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[Cites 15, Cited by 0]

Delhi District Court

Srivats Rathi vs State on 18 February, 2013

                                                      Srivats Rathi vs State
                                                               CR No. 18/13


                 IN THE COURT OF SHRI VIJAY KUMAR DAHIYA
                     ADDITIONAL SESSIONS JUDGE
                       DWARKA COURTS : DELHI

In the matter of :­

1.       Srivats Rathi
         S/o Sh. Arun Kumar Rathi
         R/o 24­Sadhana Enclave
         Malviya Nagar
         New Delhi­110017                       ...Petitioner


                                  VERSUS

1.       State (Govt. of NCT of Delhi)
         Through Public Prosecutor

2.       Indian Bank
         New Delhi Main Branch
         G­41, Connaught Circus
         New Delhi - 110001

3.       M/s Rathi Ispat Ltd.
         having its registered office at
         135, 3rd Floor
         Savitri Nagar, New Delhi

4.       Arun Kumar Rathi
         S/o Sh. G.D.Rathi
         R/o 24 Sadhana Enclave
         Malviya Nagar, New Delhi­17

5.       Santosh Kumar Bhagat
         I­1800, Block­1
         C.R.Park, New Delhi­19


CR No.18/13                          -:1:-                       18.02.2013
                                                                                  Srivats Rathi vs State
                                                                                          CR No. 18/13


6.                     Shyam Kachalia  (since deceased­proceedings  against  
                       him abated)
                       A­582, Sector­9, Vijay Nagar
                       Ghaziabad­202001

7.                     Sajeev Kumar Agarwal
                       67/8, Balbir Nagar Extension
                       Shadra, Delhi­110032

8.                     Dileep Mishra
                       1568, Cinema Gali
                       Gandhi Nagar, Shadra
                       Delhi­32

9.                     Varun Garg
                       26, Laxmi Vihar Colony
                       Maliwara, Ghaziabad­201001             ... Respondents


                                                                        CR No. 18/13
                                                     Date of Institution:  22.01.2013
                                                  Reserved for orders on: 14.02.2013
                                                Judgment announced on:  18.02.2013


JUDGMENT

1. Vide this order, I shall dispose of the revision petition filed by the petitioner against the impugned order dated 19.12.2012 whereby the Ld. Trial Court has dismissed the application of the petitioner/accused No.3 for dropping the proceeding against him at the stage of framing of notice.

2. Stating briefly, the complainant filed a complaint on CR No.18/13 -:2:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 05.09.2007 against M/s Rathi Ispat Ltd and others under section 138/141 NI Act, impleading the petitioner as accused No.3 alleging therein that the petitioner is one of the Directors of the accused company as the complainant had advanced a loan of Rs. 10 crores to the accused company of which the accused no.3/petitioner was Director in terms of loan agreement dated 13.03.2006 as well as guarantee agreement executed by the petitioner which was entered into between the complainant and accused No.1/accused company under the signature of accused No.3 Arun Kumar Rathi, father of the present petitioner. It is further stated that accused No.1 issued a post dated cheque bearing No. 99125 dated 27.07.2007 for an amount of Rs. 10 crores in favour of the complainant as full and final settlement of the loan above the loan agreement bu the said cheque was dishonoured and legal notice dated06.08.2007 was sent and he petitioner alongwith other directors have been summoned and the petitioner alongwith co­accused moved an application before Ld. MM for dropping proceedings at the stage of framing of notice but the said application has been dismissed by Ld. MM by mis­ construing the provision of section 251 Cr.PC.

3. Feeling aggrieved by the impugned order, the present petition filed.

4. It is contended that so far as framing of notice is concerned at the stage of section 251 Cr.PC is concerned, the Ld. Trial Court is to apply its mind whether to proceed further or not and CR No.18/13 -:3:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 before proceeding further under section 251 Cr.PC, Ld. Trial Court must satisfy as to which prima facie any offence made out against the accused persons, only then the notice can be framed. Court is under duty first of all to conclude after scrutinisation of record as to whether, a prima facie, offence is made out in the said complaint which is to be stated to the accused only then the accused can be asked as to whether he pleaded guilty or offer defence and while dismissing the application of the petitioner, the Ld. Trial Court has mis­interpreted the real spirit of section 251 Cr.PC.

