M. Nirmal Kumar, J.

1. The Criminal Original Petitions have been filed praying to quash the proceedings in C.C. Nos. 2661, 2662 and 2660 of 2020 respectively, pending on the file of the learned Metropolitan Magistrate for the exclusive trial at CCB Cases (relating to Cheating Cases in Chennai) and CBCID Metro Cases, Egmore, Chennai.

2. The brief facts, in nutshell, are as follows:

(i) In All the Criminal Original Petitions, the petitioner/accused Sridhar is the Executive Vice-Chairman & CEO of M/s. IndoStar Capital Finance Limited, Mumbai and one of the Directors of M/s. JR Capital Services (P) Ltd.

(ii) The defacto complainant in Crl. O.P. No. 19170 of 2020, is one of the partners of the Firm viz., M/s. LCS Foundations, on 31.08.2019, gave a complaint to the Inspector of Police, Central Crime Branch, Vepery, Chennai, addressed to the Commissioner of Police, Greater Chennai, stating that one Sridhar, the petitioner/accused, is the Director of J.R. Capital Services (P) Ltd., offered unsecured loan of Rs. 2,10,00,000/-, to the defacto complainant's Firm, when it was in financial crises. The petitioner demanded 16% rate of interest per annum from the year 2009 to 2011. He, subsequently, increased the rate of interest to 18% per annum from 2011 to 2014, thereafter 22% per annum from 2015, thereby, violated the provisions of Prevention of Charging of Exorbitant Interest Act. Increasing the rate of interest and receiving higher interest is against Sections 2(3) and 3 of Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003. The petitioner, without any license or maintaining any records, not issuing any receipts for receiving the payments by the debtor is totally against the provision under Section 3 of the Act, punishable Under Sections 17 & 18 of the Tamil Nadu Moneylenders Act, 1957. So far the petitioner collected Rs. 6.7 Crores of which Rs. 4.6 Crores, as interest. Hence, the case.

(iii) The defacto complainant in Crl. O.P. No. 19174 of 2020, is the Director of M/s. LCS City Makers (P) Ltd., on 31.08.2019, gave a complaint to the Inspector of Police, Vepery, Chennai, stating that one Sridhar - Petitioner/Accused, a co-student of the brother of the complainant from School and College level volunteered and offered unsecured loan of Rs. 8,00,00,000/-, to the complainant's Firm, when it was in financial crises. The petitioner, his associates and his Company JR Capital Services (P) Ltd., demanded interest at the rate of 22% p.a., from the year 2012 onwards, against the provisions of Charging of Exorbitant Interest Act. The accused collected Rs. 11,35,10,247/- towards principal and interest from the defacto complainant. Further, the petitioner received Rs. 3,35,10,27/-, as interest, from the defacto complainant during the period 2012 - 2017. Believing the sugar coated words of the accused that he would arrange a further loan of Rs. 25 Crores, the defacto complainant registered the property (Flat) at Coimbatore and Besant Nagar belonging to the complainant's side in favour of the accused Firm. Hence, the charge under Sections 406, 420 and 506(i) IPC and Sections 4 r/w 3 of Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003.

(iv) The defacto complainant in Crl. O.P. No. 19222 of 2020, is the Director of M/s. LCS Corporate Services (P) Ltd., Chennai, on 31.08.2019, gave a complaint to the Inspector of Police, Vepery, Chennai, stating that one Sridhar - Petitioner/Accused, a co-student of the brother of the complainant from School and College level, volunteered and offered unsecured loan of Rs. 3,00,00,000/- to the complainant's Firm, when it was in financial crises. The petitioner, his associates and his Company M/s. JR Capital Services (P) Ltd., demanded interest at the rate of 22% p.a., from the years 2012 to 2015 against the provisions of Charging of Exorbitant Interest Act. The accused collected a total amount of Rs. 4,97,24,316/-, out of which, Rs. 3,35,10,247/-, is the interest, from the defacto complainant, during the period 2012 to 2017. Hence, the charge under Sections 420 and 506(i) IPC and Section 4 r/w 3 of Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003.

3. The 1st respondent, on completion of investigation, filed the final report in Crime Nos. 371 to 373 of 2018, the same taken cognizance respectively in C.C. Nos. 2661, 2662 and 2669 of 2020, on the file of the learned Metropolitan Magistrate, Exclusively for trial of CCB cases (Cheating) and CB CID (Metro Cases), Egmore, Chennai,

4. Mr. Abudu Kumar Rajarathinam, the learned counsel appearing for the petitioner would submit that the petitioner is not a money lender, as defined under the Tamil Nadu Money Lenders Act. The petitioner is the Executive Vice-Chairman & CEO of M/s. IndoStar Capital Finance Limited, Mumbai. Therefore, the provisions of the Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003, is not attracted against the petitioner. The main business of the petitioner's Company M/s. JR Capital Services (P) Ltd., is to invest its money, as deposits, in other Companies for gaining profit. Not even a single document has been produced by the respondents in the above case to show that the petitioner is engaged in the business of money-lending. As per Section 12 of the Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003, a person referred to in Section 3 of the said Act, shall be defined with the meaning assigned to "Money Lenders", provided under the Provisions of the Tamil Nadu Money Lenders Act, 1957. Charging the petitioner under Section 3 of the Act, punishable under Section 4 of the Act, the prosecution has to first and foremost satisfy the conditions that the petitioner is a moneylender as defined under the Money Lenders Act.

