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2025 Supreme(Online)(KER) 7829
HIGH COURT OF KERALA
V. G. Arun, J
AYYAPPAN M – Appellant
Versus
STATE OF KERALA – Respondent
Crl.MC 9275/2024
M.SREEKUMAR
Allegations of extortion and unauthorized money lending were insufficient as there was no evidence of coercion leading to the delivery of property, leading to the quashing of proceedings.
Headnote:(A) Indian Penal Code - Section 384 - Kerala Money Lenders Act, 1958 - Sections 17 and 18 - Accused charged with extortion and money lending without a license - Allegations insufficient to constitute extortion as complainant was not induced to deliver property due to fear - Lending money does not alone constitute unauthorized money lending under the Act - Proceedings quashed due to complainant's lack of interest. (Paras 2, 5, 6)
(B) Extortion - Definition under Section 383 - To establish extortion, the complainant must show they were induced to deliver property through fear of injury - Mere threat to use signed blank cheques does not fulfill this requirement. (Paras 5, 6)
Facts of the case:
The petitioner, accused in a criminal case, allegedly threatened the complainant to repay a loan by using signed blank cheques and stamp papers as security. The complainant claimed to have borrowed Rs.6 lakhs but repaid Rs.4.8 lakhs, with the petitioner demanding an exaggerated balance. (Paras 1, 2)
Findings of Court:
The court found that the allegations did not meet the legal threshold for extortion or unauthorized money lending, particularly due to the complainant's failure to assert that he was induced to deliver property through fear. (Paras 5, 6)
Issues: The court addressed whether the allegations constituted extortion under IPC and whether the money lending was unauthorized under the Kerala Money Lenders Act. (Paras 2, 5)
Ratio Decidendi: The court ruled that without evidence of coercion leading to the delivery of property, the allegations did not meet the necessary legal criteria for extortion or unauthorized money lending, resulting in the quashing of proceedings. (Paras 5, 6)
Result: Crl.M.C is allowed. All further proceedings against the petitioner in C.C.No.836/2014 are quashed.
ORDER
Petitioner is the sole accused in C.C.No.836 of 2014 on the files of the Judicial First Class Magistrate Court-1, Varkala. The case originated from Crime No.966 of 2013 registered at the Varkala Police Station for offences under Section 384 of IPC and Sections 17 and 18 of the Kerala Money Lenders Act , 1958. The crime was registered on the basis of a complaint submitted by the 2nd respondent to the Superintendent of Police (Rural) Thiruvananthapuram. In the complaint the 2nd respondent averred that he had borrowed Rs.6 lakhs in the year 2013 at bank rate of interest. Although Rs.4,80,000/- was repaid, that amount was adjusted towards interest and an exaggerated amount demanded as balance. For compelling the 2nd respondent to accede to the demand, petitioner threatened to use the cheques and stamp papers given by his son and wife. The final report is filed, alleging that after forcibly obtaining blank cheques and stamp papers as security for Rs.6 lakhs borrowed by the 2nd respondent, petitioner entered huge amounts in the cheques and stamp papers and criminally intimidated the 2nd respondent by threatening to use them, even after repayment of Rs.4,80,000/-. This Crl.MC is filed seeking to quash the criminal proceedings against the petitioner.
2. Learned counsel for the petitioner contended that the offence punishable under Section 384 will not be attracted even if the allegations are accepted in their entirety. It is submitted that the 2nd respondent does not have a case that the cheques and stamp papers were obtained forcibly. On the other hand, he admits that the cheques and stamp papers were given as security for the money borrowed from the petitioner. The offence under of IPC will be attracted only if a person is put in fear of injury to himself or any other and thereby dishonestly induced to deliver any property or valuable security or something which can be converted to a valuable security. Being so, the allegation that the petitioner had threatened to present the signed blank cheques of 2nd respondent's wife and son is also not sufficient to attract the offence. It is then contended that a solitary instance of moneylending will not attract the provisions of the Money Lenders Act. In support of this contention reliance is placed on the decisions inVimal v. State of Kerala and Others [2015 (1) KLT 524] andSasidharan v. Sub Inspector [2023 (1) KLT 251].
3. I heard the learned Public Prosecutor also.
4. By order dated 10.12.2024, the Registry was directed to call for a report from the jurisdictional Magistrate regarding the present status of the case. The learned Magistrate has reported that CW1 had not responded to the summons and his presence could not be secured even after taking coercive steps. It is thus evident that the 2nd respondent is not interested in proceeding with this complaint. Being so, notice to the 2nd respondent is dispensed with.
5. The primary contention being about the inapplicability of Section 384 of IPC , it is essential to read the definition of extortion in Section 383, extracted hereunder for easy reference;
“Whoever intentionally puts any person in fear of any injury to that person, or to any other, and thereby dishonestly induces the person so put in fear to deliver to any person any property or valuable security or anything signed or sealed which may be converted into a valuable security, commits "extortion".”
A close scrutiny of the provision makes it clear that in order to attract the offence of extortion, a person should have been put in fear of injury to himself or any other and thereby dishonestly induced to deliver any property or valuable security. The 2nd respondent has no case that he was dishonestly induced to deliver any property or valuable security by being put in fear of injury. His allegation is that the petitioner had threatened that he would make use of the signed blank cheques and stamp papers given as security, unless the amount due to him is repaid with interest. The 2n
