THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY Crl.P.No.5259 of 2008 ORAL ORDER: This Criminal Petition is filed under Section 482 Cr.P.C. seeking to quash proceedings in C.C.No.1 of 2007 on the file of the District and Sessions Court, Karimnagar registered for offence punishable under Section 5 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act (for short ‘the Act’) against the petitioners and others. The petitioners are A3 to A6 in that C.C.No.1 of 2007. The brief facts of the case are as follows: The defacto-complainant filed report against the Accused before the Jagtial Town P.S., in which it is alleged as follows: A1 and A2 in the case respectively are the Managing Partner and Partner of Sudha Finance, which is a registered partnership firm, bearing No.5847/94 situated at Jagtial with Head Office at Korutla. A3 is a Coordinator and custodian of the records and stationery and deposit certificate books of the company. A1 to A5 approached the defacto- complainant and requested to make fixed deposits in the company promising to repay double the amount within 72 months and accordingly the defacto-complainant and three others deposited Rs.5,000/- each under Chakra Deposit scheme and they were issued consequential Receipts bearing Nos.D.3181, D.3183, D.3180 and D.3185 dated 15.5.1996 signed by A1 mentioning the maturity value as Rs.11,000/- and maturity date as 15.5.2002. After the expiry of the maturity period, when the defacto complainant along with the three others approached the Accused for the repayment of the maturity amount, the accused evaded to repay the amounts and threatened them with dire consequences. It is contended on behalf of A3 to A6 that no prima facie case is made against them and the case against A1 and A7 was already quashed and the defacto-complainant got no locus-standi to file the case and the matter was referred to the concerned P.S. under Section 156(3) Cr.P.C. for necessary investigation and report and consequently charge sheet was filed, but the police got no jurisdiction to entertain the matter. Insofar as A1 in the case is concerned, the proceedings in the calendar case against him were quashed by the order of this Court in Crl.P.No.1230 of 2008 dated 31.7.2008 and further insofar as A7 in the case is concerned, the proceedings initiated against him in the calendar case were quashed in Crl.P.No.6458 of 2007 dated 22.1.2008 both on the ground that absolutely no incriminating material was found against them in the case. The point for consideration is whether sufficient grounds are there in order to quash the proceedings in the calendar case insofar as A3 to A6 are concerned. It is pertinent to note here that there are specific allegations against A3 to A5 of approaching the defacto complainant along with A1 and A2 to make fixed deposit in the company promising to repay double the amount so deposited within 72 months therefrom and consequently the defacto complainant and the three others deposited the amount of Rs.5,000/- each under chakra deposit scheme therein in respect of which the said receipts dated 15.5.1996 signed by A1 are said to have been given to them noting the maturity value as Rs.11,000/- and maturity date as 15.5.2002 and also about the evasion of them to repay the amount threatening them with dire consequences when demanded to pay the maturity amounts. Section 5 of the Act contemplates; “Penalty for default; Where any financial establishment defaults in the return of the deposit either in cash or in kind or defaults in the payment of interest on the deposit as agreed upon, every person responsible for the management of the affairs of the financial establishment including the promoter, Manager or Member of the Financial Establishment shall be punished with imprisonment for a term which may extend to ten years and with fine which may extend to rupees one lakh and such financial establishment shall also be liable for fine which may extend to rupees five lakhs.” The wording of the provision makes it very clear that only financial establishment under similar circumstances would come within the purview of that, therefore it is not proper to prosecute A3 to A5 private individuals to bring them within the ambit of it. However, the allegations provide that A3 to A5 involved in cheating the defacto complainant and others in the said matter for which they can be prosecuted. Further, by virtue of Section 6 of the Act, the District Court concerned got jurisdiction to entertain the matter. However, insofar as A6 is concerned, there is no incriminating material against him, and as such the proceedings are to be quashed insofar as A6 is concerned while rejecting the plea to quash the proceedings insofar as A3 to A5 are concerned. In the result, the petition is allowed observing that the Court below has to consider the question of prosecuting A3 to A5 for other relevant offences on the basis of relevant record. ________________________ G.KRISHNA MOHAN REDDY, J Date: 21.10.2011 DA THE HON’BLE SRI JUSTICE V.ESWARAIAH AND THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY Crl.A.No.1547 of 2007 .10.2011