5. It is further contended that Ld. Trial Court has passed the impugned order on mere conjucture and surmises by misunderstanding and misreading the case law relied upon by the counsel for the petitioner.

6. It is further contended that there is no difference under section 239 and 251 Cr.PC so far as the discharge of accused in warrant or summon case respectively is concerned and case law relied by the counsel for the respondents pertains to those cases after crossing the stage of 251 Cr.PC and there is no conflict between the judgments in Bhushan Kumar vs. State AIR 2012 SC 1747 and Subramanium Sethuraman vs State of Maharashtra (2004) 13 SCC

324.

7. It is further contended that Hon'ble High Court in S.K.Bhalla vs State 180(2010) DLT 219 has already discussed the case CR No.18/13 -:4:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 law Adalat Prashad and held that if the Magistrate comes to conclusion after having a prima facie view of the averments made in the complaint annexed there with that no offence is made out then the Ld. Magistrate is supposed to discharge the accused under section 251 Cr.PC as same view has been endorsed by the Hon'ble High Court of Delhi in H.D.Gamber case; 2012 IV AD (Delhi).

8. It is further contended that the Ld. Trial Court has failed to appreciate that the petitioner has already resigned from the accused company as a director on 25.05.2006 and this fact has earlier been reflected in form No. 32 down loaded from the ROC whereas the cheque in question has been presented on 27.07.2007. Therefore, the petitioner cannot be saddled with any liability arising out the cheque in question as the same has been issued after resignation has been tendered and duly approved by Board of Directors on 02.06.2006. In this regard, he had relied upon SMS Pharmaceutical Ltd (2005) 8 SCC 89 and Aneeta Handa vs. Godfather Travels AIR 2012 SC 2795.

9. Per contra, the counsel for the respondent has contended that petitioner has filed an affidavit stating therein that the accused/petitioner owes no legal liability towards any such debt of the complainant/respondent and they do not plead guilty and proceedings against him is required to be dropped and accused be discharged. But the said affidavit has been treated by the Ld. Trial Court as application and asked the respondent /complainant to file reply to the said application/affidavit seeking discharge. It is further CR No.18/13 -:5:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 contended that it is mandate of law that proceedings under section 138 NI Act are to be conducted by way of summary trial. So even the present case was not to be tried as a summon case and therefore, there is no question of discharge of the petitioner. In this regard, he had relied upon Rajesh Agarwal vs. State, Crl. N.C.No.1996/2010 & Crl. M.A.No.7672/10 dated 28.07.201 and G.Chandrasekaran vs. C.R.Umapathy, 2004(5) CTC 50: MANU/TN/1051/2004.

10. It is further contended that in a summon trial case, there is no provision in law for discharge and as such discharge is not permissible under section 239 Cr.PC for trial in warrant cases. In chapter XX of Cr.PC, there is no whisper of any discharge of any type so the only conclusion will be that will naturally follow that accused can either be convicted or acquitted. In this regard, he had relied upon Adalat Prasad vs. Rooplal Jinder, (2004) 7 SCC 338 and Subramanium Sethuraman vs. State of Maharashtra & anr. (2004) 13 SCC 324. So far as Bhusan Kumar case (supra) is concerned. It is contended that Bhusan Kumar was pertaining to warrant case and not to summon case so the Bhusan Kumar case is not applicable to the facts and circumstances of the present case.

11. It has been further contended that petitioner/accused was appointed as a promoter of the accused company on 30.09.2005 and on 31.03.2007, he was holding 28% of share holding of the accused company. It is further contended that Srivats Rathi joined accused company on 10.04.2005 and he was appointed Director on CR No.18/13 -:6:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 27.04.2005 and even on 30.09.2005, he was holding 28 % share holding in the accused company being the largest share holder and on 11.02.2006, the complainant bank/respondent sanctioned a loan of Rs. 10 crores to the accused company which was sanctioned on the basis of personal guarantee of Srivats Rathi, petitioners (herein) and by way of tendering of post dated cheque by A.K.Rathi, father of the petitioner.