5. The learned counsel, by relying on the Judgment in M/s. Jubilee Plots and Housing Pvt. Ltd. reported in 2010 (2) L.W. 75, submitted that neither Money Lenders Act, 1957 nor Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003, has any application to loan transactions of high value and for contracts wherein the parties agreed the rate of interest to be levied between themselves. Relying on the Division Bench Judgment of this Court in Nichani Vs. State of Madras reported in 76 L.W. 642), the learned counsel submitted that the persons, who lends money to lower class society and the act was enacted against them as a different class of persons with special provisions for obtaining license, for maintenance of records and prohibiting exorbitant interest. No materials have been placed by the prosecution to show that the petitioner is carrying on business and lending money to lower class people and come under the category of "different class of persons" so that the petitioner would come under the definition of money lender. Further, as per Section 2(vi) of the Moneylenders Act, advance made on the basis of Negotiable Instruments Act exceeding Rs. 10,000/-, cannot be termed as loan/moneylending. The petitioner and his Company has invested huge amount in the defacto complainant's Companies and partnership Firm. The transactions are nothing but pure commercial transaction under the Companies Act.

6. The learned counsel would further submit that there is no clarity with regard to the actual allegations. In the first portion of the Charge Sheet, it is mentioned that the interest received by the petitioner is Rs. 1,97,24,316/- whereas, in the later portion, it is stated that the petitioner collected Rs. 3,35,10,247/-. The allegation made in the charge sheet is false, malicious, baseless and without support of any documents. The Annual Returns filed by the 2nd respondents, before the Registrar of Companies, clearly prove that a false case foisted against the petitioner with an ulterior motive to evade its payments and escape its liability against the Petitioner's Company. The defacto complainant failed to make payment from the year of 2016. The delay of one year in lodging the complaint would clearly prove that a false case has been foisted against the petitioner with mala fide intention to harass, blackmail and to tarnish his image in the Corporate world with an ulterior motive of extorting money.

7. Adding further, the learned counsel for the petitioner would submit that Final Report filed by arraying the petitioner as an accused in the capacity as Director of M/s. JR Capital Service (P) Ltd., whereas the Company not made an accused, which is against the dictum of the Hon'ble Supreme Court in Aneeta Hada v. Godfather Travels & Tours (P) Ltd., reported in (2012) 5 SCC 661 [LQ/SC/2012/406] . On the request made by the defacto complainants, the petitioner and petitioner's Company made payments. The defacto complainants repaying those deposits with interest to the petitioner's Company. Initially, the petitioner made payment to the 2nd respondent Company, after the formation of M/s. J.R. Capital Services (P) Ltd., it made deposits and repayments were made through M/s. J.R. Capital Services (P) Ltd.).

8. The transaction between the defacto complainants, petitioner and petitioner's Company, is purely a commercial business transaction, which cannot be termed as lending of money for interest. Whatever the interest paid by the 2nd respondent, the same was received by the petitioner's Company, purely as a business transaction. The Annual Returns filed by the 2nd respondent before the Registrar of Companies clearly shows that the payments made by the petitioner and petitioner's Company were treated as deposit for further development of the Company and same is nothing but a commercial business transaction happened between two companies. Further, the Annual Returns filed before the RoC falsifies the Final Report and the ledger accounts are manipulated documents prepared by the 2nd respondent for the purpose of the filing of the above case. The petitioner is admittedly the Chairman and one of the Directors respectively of the Firm and as such, he is not liable for prosecution. His further argument is that the Company having not been made an accused, the petitioner cannot be prosecuted.

9. The petitioner, CEO of Public Limited Company, is not engaged in the business of advancing and realizing the loan, as moneylender, as alleged by the prosecution and he would not come under the definition of moneylender under Section 2(8) of the Act. The Division Bench of this Court approved the findings recorded by the Learned Single Judge in the decision in Indiabulls Financial Services Ltd. Vs. M/s. Jubilee Plots and Housing Private Limited reported in 2010-2-L.W.75), stressing upon Section 2(6)(vi) of the Tamil Nadu Money Lenders Act, 1957. Further, it confirms whoever makes advances on the basis of a negotiable instrument exceeding Rs. 10,000/- is not "a person" referred to in Section 3 of the Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003. It is further held that a debtor cannot lawfully charge a person viz., a money lender with the act of exorbitant interest when the money lender advanced the loan on the basis of a negotiable instrument exceeding Rs. 10,000/-.

10. In this case, all the amounts have been received by the defacto complainant in their Bank accounts. In support of the same, the petitioner produced the Axis Bank Debit Advice to show that Rs. 2,60,00,000/- debited to the accounts of M/s. LCS City Makers Pvt. Ltd., and all other amounts through Bank transactions i.e., through negotiable instrument. Further, L.W.5, Manager, City Union Bank examined confirming that all transactions between the petitioner and the defacto complainants through Bank. Added to it, in the Annual Return, the TDS Deduction Certificate have been referred and annexed confirming the same. In the annual returns with ROC and other statutory authorities the transactions between the petitioner and the defacto complainant are shown as deposits. Contrary to the statutory returns, a certificate from the Charted Accountant will not have preference over these documents. Conveniently, the first respondent have not considered the admission and documents filed before the statutory authorities. The 2nd respondent/defacto complainant also not denied the same, but on the contrary, gives an explanation, for the purpose of accounting it was recorded as deposits, but the amount received were only loans from the petitioner, as moneylender.

