Delhi District Court
M/S Alpine Realtech Pvt. Ltd vs M/S Laurel Projects Pvt. Ltd on 13 March, 2018
In the court of Sh. A.S. Jayachandra, Ld. District &
Sessions Judge, Shahdara, Karkardooma Courts, Delhi
C.R. No. 19/18
&
C.R. no. 20/18
1. M/s Alpine Realtech Pvt. Ltd.
Through Directors
B-1/46, Lane No.3,
New Ashok Nagar,
Delhi-110096
2. Mr. Ram Singh (Director)
D-171, Sec.49, Noida,
U.P. 201301
3. Mr. Dinesh K. Shingal (Director)
A-131, Sec.55, Noida,
U.P. 201307
4. Mr. Raveen Vats,
D-171, Sec.49, Noida,
U.P. 201301 .....Appellants
Vs.
M/s Laurel Projects Pvt. Ltd.
Through AR,
Mr. Vikram Kathuria,
F-8/9, 1st Floor, Krishna Nagar,
New Delhi-110051 ..... Respondent
Date of institution : 16.01.2018
Order reserved on : 21.02.2018
Date of Order : 13.03.2018
ORDER :
By a common order both the above petitions are being disposed of since parties to the petition, facts and grounds urged are identical.
M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.1/9
1. The petitioner no.1 is a company and 2 & 3 are its directors and petitioner no.4 is its CEO, have challenged the legality, validity and correctness of the order dated 14.02.2017 passed in a complaint case bearing CC no. 959/17 (renumbered as C.C. 633/17) on the files of Ld. ACMM, Shahdara, Delhi in revision petition no. 19/18 arising out of cheque no. 400946 dated 15.09.2016 ( wrongly mentioned as cheque no. 450762 in the revision petition).
2. In CR no. 20/18, they are aggrieved by the order of the same date in CC No. 963/17 (renumbered as CC 623/17) arising out of cheque no. 400948 dated 15.9.2016.
3. The petitioners herein were summoned by the impugned orders for the offence u/s 138 of N.I. Act.
The grounds urged are :
(a) Cheque bounced is not issued towards legally enforceable debt and there was no subsisting liability, hence summoning order is bad.
(b) That the complainant concealed material facts, it was a commercial transaction with regard to allotment of flats.
(c) That the intention was to convey the property and the matter is of civil profile since there was an agreement dated 15.2.2016.
(d) That there was a clause to seek interest to the investor/complainant.
(e) The impugned cheques were not issued on an existing liability and not for performance.
M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.2/9
(f) Ld. MM had not applied his mind since this is a mere breach of contract. Certain case laws are mentioned as grounds.
4. The notices were issued to the respondents. The delay in filing the revision is condoned by an order dated 21.02.2018. The trial court records are summoned. Perused the same. Heard the Ld. Counsel on both the sides. The Ld. Counsel for the petitioners relied on the following rulings :
(a) Indus Airways vs. Magnum Aviation 2014 (12) SCC 539
(b) Shanku Concretes vs. State of Gujarat 2000 Cr.LJ 1988 (Guj.)
(c) Supply House vs. Ullas 2006 Cr.LJ 4430 (Ker.)
(d) Sudeep Jain vs. M/s E.C.E. Industries Cr.MC 1828/13 of our High Court DD 6.5.2013.
(e) Manoj Kumar Gupta vs. Barclays Bank Cr.MC 2002/11 of our High Court DD 16.1.2018
5. The Ld. Counsel for the respondent submits that there is no merit in the revisions and that mere non-pleading that there was no subsisting liability in a complaint is immaterial. He relies on M/s MMTC vs. MEDCHL referred in www.indian kanoon.org/doc/1438532 of the Hon'ble SCI.
6. In the context of rival submissions and the grounds urged in support of the petition, the legality, validity and correctness is to be examined concerning the impugned order.
7. The first ground urged is that the cheque issued by the company (which is accused no.1 in the trial court) is based on an agreement between the company and the complainant.