12. It is further contended that at the date of advancement of loan of Rs. 10 crore, accused/petitioner was a director and as a director, the accused/petitioner has executed agreement of guarantee and other related documents dated 31.03.2006 and on 20.03.2006 in terms of the loan agreement post dated cheque bearing No.99125 dated 11.02.2006 signed by Arun Kumar Rathi was given and on 22.03.2006, the amount of 10 crore was credited to the account of accused company. It is further submitted that form No. 32 as per which the accused/petitioner is stated to have resigned from the accused company but the consideration of form 32 is triable issue not to be gone into at this stage.

13. I have heard counsel for the parties and gone through the record including the case law relied upon by counsel for the parties during the course of arguments.

14. In Adalat Prashad case, the question involved was whether the trial court was empowered to recall process issued CR No.18/13 -:7:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 against the accused under section 204 Cr.PC and can resort to the stage of 203 Cr.PC and it was observed that it is impermissible to resort to section 203 Cr.PC after reaching the stage of 204 Cr.PC because the stage of section 203 was already over and Magistrate had proceeded further to the stage of 204 Cr.PC.

In para 16, it has been observed as under:

16. The next challenge of the learned counsel for the appellant made to the finding of the High Court that once a plea is recorded in a summon case it is not open to the accused person to seek a discharge, cannot also be accepted. The case involving a summons case is covered by Chapter XX of the Code which does not contemplate a stage of discharge like Section 239 which provides for a discharge in a warrant case.

Therefore, in our opinion the High Court was correct in coming to the conclusion that once the plea of the accused is recorded under section 252 of the Code the procedure contemplated under Chapter XX has to be followed which is to take the trial to its logical conclusion.

15. Whereas in Bhusan Kumar's case in Para 17, it has been observed as under:

CR No.18/13                               -:8:-                                   18.02.2013
                                                                       Srivats Rathi vs State
                                                                               CR No. 18/13




17. It is inherent in section 251 of the Code that when an accused appears before the trial court pursuant to summons issued under section 204 of the Code in a summons trial case, it is the bounden duty of the trial Court to carefully go through the allegations made in the charge­ sheet or complaint and consider the evidence to come to a conclusion whether or not, commission of any offence is disclosed and if the answer is in the affirmative, the Magistrate shall explain the substance of the accusation to the accused and ask him whether he pleads guilty otherwise, he is bound to discharge the accused as per section 239 of the Code.

16. Ld. Trial Court has observed that there is a conflict between the case of Bhusan Kumar and Subramanium Sethuraman but from the bare perusal of the above said judgments relevant portion whereof is already reproduced, I am of the opinion that there is no such conflict in the above said judgments, in as much as, in Subramanium Sethuraman case, it has been laid down that once the plea of the accused recorded under section 252 of the Cr.PC, the procedure chapter XX has to be followed which is to take the trial to its logical conclusion whereas in Bhsan Kumar, it has been observed that Magistrate is under bounden duty to carefully go through the CR No.18/13 -:9:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 allegations made in the charge and consider the evidence to come to the conclusion whether commission of any offence is disclosed and if the answer is in affirmative, the Magistrate shall explain the substance of the acquisition to the counsel otherwise he is bound to discharge the accused as per section 239 of the court, therefore, Bhusan Kumar ratio is applicable at the stage of 251 Cr.PC whereas the ratio of Setu Raman case is applicable to at the post 251 Cr.PC stage. In this regard, I found support from S.K.Bhalla case wherein Hon'ble High Court has observed as under:

15. Section 251 of the Code of Criminal Procedure deals with the stage subsequent to issue of process under section 204 Cr.PC in a summons trial case. This section casts a duty upon the Magistrate to state to the accused persons the particulars of offence allegedly committed by him and ask him whether he pleads guilty. This can be done by the Magistrate only if the charge sheet/complaint/preliminary evidence recorded during inquiry disclose commission of a punishable offence. If the chargeshsheet/complaint does not make out a triable offence, how can a Magistrate state the particulars of non­existing offence for which the accused is to be tried. Therefore, it is CR No.18/13 -:10:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 inherent in section 251 of the Code of Criminal Procedure that when an accused appears before the Trial Court pursuant to summons issued under section 204 Cr.PC in a summons trial case, it is bounden duty of the Trial Court to carefully go through the allegations made in the chargesheet/complaint and consider the evidence to come to a conclusion whether or not, commission of any offence is disclosed and if the answer is in the affirmative, the Magistrate shall explain the substance of the accusation to the accused and ask him whether he pleads guilty, otherwise, he is bound to discharge the accused.

