Karnataka High Court
Divakar Atluri vs M/S Bkg M Sand And Aggregates Pvt Ltd on 26 July, 2023
1
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH
DATED THIS THE 26TH DAY OF JULY, 2023
BEFORE
THE HON'BLE MS.JUSTICE J.M.KHAZI
CRIMINAL PETITION No.100153 OF 2023
C/W
CRIMINAL PETITION No.100154 OF 2023
CRIMINAL PETITION No.100155 OF 2023
CRIMINAL PETITION No.100156 OF 2023
CRIMINAL PETITION No.100157 OF 2023
WRIT PETITION No.105318 OF 2022 (GM-RES)
WRIT PETITION No.105328 OF 2022(GM-RES)
WRIT PETITION No.105329 OF 2022(GM-RES)
WRIT PETITION No.105332 OF 2022(GM-RES)
WRIT PETITION No.105335 OF 2022(GM-RES)
IN CRL.P No.100153 OF 2023
BETWEEN:
1. MR. SRINIVAS VARMA PENMATSA,
CHIEF EXECUTIVE OFFICER, AGE: 57 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
2
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
2. MR. T.K. RENGAMOORTHY,
VICE PRESIDENT, AGE: 56 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO. 38 & 39,
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD,
TELANGANA - 500 032.
3. MS. SHRUTI WALIA,
MANAGER - COMPANY SECRETARY,
AGE: 36 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
....PETITIONERS
(BY SRI ARVIND KAMATH SERNIOR COUNSEL FOR
SRI ANAND MUTTALI AND VIJAY HIREMATH, ADVOCATES)
AND:
BKG M SAND AND AGGREGATES PVT LTD.,
CIN: U14292KA2015PTC081935,
HAVING OFFICE AT NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
THIS CRIMINAL PETITION IS FILED U/SEC. 482 OF CR.P.C.
SEEKING TO QUASH THE COMPLAINT AND ENTIRE PROCEEDINGS
IN THE C.C.NO.492/2021 ON THE FILE OF THE CIVIL JUDGE AND
JMFC SANDUR, BALLARI FOR THE OFFENCE PUNISHABLE
3
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
U/SEC.138 AND 141 OF N.I. ACT, INSOFAR AS THE
PETITIONERS/ACCUSED NO.8, 9 AND 11 ARE CONCERNED
(ANNEXURE - A AND B) AND ETC.,
IN CRL.P No.100154 OF 2023
BETWEEN:
1. MR. SRINIVAS VARMA PENMATSA,
CHIEF EXECUTIVE OFFICER, AGE: 57 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
2. MR. T.K. RENGAMOORTHY,
VICE PRESIDENT, AGE: 56 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO. 38 & 39,
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD,
TELANGANA - 500 032.
3. MS. SHRUTI WALIA,
MANAGER - COMPANY SECRETARY,
AGE: 36 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
....PETITIONERS
(BY SRI ARVIND KAMATH SERNIOR COUNSEL FOR
SRI ANAND MUTTALI AND VIJAY HIREMATH, ADVOCATES)
4
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
AND:
BKG M SAND AND AGGREGATES PVT LTD.,
HAVING OFFICE AT NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
CIN: U14292KA2015PTC081935.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
THIS CRIMINAL PETITION IS FILED U/SEC. 482 OF CR.P.C.
SEEKING TO QUASH THE COMPLAINT AND ENTIRE PROCEEDINGS
IN THE C.C.NO.493/2021 ON THE FILE OF THE CIVIL JUDGE AND
JMFC SANDUR, BALLARI FOR THE OFFENCE PUNISHABLE
U/SEC.138 AND 141 OF N.I.ACT, INSOFAR AS THE
PETITIONERS/ACCUSED NO.8, 9 AND 11 ARE CONCERNED.
(ANNEXURE - A AND B) AND ETC.,
IN CRL.P No.100155 OF 2023
BETWEEN:
1. MR. SRINIVAS VARMA PENMATSA,
CHIEF EXECUTIVE OFFICER, AGE: 57 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
5
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
2. MR. T.K. RENGAMOORTHY,
VICE PRESIDENT, AGE: 56 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO. 38 & 39,
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD,
TELANGANA - 500 032.
3. MS. SHRUTI WALIA,
MANAGER - COMPANY SECRETARY,
AGE: 36 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
....PETITIONERS
(BY SRI ARVIND KAMATH SERNIOR COUNSEL FOR
SRI ANAND MUTTALI AND VIJAY HIREMATH, ADVOCATES)
AND:
BKG M SAND AND AGGREGATES PVT LTD.,
HAVING OFFICE AT NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
6
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
THIS CRIMINAL PETITION IS FILED U/SEC. 482 OF CR.P.C.