M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.3/9 According to the revisionist, the agreement dated 15.2.2016 shows that the complainant company is the investor and had invested in a development project and that the investor (complainant in trial court) is given the rights to dispose of/sell the units allotted at the discretion of the investor. Therefore, it is alleged that the cheque is not issued in discharge of any legally enforceable debt. Considering this fact, the petitioner urges that the Ld. MM ought to have not summoned the petitioners and the same is against law having the nature of civil profile.
8. In the ruling of MMTC (supra) urged by the respondent, the Hon'ble Supreme Court had set aside the orders of the Hon'ble Madras High Court which opined that, "The Ld. Judge has next gone into the facts and arrived at a conclusion that the cheques were issued as a security and not for any debt or liability existing on the date they were issued. In doing so the Ld. Judge has ignored the well settled law that the power of quashing criminal proceedings should be exercised very stringently and with circumspection." It is also held therein that, "There is no requirement that the complainant must specifically allege in the complaint that there was an existing liability". Therefore, considering the law laid down in MMTC (Supra) the major ground urged by the petitioners that the aspect of there being no existing liability to be explored at the time of summoning and that the case was civil in nature and further ground urged that the Ld. MM misdirected himself in summoning the petitioners, are not appealing to the judicial conscience.
9. The rulings urged by the petitioners in support of the revision are also perused. In Indus Airways (Supra), the ruling M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.4/9 of the Shanku Concretes (Supra) and Ullas' case (supra) are already discussed. The Hon'ble Supreme Court had held that :
19. The above reasoning of the Delhi High Court is clearly flawed inasmuch as it failed to keep in mind the fine distinction between civil liability and criminal liability under Section 138 of the N.I. Act.
If at the time of entering into a contract, it is one of the conditions of the contract that the purchaser has to pay the amounts in advance and there is breach of such conditions they purchaser may have to make good the loss that might have occasioned to the seller but that does not create a criminal liability under Section 138 of N.I. Act. For a criminal liability to be made out under Section 138, there should be legally enforceable debt or other liability subsisting on the date of drawal of the cheque. We are unable to accept the view of the Delhi High Court that the issuance of cheque towards advance payment at the time of signing such contract has to be considered as subsisting liability and dishonour of such cheque amounts to an offence under Section 138 of the N.I. Act. The Delhi High Court has traveled beyond the scope of Section 138 of the N.I. Act by holding that the purpose of enacting section 138 of the N.I. Act would stand defeated if after placing orders and giving advance payments, the instructions for stop payments are issued and orders are cancelled. In what we have discussed above, if a cheque is M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.5/9 issued as an advance payment for purchase of goods and for any reason purchase order is not carried to its logical conclusion, either because of its cancellation or otherwise and material or goods for which purchase order was placed is not supplied by the supplier, in our considered view the cheque cannot be said to have been drawn for an existing liability."
10. In Sudeep Jain vs. ECE Industries (supra), our Hon'ble High Court while entertaining a petition u/s 482 of Cr.PC held that the Ld. MMs to make sure at the pre-summoning stage notice be directed only to directors or employees of the company who satisfy the principles laid down in SMS Pharmaceuticals Ltd. Case 2005 (7) SCALE 397 wherein it is held that there should be an averment with regard to the role of every directors and as held in National Small Industries Corporation Ltd. Case (2010)(2) SCALE 372. The above ruling of our Hon'ble High Court directs the Magistrates to look into Form no. 32 at the time of summoning the persons. In another unreported ruling in Manoj Kumar Gupta (supra), the Hon'ble High Court has noted that if the complaint fails to disclose the facts which show that the petitioner was incharge or responsible, the complaint lacks necessary ingredients as required under the guidelines issued in SMS Pharmaceuticals (Supra).
