Cherukupalli Sitaram v. NMR Prefabs, Nellore, A. P.
2024-09-27
VENKATA JYOTHIRMAI PRATAPA
body2024
DigiLaw.ai
JUDGMENT /COMMON ORDER : The instant petitions under Section 482 of Code of Criminal Procedure, 1973 (for short 'Cr.P.C.'), have been filed by the petitioner/accused No.6, seeking to quash the proceedings against him in CC Nos.2892, 1691 and 2893 of 2020 on the file of the Courts of V Additional Judicial Magistrate of First Class, Nellore, VIII Additional Judicial Magistrate of First Class, Nellore and V Additional Judicial Magistrate of First Class, Nellore respectively, which were registered for the offence punishable under Sections 138 and 142 of the Negotiable Instruments Act, 1881 (for short 'Cr.P.C.'). 2. The facts that led to filing of the above criminal cases, in brief, are as follows: (a) Accused Nos.2 to 6 are the Directors of accused No.1 Company - Bilwa Infrastructure Limited. Complainant is M/s. NMR Prefabs, represented by its Proprietor Sri Mettukuri Siva Reddy does no business of supply and erection of Prefab works on credit and cash basis. Accused Nos.2 to 6 being the Directors and responsible for the day-to-day affairs of A1-Company, gave work/purchase order to the complainant company on 09.02.2018 for Rs.34,00,000/- and the same was revised on 04.06.2018 for Rs.35,16,430/-. (b) That being so, out of the total due amount of Rs.35,16,430/- the accused made part payments and also returned the material on different spells. On deducting the same, the remaining amount due to the complainant by the accused is Rs.27,67,472/-. (c) After repeated demands by the complainant, in discharge of the legally enforceable debt, on 15.04.2019, the accused had issued six post dated Cheques Bearing Nos.000194 dated 20.04.2019, 000195 dated 27.04.2019 000196 dated 05.05.2019, 000197 dated 12.05.2019, 000198 dated 19.05.2019 and 000199 dated 26.05.2019 for Rs.5,00,000/- each drawn on HDFC Bank, P.T. Colony, Kharkhana Road, Secunderabad duly signed by accused No.2, in favour of the complainant towards part payment. (d) On presentation of the above cheques by the complainant in Indian Bank, Vedayapalem, Nellore, the same were returned due to insufficient funds. Inspite of receipt of legal notice dated 03.07.2019 got issued by the complainant, the accused neither sent any reply nor paid any amount to the complainant. As such, the complainant filed three private complaints which above mentioned cases, against accused Nos.1 to 6. (e) Being aggrieved by the registration of the cases, petitioner/accused No.6 filed the present petitions seeking quashment of the said cases against him. Arguments Advanced at the Bar 3.
As such, the complainant filed three private complaints which above mentioned cases, against accused Nos.1 to 6. (e) Being aggrieved by the registration of the cases, petitioner/accused No.6 filed the present petitions seeking quashment of the said cases against him. Arguments Advanced at the Bar 3. Heard Sri Sivalenka Ramachandra Rao, learned Counsel for the petitioner and Sri Mangena Sree Ramarao, learned Counsel for respondent No.1. 4. Learned Counsel for the petitioner/accused No.6 petitioner is innocent of the offence alleged implicated in the said cases. Petitioner would submit that the against him and he was falsely is nothing to do with the day-to-day affairs its business. Learned to be the Director of A. 1-resignation was also accepted It is submitted that the and the allegations made in alleged offence against the proceedings against the petitioner in the Counsel has placed reliance on the judgments of the Hon'ble Apex Court in Sunita Palita and others v. Panchami Stone Quarry, (2022) 10 SCC 152 ; Siby Thomas v. Somany Ceramics Ltd., AIR 2023 SC 4929 and National Small Industries Corporation Limited v. Harmeet Singh Paintal and another, (2010) 3 SCC 330 and Katta Sujatha v. Fertilizers and Chemicals Travancore Limited and another, (2002) 7 SCC 655 . 5. Contrasting the same, learned Counsel for respondent No.1 would submit that petitioner is one of the Directors of A1-Company and is responsible for the day-to-day affairs of the said Company. There are specific allegations against the petitioner which would attract the alleged offence and hence, the proceedings against the petitioner cannot be quashed at this stage. Hence, prayed to dismiss the petitions. Point for determination : 6. Having heard the submissions of the learned Counsel representing both the parties, now the point that would emerge for determination is : Whether there are any justifiable grounds for quashment of the proceedings against the petitioner/accused No.6 in CC Nos.2892, 1691 and 2893 of 2020 which are pending before the concerned Courts? Determination by the Court : 7. A bare perusal of Section 482 Cr.P.C., makes it clear that the Code envisages that inherent powers of the High Court are not limited or affected so as to make orders as may be necessary; (i) to give effect to any order under the Code or, (ii) to prevent abuse of the process of any Court or, otherwise (iii) to secure ends of justice.