17. From the above discussion, I am of the opinion that under section 251 Cr.PC, Magistrate is of the opinion that it is no substance in the allegation made in the complaint and come to a conclusion that no offence is committed by the accused, the accused can be discharged by the Magistrate by dropping the proceedings.

18. Now coming to the second contention that no offence is made out in the complaint and accused is entitled for discharge under section 239. But in the present case, the accused had been the director of the accused company when the cheque was issued and stood as a guarantor and he has resigned thereafter. So far as the CR No.18/13 -:11:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 case law H.S.Gambhir is concerned, the cheque in that case was presented after six months and the summoning order as well as notice under section 251 Cr.PC was quashed and in the present case, the accused stood as a guarantor for a legally recoverable debt so the ratio of H.S.Gambhir case is not applicable to this case.

19. Contention in the present petition is that the petitioner was no more a director when cheque was dishonoured and being guarantor of the transaction in question, which is subject matter of the present proceedings is not liable under NI Act as after having resigned from the company, the petitioner was not a director when the cheque was presented. It is further contended that there is no specific role assigned to the accused/petitioner by the complainant in the complaint and in the absence of specific averments against the petitioner, who once upon a time happened to be director of the accused company, showing as to how and what manner the petitioner was responsible for the conduct of the business, the application seeking discharge be allowed. There is no dispute about the ratio of the case law relied upon namely SMS Pharmaceutical, Harshender Kumar and Anita Handa (supra) but the facts of the present case is distinguishable to the facts of these judgments relied upon by the petitioner as it is also settled law that when the complainant/respondent has clearly alleged that the petitioner being director was incharge of and responsible for the company for the conduct of the business and tender in guarantee by executing a guarantee agreement in favour of the respondents and the question CR No.18/13 -:12:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 whether the accused/petitioner was incharge of the field of the company and any restrictions on his power was imposed or of any special circumstances made them not liable to be convicted could be considered during trial. In this regard, I found support from cases of N.Rangachari (supra) as held in para 16 and 19.

16. While section 138 made a person criminally liable on dishonour of a cheque for insufficiency of funds or the circumstances referred to in the section and on the conditions mentioned therein, section 141 laid down a special provision in respect of issuance of cheques by companies and commission of offences by companies under section 138 of the Negotiable Instruments Act. Therein, it was provided that if the person committing an offence under section 138 of the Act was a company, every person who at the time the offence was committed, was in charge of and was responsible to the company for the conduct of the business of the company as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

The scope of Section 141 has been authoritatively discussed in the decision in S.M.S. Pharmaceuticals Ltd binding on us and CR No.18/13 -:13:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 there is no scope for redefining it in this case. Suffice it to say, that a prosecution could be launched not only against the company on behalf of which the cheque issued has been dishonoured, but it could also be initiated against every person who at the time the offence was committed, was in charge of and was responsible for the conduct of the business of the company. In fact, section 141 deems such persons to be guilty of such offence, liable to be proceeded against and punished for the offence, leaving it to the person concerned, to prove that the offence was committed by the company without his knowledge or that he has exercised due diligence to prevent the commission of the offence. Sub section (2) of section 141 also roped in Directors, Managers, Secretaries or other officers of the company, if it was proved that the offence was committed with their consent or connivance.

19. Therefore, a person in the commercial world having a transaction with a company is entitled to presume that the Directors of the company are in charge of the affairs of the company. If any restrictions on their powers are CR No.18/13 -:14:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 placed by the memorandum or articles of the company, it is for the Directors to establish it at the trial. It is in that context that section 141 of the Negotiable Instruments Act provides that when the offender is a company, every person, who at the time when the offence was committed was in charge of and was responsible to the company for the conduct of the business of the company, shall also be deemed to be guilty of the offence alongwith the company. It appears to us that an allegation in the complaint that the named accused are Directors of the company itself would usher in the element of their acting for and on behalf of the company and of their being in charge of the company.