11. In the grounds urged, the reliance is placed with regard to the law laid down in SMS Pharmaceuticals vs. Nita Bhalla 2005 (8) SCC and Anita Hada vs. God Father Travels 2012 (2) JCC NI 113 to urge that there being no reference in the M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.6/9 entire complaint with regard to the other petitioners in managing day-to-day affairs of the accused company, the trial court records are perused. In the complaint filed u/s 138 of the N.I. Act, there is an unambiguous pleading at para 4 of the complaint to this effect. After perusal of the trial court records, the ground urged by the petitioner does not stand on its legs.
12. This court in order to find out whether the cheque is issued only as a security at the time of agreement as canvassed by the Ld. Counsel for the petitioners, looked into the records summoned only for the purposes of finding out the correctness of the impugned order and not for appreciating the evidence. It is seen that the agreement which the Ld. Counsel for the petitioner canvasses is dated 15.2.2016. The cheque bounced is dated 15.9.2016. There is no mention of issuance of a post dated cheque as a security in the agreement nor there is any schedule appended to the agreement showing issuance of post dated cheque. Therefore, this aspect becomes a matter of evidence to be looked into at the time of consideration of documents. Suffice it to say that there is a pleading required as per the principles laid down in SMS Pharmaceuticals Ltd.'s case (supra).
13. As regards the civil liability or advance issuance of post dated cheques is not forthcoming from the agreement. The law laid down in Indus Airways (supra) concerned with the issuance of a cheque towards advance payment of the purchase of the goods, which purchase did not fructify and the order having been not supplied by the supplier. In the instant case, the facts arising under the agreement are totally different. Therefore, it cannot be said that the case lacked any criminal profile since the M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.7/9 bouncing of cheque itself is made a criminal liability under the Negotiable Instruments Act. Further more, section 139 of the Negotiable Instruments Act gives a presumption in favour of the holder with regard to the debt and liability unless the contrary is proved.
14. This court is aware that the powers of revision are constricted. The revision court cannot make a roving enquiry by looking into all the aspects of the evidence, the proposed defence of an accused who is only summoned by the Ld. Court below. This court can only look into satisfy itself whether the order of the ld. Court below is prima facie legal, valid and correct in the circumstances and its propriety. This court cannot exercise the powers of inherent jurisdiction in the ends of justice as provided under section 482 of Cr.PC.
15. Our Hon'ble High Court in Arvind Kejriwal & Ors. vs. Amit Sibal & Anr. 2014 (1) HCC (Del.) 719 directs the Magistrates to frame notice as required u/s 251 of Cr.PC only upon satisfaction that a prima facie case is made out against each of the persons summoned before it. The accused persons before the court below who are summoned in a summons case can always urge such pleas as are permitted before the ld. MM at the time of framing of the charge.
16. In view of the above, under the limited powers of revision after examining the trial court record, this court sees no illegality, incorrectness or impropriety in the impugned orders dated 14.02.2017. Hence, the following :
ORDER :
M/s Alpine Realtech Pvt. Ltd. & ors.
Vs. M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.8/9 The revision petition nos. 19/18 and 20/18 stand dismissed. The petitioners may urge all the pleas and grounds urged in the revision before the Ld. MM at the time of framing of notice u/s 251 of Cr. PC. Parties are directed to appear before the court below on 16.03.2018.
Original order be kept in Cr. Rev. No. 19/18 and a copy of the same be kept in the other file i.e. Cr. Rev. No. 20/18. Trial court records be sent back along with a copy of this order.
Revision files be consigned to record room. Digitally signed
by A.S.
A.S. JAYACHANDRA
JAYACHANDRA Date:
2018.03.13
15:17:56 +0530
Typed to the dictation directly, (A.S. Jayachandra)
corrected and pronounced in District & Sessions Judge,
open court on 13.03.2018 Shahdara/KKDCourts, Delhi.
M/s Alpine Realtech Pvt. Ltd. & ors.
Vs.
M/s Laurel Projects Pvt. Ltd. & Ors. CR No. 19/18 & 20/18 Page No.9/9