11. The learned counsel further submitted that the documentary evidence will prevail over the oral evidence. Further, contemporaneous statutory document will prevail over the subsequent created documents. The 2nd respondent not filed any errata or corrigendum before the statutory authority about the deposits submitted in the returns are not actually deposited and are only loans availed from the petitioner. The petitioner and his wife during 2012 invested their hard earned money as deposits in the Companies of the defacto complainant. Later, as per the amendment brought under the Companies Act, 2013, the investments were made as "inter-corporate investment" through Company named M/s. J.R. Capital Services Pvt. Ltd., wherein the petitioner is one of the Directors. All the investments made to the defacto complainant entities were legal, through Bank transaction. The transactions between the two entities, cannot be termed as private individual transaction, projecting as moneylending and charging of exorbitant interest.

12. The prosecution allegation that the petitioner usurps the residential properties under the guise of wiping out the existing loan and thereby, committed the offence under Section 406 IPC., is not sustainable. The public documents and the sale deed executed by the defacto complainant, the statutory filing and other documents unblemished with sterile quality, as produced herein would prove that the petitioner foisted in a false case with mala fide intention. The statutory and public document Form DPT-4 statement regarding deposits filed along with the annual report would prove that investment made by the petitioner is shown as deposit under the Companies Act. Further, the interest, which paid to the petitioner by the defacto complainant, is after deducting TDS under Form 16-A of the Income Tax Act. This would clearly prove that the petitioner is an investor and not a moneylender. The petitioner, on the request of the second respondent after purchase of the properties given the same as security for the loan obtained by the defacto complainant from the Financial Institution. Since the defacto complainant failed to discharge the loan availed from the Financial Institution, the account become NPA and thereby, the purchased property of the petitioner brought under the SARFAESI Act and at the verge of auction, the petitioner discharged the loan of the defacto complainant to the tune of Rs. 3.9 crores with M/s. Sundaram BNP Paribas Home Finance Limited.

13. Petitioner further submitted that apart from lodging the aforesaid criminal case, one of the defacto complainant Y. Prabu, through his son P. Balasubramaniam and Saaswathi Prabhu managed to file a Suit in C.S. No. 506 of 2018, seeking for cancellation of sale deed, dated 28.02.2017, in Doc. No. 442 of 2017, pertaining to the property at Kotturpuram, Chennai, wherein, in the civil Suit, the defacto complainant Y. Prabu shown as defendant along with the petitioner and the petitioner's Company, M/s. JR Capital Services (P) Ltd. In the plaint, they admitted that the defacto complainant Y. Prabu to tide over the financial commitments executed the sale deed to repay the petitioner. Further, in the suit, the payments through Bank is admitted. The only objection is that the sale deed executed on the guidelines value, not as per the market value. Further, the consideration, which was routed through bank have been re-routed through the defacto complainant and his wife's account to the petitioner company. Further, from the plaint it is seen that the defacto complainant have become insolvent. Obviously, to tide over such a situation, a false complaint made to have their free passage.

14. It is submitted that the 1st respondent has investigated the above case in a blindfolded and haphazard manner and has acted as a mouth piece of the 2nd respondent. The 1st respondent unlawfully relied upon the inadmissible and unauthenticated ledger account manipulated by the 2nd respondent for filing final report without even seeking for the annual returns filed before the RoC. The allegation made against the petitioner to attract Section 420 of IPC., is that the petitioner tempted the 2nd respondent that he will bring additional loan of Rs. 25 Crores to their Companies and the same would in no way attract offence under Sec. 420 of IPC. Section 420 of IPC., is included against the petitioner in the above case is, simply for the purpose of evading the procedure of filing a criminal complaint under Sec. 200 of Cr.P.C. before a Magistrate and to avoid deposit of principal amount, as provided under Sec. 5(1) of the Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003.

15. The learned counsel for the petitioner relied upon the Judgment of the Hon'ble Supreme Court in Harshendra Kumar D. Vs. Rebatilata Koley and Others reported in 2011 (3) SCC 351) [LQ/SC/2011/217] , for the proposition that, if the accusations cannot stand on the face of documents, which are beyond suspicion or doubt, it would be travesty of justice, if accused is relegated to trial and asked to prove his defence. Further, relied on the Judgment in Mohd. Akram Siddiqui Vs. State of Bihar and another reported in 2019 (13) SCC 350) [LQ/SC/2018/1284] , for the point that cases where documents relied upon is a public document or where veracity thereof is not disputed by the complainant, consideration of prima facie defence evidence under inherent power of High Court is not absolutely barred. Further, relying on the Judgment of this Court in Renuka Ramanath Vs. Yes Bank Limited reported in 2012 (3) MWN (Crl.) (DCC) 124 (Mad.), would submit that exercise of inherent power, the High Court required to refer only undisputed and unimpeachable documents.

