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Judgment
Mohan Shantanagoudar
Petitioner is accused in C.C. No. 755/2005 pending on the file of JMFC-I Court, Bijapur for the offences punishable under Sections 467, 468, 478 and 420 of IPC. The respondent No. 2 lodged the complaint before Gandhi Chowk Police Station, Bijapur on 20.07.1998 with an allegation that M/s. Kailash Oil Extractors obtained ` 9,00,000/- loan from respondent No. 1-Bank; while obtaining the loan, the petitioner herein stood as guarantor; the petitioner mortgaged three properties and all the three properties were taken as security for the loan amount and the amount was released in favour of the borrower (M/s. Kailash Oil Extractors) on 04.03.1994. Subsequently on verification it was found that one of the three properties namely a house bearing Plot No. 1262/1 measuring 30/40 feet does not stand in the name of the petitioner, whereas other two properties were standing in the name of the petitioner. Thus, having found that the petitioner cheated the bank, complaint came to be lodged on 20.07.1998 against the petitioner. The PSI after investigation, laid ''B'' report on 02.03.2002 before the jurisdictional Court. The complainant filed protest petition, ultimately the process is issued by the impugned order against the petitioner. The proceedings are going on before the Court below. In the meanwhile, the first respondent-bank has compromised the matter with the borrower namely M/s. Kailash Oil Extractors Limited by settling their dues in full with the Bank by remitting ` 13.50 lakhs on 11.02.2006. Since the matter is compromised, this petition is filed by the petitioner being the guarantor for quashing the proceedings.
In the normal course, this Court would not have intervened in such matters inasmuch as the petitioner will have to face trial as he has cheated the bank. But the proceedings are pending since 1998 i.e. since 15 years, the matter is being continued and it is still in preliminary stage. Moreover, Sri. Ravindra Reddy, learned Advocate appearing on behalf of the petitioner is justified in relying upon the judgment of the Apex Court in the case of Nikhil Merchant Vs. Central Bureau of Investigation and Another, wherein it is observed thus:
In the instant case, the disputes between the Company and the Bank have been set at rest on the basis of the compromise arrived at by them whereunder the dues of the Bank have been cleared and the Bank does not appear to have any further claim against the Company. What, however, remains is the fact that certain documents were alleged to have been created by the appellant herein in order to avail of credit facilities beyond the limit to which the Company was entitled. The dispute involved herein has overtones of a civil dispute with certain criminal facets. The question which is required to be answered in this case is whether the power which independently lies with this Court to quash the criminal proceedings pursuant to the compromise arrived at, should at all be exercised?
On an overall view of the facts as indicated hereinabove and keeping in mind the decision of this Court in B.S. Joshi''s case (supra) and the compromise arrived at between the Company and the Bank as also clause 11 of the consent terms filed in the suit filed by the Bank, we are satisfied that this is a fit case where technically should not be allowed to stand in the way in the quashing of the criminal proceedings, since, in our view, the continuance of the same after the compromise arrived at between the parties would be a futile exercise.
From the above it is clear that the Supreme Court observed that since compromise is arrived at between the Company and the bank, the technicality should not be allowed to stand in the way of quashing the criminal proceedings, since the continuance of the same after the compromise arrived at between the parties would be a futile exercise.
In view of the same, the proceedings on hand are liable to be quashed. Accordingly, the proceedings are quashed. Petition is allowed.