IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE 24TH DAY OF JUNE, TWO THOUSAND AND TEN PRESENT HON'BLE SRI JUSTICE A.GOPAL REDDY CRIMINAL PETITION No.737 of 2008 Between: Pathuri Mohan and another … Petitioners And Sub-Inspector of Police, CCS Police station, Eluru and another … Respondents This Court made the following: HON'BLE SRI JUSTICE A.GOPAL REDDY CRIMINAL PETITION No.737 of 2008 ORDER: - This petition under Section 482 of the Code of Criminal Procedure, 1973 (for short, “Cr.P.C.”), is filed to quash the proceedings in C.C.No.863 of 2007 on the file of II Additional Judicial Magistrate of First Class at Eluru for the offences punishable under Sections 420 of the Indian Penal Code, 1860 (for brevity, “IPC”) against the petitioners/accused. L.W.1-Perabathula Rambabu, who is the father of Perabathula @ Mutyala Lalitha (L.W.2), W/o.M.V.V.Satyanarayana, filed a complaint stating that he had acquaintance with L.W.4, an advocate and while A1 and A2 visited the office of L.W.4, L.W.4 introduced them to L.W.1 stating that A1 is a Post Graduate with M.B.A. Degree and was much inclined to do business, for which he need Rs.2,00,000/- as loan and offered his agricultural land to an extent of Ac.3-50 cents situated at Gopavaram village of Musunuru Mandal, Krishna District as security. Both A1 and A2 promised that the loan will be cleared within six months, until such time monthly interest at 24% p.a. will be paid. On the said promise, L.W.1 paid the amount to A1 and A2 on 01.06.2004 at the office of L.W.4, in the presence of L.Ws.4 to 6. A1 executed a mortgage deed in respect of the said property in favour of L.W.2 at Sub-Registrar Office, Nuziveedu on 01.06.2004, which was attested by L.W.3. On the same day, A1 delivered two post dated cheques bearing Nos.394846 and 394847 of State Bank of India, Vijayarai Branch for Rs.1,50,000/- and Rs.74,000/-, dated 01.12.2004 and 15.12.2004 respectively. When the accused defaulted the payment of monthly interest and on the demand made by L.Ws.1 and 4, A1 delivered two cheques bearing Nos.086541 and 086542, dated 04.08.2004 for Rs.4,000/- each on State Bank of India, Main Branch, Eluru vide his Savings Bank Account No.63431. When both the cheques were presented, they were returned with an endorsement ‘funds insufficient’. L.W.1 in good faith contacted both the accused with the assistance of L.Ws.5 to 7. On the promise made by them, he has not taken any steps to prosecute them for the offence under Negotiable Instruments Act, but filed a civil suit in O.S.No.102 of 2006 for recovery of the loan amount. When the accused failed to pay the amounts, L.W.1 made a complaint before the Sub-Divisional Police Officer, Eluru, which was endorsed to Station House Officer, CCS Police Station for investigation. On the said complaint, police registered a case in crime No.38 of 2007 and after due investigation laid the charge sheet for the offence punishable under Section 420 IPC. Prima facie, the ingredients of Section 415 IPC have not been attracted, for the reason that A1 and A2 have not induced the complainant by issuing cheques by parting the valuable security with the mother of L.W.1. They have borrowed the money from his daughter L.W.2 by executing a mortgage deed, mortgaging Ac.3-50 cents in her favour and received loan of Rs.2,00,000/- obtained by A1 and after obtaining the loan, they delivered two post dated cheques for Rs.1,50,000/- and Rs.75,000/- respectively, and when the interest has not been paid, they issued further two cheques which were also dishonoured. If the said cheques were dishonoured, the remedy of L.W.2 is to issue notice as contemplated under Section 138 of N.I.Act for initiation of prosecution. But, it is nowhere alleged that L.W.2 issued such notice and on issuing such notice, the accused prevented her not to proceed further in the matter and cheated L.W.2. In the absence of element of cheating or inducement at the time of parting the money or induces the person so deceived, to do or omit to do anything which he would not do or omit if he was not so deceived, the petitioners/accused cannot be proceeded under Section 420 IPC and the proceedings so initiated is only an abuse of process, to coerce the accused for due realisation of the amount, for which a civil suit is already filed. In view of the same, it is a fit case where the proceedings cannot be continued and it is accordingly quashed. Accordingly, the Criminal Petition is allowed. _______________ A.GOPAL REDDY, J 24th June 2010 lmv