Induslnd Bank vs State of Kerala

Ashok Bhushan, J.—Heard learned counsel for the petitioner and the learned Government Pleader appearing for respondents 1 to 9.

The petitioner is a banking company duly licensed by the Reserve Bank of India to function as a Bank. The petitioner has come up in the writ petition praying for a declaration that the registration of crimes by the State police under the provisions of Kerala Money Lenders Act and Kerala Prohibition of Charging Exorbitant Interest Act, 2012 against the petitioner bank which is a scheduled commercial bank as seen from Ext.P1 is illegal and unwarranted and hence unsustainable in law as the petitioner bank is exempted under Section 2(7)(a) of the Kerala Money Lenders Act. Further direction has been sought to respondents 2 to 8 and the police force of the first respondent, not to harass the petitioner bank and its various branches for the alleged infraction of the provisions of Kerala Money Lenders Act and Kerala Prohibition of Charging Exorbitant Interest Act, 2012 and register crimes under the provisions of the said Act.

The petitioner''s bank being a scheduled commercial bank recognised and duly licensed by Reserve Bank of India is exempted from the operation of the Kerala Money Lenders Act, 1958. It is submitted that in accordance with Section 2(7)(a) of the Kerala Money Lenders Act, the petitioner bank is exempted. The State police is proceeding with a drive known as ''operation kubera'' in the whole of the State, under which the petitioner''s bank and its officials are also being harassed and First Information Reports have been launched under the Kerala Money Lenders Act, 1958 whereas the petitioner being a scheduled commercial bank is not a money lender and no crime can be registered against the petitioner bank.

Learned Government Pleader appearing for the State submitted that first and final reports have been submitted before the concerned court below. On the basis of search conducted in one M/S Divya Motors, it is submitted that the respondent police is not causing any undue harassment to the bank officials and all investigations are to be carried in accordance with law. Learned Government Pleader has referred to three crimes which have been registered against the bank - Crime No. 1065/14 under Section 511 of 468 IPC and Sections 13 and 17 of Kerala Money Lenders Act; Crime No. 1055/14 under Section 420 IPC and Section 17 of the Kerala Money Lenders Act and Crime No. 551/14 under Sections 471, 420, 506(1) IPC and Section 17 of the Kerala Money Lenders Act read with Section 4 of Kerala Prevention of Exorbitant Interest Act, 2012.

For the purposes of this writ petition, the issue to be considered is as to whether against the petitioner bank, the respondent authorities can proceed under the Kerala Money Lenders Act, 1958. No other issue is being examined in the writ petition nor we are expressing any opinion with regard to any other crimes alleged to have been committed by the bank officials or others. The Kerala Money Lenders Act, 1958 has been enacted to provide for regulation and control of the business of money lenders in the State of Kerala. Section 2(7) defines "money lender". Section 2(7) which is relevant for the present case is as follows:

money-lender" means a person whose main or subsidiary occupation is the business of advancing and realising loans or acceptance of deposits in the course of such business and includes any person appointed by him to be in charge of a branch office or branch offices or a liaison office or any other office by whatever name called, of his principal place of business and a pawn broker, but does not include -

(a) a bank or a co-operative society; or

(b) the Life Insurance Corporation of India established under Section 3 of the Life Insurance Corporation Act, 1956 (Central Act 31 of 1956); or

[(bb) the Industrial Credit and Investment Corporation of India limited incorporated under the Indian Companies Act, 1913 (7 of 1913);]

(c) the Industrial Finance Corporation established under Section 3 of the Industrial Finance Corporation Act, 1948 (Central Act 15 of 1948); or

[(d) x x x x]

(e) the State Financial Corporation established under Section 3 of the State Financial Corporation Act, 1951 (Central Act 63 of 1951); or

(f) any institution established by or under an Act of Parliament or the Legislature of a State, which grants any loan or advance in pursuance of the provisions of that Act; or

(g) any other institution in the public sector, whether incorporated or not exempted by the Government by notification.

The petitioner bank being exempted from the definition of money lenders, we fail to see that on what basis respondents can proceed against the bank under the Kerala Money Lenders Act, 1958. As observed above, we do not express any opinion with regard to the other offences, if any, committed by the bank. Thus, to the above limited extent, we accept the submission of learned counsel for the petitioner and direct that the bank being exempted from the operation of 1958 Act, the police shall not take any proceedings against the petitioner under the 1958 Act. We have given liberty to the police personnel to complete the investigation and take a decision with regard to the three crimes mentioned above. Learned Government Pleader has submitted that no harassment shall be maintained by the police authorities in the context of investigation of the aforesaid crime.

With the aforesaid observation, this writ petition is disposed of.