16. Further, the learned counsel relying upon the Judgment of the Apex Court in TVC Skyshop Limited Vs. Reliance Communication and Infrastructure Limited reported in 2013 (11) SCC 754) [LQ/SC/2013/753] , would submit that as per Section 34 of Civil Procedure Code, interest charged as per terms of agreement between parties cannot be latter accepted and termed highly in excess. Further, relying on the Judgment of this Court in J.D. Nichani Vs. State of Madras reported in 1963-76-L.W. 642), with regard to the validity of the Money Lending Act, wherein it is held that the act was primarily brought in to remove the evil of moneylenders exploitation was with reference to lower middle class people, particularly, the salary servants and wagers. Further, the advances on the basis of negotiable instrument as defined in Negotiable Instruments Act, 1881 exceeding certain amount would not come under Money Lending Act. Further, the learned counsel relied on the Judgment of this Court in Indiabulls Financial Services Ltd. Vs. M/s. Jubilee Plots and Housing Private Limited reported in 2010-2-L.W.75), wherein this Court considered in detail the ambient scope of Tamil Nadu Prohibition of Charging Exorbitant Act along with the provision of Tamil Nadu Money Lenders Act, 1957. That "Person", as defined under Section 3 of Tamil Nadu Prohibition of Exorbitant Interest Act, is none other than the money lender, as defined under the provision of Tamil Nadu Money Lenders Act. Further, following the Judgment in J.D. Nichani's case held that the Tamil Nadu Money Lenders Act, 1957 and Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003 would not apply to money lenders who advance loan on the basis of negotiable instrument exceeding Rs. 10,000/-.

17. The learned counsel for the petitioner further relied on a Division Bench Judgment of this Court in Sri Kalpatharu Financiers by its Partner Mr. K. Selvaraj Vs. V. Natarajan reported in CDJ 2012 MHC 2307), wherein the Division Bench approved the view taken by the learned Single Judge of this Court in Indiabulls's case and held that "a person" referred to in Section 3 of the Act 38 of 2003 and the 'money lender' as referred in Section 2(8) is not applicable to the loan transaction between two parties where the loan is on the basis of a Negotiable Instrument exceeding Rs. 10,000/-. Further, the learned counsel relied upon the Judgment of this court in A. Gaunasekaran Vs. P. Velusamy reported in 2014(1) MWN (cR.dcc 49 (Mad.). As per Section 12 of Tamil Nadu Money-lenders Act, subject to the provisions of this Act, the provision of the Money Lenders Act, insofar as they are applicable to Money Lenders shall mutatis mutandis apply to a person referred to in Section 3 of the Tamil Nadu Money-lenders Act. Further, the learned counsel relied on the Judgment of the Apex Court in Aneeta Hada Vs. Godfather Travels & Tours (P) Ltd., reported in 2012 (5) SCC 661) [LQ/SC/2012/406] for the point that without arraying the Company, the petitioner cannot be prosecuted in the absence of individual specific overt act against the petitioner.

18. Mr. A. Damodaran, the learned Additional Public Prosecutor appearing for the 1st respondent in all the petitions would submit that the petitioner herein is a moneylender, as defined under the Tamil Nadu Money Lenders Act. During 2012, when the defacto complainants' Firm was in financial crisis, the accused and his associates offered unsecured loan to the tune of several crores at the rate of 16% interest per annum and charged the interest, subsequently, the petitioner increased the rate of interest to 18% per annum, thereafter, 22% per annum, The increase in rate of interest is against the statutory provision and receiving huge interest is in violation of Sections 2(3) and 3 of Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003 and punishable under Section 4 of the said Act.

19. The case against the petitioner in O.P. No. 19170 in C.C. No. 2661 of 2020 is that the defacto complainant, partner of LCS Foundation, involved in development of residential apartments under joint development model with land owners. The petitioner is the Director of JR Capital Services (P) Ltd., engaged in providing finance to needy one on interest basis. During 2009, when the defacto complainant was in financial crisis, the petitioner offered unsecured loan of Rs. 2,10,00,000/-, for which, the petitioner demanded 16% rate of interest per annum, charged the same for the period from 2009 to 2011. Subsequently, he increased the interest rate to 18% for the period from 2011 to 2014, further increased the interest rate to 22% from 2015. The increase in interest rate is in violation of Section 2(3) of Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003.

20. The petitioner, without any licence or maintaining any records not issuing any receipt for receiving the payment by the debtors, violated the provisions under Section 3 of the Act, punishable under Sections 17 and 18 of the Tamil Nadu Money Lenders Act. He also collected exorbitant interest at the rate of 16% p.a., in violation of Section 7 of the Act and Government Notification in G.O. Ms. No. 406 Co-operation Department, dated 05.07.2017. The defacto complainant was made to pay a sum of Rs. 6.7 Crore of which Rs. 4.6 Crors, as interest and the principal accounted was Rs. 2.1 Crore. O.P. No. 19222 of 2020 in C.C. No. 2660 of 2020 is that the defacto complainant, one of the Director of LCS Makers Private Limited, a Firm is engaged in the property development. The petitioner, as Director of M/s. JR Capital Services (P) Ltd., engaged in providing finance to the needy person, on interest. During 2012, when the 2nd respondent was in financial crisis, the petitioner offered unsecured loan of Rs. 3,00,00,000/- and demanded 22% rate of interest per annum, for the year 2015-16. During this period, the petitioner received Rs. 4,97,24,316/-, as principal and Rs. 1,97,24,316/- towards interest.

