  further direction to the respondent Police and hence the
\nfollowing order:\n<\/p>\n
In result,\n<\/p>\n
(i)the above criminal original petition  for  quash,  since  being  bereft  of
\nmerit, is dismissed.\n<\/p>\n
(ii)The  Inspector  General  of Police, Economic Offences Wing ( Headquarters)
\nChennai is directed to withdraw the case registered in Cr.No.8\/2003  from  the
\nfile  of  the  respondent  and  entrust the same with a responsible Officer of
\nindependent stature and proven ability and integrity to investigate  into  not
\nonly  the  complaint  as given on the part of the defacto-complainant but also
\nagainst all the officials of the defacto-complainant, who were responsible for
\nreleasing the sum of  Rs.1  crore  in  favour  of  the  accused,  deliberately
\nflouting  the  norms and procedures to be adopted in lending of such money, on
\nbogus and false records, enlisting all of them as accused and investigate into
\nthe acts of  conspiracy,  breach  of  trust  and  cheating  and  expedite  the
\ninvestigation and file the final report at the earliest in the manner required
\nunder law.\n<\/p>\n
                Consequently, Crl.M.P.No.6397 of 2003 is also dismissed.\n<\/p>\n
Index:  Yes
\nInternet:  Yes
\nRao<\/p>\n
To\n<\/p>\n
1.The XI Metropolitan Magistrate,
\nSaidapet,
\nChennai-15.\n<\/p>\n
2.The Inspector General of Police,
\nHeadquarters,
\nChennai-600 002.\n<\/p>\n
3.The Inspector of Police,
\nEOW-II (Headquarters),
\nChennai-600 002.\n<\/p>\n
4.Mr.A.N.Thambidurai,
\nGovernment Advocate (crl.side)
\nHigh Court, Madras.\n<\/p>\n
5.The Public Prosecutor,
\nHigh Court, Madras.\n<\/p><\/p>\n","protected":false},"excerpt":{"rendered":"
Madras High Court Devi Padmanabhan vs State on 4 September, 2003 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 04\/09\/2003 CORAM THE HONOURABLE MR.JUSTICE V.KANAGARAJ CRIMINAL ORIGINAL PETITION No.22438 OF 2003 AND CRL.M.P.No.6397 OF 2003. Devi Padmanabhan … Petitioner -Vs- State, rep.by The Inspector of Police, EOW-II (Headquarters) Chennai-600 002. … Respondent Criminal Original […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,13],"tags":[],"class_list":["post-150433","post","type-post","status-publish","format-standard","hentry","category-high-court","category-madras-high-court"],"yoast_head":"\nDevi Padmanabhan vs State on 4 September, 2003 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/devi-padmanabhan-vs-state-on-4-september-2003-2\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Devi Padmanabhan vs State on 4 September, 2003 - 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