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TMI Blog2023 (8) TMI 342X X X X Extracts X X X X X X X X Extracts X X X X ..... such a complaint has to be filed only by the credit information agency, in which case the credit information agency would have to be first satisfied with the allegations in the complaint and thereafter initiate prosecution against the offender. By-passing the above said procedure, which provides a remedy to the victim and protection to all parties concerned, and resorting to a penal provision by making statements such as friends and others in the business circle came to know about entries etc., which are not factual, is inappropriate, to say the least. In such circumstances, the impugned complaint which does not disclose the offence of defamation is unsustainable for the reasons stated. This Criminal Original Petition is allowed. - Honourable Mr. Justice Sunder Mohan For the Petitioners : Mr. AR.L. Sundaresan, Senior Counsel for Mr. N. Ravishankar Vallatharasu. For the Respondent : Mr. John Sathyan, Senior Counsel for Mr. A. Shamsudeen Raja ORDER The petition is to quash the complaint filed in C.C. No. 4081 of 2019 before the IX Metropolitan Magistrate, Saidapet, for the alleged offence under Section 500 of the Indian Penal Code. 2. It is alleged in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t; and that the friends and others from his business circle started enquiring the respondent about the false entries and hence the petitioners have committed the offence under Section 500 of the Indian Penal Code. 3. (a) Mr. AR.L. Sundaresan, learned Senior Counsel for the petitioners, submitted that the impugned complaint does not disclose the alleged offences. The petitioners have no control over the entries made by the CIBIL authorities. The petitioners have informed the CIBIL authorities that a Suit was filed for the recovery of money. The fact that the Suit was pending and withdrawn on settlement of the dues cannot be disputed by the respondent. The entries would only show that the Suit was filed and there was no money due from the respondent, which is a fact. (b) Further, the learned Senior Counsel submitted that the fact that there was a default in payment is also admitted. It is the case of the respondent that such an entry should not have been made, as the default cannot be attributed to them. The petitioners cannot be prosecuted for the offence under Section 500 of the Indian Penal Code as the Credit Information Companies (Regulation) Act, 2005 [hereinafter referred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , have deliberately made entries with an intention to harm the reputation of the respondent. (d) The learned Senior Counsel further pointed out to an RBI circular dated 03.09.2013 which had advised the banks not to make lumpsum disbursal and to disburse the amounts based on the stage of construction. In the instant case, since that guideline has been violated by the first petitioner, the respondent cannot be said to be a chronic defaulter and hence, the entries made to that effect in CIBIL is false. The petitioners are aware of the said false entries and deliberately made them only to harm the reputation of the respondent. Hence, the learned Senior Counsel submitted that all these issues could be adjudicated only before the trial Court and prayed for the dismissal of this petition. 5. This Court finds on a reading of the complaint that the crux of the allegation is that the petitioners, in order to tarnish the image of the respondent had published false entries in CIBIL as if the respondent borrowed the loan, defaulted in the repayment of the loan and a suit was initiated for recovery of money. The question involved in this petition is whether false entries were made by the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on company. A reading of the CIBIL report would show that the credit information includes information relating to whether a Suit was filed against the borrower. The respondent cannot deny the fact that a Suit was filed. A Suit cannot be filed unless there is a default. The petitioners have also disclosed the fact that there are no dues in the account. The entries, thus, cannot be said to be false. In any case, if the respondent is aggrieved by any entry, the CIC Act provides for a detailed mechanism. The mechanism is provided in Section 21 of the CIC Act as also under the Credit Information Companies Rules, 2006. Section 21 of the said Act is extracted hereunder for better understanding; Section 21. Alteration of credit information files and credit reports. (1) Any person, who applies for grant or sanction of credit facility, from any credit institution, may request to such institution to furnish him a copy of the credit information obtained by such institution from the credit information company. (2) Every credit institution shall, on receipt of request under sub-section (1), furnish to the person referred to in that sub-section a copy of the credit information su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The respondent has not resorted to such a process. 8. Thus, whether the respondent had justification for the default or whether the petitioners had violated the guidelines of the Reserve Bank of India by disbursing the loan are matters which could have been adjudicated by resorting to the Arbitration process. If the petitioner had raised a dispute in terms of Section 18 of the CIC Act, the authorities concerned would have had a chance to address the issue. Thus, in such circumstances, the entries made in the CIBIL cannot be said to be false. The entries are as per the statutory requirements under the CIC Act. Merely because there is an entry that there was the default in the repayment or a Suit has been filed against the respondent, it cannot be said that the same was intended to harm the reputation of the respondent. 9. Be that as it may. In order to attract the offence under Section 500 of the Indian Penal Code as defined under Section 499 of the Indian Penal Code, the words spoken or signs or visible representations containing the imputation must be made or published with an intention to harm or knowing or having reason to believe that such imputation will harm the reput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the exact information given by the petitioners but however, they came to know of the adverse entries only due to the rejection of their loan application made to other credit institutions. The above also would show that the respondent themselves are not sure of the exact words of imputation said to have been published/given by the petitioner. 10. Above all, the fact that the information is to be kept confidential, it is not accessible to the general public, and it is accessible only by the members of the credit information agency would also establish that the statement made by the respondent that he received calls from his business and friends circle about the false entries is only to make it appear that there was a harm to his reputation in the estimation of others. In paragraph No.16 of the complaint, the respondent has stated as follows; 16. The complainant started receiving many telephone calls from his business and friends circle who enquired about the false entries published in CIBIL and the alleged default in repayment of loan dues. In view of the confidential nature of the information, this statement cannot be true. It is pertinent to point out that information ..... X X X X Extracts X X X X X X X X Extracts X X X X
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