A microfinance institution unable to prove compliance with money lending regulations may face criminal prosecution despite claims of RBI registration.

ORDER :

E.V.VENUGOPAL, J.

Criminal Petition No.4822 of 2021 is filed seeking to quash the proceedings against the petitioner/A1 in Crime No.89 of 2010 on the file of Utnoor Police Station, Adilabad District, registered for the offences punishable under Section 420 IPC and Section 16(1)(a)(b), Section 24 of the A.P.Scheduled Area Money Lenders Regulation, 1960 (for short ‘the Regulation, 1960).

2. Criminal Petition No.4823 of 2021 is filed seeking to quash the proceedings against the petitioner/A1 in Crime No.30 of 2010 on the file of Narnoor Police Station, Adilabad District, registered for the offences punishable under Section 420 IPC and Section 16(1)(a)(b), Section 24 of the A.P.Scheduled Area Money Lenders Regulation, 1960.

3. Since in both the Criminal Petitions, the petitioner is one and the same and arising out of similar offences, they are being heard together and disposed of by way of this Common Order.

4. Brief facts of the case in Criminal Petition No.4822 of 2021 are as follows:

The 2nd respondent/Tahsildar, Utnoor, Adilabad District, lodged a complaint with the Station House Officer, Utnoor, on 28.08.2010 stating that the following six organizations are conducting money lending business in the district: 1) Basics, 2) SKS (Swayam Krushi), 3) Samulla, 4) Spandana, 5) L&T, and 6) Trinity. Among these, the SKS (Swayam Krushi) Microfinance Organization, owned by Proprietor Akkula Vikram, residing at Jubilee Hills, Hyderabad, along with their employees — 1) D. Venkateshwarlu, Unit Manager, Branch Utnoor, 2) Mahender, 3) Gopi Krishna, and others, all residents of Utnoor — are conducting money lending business in Utnoor Mandal, which is a notified agency area, in violation of rules by operating without obtaining a license from the Agency Revenue Divisional Officer, Utnoor. They are charging exorbitant interest rates from poor tribals and cheating them. The money lending business conducted by SKS (Swayam Krushi) is detrimental to the poor tribals and is ultimately leading them into financial trouble. Necessary action is requested against the accused, with reference to the Circular vide Letter No. TMPU/144/2010, dated 26.07.2010, issued by the Project Officer, ITDA Utnoor, Adilabad District.

5. Basing on the said complaint, a case in Crime No.89 of 2010 under Section 420 of IPC and Section 16(1)(a)(b) and 24of the A.P.Scheduled Area Money Lenders Regulation, 1960 and took up the investigation.

6. Brief facts of the case in Criminal Petition No.4823 of 2021 are as follows:

The 2nd respondent/Tahsildar, Utnoor, Adilabad District, lodged a complaint with the Station House Officer, Utnoor, on 29.08.2010 stating that the following six organizations are engaged in money lending business in the district, namely: 1) Basics, 2) SKS (Swayam Krushi), 3) Sharumulla, 4) Spandana, 5) L&T, and 6) Trinity. Among these organizations, the SKS (Swayam Krushi) Microfinance Organization, Proprietor Akkula Vikram, residing at Jubilee Hills, Hyderabad, along with their employees — 1) K. Santosh, Unit Manager, Branch Utnoor, 2) N. Mahender, 3) Gopi Krishna, and others, all residents of Utnoor — are conducting money lending business in Narnoor Mandal, which is a notified agency area, in violation of rules by operating without obtaining a license from the Agency Revenue Divisional Officer. They are charging the highest interest rates from poor tribals and cheating them. The money lending business conducted by SKS (Swayam Krushi) is detrimental to the poor tribals and is ultimately leading them into financial trouble. Necessary action is requested against the accused, with reference to the Circul