IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.SASIDHARAN NAMBIAR TUESDAY, THE 14TH JULY 2009 / 23RD ASHADHA 1931 Crl.MC.No. 4950 of 2008() ------------------------- ST.2525/2008 of JUDL.MAGISTRATE OF FIRST CLASS COURT -I, ALAPPUZHA .................... PETITIONER(S): ACCUSED: ------------------------------------------ 1. SUBHASH, BRANCH MANAGER, PUNJAB NATIONAL BANK,MULLACKAL, ALAPPUZHA. 2. T.SASIDHARA PANICKER, ASSISTANT GENERAL MANAGER, REGIONAL OFFICE, PUNJAB NATIONAL BANK, CPGP TOWERS, GENERAL HOSPITAL ROAD, STATUE JUNCTION, THIRUVANANTHAPURAM. BY ADV. MR.P.K.SURESH KUMAR RESPONDENT(S): STATE & COMPLAINANT: ----------------------------------------------------------------- 1. STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM 2. K.RADHAKRISHNAN, S/O. KOLAPPA PILLAI, LEKSHMI VILAS, VELLAKINAR, ALAPPUZHA. R1 BY PUBLIC PROSECUTOR MR. THOMAS J.AMBOOKKEN R2 BY ADVS. MR.H.B.SHENOY, MR.B.ASHOK SHENOY, SMT.LAKSHMI B.SHENOY, MR.ABU MATHEW, MR.SOBHAN GEORGE, MR.THOMAS.P.MAKIL. THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 14/07/2009, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: Kss M.SASIDHARAN NAMBIAR,J. =========================== CRL.M.C.No.4950 OF 2008 =========================== Dated this the 14th day of July,2009 ORDER Second respondent had availed educational loan from Punjab National Bank for the purpose of his son's higher education at Australia. When there was default in payment of the amount due, first petitioner as the Branch Manager and second petitioner as the Assistant General Manager of the creditor Bank initiated proceedings under the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002 (hereinafter referred to as the Act). As provided under the Act a notice was published in Deshabhimani Daily dated 11.8.2008. Second respondent filed Annexure A2 complaint before Judicial First Class Magistrate Court, Aappuzha alleging that the publication of Annexure A1 notice amount to defamation and by its publication his reputation was tarnished among the people and the family and contended that petitioners committed the offence under section 499 punishable under section 500 of the Indian Penal Code. This petition is filed under section 482 of Code of Crl.M.C.4950/2008 2 Criminal Procedure to quash the complaint alleging that the proceedings is only an abuse of process of court. 2. Learned counsel appearing for the petitioners and learned counsel appearing for the second respondent were heard. 3. Learned counsel appearing for the petitioners submitted that petitioners are the officials of the creditor Bank from which second respondent had availed a loan and as officers of the Bank they are entitled to proceed under the provisions of the Act and the disputed publication was made as provided under the Act and even if it amounts to defamation, under section 32 of the Act, petitioners cannot be prosecuted as there is a clear bar under the statute. Petitioners also contended that they are entitled to proceed under the Act and based on the said proceedings, petitioners cannot be prosecuted. 4. Learned counsel appearing for the second respondent submitted that as per the loan agreement, the education loan of Rs.4,74,178/- is secured by a collateral security and the amount is to be repaid after the lapse of one year or when the son of the second respondent getting employment, whichever event occurs first, and as on 28.7.2008 second respondent had already remitted Rs.1,07,651/- and in such circumstance there is no bona Crl.M.C.4950/2008 3 fides on the part of the petitioners to proceed under the Act and by the publication the reputation of the second respondent is adversely affected and therefore prosecution cannot be quashed as sought for. 5. The case of the second respondent is that by publishing Annexure A1 notice in the Deshabimani Daily, petitioners have committed an offence under section 499 punishable under section 500 of Indian Penal Code. It is not disputed that the said publication was made as provided under the Act as the Bank had proceeded under the said Act for realisation of the amount due. The question is whether on the allegation that the publication of the notice amount to defamation petitioners could be prosecuted?. 6. Section 32 of the Act protects the action taken by the petitioners in good faith. Section 32 reads:- “Protection of action taken in good faith:- No suit, prosecution or other legal proceeding shall lie against any secured creditor or any of his officers or manager exercising any of the rights of the secured creditor or borrower for anything done or omitted to be done in good faith under this Crl.M.C.4950/2008 4 Act. Objections and Reasons:- This clause provides for protection of action taken in good faith. It provides that no suit, prosecution or other legal proceedings shall lie against any secured creditor or any of his officers or manager exercising any of the rights of the secured creditor or borrower for anything done or omitted to be done in good faith under the proposed legislation.” As is clear from the objects and reasons, the clause is enacted to provide for protection of action taken in good faith. When the borrower fails to pay that amount and the creditor is entitled to proceed under the Act, any proceedings taken under the Act is protected by the provisions of Section 32. When the disputed publication was made by the petitioners, as provided under section 32 of the Act, petitioners cannot be prosecuted for the said offence so long as their action is bona fide. Petitioners have no case that the amount was not due when the bank proceeded to realise the amount. If that be so, the proceedings under the Act cannot be said to be without Crl.M.C.4950/2008 5 bonafides. If so, under section 32 of the Act petitioners cannot be prosecuted. Petition is allowed. S.T.2525/2008 on the file of Judicial First Class Magistrate Court, Alappuzha is quashed. M.SASIDHARAN NAMBIAR JUDGE tpl/- M.SASIDHARAN NAMBIAR, J. --------------------- W.P.(C).NO. /06 --------------------- JUDGMENT SEPTEMBER,2006