Karnataka High Court
M/S Madanapalle Spinning Mills Limited vs M/S Sri Salasar Balaji Enterprises on 12 December, 2013
Author: Huluvadi G.Ramesh
Bench: Huluvadi G Ramesh
IN THE HIGH COURT OF KARNATAKA
GULBARGA BENCH
Dated this the 12th day of December, 2013
Before
THE HON'BLE MR JUSTICE HULUVADI G RAMESH
Criminal Petitions 2995 c/w 2996 / 2013
Between:
1 M/s Madanapalle Spinning Mills Ltd
Regd. & Corporate Off. - 106, I Floor
Raheja Chambers, Musuem Road
Bangalore 1 - by its Chairman &
Mg. Director - Mr Laxmikant Bhandari
2 Mr Laxmikant Bhandari, 48 yrs
S/o late Vithaldas Bhandari
Chairman & Mg. Director of
M/s Madanapalle Spinning Mills Ltd
Regd. & Corporate Off. - 106, I Floor
Raheja Chambers, Musuem Road
Bangalore
3 Sri Gopal Bhandari, 45 yrs
S/o late Vithaldas Bhandari
Jt. Managing Director of
M/s Madanapalle Spinning Mills Ltd
Regd. & Corporate Off. - 106, I Floor
Raheja Chambers, Musuem Road
Bangalore 1 Petitioners
(By Sri Shivanand V Pattanashetti, Adv.)
2
And:
M/s Salasar Balaji Enterprises
By its Prtner - Laxmikant Boob
30 yrs, S/o late Narayanadas Boob
Business Partner of
M/s Salasar Balaji Enterprisers
KIADB Plot # 60 - A & B
Indl. Area, Hyderabad Road
Raichur 584 102 Respondent
(By Sri Shivakumar Kalloor, Adv.)
Criminal Petitions are filed under S.482 of the Criminal Procedure
Code praying to set aside the order of taking cognizance and issue of
process in CC 426/2013 & CC 427/2013 by the Prl. Civil Judge & JMFC,
Riachur.
Petitions coming on for Admission this day, the court made the
following:-
ORDER
On the ground that the cheque was issued by the sister concern though the transaction was between a different person, and taking cognizance of the proceedings under S.138 of the Negotiable Instruments Act by the Prl. Civil Judge & JMFC, Raichur in CC 426 and 427 / 2013 is bad in law, petitioners are before this Court in these petitions.
Heard the counsel representing the parties.
3It is the contention of the petitioners' counsel that there is no transaction or nexus between the petitioners and the respondent. As such, taking cognizance and issuance of process is bad in law.
Per contra, respondent relied upon the judgment of the Apex Court in the case of Anil Sachar & Anr Vs M/s Shree Nath Spinners Pvt Ltd& Ors - SLP 1830-31/2009 in Crl.A 1413-14/2011 wherein in para 7, it is observed, though the transaction is between two different legal entities, the dishonor of the cheques would make signatory of the cheques liable under the provisions of the Act. It is also observed, on lifting the corporate veil, the true transaction would be considered. The inter se transaction between the two sister concerns would not definitely escape the liability for non- payment and dishonour of the cheque as the sister concern while dealing with the matter has acted on behalf of the supplier and hence, it is liable.
In the case on hand, grievance of the petitioners is, the cheques were not issued by the complainant but by others. Here the matter has to be examined in detail during trial as to the liability of the accused vis a vis the complainant. Whether the cheques were issued towards legally enforceable 4 debt and whether the complainant has got right to file a complaint and in so far as liability as against the accused, at the threshold, the same cannot be discussed on the ground that complainant is different and drawer of the cheque is different.
In view of the above, petitions are disposed of. It is for the petitioners to go before the trial court to take all such defense available to them. However, so far as appearance of the accused is concerned, the trial court would consider the exemption application liberally and dispose of the matter, according to law.
Sd/-
Judge An