2023 (9) TMI 859 - HC - Indian Laws

Validity of Filing Complaints under Section 138 Without Money Lending License

Hansraj Bansal Versus State & Another

Hansraj Bansal Versus State & Another - TMI Issues Involved:1. Whether a person can be debarred from filing and prosecuting a complaint under section 138 of the Negotiable Instruments Act if he is doing business of money lending without holding a valid license.2. Whether there is an apparent conflict between section 3 of the Punjab Registration of Money Lenders Act, 1938 and section 138 of the Negotiable Instruments Act.3. The maintainability of the revision petitions directly before the High Court without invoking the jurisdiction of the Sessions Court.Summary:Issue 1: Debarment from Filing and Prosecuting Complaint under Section 138 of the Negotiable Instruments ActThe petitioner filed multiple complaints under section 138 of the Negotiable Instruments Act against various respondents for dishonored cheques. The trial court dismissed these complaints on the grounds that the petitioner was engaged in money lending without a valid license, thus violating the Punjab Registration of Money Lenders Act, 1938. The trial court concluded that the petitioner was a money lender within the meaning of Section 2(9) of the Punjab Registration of Money Lenders Act, 1938, and dismissed the complaints based on this interpretation.The High Court, however, disagreed with this conclusion, stating that section 3 of the Punjab Registration of Money Lenders Act, 1938 does not limit the operation of section 138 of the Negotiable Instruments Act. The court emphasized that both statutes operate independently and are mutually exclusive. The court cited various judgments to support the view that a person can still institute and prosecute complaints under section 138 of the Negotiable Instruments Act even if they do not hold a valid money lending license.Issue 2: Conflict between Section 3 of the Punjab Registration of Money Lenders Act, 1938 and Section 138 of the Negotiable Instruments ActThe High Court addressed the potential conflict between the two statutes by applying the Doctrine of Harmonious Construction. The court noted that the legal provisions in different statutes should be read in a way that gives maximum effect to both. The court concluded that there is no apparent conflict between section 3 of the Punjab Registration of Money Lenders Act, 1938, which bars civil remedies for unlicensed money lenders, and section 138 of the Negotiable Instruments Act, which provides criminal remedies for dishonored cheques.Issue 3: Maintainability of Revision Petitions Directly before the High CourtThe respondents argued that the revision petitions were not maintainable as the orders were in the nature of dismissal of complaints and acquittal of the respondents, and the petitioner should have filed an appeal. The High Court, however, held that the trial court had dismissed the complaints without concluding the trial, which does not amount to acquittal. The court further noted that Section 397 of the Code of Criminal Procedure, 1973 gives concurrent jurisdiction to both the High Court and Sessions Court, making the revision petitions maintainable directly before the High Court.Conclusion:The High Court allowed the revision petitions, set aside the orders dated 15.07.2015 and 20.08.2015, and remanded the complaints back to the concerned trial court for expeditious trial in accordance with law. The petitioner and the respondents were directed to appear before the Chief Metropolitan Magistrate for further assignment to a competent court on 23.09.2023 at 2:30 pm.