SEEKING TO QUASH THE COMPLAINT AND ENTIRE PROCEEDINGS
IN THE C.C.NO.490/2021 ON THE FILE OF THE CIVIL JUDGE AND
JMFC SANDUR, BALLARI FOR THE OFFENCE PUNISHABLE
U/SEC.138 AND 141 OF N.I.ACT, INSOFAR AS THE
PETITIONER/ACCUSED NO.8, 9 AND 11 ARE CONCERNED.
(ANNEXURE - A AND B) AND ETC.,
IN CRL.P No.100156 OF 2023
BETWEEN:
1. MR. SRINIVAS VARMA PENMATSA,
CHIEF EXECUTIVE OFFICER, AGE: 57 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
2. MR. T.K. RENGAMOORTHY,
VICE PRESIDENT, AGE: 56 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO. 38 & 39,
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD,
TELANGANA - 500 032.
3. MS. SHRUTI WALIA,
MANAGER - COMPANY SECRETARY,
AGE: 36 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
7
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
....PETITIONERS
(BY SRI ARVIND KAMATH SERNIOR COUNSEL FOR
SRI ANAND MUTTALI AND VIJAY HIREMATH, ADVOCATES)
AND:
BKG M SAND AND AGGREGATES PVT LTD.,
HAVING OFFICE AT NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
CIN: U14292KA2015PTC081935.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
THIS CRIMINAL PETITION IS FILED U/SEC. 482 OF CR.P.C.
SEEKING TO QUASH THE COMPLAINT AND ENTIRE PROCEEDINGS
IN THE C.C.NO.494/2021 ON THE FILE OF THE CIVIL JUDGE AND
JMFC SANDUR, BALLARI FOR THE OFFENCE PUNISHABLE
U/SEC.138 AND 141 OF N.I.ACT, INSOFAR AS THE
PETITIONERS/ACCUSED NO.8, 9 AND 11 ARE CONCERNED.
(ANNEXURE - A AND B) AND ETC.,
IN CRL.P No.100157 OF 2023
BETWEEN:
1. MR. SRINIVAS VARMA PENMATSA,
CHIEF EXECUTIVE OFFICER, AGE: 57 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
8
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
2. MR. T.K. RENGAMOORTHY,
VICE PRESIDENT, AGE: 56 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO. 38 & 39,
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD,
TELANGANA - 500 032.
3. MS. SHRUTI WALIA,
MANAGER - COMPANY SECRETARY,
AGE: 36 YEARS,
KARVY DATA MANAGEMENT SERVICES LTD.,
AT: KARVY GATEWAY, PLOT NO.38 & 39
NANAKRAMDUGA, FINANCIAL DISTRICT,
GACHIBOWLI, RANGAREDDI, HYDERABAD
TELANGANA - 500 032.
....PETITIONERS
(BY SRI ARVIND KAMATH SERNIOR COUNSEL FOR
SRI ANAND MUTTALI AND VIJAY HIREMATH, ADVOCATES)
AND:
BKG M SAND AND AGGREGATES PVT LTD.,
HAVING OFFICE AT NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
9
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
THIS CRIMINAL PETITION IS FILED U/SEC. 482 OF CR.P.C.
SEEKING TO QUASH THE COMPLAINT AND ENTIRE PROCEEDINGS
IN THE C.C.NO.491/2021 ON THE FILE OF THE CIVIL JUDGE AND
JMFC SANDUR, BALLARI FOR THE OFFENCE PUNISHABLE
U/SEC.138 AND 141 OF N.I.ACT, INSOFAR AS THE
PETITIONERS/ACCUSED NO.8, 9 AND 11 ARE CONCERNED.
(ANNEXURE - A AND B) AND ETC.,
IN W.P No.105318 OF 2022
BETWEEN:
1. DIVAKAR ATLURI,
AGED ABOUT 65 YEARS,
S/O MADHUSUDHANA RAO ATLURI,
INDEPENDENT NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.114, 8-2-293/82/NL/114,
MLA'S & MP'S COLONY,
ROAD NO.10C, JUBILEE HILLS,
HYDERABAD - 500 033.