21. The overt act as against the petitioner in Crl. O.P. No. 19174 of 2019 in C.C. No. 2662 of 2020 is that the defacto complainant, one of the Directors of M/s. LCS City Makers Private Limited, engaged in the property development under Joint development with land owners. The petitioner is Director of M/s. JR Capital Services (P) Ltd., engaged in providing finance to needy Firms, on interest basis. During 2012, when the defacto complainant Firm was in financial crisis, he offered unsecured loan of Rs. 3 Crores and demanded 22% rate of interest per annum, charged the same for the period from 2012 - 2016 and collected Rs. 11,35,10,247 towards principal and interest, in which, Rs. 3,35,10,247/- accounted for interest, for the period 2012-17. The petitioner also tempted the defacto complainant that he will arrange additional loan of Rs. 25 Crores and got transferred residential property of the defacto complainant in Mylapore, Sasthrinagar, Adayar, and Coimbatore, on the promise that the entire loan would be wiped out. Further, he promised to arrange loan with Kotak Mahindra Investments Ltd., and Pirmal Capital, but failed to do so, on the other hand, retained the property.

22. It is further submitted that the accused tempted the defacto complainant that he will arrange additional loan of Rs. 25,00,00,000/-. In order to extract money from the defacto complainant, the accused pressurized, threatened the defacto complainant with dire consequences, thereby, the accused committed the offences of cheating, criminal intimidation, charging exorbitant rate of interest. Further, 37 documents have been filed by the prosecution to prove the charges against the petitioner along with the final report. The charges against the petitioner established through the material evidence. There is no necessity to cite the Company of the petitioner, as accused in the case. After completion of investigation in a proper and fair manner, a prima facie case made out against the petitioner and final report filed before the trial Court. The petitioner can very well place his argument at the time of trial before the trial Court. The petitioner has sufficient and fair opportunity to prove his innocence during trial.

23. Mr. S. Ramesh, the learned counsel for 2nd respondent/defacto complainant submitted that M/s. LCS Foundations and M/s. LCS City Makers Private Limited are partnership Firms, the partners are brothers. The partnership Firms created in the year 2003 and the partners were Y. Prabu, Y. Jaisankar and Y. Balaji. M/s. LCS Foundation and M/s. LCS City Makers Private Ltd., are developing plots and selling the same. During the formative years of the petitioner, one R. Yagnaraman, the father of the defacto complainant, responsible for the petitioner's growth and coming up in his life. Right from the child hood, the petitioner's family and the defacto complainant's family are known to each other. In fact, the petitioner is a co-student of the brother of one of the complainants from School and College level. The petitioner taking advantage of long and close relationship, when the defacto complainants' Firm was in need of funds for their business, the petitioner taking advantage of the situation, lend money at exorbitant interest. The money was routed by the petitioner through his Company and family members and the terms and conditions were solely decided by the petitioner.

24. Initially, FIR was registered on 31.08.2018, and thereafter charge sheet filed in the year September 2020. The petitioner not a moneylender is denied. The defacto complainant family owned a valuable property of one ground in Kotturpuram, which illegally got transferred in the name of the petitioner, challenging the same, a suit has been preferred before this Court in C.S. No. 506 of 2018, in the suit the petitioner filed a counter affidavit in O. Appln. Nos. 700 and 701 of 2018. In the said counter affidavit, the petitioner herein specifically admitted that he has provided loan in his name or in the name of his wife or in the name of the Company. The petitioner also admits that the Company, M/s. JR Capital Services (P) Ltd., is a family owned concern. Thus, by the above admission, it is confirmed that the transaction is a loan transaction and it is not deposits, as claimed by the petitioner now.

25. In view of the petitioner's admission in the other proceedings, the petitioner cannot take shelter under Section 2(6)(1) of Tamil Nadu Money Lenders Act and Sections 2(6)(v) of the Act. In view of the disputed fact it has become a subject matter of trial and bonafide contained in the above provision is a matter of fact. Insofar as the decision of this Court relied on by the petitioner in Indiabulls Financial Services Ltd. Vs. M/s. Jubilee Plots and Housing Private Limited reported in 02010-2-L.W.75), is not applicable to the facts of the present case on hand. Further, as per Tamil Nadu Exorbitant Interest Act, Section 3 it starts with, 'no person shall charge' and Section 4 starts with, 'Notwithstanding anything contained in the Money Lenders Act' and state that whoever contravenes the provisions of Section 3 or molests or abets the molestation of any debtor for recovery of any loan liable to be punished under the Act. It is a non obstante clause. If the petitioner's contention is to be accepted, then, any person/moneylender can charge exorbitant interest and they can go scot-free. The scope of Money Lenders Act is to regulate and control the business of Moneylenders and the scope of Prohibition of Charging Exorbitant prohibit charging of exorbitant interest by any person. The words, 'any persons' in Section 3 includes moneylenders. As per Section 12 of the Exorbitant Interest Act, it includes the Money Lenders Act in mutatis and mutandis, thereby, the Money Lenders Act also covered under the Exorbitant Interest Act.

