ALPIC FINANCE LIMITED Vs. P SADASIVAN

JUDGEMENT

(1.) Leave gran-ted.

(2.) Appellant is a registered company having its head office at Mumbai. It is a non-banking financial institution functioning under the regulation of the Reserve Bank of India. It is carrying on business, inter alia, of leasing and hire purchase. The first respondent is the Chairman and founder trustee of a trust by name 'Visveswaraya Education Trust'. The second respondent, wife of the first respondent is also a trustee. The trust runs a dental college by name Rajiv Gandhi Dental College. The respondents entered into an agreement with the appellant-company whereby the appellant agreed to finance the purchase of 100 hydraulically operated dental chairs. The total cost of the chairs was around Rs. 92,50,000/-. The appellant-company agreed to finance the respondents for the purchase of these chairs through a lease agreement and as per the agreement, the respondents were liable to pay rentals quarterly. The respondents agreed to pay quarterly a sum of Rs. 7,50,000/- for the first year; Rs. 12,50,000/- for the second year; Rs. 8,00,000/- for the third year and Rs. 6,25,000/- for the fourth year. As per the agreement, the appellant-company, the lessors would have sole and exclusive right, title and interest in the dental chairs supplied till the entire hire purchase amount was paid. In accordance with the agreement, the appellant made payments to M/s. United Medico Dental Equipments and they delivered the dental chairs to the respondents. The appellant-company alleged that the respondents were not regular in making the payments and committed default in payment of the instalments and that the bank had dishonoured certain cheques issued by the respondents. The appellant company also alleged that on physical verification, certain chairs were found missing from the premises of the respondents and thus they have committed cheating and caused misappropriation of the property belonging to the appellant. The appellant-company filed a private complaint under Section 200, Cr. P.C. before the Chief Metropolitan Magistrate, Bangalore alleging that the respondents had committed offences under Sections 420, 406 and 423 read with Section 120-B, I.P.C. In that proceedings, the appellant-company moved an application under Section 93, Cr. P.C. to issuue a search warrant to seize the property in dispute and also to hand over these items to the complainant. The learned Magistrate took cognizance of the alleged complaint and issued summons to the respondents and passed an order on the application filed under Section 93 of the Cr. P.C. to have a search at the premises of the respondents and to take possession of the properties involved in the case. These proceedings were challenged by the respondents under Section 482, Cr. P.C. before the learned single Judge of the Karnataka High Court at Bangalore. The learned single Judge was pleased to quash the entire proceedings and directed the appellant company to return all the properties seized by the Police pursuant to the warrant issued by the learned Magistrate. Thus, the order of the learned Magistrate taking cognizance and issuing process to the respondents as well as the order of search and the direction for restoration of the property to the appellant-company were set aside. Aggrieved by the same, the appellant-company has preferred this appeal.

(3.) We heard the learned counsel on either side. Learned senior counsel for the appellant-company Mr. P. S. Mishra argued in detail and contended that the learned single Judge has seriously erred in quashing the proceedings under Section 482, Cr. P.C. The learned counsel for the appellant-company contended that the allegations in the complaint clearly made out offences punishable under Sections 420, 406, 423, 424 read with Section 120-B, I.P.C. The learned counsel for the respondents, on the other hand, contended that the complaint was filed only to harass the respondents and it was motivated by mala fide intention. It was argued that the entire transaction was of civil nature and that the respondents have made a substantial payment as per the hire purchase agreement and the default, if any, was not willful and there was no element of misappropriation or cheating. The respondents also denied having removed any of the items of the disputed property clandestinely to defeat the interest of the appellant.