2. VIJAY KUMAR TARIMELA,
AGED ABOUT 64 YEARS,
S/O BALI REDDY TARIMELA,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.12 MLA'S COLONY,
BANJARA HILLS,
HYDERABAD - 500 034.
3. RAJAT PARTHASARATHY,
AGED ABOUT 38 YEARS,
S/O C. PARTHASARATHY,
10
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
NO. 301, SRI ADITYA AKSHAYA PRIDE
BHARANI LAYOUT, D.NO.8-2-293/82/BH/63,
ROAD NO.78, FILM NAGAR, JUBILEE HILLS,
HYDERABAD - 500 033.
4. C. PARTHASARATHY,
AGED ABOUT 67 YEARS,
S/O LATE C.R. RAJAGOPALAN,
NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
H NO. 8-2-293/82/A/648,
ROAD NO.34, JUBILEE HILLS,
HYDERABAD - 500 033.
....PETITIONERS
(BY SRI JAYAKUMAR PATIL SERNIOR COUNSEL FOR
SRI NIKHIL K. AND SMT.P.S. AISHWARYA NAIR, ADVOCATES)
AND:
M/S BKG M SAND AND AGGREGATES PVT LTD.,
A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 2013,
HAVING REGISTERED OFFICE AT
NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
MR. BAVIHALLI RUDRAGOUDA.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
11
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA R/W SEC.482 OF CR.P.C.
1973 PRAYING TO 1) QUASHING THE PRIVATE COMPLAINT IN
PCR NO.84 OF 2021 FILED BY THE RESPONDENT AGAINST THE
PETITIONERS CONTAINED IN ANNEXURE - A PENDING ON THE
FILE OF CIVIL JUDGE AND JMFC COURT SANDUR. INSOFAR AS
PETITIONERS ARE CONCERNED; 2) TO QUASH/SET-ASIDE THE
ORDER OR COGNIZANCE AND ISSUANCE OF PROCESS/SUMMONS
TO THE PETITIONERS DATED 17.12.2021 AND ALL FURTHER
PROCEEDINGS INCLUDING THE ISSUANCE OF NBW ON
15.10.2022 IN C.C.NO.491 OF 2021 PENDING BEFORE THE
HON'BLE 175-CIVIL JUDGE AND JMFC SANDUR, BALLARI
CONTAINED IN ANNEXURE - B INSOFOR AS PETITIONERS ARE
CONCERNED AND ETC.,
IN W.P No.105328 OF 2022
BETWEEN:
1. DIVAKAR ATLURI,
AGED ABOUT 65 YEARS,
S/O MADHUSUDHANA RAO ATLURI,
INDEPENDENT NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.114, 8-2-293/82/NL/114,
MLA'S & MP'S COLONY,
ROAD NO.10C, JUBILEE HILLS,
HYDERABAD - 500 033.
2. VIJAY KUMAR TARIMELA,
AGED ABOUT 64 YEARS,
S/O BALI REDDY TARIMELA,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.12 MLA'S COLONY,
12
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
BANJARA HILLS,
HYDERABAD - 500 034.
3. RAJAT PARTHASARATHY,
AGED ABOUT 38 YEARS,
S/O C. PARTHASARATHY,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
NO. 301, SRI ADITYA AKSHAYA PRIDE
BHARANI LAYOUT, D.NO.8-2-293/82/BH/63,
ROAD NO.78, FILM NAGAR,
JUBILEE HILLS,
HYDERABAD - 500 033.
4. C. PARTHASARATHY,
AGED ABOUT 67 YEARS,
S/O LATE C.R. RAJAGOPALAN,
NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
H NO. 8-2-293/82/A/648,
ROAD NO. 34, JUBILEE HILLS,
HYDERABAD - 500 033.
....PETITIONERS
(BY SRI JAYAKUMAR PATIL SERNIOR COUNSEL FOR
SRI NIKHIL K. AND SMT.P.S. AISHWARYA NAIR, ADVOCATES)
AND:
M/S BKG M SAND AND AGGREGATES PVT LTD.,
A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 2013,
HAVING REGISTERED OFFICE AT
NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
13
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
REPRESENTED BY ITS MANAGING DIRECTOR,
MR. BAVIHALLI RUDRAGOUDA.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA R/W SEC.482 OF CR.P.C.
