High Court

Legal Reasoning

{1} 2909.22 CRAPLN R..odtIN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABADCRIMINAL APPLICATION NO. 2909 OF 2022Smt. Ratnabai Ratu Bheemashankar Chitte,Age 55 years, Occ. Homemaker,R/o. /Sonar Colony, Oerga, Tq. Murum,District Osmanabad... APPLICANT.VERSUS1. The State of Maharashtra through Murum Police Station, Tq. Murum, Dist. Osmanabad.2. Shri Prashant Lakshamrao Shapurkar, Age 58 years, Occ. Service (Assistant Registrar, Omerga) R/o. At post Omerga, Tq. Murum District Osmanabad.3. Liyakat Abbas Shaikh, Age 65 years, Occ. Retired, R/o. Kesar javalga, Tq. Omerga Dist. Osmanabad.. RESPONDENTS.Mr. P.D. Bachate, Advocate h/f. Mr. A.C. Sisodiya, Advocate for applicant,Mr. V.K. Kotecha, APP for respondent State,Mr. Z.H. Farooqui for intervenor. CORAM : SMT. VIBHA KANKANWADI & S.G. CHAPALGAONKAR, JJ. DATE : 23rd SEPTEMBER, 2024. JUDGMENT [ PER S.G. CHAPALGAONKAR, J.] :-1.The applicant has filed this application under Section 482 ofCr.P.C. for quashment of the FIR in Crime No. 242 of 2022, dated23.7.2022, registered with Police Station, Murum, District Osmanabad {2} 2909.22 CRAPLN R..odtfor the offence punishable under the Maharashtra Money Lending Act,2014 as well as consequential proceeding in RCC No. 192 of 2022pending before the JMFC, Omerga.2.Respondent No.2, Assistant Registrar, Cooperative Societies,Umerga, lodged report to Police Station, Murum alleging that inpursuance of complaint made by respondent No.3, the District DeputyRegistrar issued communication dated 8.7.2022, directing him to takefurther steps under Maharashtra Money Lending (Regulation) Act, 2014.(hereinafter referred to as “Money Lending Act” for sake of brevity) asper opinion of the District Government Pleader, Osmanabad.Consequently, he filed the FIR. 3.It is alleged that Liyakat Abbas Shaikh (respondent No.3)made a complaint against applicant/accused regarding unauthorisedmoney lending business. Consequently, inquiry was conducted byAssistant Registrar and report dated 13.12.2021 has been submitted,which states that sale deed dated 18.3.2010 depicts out and out saletransaction. However, the transcript of the telephonic talk and somereceipts produced by the complainant needs forensic investigation to findout whether subject transaction was an out and out sale or it was in thenature of money lending. However, the District Deputy Registrar closedthe file observing that the transaction dated 18.3.2010 is a saletransaction. Again, respondent No.3, made a complaint to DistrictDeputy Registrar dated 8.7.2022 alleging that land Gat No. 505 situatedat Kesar Jawalgaon was mortgaged by his mother Sajanbi Abbas Shaikhwith late Shankar Sidhrappa Khajje. Nominal sale deed No. 660 of 2010was executed on agreement that interest @ 3% shall be paid on the {3} 2909.22 CRAPLN R..odtamount received under the transaction. Meanwhile, Shankar SidrappaKhajje had executed a sale deed in the name of his daughter Ratnabai,who was indulged in money lending business through her father lateShankar Khajje. However, Shankar Sidramappa Khajje as well as motherof respondent No.3 Sajanbi expired. Therefore, amount paid towardsinterest was transmitted to Ratnabai Chitte. The respondent No.3 madetele-conversation with Ratnabai and shown his willingness to pay entireamount of loan alongwith interest. The conversation is recorded inmobile phone. Consequently, the District Deputy Registrar opined tolodge the FIR against the applicant under Section 39 of the MoneyLending Act.4.On the basis of aforesaid report, Crime No. 242 of 2022 hasbeen registered. The investigation progressed and finally charge sheethas been filed against applicant in RCC No. 192 of 2022 of 2022 beforeJMFC at Omerga.5.Mr. P.D. Bachate, learned advocate appearing for theapplicant vehemently submits that the alleged sale transaction wasbetween Smt. Sajanbi Abbas Shaikh and Shankar Khajje in respect ofland bearing No. 505 situated at Kasar Jalgaon. Sajanbi executedRegistered sale deed No. 660 of 2020 in favour of Shankar Khajje on18.3.2010. Consequently, mutation entry No. 2544 was certified in thename of Shankar in ownership column. On 7.3.2017, Sajanbi passedaway. On 22.5.2019, Shankar Khajje transferred said land in the name ofapplicant Ratnabai under registered sale deed No. 1721 of 2019.Thereafter, on 24.11.2019, Shankar Khajje also expired. In thisbackground, since 2021, respondent No.3 Liyakat Abbas represented {4} 2909.22 CRAPLN R..odtauthorities under the Money Lending Act that the original transaction of2010 between Sajanbi and Shankar Khajje was a money lendingtransaction. The Asistant Registrar Cooperative Societies, on inquiry, gavea report that transaction of 2010 was out and out sale. Consequently, thecomplaint filed by Liyakat Abbas was closed by order dated 23.12.2021passed by District Deputy Registrar. Surprisingly, another representationdated 28.12.2021 has been made by Liyakat Ali to respondent No.3 andsame was entertained by him and directions were given to the AssistantRegistrar Cooperative Societies to lodge the police report. Consequently,FIR in Crime No. 242 of 2022 has been lodged for the offencepunishable under Section 39 of the Maharashtra Money Lending(Regulation)Act, 2014. 