Purshottam Dass Niranjan Lal v. Nahar Fibres (Proprietor) M/s Nahar Spinning Mills Limited, Ludhiana
2013-02-20
RANJIT SINGH
body2013
DigiLaw.ai
JUDGMENT Mr. Ranjit Singh, J.: - Respondent has complained that M/s Nahar Fibres is a proprietor of M/s Nahar Spinning Mills Ltd. Petitioner No.1 is a proprietorship concern, whereas petitioner No.2 is its proprietor and authorised signatory. Complainants have been supplying yarn to one Maral Overseas Limited (Khargone) Moral Sarorar, VPO Khal Bujurg, Tehsil Hhosrulad, District Khargoan, Madhya Pradesh through the petitioners. Through various bills, they have been getting part payments. After adjustment of the part payments, an amount of Rs.9,81,333-75P. was due on 31.7.2012. It is alleged that the yarn was supplied to M/s Maral Overseas Ltd. through the petitioners-accused, who stood surety and issued a cheque dated 31.5.2012 for Rs.8,70,186/- drawn on Citi Bank honoring Nahar Fibres (Unit of complainants). The aforesaid cheque was accordingly presented for encashment to the bankers. The cheque was returned unpaid vide Memo dated 8.8.2012 with the remarks “that the payment is stopped by the drawer”. As per the allegations, there were no funds in the account to honour their legal liability and they have connived with the bank officials and got issued the memo of payment stopped. Complainant issued a registered A.D. legal notice on 21.8.2012 calling upon the accused to make payment within 15 days. Despite service of notice, the petitioners failed to make payment of the cheque amount and, thus, incurred a liability under Section 138 of the Negotiable Instruments Act (for short “the Act”). The complainant accordingly has filed a complaint in the Court of Shri Rahul Kumar, Judicial Magistrate Ist Class, Ludhiana, who took cognizance of the same and has summoned the petitioners. The petitioners accordingly have approached this Court for quashing of the summoning order and the complaint on various counts. 2. Plea is that this summoning order has been issued mechanically on the complaint. Continuation of this proceeding is stated to be an abuse of the process of law. It is alleged that the trial Court failed to consider that the complaint has been filed by M/s Nahar Fibers as proprietor of M/s Nahar Spinning Mills Ltd. and as per the law, a proprietorship concern has no separate legal entity except of the proprietor himself. It is stated that complaint has been filed by an entity, who has no legal existence in the eyes of law. The trial Court has, thus, statedly erred in taking cognizance to the criminal complaint. 3.
It is stated that complaint has been filed by an entity, who has no legal existence in the eyes of law. The trial Court has, thus, statedly erred in taking cognizance to the criminal complaint. 3. During the course of arguments, counsel for the petitioners submits that concededly this cheque was given as a surety. The surety was obviously for the reason that the complainant would get the amount for the items supplied at the asking of the petitioners. If the petitioners had not undertaken this liability, they were not required to give a cheque, may be as a surety. The counsel in support of his plea that offence under Section 138 of the Act would not be made out has relied upon judgments in the cases of Sudhir Kumar Bhalla Versus Jagdish Chand, etc. etc., JT 2008(6) SC 549 and M.S.Narayana Menon @ Mani Versus State of Kerala & Anr., AIR 2006 (SC) 3366 . In the case of Sudhir Kumar Bhalla (supra), the allegation was also that the respondents were alleging that figures on the cheques were altered by the respondents and that cheques were given as a security. Magistrate dismissed the complaint of the respondents under Section 138 of the Negotiable Instruments Act and proceeded with the complaint of the appellants, who were before the Hon’ble Supreme Court. On an appeal, High Court ordered conviction of the appellants under Section 138 of the Act holding that the figures of amount of cheques were supported by figures written in words. Therefore, the contention of alteration in figures is not tenable. The Hon’ble Supreme Court held that Single Judge has not addressed himself to the legal questions raised by the appellants that the criminal proceedings are attracted on account of dishonour of cheques issued to discharge the liability and not for cheques issued as security. No convincing reasons given on alteration of figures in cheques by adding zeros to figure of amounts, which had been proved by expert evidence. Impugned judgment accordingly was quashed. 4. Obviously, the Hon’ble Supreme Court was not dealing with the order arising out of petition under Section 482 Cr.P.C. for quashing. The plea that this cheque is issued for a surety and not to discharge the liability obviously has to be pleaded before the trial Court.
Impugned judgment accordingly was quashed. 4. Obviously, the Hon’ble Supreme Court was not dealing with the order arising out of petition under Section 482 Cr.P.C. for quashing. The plea that this cheque is issued for a surety and not to discharge the liability obviously has to be pleaded before the trial Court. If the petitioners are able to establish that this cheque was not to discharge any liability, the trial court would be competent to deal with the issue and decide accordingly. In a petition under Section 482 Cr.P.C., it will be too early for this court to form any opinion in this regard whether this cheque was to discharge any liability or was for the purpose of surety only. For similar consideration, the ratio of law in M.S.Narayana Menon @ Mani’s case (supra) would not be attracted in the fact situation in this case. All these pleas are required to be raised before the Court, which will decide the same on the basis of evidence that may be led and only then it can be determined whether cheque was meant to discharge any liability or as a surety. No case for quashing of the complaint at this stage, therefore, is made out. 5. The petition is accordingly dismissed.