1973 PRAYING TO 1) QUASHING THE PRIVATE COMPLAINT IN
PCR NO.85 OF 2021 FILED BY THE RESPONDENT AGAINST THE
PETITIONERS CONTAINED IN ANNEXURE - A PENDING ON THE
FILE OF CIVIL JUDGE AND JMFC COURT SANDUR. INSOFAR AS
PETITIONERS ARE CONCERNED; 2) TO QUASH/SET-ASIDE THE
ORDER OR COGNIZANCE AND ISSUANCE OF PROCESS/SUMMONS
TO THE PETITIONERS DATED 17.12.2021 AND ALL FURTHER
PROCEEDINGS INCLUDING THE ISSUANCE OF NBW ON
15.10.2022 IN C.C.NO.492 OF 2021 PENDING BEFORE THE
HON'BLE 175-CIVIL JUDGE AND JMFC SANDUR, BALLARI
CONTAINED IN ANNEXURE - B IN RESPECT OF THE PETITIONERS
,INSOFOR AS PETITIONERS ARE CONCERNED AND ETC.,
IN W.P No.105332 OF 2022
BETWEEN:
1. DIVAKAR ATLURI,
AGED ABOUT 65 YEARS,
S/O MADHUSUDHANA RAO ATLURI,
INDEPENDENT NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.114, 8-2-293/82/NL/114,
MLA'S & MP'S COLONY,
ROAD NO.10C, JUBILEE HILLS,
HYDERABAD - 500 033.
14
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
2. VIJAY KUMAR TARIMELA,
AGED ABOUT 64 YEARS,
S/O BALI REDDY TARIMELA,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.12 MLA'S COLONY,
BANJARA HILLS,
HYDERABAD - 500 034.
3. RAJAT PARTHASARATHY,
AGED ABOUT 38 YEARS,
S/O C. PARTHASARATHY,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
NO. 301, SRI ADITYA AKSHAYA PRIDE
BHARANI LAYOUT, D.NO.8-2-293/82/BH/63,
ROAD NO.78, FILM NAGAR, JUBILEE HILLS,
HYDERABAD - 500 033.
4. COMANLUR PARTHASARATHY,
AGED ABOUT 67 YEARS,
S/O LATE C.R. RAJAGOPALAN,
NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
H NO. 8-2-293/82/A/648,
ROAD NO. 34, JUBILEE HILLS,
HYDERABAD - 500 033.
....PETITIONERS
(BY SRI JAYAKUMAR PATIL SERNIOR COUNSEL FOR
SRI NIKHIL K. AND SMT.P.S. AISHWARYA NAIR, ADVOCATES)
AND:
M/S BKG M SAND AND AGGREGATES PVT LTD.,
A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 2013,
15
CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023
CRL.P NO.100155/2023 CRL.P NO.100156/2023
CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
HAVING REGISTERED OFFICE AT
NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
MR. BAVIHALLI RUDRAGOUDA.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 AND
227 OF THE CONSTITUTION OF INDIA R/W SEC.482 OF CR.P.C.
1973 PRAYING TO 1) QUASHING THE PRIVATE COMPLAINT IN
PCR NO.87 OF 2021 FLED BY THE RESPONDENT AGAINST THE
PETITIONERS CONTAINED IN ANNEXURE - A PENDING ON THE
FILE OF CIVIL JUDGE AND JMFC COURT SANDUR. INSOFAR AS
PETITIONERS ARE CONCERNED; 2) TO QUASH/SET-ASIDE THE
ORDER OR COGNIZANCE AND ISSUANCE OF PROCESS/SUMMONS
TO THE PETITIONERS DATED 17.12.2021 AND ALL FURTHER
PROCEEDINGS INCLUDING THE ISSUANCE OF NBW ON
15.10.2022 IN C.C.NO.494 OF 2021 PENDING BEFORE THE
HON'BLE CIVIL JUDGE AND JMFC SANDUR, BALLARI CONTAINED
IN ANNEXURE - B IN RESPECT OF THE PETITIONERS, INSOFOR
AS PETITIONERS ARE CONCERNED AND ETC.,
IN W.P No.105329 OF 2022
BETWEEN:
1. DIVAKAR ATLURI,
AGED ABOUT 65 YEARS,
S/O MADHUSUDHANA RAO ATLURI,
INDEPENDENT NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.114, 8-2-293/82/NL/114,
16
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CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
MLA'S & MP'S COLONY,
ROAD NO.10C, JUBILEE HILLS,
HYDERABAD - 500 033.
2. VIJAY KUMAR TARIMELA,
AGED ABOUT 64 YEARS,
S/O BALI REDDY TARIMELA,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.12 MLA'S COLONY,
BANJARA HILLS,
HYDERABAD - 500 034.
