- 1 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF MARCH, 2026 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ CRIMINAL PETITION NO. 9545 OF 2018 BETWEEN: S.P.ARAVINDA AGED ABOUT 46 YEARS, S/O. PRABHAKARA, R/O. SPM ROAD, SAGAR TOWN, SHIMOGA - 577401 …PETITIONER (BY SRI. VIJAYA M N., ADVOCATE) AND: STATE OF KARNATAKA THROUGH SAGAR TOWN POLICE, SAGAR TALUK, SHIMOGA DISTRICT - 577401 REPRESENTED BY STATE PUBLIC PROSECUTOR HIGH COURT OF KARNATAKA BENGALURU - 560001 …RESPONDENT (BY SRI. M.R.PATIL, HIGH COURT GOVERNMENT PLEADER) THIS CRL.P FILED U/S.482 CR.P.C PRAYING TO QUASH THE REGISTRATION OF CRIME NO.166/2015 BY THE RESPONDENT POLICE AGAINST THE ACCUSED AND CONSEQUENT FILING OF THE CHARGE SHEET AGAINST THE ACCUSED FOR THE OFFENCE P/U/S 420 OF IPC AND SECTIONS 5, 38 AND 39 OF KARNATAKA MONEY LENDERS ACT, 1961 AND SECTIONS 3 AND 4 OF THE KARNATAKA PROHIBITION OF CHARGING EXORBITANT INTEREST ACT, 2004, Digitally signed by MARKONAHALLI RAMU PRIYA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 PENDING IN C.C.NO.180/2016 ON THE FILE OF THE ADDITIONAL CIVIL JUDGE AND JMFC AT SAGAR. THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE R. NATARAJ ORAL ORDER The petitioner has challenged the criminal proceedings initiated against him by the respondent in C.C.No.180/2016 (Cr.No.166/2015) for the offences punishable under Section 420 of Indian Penal Code (henceforth referred to as 'IPC' for short), Sections 5, 38 and 39 of the Karnataka Money Lenders Act, 1961 (henceforth referred to as 'Act, 1961' for short) and Sections 3 and 4 of the Karnataka Prohibition of Charging Exorbitant Interest Act, 2004 (henceforth referred to as 'Act, 2004' for short). 2. The respondent, on the basis of certain information furnished by the public at large, secured a search warrant to search the house of the petitioner. Pursuant thereto, the house of the petitioner was searched and certain documents were seized. Based on such search and seizure, the respondent - 3 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 initiated proceedings and registered Cr.No.166/2015 and thereafter conducted an investigation and filed a charge sheet for the offences punishable under Section 420 of IPC, Sections 5, 38 and 39 of Act, 1961 and Sections 3 and 4 of Act, 2004. 3. Being aggrieved by filing of charge sheet against the petitioner, he is before this Court. 4. The learned counsel for the petitioner submits that though Crime No.166/2015 was registered against the petitioner, the search conducted in the house of the petitioner did not yield any incriminating documents. On the contrary, the respondent seized certain promissory notes, consideration receipts and certain note books indicating the amounts allegedly due from the customers of the petitioner. She submits that the respondent did not unearth any material disclosing the commission of offences punishable under Sections 5, 38 and 39 of Act, 1961 or under Sections 3 and 4 of the Act, 2004. She therefore contends that impugned prosecution is without any basis and amounts to harassment of the petitioner. - 4 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 5. The learned High Court Government Pleader on the other hand, submits that the search and seizure disclosed several documents indicating commission of offences punishable under Sections 3 and 4 of the Act, 2004 and therefore, the petitioner was charge sheeted for the said offences. He further contends that it was revealed during the course of investigation that the petitioner was in the habit of collecting title deeds of immovable properties as security for the money lent. He therefore submits that an offence punishable under Section 420 of IPC was also made out. 6. I have considered the submissions of learned counsel for the petitioner and the learned High Court Government Pleader for the respondent. 7. The petitioner is a money lender registered under the provisions of the Act, 1961. It may be that certain complaints were lodged against the petitioner alleging that he had charged excessive interest and had committed acts violative of the provisions of the Act, 1961. However, when the business premises of the petitioner and his house were searched, the respondent seized only documents relating to his - 5 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 business and no material indicating violation of the provisions of the Act, 1961 was seized. Even assuming that the petitioner had charged excessive interest attracting Sections 3 and 4 of the Act, 2004, that it per se would not become an offence, in view of Section 5 of the Act, 2004 which enables the debtors to deposit the loan amount together with interest at the rate fixed by the State Government under Section 28 of the Act, 1961. 8. As far as the offence under Sections 4 and 5 of the Act, 2004 are concerned, Section 4 of Act, 2004 provides that any person who contravenes the provisions of Section 3, or molests or abets the molestation of any debtor for recovery of any loan, shall be punishable with imprisonment for a term which may extend to three years and with fine which may extend to Rs.30,000/-. 9. In the case on hand, there is no material to indicate that the petitioner had charged exorbitant interest or that he had molested any debtor for recovery of any loan. Therefore, no offences under Sections 3 and 4 of Act, 2004 were made out against the petitioner. - 6 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 10. Likewise, as the petitioner is a registered money lender, his activity of money lending is permitted under the Act, 1961 and therefore, no offence under Section 5 of Act, 1961 is made out. 11. In so far as the offence punishable under Section 38 of the Act, 1961 is concerned, the said provision relates to molestation of a debtor for recovery of a debt due from him. There is no material to indicate commission of such offence. 12. In view of the above, the petitioner had not committed any offences for which charge sheet was filed against him. 13. In so far as the offence under Section 420 of IPC is concerned, when a special enactment declared a particular act constitutes an offence and prescribes the consequences thereof, the State cannot invoke the provisions of Section 420 of IPC. Consequently, the charge sheet filed against the petitioner is without basis and is not supported by any material. 14. In that view of the matter, this criminal petition is allowed and the charge sheet filed against the petitioner in - 7 - HC-KAR NC: 2026:KHC:12658 CRL.P No. 9545 of 2018 C.C.No.180/2016 (Cr.No.166/2015) for the offences punishable under Section 420 of IPC, Sections 5, 38 and 39 of Act, 1961 and Sections 3 and 4 of Act, 2004 pending on the file of the Additional Civil Judge and JMFC, Sagar is quashed. Sd/- (R. NATARAJ) JUDGE HJ List No.: 1 Sl No.: 27