6.Mr. P.D. Bachate, further submits that basic transaction wasbetween Sajanbi and Shankar Khajje. It was out and out sale transactionand same was acted upon. The complaint in this regard was inquired andclosed. There is nothing on record to show that the applicant/accusedwho is daughter of Shankar Khajje was involved in the money lendingbusiness. Therefore, he submits that from the contents of the FIR or thematerial in charge sheet no ingredients of the offence under Section 39 ofthe Money Lending (Regulation) Act, 2014 would attract. Hence, heurged to quash and set aside the FIR and consequential criminalproceeding.7.Per contra, Mr. V.K. Kotecha and Mr. Z.H. Farooqui, learnedadvocate for the intervenor would submit that there is ample material toshow that in fact, the transaction under sale deed of 2010 was a moneylending transaction and late Shankar Khajje had agreed to re-convey the {5} 2909.22 CRAPLN R..odtland on return of the principal amount alongwith interest. They would,therefore, urge to reject the application.8.We have considered the submissions advanced by learnedadvocates appearing for respective parties. We have minutely consideredthe contents of the FIR and charge sheet. Apparently, applicant ischarged fo the offence under Section 39 of the Maharashtra MoneyLending (Regulation) Act, 2014. It would be apposite to quote wordingof Section 39 for ready reference, which reads thus :-“39. Whoever carries on the business of money-lendingwithout obtaining a valid licence, shall, on conviction, bepunished with imprisonment of either description for a termwhich may extend to five years or with fine which mayextent to fifty thousand rupees or with both.”9.The plain reading of aforesaid section would show that themischief of un-authorized money lending business is sought to beaddressed by making such activity as an offence. The term “business ofmoney lending” has been defined under section 2(3) of the Act of 2014,which reads thus :-“2(3) “Business of money lending” means business ofadvancing loans, whether in cash or kind and whether or notin connection with or in addition to any other business.”To constitute any activity as a business, as defined in Black’s LawDictionary an habitual employment or engagement in a particular {6} 2909.22 CRAPLN R..odtcommercial activity to earn the profit or livelihood or gain, would benecessary. It would be difficult to term any activity as business only onthe basis of an isolated transaction. Therefore, it would be necessary tofind out whether in the facts of the present case, there is material todemonstrate continuous activity of money lending or earning profits atthe hands of the accused, so as to attract the penalty under Section 39 ofthe Act of 2014. 10.As noted in the earlier paragraphs, it can be discerned fromthe contents of FIR that there is stipulation of only one transaction, thattoo, between the father of the applicant No.1 and father of respondentNo.3. Admittedly, it is a registered sale deed, except bare words ofrespondent No.3 that it was as money lending transaction, there isnothing on record to establish said fact. Pertinently, the father ofapplicant No.1 died in the year 2017 and now, allegation is made thatapplicant was, in fact, indulged in the money lending business throughher father. To support such contention, there is no iota of material in theentire charge sheet.11.It could be observed that during the lifetime of father ofapplicant No.1, mother of respondent No.3 never objected suchtransaction to be a money lending transaction. Even assuming thatimpugned transaction was a money lending transaction as stipulated inthe FIR, the prosecution for the offence under Section 39 of the MoneyLending Act, would not be permissible unless continuous activity ormultiple transactions to pass the test of business, is brought on record. Inthe case of Mandubai Vithoba Pavar vs. State of Maharashtra (2016) 1Bom. C.R. (Cri) 794, this court observed in para.11 as under :- {7} 2909.22 CRAPLN R..odt“11. The above discussion makes it clear that for it to be abusiness there has to be a continuous and systematic activityby application of labour or skill with a view of earningincome when it could be called "business". In order to dobusiness of money lending, it would be necessary for theState to point out multiple activities of money lending doneby the petitioner. Merely referring to one isolated transactionclaimed to be a loan transaction or money lending wouldnot be enough to show that the petitioner was involved in"business of money lending" without licence. The FIR in thepresent matter read as a whole does not spell out that thepetitioner was doing "business of money lending". This beingso, on the basis of such FIR the prosecution cannot bemaintained.Similarly, the Division Bench of this Court in the case of BalasahebRamrao Bade vs. State of Maharashtra and others reported in (2019)5Mh.L.J. (Cri.) 132, and in case of Anup Niranjan Dodiya and another vs.State of Maharashtra and others, reported in 2020 All M.R. (Cri). 2497,dealt with the definition of “money lending” and held that to make outoffence under Section 39 of the Money Lending Act, inference of moneylending business can not be drawn on the basis of isolated transaction soalso prosecution of accused can not be permitted on that basis. 12.In view of the aforesaid legal position, in facts of the presentcase, we do not find any reason to permit continuation of criminalprosecution against applicant-accused which would amount to an abuse {8} 2909.22 CRAPLN R..odtof process of law. Hence we pass the following order :-O R D E R[I]The application allowed;[II]The FIR in crime No. 242 of 2022 dated 23.7.2022registered with Murum Police Station, Dist. Osmanabad, for the offenceunder Section 39 of the Maharashtra Money Lending Regulation Act,2014 and consequential proceeding in RCC No. 192 of 2022 pendingbefore J.M.F.C., Omerga, is hereby quashed and set aside.[III]Application stands disposed of.[S.G. CHAPALGAONKAR, J] [ SMT. VIBHA KANKANWADI, J] grt/-