3. RAJAT PARTHASARATHY,
AGED ABOUT 38 YEARS,
S/O C. PARTHASARATHY,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
NO. 301, SRI ADITYA AKSHAYA PRIDE
BHARANI LAYOUT, D.NO.8-2-293/82/BH/63,
ROAD NO.78, FILM NAGAR, JUBILEE HILLS,
HYDERABAD - 500 033.
4. C. PARTHASARATHY,
AGED ABOUT 67 YEARS,
S/O LATE C.R. RAJAGOPALAN,
NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
H NO. 8-2-293/82/A/648,
ROAD NO. 34, JUBILEE HILLS,
HYDERABAD - 500 033.
....PETITIONERS
(BY SRI JAYAKUMAR PATIL SERNIOR COUNSEL FOR
SRI NIKHIL K. AND SMT.P.S. AISHWARYA NAIR, ADVOCATES)
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AND:
M/S BKG M SAND AND AGGREGATES PVT LTD.,
A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 2013,
HAVING REGISTERED OFFICE AT
NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
MR. BAVIHALLI RUDRAGOUDA.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL FOR
SRI K.L. PATIL, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA R/W SEC.482 OF CR.P.C.
1973 PRAYING TO 1) QUASHING THE PRIVATE COMPLAINT IN
PCR NO.86 OF 2021 FLED BY THE RESPONDENT AGAINST THE
PETITIONERS CONTAINED IN ANNEXURE - A PENDING ON THE
FILE OF CIVIL JUDGE AND JMFC COURT SANDUR. INSOFAR AS
PETITIONERS ARE CONCERNED; 2) TO QUASH/SET-ASIDE THE
ORDER OR COGNIZANCE AND ISSUANCE OF PROCESS/SUMMONS
TO THE PETITIONERS DATED 17.12.2021 AND ALL FURTHER
PROCEEDINGS INCLUDING THE ISSUANCE OF NBW ON
15.10.2022 IN C.C.NO.493 OF 2021 PENDING BEFORE THE
HON'BLE 175-CIVIL JUDGE AND JMFC SANDUR, BALLARI
CONTAINED IN ANNEXURE - B IN RESPECT OF THE PETITIONERS
INSOFOR AS PETITIONERS ARE CONCERNED AND ETC.,
IN W.P No.105335 OF 2022
BETWEEN:
1. DIVAKAR ATLURI,
AGED ABOUT 65 YEARS,
18
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CRL.P NO.100157/2023 WP NO.105318/2022
WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
S/O MADHUSUDHANA RAO ATLURI,
INDEPENDENT NON - EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.114, 8-2-293/82/NL/114,
MLA'S & MP'S COLONY,
ROAD NO.10C, JUBILEE HILLS,
HYDERABAD - 500 033.
2. VIJAY KUMAR TARIMELA,
AGED ABOUT 64 YEARS,
S/O BALI REDDY TARIMELA,
INDEPENDENT NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
PLOT NO.12 MLA'S COLONY,
BANJARA HILLS,
HYDERABAD - 500 034.
3. RAJAT PARTHASARATHY,
AGED ABOUT 38 YEARS,
S/O C. PARTHASARATHY,
NON-EXECUTIVE DIRECTOR,
KARVY DATA MANAGEMENT SERVICES LTD.,
NO. 301, SRI ADITYA AKSHAYA PRIDE
BHARANI LAYOUT, D.NO.8-2-293/82/BH/63,
ROAD NO.78, FILM NAGAR, JUBILEE HILLS,
HYDERABAD - 500 033.
4. C. PARTHASARATHY,
AGED ABOUT 67 YEARS,
S/O LATE C.R. RAJAGOPALAN
NON - EXECUTIVE DIRECTOR
KARVY DATA MANAGEMENT SERVICES LTD.,
H NO. 8-2-293/82/A/648,
ROAD NO. 34, JUBILEE HILLS,
HYDERABAD - 500 033.
....PETITIONERS
19
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WP NO.105332/2022 WP NO.105335/2022
(BY SRI JAYAKUMAR PATIL SERNIOR COUNSEL FOR
SRI NIKHIL K. AND SMT.P.S. AISHWARYA NAIR, ADVOCATES)
AND:
M/S BKG M SAND AND AGGREGATES PVT LTD.,
A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 2013,
HAVING REGISTERED OFFICE AT
NO.2189, BKG HOUSE,
K.H.B. COLONY, SANDUR, BALLARI,
KARNATAKA - 583 119.