26. With regard to the petitioner's reliance in the decision of Renuka Ramanath's case (cited supra) it is with regard a case under Negotiable Instruments Act, wherein the dispute is with reference to the resignation of the Director. With regard to TVC Skyshop Limited case (cited supra) it is a case, it has been dealt under Civil Procedure Code, under Order 37, Rule 4 of CPC., wherein, the Apex Court rejected the application seeking leave to defend as parties. With regard to J.D. Nichani's case, the principles laid down therein are not relevant to the case on hand. With regard to the decision in the case of State of Kerala Vs. M/s. Mar Appraem Kuri Co. Ltd., reported in 2012 (7) SCC 106) [LQ/SC/2012/450] , which pertains to repugnancy of law between State and Centre with reference to an entry in Lists I, II & III of Schedule VII of Constitution of India for the reason that the Interest Act, 1978 is a Central Act and under Section 3 of the said Act, the interest Act contained in the inter instrument payable by the parties. With regard to the mails enclosed by the petitioner in his typed set, these mails proved that it is a loan and the petitioner wants to set off the loan with usurious interest with some of the properties of the respondents. Further, in one of the mail, he claims 12% interest on deposit, and in default, a further 12%, which would prima face prove that the petitioner was charging exorbitant interest.

27. Mr. S. Ramesh, the learned counsel appearing for the 2nd respondents/defacto complainants in all the Petitions reiterated the averments made in the complaint and prayed for dismissal of the petitions. He would further submit that the petitioner being responsible for the conduct of the business of the Firm is solely responsible for contraventions of the Act, which themselves are punishable. It was also submitted that a complaint is maintainable without the Company being impleaded as a party in a case. He further submitted that the person, who is in charge of and responsible to the Company, is to be punished and not the Company. The Company cannot be sent to jail, but the person who is looking after its day-to-day administration and affairs can be held responsible and if offence is proved, he can be punished. In this view of the matter, impleading the Company as an accused is not necessary and its omission to do so is not vital to the case of the accused, and therefore, the person in charge of and responsible for its conduct of business, shall be liable and punishable. Hence, prayed for dismissal of the petitions.

28. I have heard the learned counsels appearing on either side and perused the materials available on record.

29. It is not in dispute that the defacto complainant availed corporate loan and deposits from the petitioner and petitioner's Company to the tune of several crores, when the defacto complainants Firms in crises. On 31.08.2019, the defacto complainants gave complaints to the Inspector of Police, Central Crime Branch, Vepery, Chennai, addressed to the Commissioner of Police, Greater Chennai, stating that the petitioner offered loan to the defacto complainant's Firm, when it was in financial crisis of several crores at the rate of 16% interest per annum, subsequently, increased the rate of interest to 18% per annum, thereafter, 22% per annum. The petitioner is the Chief Executive Officer of a Public Listed Company.

30. Further, the petitioner and his Firm invested huge amount to the defacto complainants' Company and the transactions are pure commercial transaction under the Companies Act. There was not even a single cash transaction between the parties and all the transactions were through Bank and the defacto complainants repaid part of principal and interest accrued on the investments through bank transaction, after deducting TDS under the Income Tax Act. The said commercial transactions are expressly excluded under the Money Lenders Act and the petitioner cannot be termed as money lender. When the investments made by the petitioner not fall under the definition of loan, as defined under the Money Lenders Act, the petitioner cannot be charged for an offence under Section 3 of Exorbitant Interest Act.

31. It is seen from the public documents viz., Form DPT-4, statement regarding deposits, available even prior to Act, 2013, coming into force, returns filed along with Annual Report before RoC disclose the investments made by the petitioner, as deposits under the Companies Act. The petitioner made as shareholder by the defacto complainants in their Companies. It is settled law that ordinarily and in the normal course, the High Court, when approached for quashing of a criminal proceeding, will not appreciate the defence of the accused; neither would it consider the veracity of the documents on which the accused relies. However an exception is carved out by the Hon'ble Apex Court to the effect that in an appropriate case where the document relied upon is a public document or where veracity thereof is not disputed by the complainant, the same can be considered.

32. The Tamil Nadu Prohibition of Charging Exorbitant Interest Act 2003, is an act to prohibit the charging of exorbitant interest by any person and matters incidental thereto. The scheme of the Act is to regulate and prohibit the culture of collecting exorbitant interest. According to the defacto complainants, the petitioner and his associates charging exorbitant interest for the loan availed by the defacto complainants' Companies, therefore, acted in contravention of the provisions of the Act. If it is the case of the defacto complainants, they can very well approach the civil Court by instituting the proceedings, for limiting the interest. Further, under Section 25 of the Act, the State can limit the rate of interest.

33. Charging the petitioner under Section 3 of the Act, punishable under Section 4 of the Act, the prosecution has to first and foremost satisfy the conditions that the petitioner is a money lender, as defined under the Moneylenders Act. But, in this case, no materials placed by the prosecution to show that the petitioner is carrying on business of lending money to lower class of people exploiting them who come under the category of "different class of persons" so that the petitioner would come under the definition of moneylender. As could be seen from the records that the petitioner and his Company invested huge amount in the defacto complainants' Companies, the transactions are nothing but pure commercial transaction under the Companies Act.

