Delhi High Court - Orders
Maharashtra Bio Fertilizers (India) ... vs Crystal Crop Protection Limited on 1 November, 2022
Author: Jasmeet Singh
Bench: Jasmeet Singh
$~27, 52 & 54
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CRL.M.C. 3136/2022
MAHARASHTRA BIO FERTILIZERS (INDIA) PRIVATE
LIMITED THROUGH ITS DIRECTOR MR. KUSHAL NILESH
THAKKER AND ORS ..... Petitioners
Through: Mr. Abhay Anil Anturkar, Mr.
Bhavya Pande, Mr. Dhruv Tank,
Advs.
versus
CRYSTAL CROP PROTECTION LIMITED ..... Respondent
Through: Mr. Amandeep Singh, Mr. Karmveer,
Mr. Pradeep Desodya, Mr. Dilip K.
Niranjan, Advs.
52
+ CRL.M.C. 4651/2022
MAHARASHTRA BIO FERTILIZERS (INDIA) PRIVATE
LIMITED THROUGH ITS DIRECTOR MR. KUSHAL NILESH
THAKKER AND ORS ..... Petitioners
Through: Mr. Abhay Anil Anturkar, Mr.
Bhavya Pande, Mr. Dhruv Tank,
Advs.
versus
CRYSTAL CROP PROTECTION LIMITED ..... Respondent
Through: Mr. Amandeep Singh, Mr. Karmveer,
Mr. Pradeep Desodya, Mr. Dilip K.
Niranjan, Advs.
54
+ CRL.M.C. 5425/2022, CRL.M.A. 21510/2022
Signature Not Verified
Digitally Signed byAMIT
ARORA
Signing Date:04.11.2022
18:19:04
MAHARASHTRA BIO FERTILIZERS (INDIA) PRIVATE
LIMITED THROUGH ITS DIRECTOR MR. KUSHAL NILESH
THAKKER AND ORS ..... Petitioners
Through: Mr. Abhay Anil Anturkar, Mr.
Bhavya Pande, Mr. Dhruv Tank,
Advs.
versus
CRYSTAL CROP PROTECTION LIMITED ..... Respondent
Through: Mr. Amandeep Singh, Mr. Karmveer,
Mr. Pradeep Desodya, Mr. Dilip K.
Niranjan, Advs.
CORAM:
HON'BLE MR. JUSTICE JASMEET SINGH
ORDER
% 01.11.2022 This is a petition seeking quashing of complaint case Nos. 5891/2020, 6010/2020 and 6012/2020 pending before the learned CMM, North West, Rohini Court, Delhi.
It is stated by Mr. Anturkar, learned counsel for the petitioners, that in the present case the facts lie in a narrow arena.
It is stated that during the period from February 2020 to April 2021, the petitioner company (the accused) made purchases worth Rs. 7,13,00,000/- from the respondent company (the complainant). The purchase was made on credit basis.
The petitioner company issued 3 undated cheques No. 002815, 002816 and 002817 on 26.02.2020 for Rs. 2,00,00,000/- each.
The said cheques on presentation were dishonoured, as a result of Signature Not Verified Digitally Signed byAMIT ARORA Signing Date:04.11.2022 18:19:04 which 3 criminal complaints u/s 138 NI Act were filed by the respondent.
During the pendency of the proceedings, the parties arrived at a settlement dated 11.01.2021 and the relevant portion reads as under:
"This Memorandum of Understanding ('Understanding') is executed on 11th day of January 2021 by and between - „M/s Crystal Crop Protection Limited, company incorporated under the Companies Act, 1956 having its Registered Office at 206, 2nd Floor, Span Trade Centre, Opp. Kochrab Gandhi Ashram, Near Paldi Char Rasta Ashram Road, Ellisbridge Ahmedabad Gujrat 380006, India and Corporate Office at B- 95, Wazirpur Industrial Area, New Delhi-110052 ,hereinaiter called the „First Party‟ AND M/s Maharashtra Bio Fertilizers (India) Private Limited Registered office at NEAR UDYOG BHAVAN SHIVAJI NAGAR, MAIN ROAD LATUR Latur MH 413512 and corporate Offlce Address - MBF, 901, Fountain Head Building, Adjacent to Phoenix Mall, Nagar Road, Viman Nagar, Pune- 411014 , hereinafter called as the „Second Party‟. Whereas:
A. The First Party was manufacturing Pesticides, Insecticides, Weedicides, Herbicides, Fertilizers, Plant Growth Regulators, Seeds, Agri Equipment & other cognate and allied agricultural goods (hereinafter referred to as "goods"). And supplying to Second Party.
B. The Second Party was procuring goods from First Party, and an Principal outstanding of Rs. 7,13,87,553l- (Rupees Seven Crore, Thirteen Lakh, Eighty Seven Thousand Five hundred Fifty three Only) become payable. During the course of business Second Party stopped making payment to First Party. After series of Negotiations Second Party gave Post Dated Cheques to First Party.
