SC asks HC to consider fresh plea against quashing of FIR against money lenders

The Supreme Court has asked the Karnataka High Court to examine afresh a plea by a man challenging quashing of an FIR lodged against money lenders for charging exorbitant interests on him for a loan.

A bench of Justices N V Ramana and S Abdul Nazeer remanded the matter back to the high court after hearing arguments from counsel Sanjay M Nuli, representing Veerabasappa, a resident of Koppal, and advocate S G Patil, for the respondent-accused.

The top court agreed to a plea that the high court should not have quashed the criminal proceedings, while taking up a batch of petitions by the accused, as in the instant case, there were no procedural irregularities like conducting raids on the premises of money lenders without prior permission from the registrar.

The petitioner here challenged quashing of an FIR registered against Shanmukhappa Singanal, his son Suresh, and Mahesh in 2015 with Gangavathi town police station for the offences under the Karnataka Prohibition of Charging Exorbitant Interest Act, 2004, and under Section 420, 504 and 506 of Indian Penal Code.

The high court had on June 22, 2017, set aside the criminal proceedings initiated against a group of money lenders.

The high court had concluded that the police authorities did not follow the procedure mandated under the Criminal Procedure Code as they conducted raids on the premises of the accused and seized some documents before registering the FIR.

The petitioner challenged the high court findings, contending that on receipt of information about cognisable offence, it is bounden duty of the police to inspect, search and seize the relevant material even before completing the necessary formalities like recording information in the dairies of registering FIR.

Acting on a batch of petitions filed by money lenders under Section 482 of the Criminal Procedure Code, the high court has held that under Section 15 of the Karnataka Money Lenders Act, it was only the registrar and the assistant registrar or any other person, authorised by the state government for that purpose, who can enter into the premises of the money lenders to inspect and seize documents and also to verify whether the business of money lending is carried on in accordance with the provisions of money lending or not.

It was contended by the petitioner that Section 15 was an enabling provision and it could not be construed to debar the police authorities from performing their duties.

In his complaint to police, Veerabasappa claimed he took a loan of Rs 8.32 lakh from Shanmukhappa and others and paid back total Rs 34 lakh, including exorbitant interest, to them.

But the accused misused some cheques issued by him and initiated proceedings against him under the Negotiable Instruments Act and further demanded Rs 24 lakh.