34. Moreover, on the request made by the 2nd respondent, the petitioner and his associates made payments to the defacto complainant's Companies which are reflected in the statutory returns. The defacto complainant repaying the amount to the petitioner's Company again reflected in statutory documents. The transactions between the defacto complainants and the petitioner's Company is purely a commercial business transaction, which cannot be termed as lending of money for interest. Further, the Annual Returns filed by the defacto complainants before the Registrar of Companies would show that payment made to the petitioner and the petitioner's Company are declared as deposit for further development of the defacto complainants' Companies. The allegation made against the petitioner in respect of the offence under Section 420 of IPC., is that the petitioner lured the defacto complainants that he will bring additional loan of Rs. 25/- Crores to their Companies, latter failed, for the reason M/s. Kotak Mahindra Investments Ltd., and Pirmal Capital found the petitioners credentials does not satisfy their requirements, for which petitioner cannot be the reason, and the same would in no way attract offence under Sec. 420 of IPC. Thus, viewed from any angle, continuation of proceedings is an abuse of process of law.

35. As regards entrustment and misappropriation, charging the petitioner under Section 406 IPC., would not apply for the reason that the defacto complainant admits that the petitioner and the defacto complainants are known to each other from their childhood and the petitioner being the Director of M/s. JR Capital Services (P) Ltd., is not in dispute, which is providing advise to customers for the investment, capital and assess management. The petitioner Company, as per MOU, can invest its money as deposits in other companies for gaining profit. The defacto complainant's business fallen into debt trap unable to continue their business, needed immediate infusion of capital for their business, approached the petitioner, who initially extended some help as loan, thereafter, after amendment to the Companies Act, in the year 2013, the earlier and subsequent loans converted as deposits a legal requirement. The entire transactions between the petitioner and the defacto complainant were through Banks, which is not disputed. The payment made by the petitioner is recorded in the Books of Accounts of the defacto complainant. Likewise, the payment of interest recorded in their Books of Accounts and TDS certificate, under Section 16A is registered. These particulars find place in the statutory returns filed with Registrar of Companies as well as in the Income Tax Department.

36. Admittedly, the transaction going from the year 2012 to 2017, thereafter, some properties, two in Chennai and one in Coimbatore registered in the name of the petitioner. This had taken place in the year 2017. According to the defacto complainant, the sale deeds executed on the promise that further infusion of capital to the tune of Rs. 25 Crore would be arranged through Kotak Mahindra Investments Ltd., and Pirmal Capital. Thereafter, contrary to the undertaking, the petitioner neither made financial arrangement nor re-conveyed the properties, due to this reason, the defacto complainant got into debt trap, declared bankrupt. From the records it is seen that the properties come under the SARFAESI and the petitioner transferred huge sums of money, retrieving the property from the SARFAESI proceedings.

37. In this case, all the transactions are through Bank. At this stage, in the year 2018, complaints lodged against the petitioner, FIR registered, investigation completed charge sheet filed. The transaction going on for years together. There have been initial payment, subsequent enhanced payment. In the meantime, repayments have been made. All are contemporaneously recorded by way of documents and statutory returns, not in disputes till 2018. Further, it is also seen that a civil suit in C.S. No. 506 of 2018 filed by one of the defacto complainant Y. Prabu, his son and daughter, arraying the said Prabu as first defendant and the petitioner and his Companies as defendants 2 and 3. From the plaint copy, it is seen that it was the parents of the plaintiff in civil Suit, who forced to revoke the family settlement and thereafter, the properties conveyed to the petitioner and the payments were routed in their accounts, which were used to settle the dues of the petitioner.

38. The defacto complainant's contention that the petitioner is a money lender and charging exorbitant interest is not legally tenable on the facts and circumstances of the case. Further, this Court in Nichani's case clearly held that the transaction made to negotiable instruments more than Rs. 10,000/- would not come under Money Lenders Act, which been relied on and this Court in the case of India Bulls following the same held that the phrase, "a person" referred to Section 3 of Tamil Nadu Prohibition of Charging Exorbitant Interest Act shall be defined with the meaning assigned to money lenders under the provision of Tamil Nadu Money Lenders Act, 2003. The 'person' as defined under Section 3 of the Tamil Nadu Prohibition of Charging Exorbitant Interest Act 2003 is none other than the money lender, as defined under the provisions of Tamil Nadu Money Lenders Act, 1957.

39. In the case of India Bulls this Court had in detail examined the provision of Tamil Nadu Money Lenders Act, corresponding with Exorbitant Interest Act and applicability of the same, found that " a person" referred to Section 3 of the Exorbitant Interest Act shall be defined with a meaning assigned to moneylenders under the provision of Money Lenders Act and held that the said person as defined under Section 3 of the Prohibition of Charging Exorbitant Interest Act is none other than the moneylender as defined under the provisions of the Tamil Nadu Money Lenders Act, 1957. Further referring to Section 2(6) it had held that an advance made on the basis of negotiable instrument and defined in Negotiable Instruments Act, 1881, exceeding Rs. 10,000/- would not come under loan. Further, the Division Bench of this Court in Sri Kalpatharu Financiers's case (cited supra), had occasion to consider the finding of India Bulls's case approved the same. It would be appropriate to extract para 70 to 75, which reads as follows:-

"71. Therefore, when a loan is on the basis of a Negotiable Instrument viz., a promissory note which exceeds 10,000/-, it is not covered under the Money Lenders Act 1957.

