IMPORTANT POINT
The prosecution must provide substantial evidence to establish that an individual is engaged in money lending as a business to sustain charges under the Money-Lenders Act.

ORDER :

A. Badharudeen, J.

Accused Nos.1 to 3 in Crime No.3099/2017 of Aluva East Police Station, which is now pending as C.C.No.1797/2017 on the files of the Judicial First Class Magistrate Court-I, Aluva, seek quashment of the above proceedings on the ground that they are absolutely innocent of the allegations.

2. Heard the learned counsel for the petitioners and the learned Public Prosecutor, in detail. Though notice served to the 2nd respondent, no appearance.

3. In a nutshell, the allegation of the prosecution is that the accused herein committed offences punishable under Sections 447 and 506(i) r/w Section 34 of the Indian Penal Code, 1860 (for short, 'the IPC' hereinafter) as well as under Sections 17 and 18 of the Kerala Money-Lenders Act, 1958 (for short, ‘the Act, 1958’ hereinafter) and Section 3 of the Kerala Prohibition of Charging Exorbitant Interest Act, 2012 (for short, ‘the Act, 2012). The sum and substance of the allegation is that, the 1st accused, who did not have any licence under the Act, 1958, gave Rs.6 Lakh to the de facto complainant and her husband on undertaking to pay Rs.36,000/- towards interest for the said sum after obtaining blank cheque leaves of the de facto complainant and her husband. Thereafter, on 01.10.2016, the 3rd accused threatened the husband of the de facto complainant over phone that case would be filed against them, if Rs.3 Lakh with interest would not be repaid. Later, at 11.00 hrs. on 14.6.2017, the 1st accused went to the house of the de facto complainant and threatened them and demanded repayment of Rs.3 Lakh with interest.

4. While seeking quashment of the entire proceedings, it is submitted by the learned counsel for the petitioners that, as far as petitioners 2 and 3, who are arrayed as accused Nos.2 and 3 are concerned, not even remote allegations are raised against them. However, they also got arrayed as accused, since they are 1st petitioner's brother and wife, respectively. It is submitted by the learned counsel for the petitioners further that the 1st petitioner is not a money lender and he has never run money lending business, for which licence is made mandatory under Section 3 of the Act, 1958. According to the learned counsel for the petitioners, when the de facto complainant and her husband approached the 1st petitioner to advance Rs.6 Lakh for their urgent need, which was given as loan and for which, the de facto complainant and her husband had issued blank cheque leaves to ensure its repayment. Since the amount was defaulted, the 1st accused demanded repayment of the same. At this juncture, this case has been foisted, without any materials. According to the learned counsel for the petitioners, in order to attract the offence under Section 17 of the Act, 1958, money lending business shall not be carried out without licence or in violation of the conditions of the licence. The learned counsel would further submit that, in this matter, the 1st petitioner did not run a money lending business and therefore, he did not require any licence and therefore, the offence under Section 17 punishable under Section 18 of the Act, 1958, is not made out prima facie. Similar is the position as far as Section 3 of the Act, 2012, is concerned. Apart from that, it is argued by the learned counsel for the petitioners that demand for money is the premise on which the prosecution alleges commission of offences punishable under Sections 447 and 506(i) r/w Section 34 of the IPC. Since the 1st petitioner/1st accused is entitled to get back the money he had given as loan, the demand for the same would not attract the said offences and therefore, the quashment, as sought for, is liable to succeed.

5. The learned Public Prosecutor even though opposed quashment, he fairly conceded that during investigation, prosecution did not collect any materials to show that the 1st petitioner is a man doing money lending business.

6. In the decision in Sebastian Joseph v. State of Kerala and Ors. reported in [MANU/