C. When First Party deposited Post Dated Cheque‟s in their bank Cheques got Dishonoured.
D. Now Second Party approached to First Party and is willing to settle the dispute between both parties.Signature Not Verified Digitally Signed byAMIT ARORA Signing Date:04.11.2022 18:19:04
THIS "MOU" WITNESSES AS UNDER:
1. Second party accept Principal outstanding Liability of Rs.
7,13,87,553/- (Rupees Seven Crore, Thirteen Lakh, Eighty Seven Thousand Five hundred Fifty three Only). Second Party willing to Settle the amount with Principal amount only
2. That Second Party represented that their financial Condition is very poor, and they can pay their debt only in trenches and sought help from the First Party.
Second party gave us 2 proposals as per following:
a) Second party will purchase stocks worth of Rs.25-30 Cr.
from First party against advance cash & clear all old o/s of Rs.7.13 Cr by Oct'21 by paying additional amount every month starting from Jan„21.
b) Second party will sell following products to First party in following manner & pay balance amount within 31.10.21 by paying every month.
3. That once all payment is cleared by the Second Party, First Party shall withdraw all legal proceedings against the Second Party.
4. It has been clearly understood by both the Parties that the terms of this Understanding cannot be altered except with the written mutual consent of both the Parties and this MOU do not absolve any liability of the Second Party. All notices and correspondence hereunder shall be in writing." Hence, the petition for quashing.
It is stated by Mr. Anturkar that once the parties have arrived at a settlement, the cause of action as regards the 138 complaint is concerned, ceases to exist.
He states that the settlement agreement subsumes the original complaint and the 3 complaints cannot now be prosecuted.
To buttress his arguments Mr. Anturkar has relied on the judgment viz Signature Not Verified Digitally Signed byAMIT ARORA Signing Date:04.11.2022 18:19:04 'Gimpex Private Limited vs. Manoj Goel', 2021 SCC OnLine SC 925 and more particularly para 38 which reads as under:
"38. When a complainant party enters into a compromise agreement with the accused, it may be for a multitude of reasons-higher compensation, faster recovery of money, uncertainty of trial and strength of the complaint, among others. A complainant enters into a settlement agreement with open eyes and undertakes the risk of the accused failing to honour the cheques issued pursuant to the settlement, based on certain benefits that the settlement agreement postulates. Once parties have voluntarily entered into such an agreement and agree to abide by the consequences of non-compliance of the settlement agreement, they cannot be allowed to reverse the effects of the agreement by pursuing both the original complaint and the subsequent complaint arising from such non-compliance. The settlement agreement subsumes the original complaint. Non-compliance of the terms of the settlement agreement or dishonour of cheques issued subsequent to it, would then give rise to a fresh cause of action attracting liability under Section 138 of the NI Act and other remedies under civil law and criminal law."
(emphasis supplied) Mr. Amandeep Singh, learned counsel has filed a response in CRL.M.C. 3136/2022 and states that as per the MoU dated 11.01.2021, the parties never agreed for compounding of the offence without clearing the dues.
He draws my attention to clause 3 of the settlement agreement reproduced above to state that only after the payment of entire Rs. 7,13,87,553/-, the legal proceedings were to be withdrawn.
He further seeks to distinguish the judgment of Gimpex (supra) by stating that the said case, new cheques were issued in place of old cheques and it was held that 2 complaints cannot lie, one against the dishonour of Signature Not Verified Digitally Signed byAMIT ARORA Signing Date:04.11.2022 18:19:04 first set of cheques and two, against dishonour of second set of cheques.
I have heard learned counsel for the parties. In the present case, there was a compromise, pursuant to which the petitioner was required to clear the entire arrears of Rs. 7,13,87,553/- due and payable to the respondent.
There were two mechanisms contemplated in the MoU either of which could be opted by the petitioner for clearing the dues.
Admittedly, the dues of Rs. 7,13,87,553/- have not been cleared. The petitioner cannot be permitted to dangle a carrot at the respondent by entering into a compromise, not adhering to its obligations and thereafter insisting on the respondent to file either a suit for specific performance, contempt proceedings or execution.
The petitioner, in this case, has miserably failed to adhere to any of the 2 proposals.
The judgment of Gimpex(supra) is also distinguishable as in Gimpex(supra), pursuant to a settlement, a new set of cheques were issued and were dishonoured.
In the present case, no cheques were issued in place of the earlier cheques.
Further, the MoU itself states that only once payment is cleared by the petitioner, the respondent shall withdraw the legal proceedings.
In the present case, the payment has not been cleared and hence the proceedings continue to subsist and shall be prosecuted by the respondent.
The consequences of non-compliance of the settlement agreement are given in the MoU dated 11.01.2021 itself.
For the aforesaid reasons, there is no merit in the petitions and the Signature Not Verified Digitally Signed byAMIT ARORA Signing Date:04.11.2022 18:19:04 same are dismissed.
The stay order stands vacated.
JASMEET SINGH, J NOVEMBER 1, 2022/dm Click here to check corrigendum, if any Signature Not Verified Digitally Signed byAMIT ARORA Signing Date:04.11.2022 18:19:04