72. In Indiabulls Financial Services Limited and Another v. Jubilee Plots and Housing private Limited and Others (surpa) the learned single Judge of this Court had an occasion to deal with the provisions of the Exorbitant interest Act 2003, Tamil Nadu money Lenders Act 1957 and has observed

15. As per Section 2(6)(vi) of the Tamil Nadu Money Lenders Act, 1957, an advance made on the basis of a negotiable instrument exceeding 10,000/- would not fall under the definition of loan. Therefore, a money lender, who makes advances on the basis of a negotiable instrument exceeding 10,000/- is not "a person" referred to in Section 3 of the Tamil Nadu Prohibition of Charging Exorbitant Interest Act, 2003. In other words, a debtor cannot lawfully charge a person viz., a money lender with the act of exorbitant interest when the money lender advanced the loan on the basis of a negotiable instrument exceeding 10,000/-.

73. As stated earlier, the object of the Act 38 of 2003 is to prohibit the charging of exorbitant interest by any person. More particularly, it prohibits "a person" from charging more than 9% simple interest per annum for secured loan and 12% simple interest per annum for unsecured loan advanced by him and the hourly vatti, daily vatti, meter vatti, kandhu vatti and thandal are thereby prohibited.

74. As per the provisions of the Money Lenders Act money lender is a person whose main or subsidiary occupation is a business of advancing and realising loans and an advance made on the basis of the pronote exceeding 10,000/- will not be covered by the Money Lenders Act.

75. Therefore 'a person' referred to in Section 3 of Act 38 of 2003 and the 'money lender' as referred to in Section 2(8) is not applicable to the loan transaction between two parties where the loan is on the basis of a Negotiable Instrument viz. a promissory note exceeding 10,000/-. Therefore, the provisions of these two acts are not applicable to the case on hand."

40. In this case it is not in dispute that the statutory returns filed by the defacto complainant admitting the deposit and payment of interest have been filed by them reflects in Income Tax returns. The documents produced not seriously objected, further it is seen from the plaint in C.S. No. 506 of 2018, one of the defacto complainants' son and daughter questioned the sale deed executed in favour of the petitioner by their father. Thus filed a suit in C.S. No. 506 of 2018, with a prayer seeking to cancel the sale deed executed in favour of M/s. JR Capital Services (P) Ltd., further, seeking an injunction not to disturb their peaceful possession of the property. On the one hand, the defacto complainants' allegation is that exorbitant interest have been calculated and accounted, on the other hand, the son and daughter of one of the defacto complainants Y. Prabu question the sale deed, thereby, disputing the payment/giving credit to the principal and interest. The defacto complainant cannot have a prevaricating stand.

41. Further, the specific case of the defacto complainant is that the petitioner, as Director of M/s. JR Capital Services (P) Ltd., is prosecuted. In this case, admittedly, the said JR Capital Services (P) Ltd., is not arrayed as an accused. In the event of the Principal not made as an accused, the petitioner as Director cannot be proceeded, unless there are materials to show that that the petitioner acted as alter ego of JR Capital Services (P) Ltd., there is no specific overt act for the same. Further, from the list of witnesses it is seen that in all the 3 cases, the witnesses are identical, L.W.1 is the defacto complainant; L.W.2, L.W.3 are partner and brothers; L.W.4 is the family member and L.W.5 is the Manager of City Union Bank and L.W.6 is the Investigating Officer. All the witnesses state about the relationship and transactions between the petitioner from the year 2009 and for almost a decade, they have been doing business and suddenly some misunderstanding arose in the year 2017, thereafter, complaint lodged. Other than the family members of the defacto complainant, the City Union Bank Manager is the only other witness, who states about furnishing statement of accounts from the year 2009 to 2017. The statement of accounts is not disputed. The transaction between the petitioner and the defacto complainant is only through bank, which is reflected in the statutory returns. Other than that, it is investigating officer, from the statement of witnesses and documents produced it is seen that there is no case made out against the petitioner. Further on the facts and materials, the petitioner cannot be Termed as Money Lender, the corporate deposit and Transaction cannot be cloaked as loan, with exorbitant interest. The petitioner company not arrayed as accused, in absence of the company, the petitioner cannot be prosecuted as Director. In view of the same, this Court finds that the continuation of proceedings would amount to abuse of process of law. Hence, the proceedings against the petitioner in all the three cases are liable to be quashed.

42. In the result, the Criminal Original Petitions are allowed and proceedings in C.C. Nos. 2661, 2662 and 2660 of 2020 respectively, pending on the file of the learned Metropolitan Magistrate for the exclusive trial at CCB Cases (relating to Cheating Cases in Chennai) and CBCID Metro Cases, Egmore, Chennai, are quashed. Consequently, the connected miscellaneous petitions are closed.