21. The petitioner/accused was director when the post dated cheque was given and stood as a guarantor to the accused company which had received the cheque of loan amount. Admittedly, the petitioner was guarantor on the date when the cheque was issued by the company in pursuant of the loan agreement but the said cheque was dishonoured by the bank when presented for payment and the petitioner has sought the dropping of the proceedings and discharge on the ground that when the cheque was presented, he was no longer the director of the accused company. It may be noted here that the CR No.18/13 -:15:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 liability of the company to pay the loan amount to the complainant arose pursuant to the loan and gurantee agreement and there is a reference to the said loan/guarantee agreement in the complaint, the complainant was at liberty to rely upon the said loan agreement and produce the evidence regarding the terms of the agreement and at the time of issuance the process, Magistrate had before him the complaint and the statement of the complainant recorded on oath and the complainant has specifically given the ingredients of the section 141 CR.PC. Therefore when the loan/guarantee agreement was signed and cheque in question was issued, accused was director and had also executed the guarantee agreement as a guarantor.

22. Now coming to the last contention of the counsel for the petitioner that cheque given by the accused company and the petitioner/accused was a guarantor, therefore, the petitioner being no more a director of the accused company when the charge was dishonoured. Therefore, the petitioner is not liable as a guarantor or director and cheque in question cannot be the subject matter of proceedings under section 138 of NI Act against the petitioner. In this regard, the counsel for the petitioner has relied upon Hardeep Singh Nagra vs. State 2010(1) JCC (NI) 62. But in ICDS, the Supreme Court has taken contrary view and observed as under:

"10. The language, however, has been rather specific as regards the intent of the legislature. The commencement of the Section stands with CR No.18/13 -:16:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 the words "Where any cheque". The above noted three words are of excrement significance, in particular, by reason of the user of the word "any"­­the first three words suggest that in fact for whatever reason if a cheque is drawn on an account maintained by him with a banker in favour of another person for the discharge of any debt or other liability, the highlighted words if read with the first three words at the commencement of Section 138, leave no manner of doubt that for whatever reason it may be, the liability under this provision cannot be avoided in the event the same stands returned by the banker unpaid. The legislature has been careful enough to record not only discharge in whole or in part of any debt but the same includes other liability as well. This aspect of the matter has not been appreciated by the High Court, neither been dealt with or even referred to in the impugned judgment.
11. The issue as regards the co­extensive liability of other guarantor and the principle debtor, in our view, is totally out of the purview of section 138 of the Act, neither the same calls for any discussion therein. The language of the CR No.18/13 -:17:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 Statute depicts the intent of the law­makers to the effect that where ever there is a default on the part of one in favour of another and in the event a cheque is issued in discharge of any debt or other liability there cannot be any restriction or embargo in the matter of application of the provisions of section 138 of the Act" 'Any cheque' and 'other liability' are the two key expressions which stands as clarifying the legislative intent so as to bring the factual context within the ambit of the provisions of the Statute. Any contra interpretation would defeat the intent of the legislature. The High Court, it seems, got carried away by the issue of grantee and guarantor's liability and thus has overnooked the true intent and purport of section 138 of the Act. The judgments recorded in the order of the High Court do not have any relevance in the contextual facts and the same thus does not lend any assistance to the contentions raised by the respondents.

23. It has been further contended that security cheque cannot be subject matter of proceedings under NI Act. In Ravi Kumar D. vs State of Delhi & Anr. Crl M.C No.4378/09 & Crl. M.a. No. 14989/09, it has been held that the security cheque cannot be CR No.18/13 -:18:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 presented for encashment and in para 9, it has been observed as under:

9. Plan reading of the above provision of law shows that criminal liability under section 138 NI Act is attracted only if the dishonoured cheque was issued for the discharge in whole or in part of any existing debt or liability. The section does not apply to a cheque issued to meet future liability which may arise on happening of some contingency. Thus, it is clear that a post dated cheque, if issued for discharge of a debt due, in the event of dishonour, would attract section 138 of the Ni Act but a cheque issued not for an existing debt/liability but issued by way of security for meeting some future contingency would not attract section 138 of the NI Act.

