The judgment emphasizes the need to establish a prima facie case of criminal intention and the requirement of prior sanction under Section 197 Cr.P.C for prosecuting public servants.

1. This petition has been filed by the petitioners, who are accused before the lower Court, seeking for quashment of the complaint filed by the respondent/complainant against them under Section 482 Cr.P.C.

2. The respondent is the complainant before the lower Court and the respondent presented complaint under Sections 190 and 200 Cr.P.C for taking cognizance of the offences under Sections 403, 406, 420 and 500 read with 120-B IPC. The said complaint filed by the respondent/complainant was taken cognizance and the lower Court viz., Judicial Magistrate No.I, Pondicherry had ordered issuance of summons to the petitioners who are ranked as Accused Nos.1 to 3, A4 and A5, who are also stated to have participated in the offences. The Accused Nos.1 to 3, who are the petitioners herein, have applied to the Court under Section 482 Cr.P.C seeking for the quashment of the said complaint on various grounds.

3. Heard Mr.T.P.Manoharan, learned counsel for the petitioners/Accused Nos.1 to 3 and Mrs.S.Deepika, learned counsel appearing for the respondent/complainant.

4. The learned counsel for the petitioners would submit in his arguments that the petitioners 1 to 3 are none other than the Corporation constituted under the Statute and its Managing Director and General Manager (Finance) and they are sponsored by the Pondicherry Government and A1 to A3 (petitioners 1 to 3) are the public servants within the meaning of Section 197 Cr.P.C. He would further submit in his arguments that the petitioners have taken action against the respondent/complainant under Pondicherry Revenue Recovery Act for the outstanding payable by him to the first petitioner Corporation under Section 29 of the State Financial Corporation Act, 1951. In order to counterblast the said action, a private complaint has been drafted and framed in such a way to bring life to the alleged offences which were barred by limitation, by bringing another new offence under Section 500 I.P.C i.e., defamation. He would further submit in his arguments that taking cognizance of the complaint by the lower Court is not sustainable in law. In order to sustain his argument, he would bring various instances, transactions had in between the petitioners and the respondent. He would further submit that the fourth accused Company viz., Pondy Hydra Magne (P) Limited had applied for a term loan with the first petitioner and on his application, a term loan of Rs.24,52,000/- was sanctioned by the first petitioner for establishing the SSI unit and in pursuance of the said term loan, various documents have been submitted as the Directors of the said company executed. He would further submit in his arguments that while the said loan was subsisting, the respondent had purchased certain properties from the Pondy Hydra Magne (P) Limited and also mortgaged assets in favour of the respondent and took possession of the said property even during the subsistence of the said mortgage. He would also submit in his arguments that the said Pondy Hydra Magne (P) Limited was trying to transfer the said loan to the account of the respondent and the respondent was paying interest accrued to the said term loan amounted to Rs.18 lakhs borrowed by the said Pondy Hydra Magne (P) Limited to the said corporation. He would further submit that having paid so, payable to the corporation, the respondent had accepted that it was liable to pay the said loan amount which was borrowed by the said Pondy Hydra Magne (P) Limited. He would further submit in his arguments that the contention of the respondent was that it had been cheated by the petitioners as well as the other accused viz., A4 and A5 by a conspiracy of cheating and deceiving a sum of Rs.18 lakhs and also the properties, cannot be a ground for launching a criminal prosecution against the petitioners. He would further submit in his arguments that the payment of loan as well as the purchase of the property are purely civil transactions and there is no iota of any crimin