A Court while sitting in Section 482 Cr.P.C., jurisdiction is not functioning as a Court of appeal or a Court of revision. It must exercise its powers to do real and substantial justice, depending on the facts and circumstances of the case. These powers must be invoked for compelling reasons of abuse of process of law or glaring injustice, which are against sound principles of criminal jurisprudence. 8. As seen from the averments made in the complaints, accused Nos.2 to 6 being the Directors and responsible for the day-to-day affairs of A1 Company, in discharge of the legally enforceable debt due to the complainant, had Issued six post dated Cheques Bearing Nos.000194 dated 20.04.2019, 000195 dated 27.04.2019, 000196 dated 05.05.2019, 000197 dated 12.05.2019, 000198 dated 19.05.2019 and 000199 dated 26.05.2019 for Rs.5,00,000/- each drawn on HDFC Bank, P.T. Colony, Kharkhana Road, Secunderabad duly signed by accused No.2, in favour of the complainant towards part payment and on presentation, the said cheques were returned due to insufficient funds. Despite sending registered legal notice, as the accused had not paid any amount to the complainant, the present cases were lodged against all the accused. 9. It is pertinent to state that Section 141 of the Act is an exception to the normal rule that there cannot be any vicarious liability when it comes to a penal provision. The vicarious liability attracts when the ingredients of sub-section (1) of Section 141 of the Act are satisfied. The section provides that every person, who, at the time the offence was committed was in charge of, and was responsible to the Company for the conduct of business of the Company, as well as the company shall be deemed to be guilty of the offence under Section 138 of the Act. 10. In the instant case, in view of the contention of the learned Counsel for the petitioner/accused No.6 that the petitioner ceased to be the Director of A1-Company since 09.09.2020 and the letter of his resignation was also accepted and communicated to the Ministry of Corporate Affairs, a bare perusal of the master data of A1-Company, would show that the petitioner/accused No.6 was one of the Directors of A1-Company from 17.01.2018 to 09.09.2020 and his resignation as the Director was accepted on 09.09.2020. Whereas, the subject cheques were of the year 2019, during which period, he was one of the Directors.
Whereas, the subject cheques were of the year 2019, during which period, he was one of the Directors. As such, this Court is of the view that there is verifiable material to be decided during trial. To prove his case, the petitioner is expected to lead unimpeachable and incontrovertible evidence. In the light of the specific allegations against the petitioner, the judgments relied on by the learned Counsel for the petitioner are not helpful to the case of the petitioner. This Court in Gutti Rama Subrahmanyam v. State of A.P., 2024 SCC OnLine AP 1472, while reiterating a catena of decisions, referred to Gunmala Sales Pvt. Ltd. v. Anu Mehta, (2015) 1 SCC 103 , as follows: "18. In Gunmala Sales Pvt. Ltd. v. Anu Mehta, (2015) 1 SCC 103 , the Hon'ble Supreme Court reiterated the positions laid down in the decisions of Anita Malhotra (supra) and Harshendra Kumar (supra) and held that though a mini trial or a roving inquiry ought not be conducted in Section 482 proceedings, it would be justified to decide based on material that is convincing or uncontroverted to establish the innocence of a Director without requiring him to face a criminal trial. The Apex Court had summarized the conclusions derived from the catena of decisions at Para 34, of which Para 34.3 holds specific relevance to the present case of hand, which reads; "34.3. In the facts of a given case, on an overall reading of the complaint, the High Court may, despite the presence of the basic averment, quash the complaint because of the absence of more particulars about the role of the Director in the complaint. It may do so having come across some unimpeachable, incontrovertible evidence which is beyond suspicion or doubt or totally acceptable circumstances which may clearly indicate that the Director could not have been concerned with the issuance of cheques and asking him to stand the trial would be abuse of process of Court. Despite the presence of basic averment, it may come to a conclusion that no case is made out against the Director. Take for instance a case of a Director suffering from a terminal illness who was bedridden at the relevant time or a Director who had resigned long before issuance of cheques.
Despite the presence of basic averment, it may come to a conclusion that no case is made out against the Director. Take for instance a case of a Director suffering from a terminal illness who was bedridden at the relevant time or a Director who had resigned long before issuance of cheques. In such cases, if the High Court is convinced that prosecuting such a Director is merely an arm-twisting tactics, the High Court may quash the proceedings. It bears repetition to state that to establish such case unimpeachable, incontrovertible evidence which is beyond suspicion or doubt or some totally acceptable circumstances will have to be brought to the notice of the High Court. Such cases may be few and far between but the possibility of such a case being there cannot be ruled out. In the absence of such evidence or circumstances, complaint cannot be quashed." (Emphasis supplied) 11. In the instant case, there are disputed questions of fact which are to be decided during trial by the Trial Court. While exercising the jurisdiction under Section 482 Cr.P.C., it is not permissible to act as if this Court were a Trial Court. Having regard to the facts and circumstances of the case, this Court is of the opinion that there are no valid grounds emanating from the record warranting interference of this Court by exercising the inherent powers of this Court under Section 482 Cr.P.C., to quash the case against the petitioner/accused No.6. 12. Without prejudice to the defence available. Criminal Petition Nos.9904, 9905 and 9906 of 2022 are hereby dismissed. 13. Pending miscellaneous petitions, if any, shall stand closed.