24. High Court of Punjab and Haryana in Shree Bhagwati Apparels India Ltd & Ors v. M/s Bibby Financial Services India Pvt. Ltd Manu/D/0302/2013 has observed as under:

The petitioners were granted domestic factoring facilities on 18.03.2011 by the respondent to the tune of Rs. 2,00,00,000/­ with the condition of maximum CR No.18/13 -:19:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 pre­payment of 80%. The petitioner gave the cheques of security amounting to Rs. 2,00,00,000/­ without date towards guarantee as guarantee of Liverpool Retial India Limited. On 09.06.2009, M/s Liverpool Retail India Limited was supplied goods and their invoices were discounted and M/s Liverpool Retail India Limited too issued the cheques for the said amount. The cheques were of different dates I.e 14.09.2009 to 16.12.2009. On 05.11.2009, the said cheques were dishonoured for insufficient funds. Thereafter, the respondent had no choice but to deposit the cheques given by the petitioners as guarantee. Their cheques were dishonoured. Hence, on 20.04.2010, the respondent filed the complaint against M/s Liverpool Retail India Ltd and its Directors. Thereafter the complainant deposited the cheques issued by the petitioner as guarantor of the said amount. The cheques issued by the petitioner were also dishonoured. Accordingly, the second complaint was filed on 28.07.2010 under Section 138 of the Negotiable Instruments Act against the petitioners.

Moreover, as per the nature of the transaction between the parties, the Borrower who in the present case, happens to be the petitioner No.1 makes itself CR No.18/13 -:20:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 liable for rendering all outstanding amounts to the Factor I.e the respondent in the event of the purchaser of goods I.e M/s Liverpool Retail India Limited defaulting in making payment.

In view of the above, it cannot be said, at this stage, that the cheques were towards security. The said fact being disputed and debatable, it is a matter to be decided in trial.,,,,

25. But in the present case, the cheque has not been presented for future liability which may arise on happening of some contingency. Otherwise as has been observed in Krish International P.Ltd & Ors vs. State & Manu/DE/0302/2013, Hon'ble High Court of Delhi has observed in para 8:

8. There is no dispute about the proposition of law as laid down in M/s. Collage Culture that a cheque issued not for an existing due but issued by way of security would not attract the provisions of section 138 of the Act. In M/s Collage Culture the Ld. Single Judge of this Court (Pradeep Nandrajog, J.) drew distinction between a cheque issued for a debt in present but payable in future and second for a debt which may become payable in future upon the CR No.18/13 -:21:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 occurrence of a contingent event. Para 20 to 24 of the report in M/s. Collage Culture are extracted hereunder:
20. A post dated cheque may be issued under two circumstances. Under circumstance one, it may be issued for a debt in present but payable in future.

Under second circumstance it may be issued for a debt which may become paybale in future upon the occurrence of a contingent event.

21. The difference in the two kinds of post­dated cheques would be that the cheque issued under first circumstance would be for a debt due, only payment being postponed. The latter cheque would be by way of a security.

22. The word 'due means 'outstanding at the relevant date'. The debt has to be in existence as a crystallized demand akin to a liquidated damages and not a demand which may or may not come into existence; coming into existence being contingent upon the happening of an event.

26. Therefore, it cannot be said that the cheque in question has not been issued by the accused company for meeting any future CR No.18/13 -:22:- 18.02.2013 Srivats Rathi vs State CR No. 18/13 liability which may happen on some contingency. So therefore in view of the case law Collage Culture & Ors (supra) it can be safely held that the cheque in question was issued by way of security for pre­existing debt and in view of the law laid down in Shree Bhagwati Apparels India Ltd & Ors (supra) and Krish International P.Ltd (supra), cheque has been issued for security by guarantor can be subject matter of the proceedings under section 138 NI Act.

27. From the above discussion, I am of the opinion that counsel for the petitioners has failed to point out any illegality in the impugned order. So this petition is devoid of merits and is hereby dismissed.

28. Needless to say that nothing stated herein shall tantamount to an expression of my opinion on the merits of the case.

29. TCR and copy of the order be sent to the Ld. Trial Court for information and compliance.

30. File be consigned to record room.



Announced in the open court                     (Vijay Kumar Dahiya)
on the 18th Day of February 2013                    ASJ/ Dwarka Courts
                                                                   New Delhi 




CR No.18/13                             -:23:-                                  18.02.2013