MARYKUTTY DANIEL Vs. STATE OF KERALA

JUDGEMENT

(1.) The prayer in this Criminal Miscellaneous Case instituted under Section 482 of the Code of Criminal Procedure seeking invocation of the inherent powers conferred on this Court as per that provision, is for an order from this Court to quash the impugned Annexure-A1 FIR in Crime No. 1139/2014 of Konni Police Station, Pathanamthitta District. The impugned crime has been registered against the petitioners for offences punishable under Section 3(2) r/w. Sections 17 and 18 of the Kerala Money Lenders Act 1958 and Section 45S of the Reserve Bank of India Act 1934. The crime has been registered on the basis of Annexure-A1(a) letter dated 15/05/2012 sent by the Deputy General Manager of Reserve Bank of India to the Director General of Police, Economic Offences Wing, Police Head Quarters, Thiruvananthauram. It has been intimated in the said letter that the partnership firm called "Pathanamthitta Popular Finance" owned by the petitioners has been engaged in financial activities such as extending gold loans, Foreign Exchange etc. and that public funds are being collected in the name of "Popular Traders" a sister concern of the afore stated M/s. Popular Finance, which is in contravention of Section 45S of the RBI and accordingly, the Deputy General Manager of the RBI had requested the State police authorities to take appropriate action in that matter. Likewise, Annexure-A2(b) letter dated 16/07/2012 was also addressed by the Deputy General Manager of Reserve Bank of India to the Commissioner of Commercial Taxes, Govt. of Kerala, Thiruvananthapuram. It is also on the same lines as in the afore stated letter dated 15/05/2012. The Commissioner of Commercial Taxes, Government of Kerala acted on the said intimation given by the Reserve Bank of India and has duly instituted a complaint before the Chief Judicial Magistrate's Court, Pathanamthitta against the petitioners herein and three others under Section 58B(5A) of the RBI Act for the alleged offence under Section 45S of the RBI Act. It is pointed out that the learned Magistrate has taken cognizance of the said offence and the case has been numbered as Summary Trial Case, S.T. No. 416/2013 on the file of the Chief Judicial Magistrate Court, Pathanamthitta and that the matter is posted for framing of charges against the accused therein etc.

(2.) The sheet anchor of the contentions raised by the petitioners in this case is that on the same set of facts, a complaint as envisaged in terms of Section 58B(5A) of the RBI Act has already been duly instituted before the Chief Judicial Magistrate's Court as evident from Annexure-A2/Annexure-A2(a) and therefore the impugned criminal proceedings in Annexure-A1 Crime No. 1139/2014 of Konni Police Station for the same set of facts is clearly not maintainable etc. The main contentions raised by the petitioners are as follows:

(3.) This Court by order dated 21/05/2015 had directed the learned Public Prosecutor concerned to get instructions and also to get specific clarifications as to whether the factual transactions in the impugned Annexure-A2(a) complaint which has led to the institution of S.T. No. 416/2013 on the files of Chief Judicial Magistrate's Court, Pathanamthitta, are the same as those related to the offences under the impugned Annexure-A1 FIR in Crime No. 1139/2014 of Konni Police Station. Accordingly, the learned Additional Director General of Prosecutions has filed a statement dated 16/06/2015 of the investigating officer in this case (Deputy Superintendent of Police, Special Team, Crime Branch-CID STATS, Thiruvananthapuram). In the said statement it has been averred that as per the information disclosed in the Annexure-A1(a) letter dated 15/05/2012 sent by the Deputy General Manager, Reserve bank of India to the Director General of Police, Crime Branch, it has been stated that M/s. Popular Finance, Smt. Marykutty Daniel, as its Chairperson and Sri. Roy Daniel, as its Managing Director has been engaged in financial activities such as extending gold loans, foreign exchange activities, exports etc. through their branches as observed from the advertisements given by the firm in the print and visual media and that they are also collecting public funds as term loan in the name of M/s. Popular Traders, which is a sister concern of M/s. Popular Finance, through their branches all over India which have been utilised by M/s. Popular Finance for granting gold loans to the public and it is in violation of Section 45S of the Reserve Bank of India Act, 1934. An enquiry was duly conducted through a Deputy Superintendent of Police, Economic Offences Wing-I of the State Crime Branch CID, which reveals that even though Popular Finance and Popular Traders are partnership firms and Popular Finance has obtained only Money Lending licence from the Commercial Taxes Department, Government of Kerala, under the Kerala Money Lenders Act, Section 45S of the RBI Act 1934 does not permit any individual firm or unincorporated association of individuals to collect deposits, other than by way of loans from relatives (in the case of individual) or by way of loans from the relative or relatives of any of the partner (in the case of partnership firm). That thus collection of public funds by M/s. Popular Traders is in violation of 45S of the RBI Act and that the activities of M/s. Popular Finance and M/s. Popular Traders are akin to those conducted by a Non-Banking Financial Company which requires registration under the RBI Act 1934 and that neither Popular Finance nor Popular Traders is registered with RBI as a Non Banking Finance Company (NBFC). It is based on these findings in the enquiry and as well as the report of the Deputy General Manager, RBI, that the State Police Chief has given instructions to the Superintendent of Police, Pathanamthitta to register a crime in the matter and conduct investigation thereon, as per letter dated 30/09/2014. It is accordingly that the impugned Annexure-A1 crime No. 1139/2014 of Konni Police Station has been registered for offences under Sections 3(2) r/w. Sections 17 and 18 of the Kerala Money Lenders Act and Section 45S of the RBI Act 1934. That during preliminary investigation conducted by the Sub Inspector of Police, Konni, it has been revealed that Popular Finance has 269 branches all over India along with its sister concern Popular Traders and had collected crores of rupees from thousands of depositors. Later, as per order dated 20/03/2015, the State Police Chief has issued orders to transfer this case to CBCID and vide consequential order dated 06/04/2015 of Additional DG of Police (Crimes), the investigation of the crime has been entrusted with Special Investigation Team consisting of one Deputy Superintendent of Police, two Detective Inspectors, three Detective Sub Inspectors, and one Senior Civil Police officer under the direct supervision of Superintendent of Police, Economic Offence Wing-1, Crime Branch CID, Kollam. That the investigation conducted by the Special Team for the Crime Branch is going on and is in a preliminary stage.