REPRESENTED BY ITS MANAGING DIRECTOR,
MR. BAVIHALLI RUDRAGOUDA.
...RESPONDENT
(BY SRI SRINIVAS RAGHAVAN SENIOR COUNSEL
FOR SRI K.L. PATIL, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA R/W SEC.482 OF CR.P.C.
1973 PRAYING TO 1) QUASHING THE PRIVATE COMPLAINT IN
PCR NO.83 OF 2021 FILED BY THE RESPONDENT AGAINST THE
PETITIONERS CONTAINED IN ANNEXURE - A PENDING ON THE
FILE OF CIVIL JUDGE AND JMFC COURT SANDUR. INSOFAR AS
PETITIONERS ARE CONCERNED; 2) TO QUASH/SET-ASIDE THE
ORDER OF COGNIZANCE AND ISSUANCE OF PROCESS/SUMMONS
TO THE PETITIONERS DATED 17.12.2021 AND ALL FURTHER
PROCEEDINGS INCLUDING THE ISSUANCE OF NBW ON
15.10.2022 IN C.C.NO.490 OF 2021 PENDING BEFORE THE
20
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WP NO.105328/2022 WP NO.105329/2022
WP NO.105332/2022 WP NO.105335/2022
HON'BLE 175-CIVIL JUDGE AND JMFC SANDUR, BALLARI
CONTAINED IN ANNEXURE - B INSOFOR AS PETITIONERS ARE
CONCERNED AND ETC.,
THESE PETITIONS HAVING BEEN HEARD AND RESERVED
ON 12.04.2023, COMING ON FOR PRONOUNCEMENT OF ORDER
THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
While accused Nos.8, 9 and 11 have filed Criminal petitions under Section 482 Cr.P.C., accused Nos.3 to 6 have filed writ petitions under Article 226 and 227 of Constitution of India r/w Section 482 Cr.P.C, to quash criminal proceedings initiated against them in C.C.No.490 to 494/2021, for the offence punishable under Section 138 of N.I.Act.
2. For the sake of convenience, the parties are referred to by their rank before the trial Court. 21
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3. Complainant which is a private limited company, has filed complaint under Section 200 Cr.P.C against accused Nos.1 to 11 alleging offence punishable under Section 138 r/w Section 141 and 142 of of N.I.Act, contending that accused No.1 is an unlisted public limited company. Accused No.2 is the Managing Director, accused No.3 is a Chairman & Director, accused No.4 is the whole time Director, accused Nos.5 and 6 are Directors, accused No.7 is the Chief Financial Officer, accused No.8 is the Chief Executive Officer, accused No.9 is the Vice President & Head-Business Development, accused No.10 is the Vice President - Strategy & planning and accused No.11 is the Manager - Company Secretary of accused No.1- Company. Accused Nos.2 to 11 are key decision makers, actively and directly involved, incharge of and responsible for the conduct, running and management of day to day affairs, operations and business of accused No.1, including its banking and financial 22 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 transactions and as such form the core management team. By virtue of the offices/position held, powers exercised, duties and responsibilities owed, and functions performed by, each of the accused Nos.2 to 11 represent the directing mind and will of accused No.1 - Company. Their state of mind is the state of mind of accused No.1.
3.1 For these reasons inter-alia, the complainant believed the assurances and representations of accused Nos.2 to 11 on every occasion that one or more of them misrepresented, induced the complainant into extending loans and allowing them more and more time for repayment including through cheques issued and handed over to the complainant and replaced from time to time. On 07.03.2019, accused availed loan of Rs.25 crores in the form of an inter- corporate deposit in favour of accused No.1 for a period of 47 days at an interest at 16% p.a. They executed a demand 23 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 promissory note. They also issued cheques towards entire principal and interest as security to begin with and for encashment on the due dates towards discharge of their liabilities. However, at the request of accused to roll over the repayment for another 27 days, i.e., till 21.05.2019, time was extended, accused replaced the earlier cheques with fresh cheques.
3.2 Vide letter dated 29.04.2019, accused availed additional sum of Rs.10 crores in the form of inter-corporate deposit for a period of 15 days with interest at 16% p.a. and executed a demand promissory note and issued cheque. In fact on 15.05.2019, accused have repaid Rs.10 crores with interest in a sum of Rs.5,91,781/-.
3.3 Rs.25 crores was due for payment on 21.05.2021. However, at the request of accused Nos.2 to 11, complainant 24 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 provided a roll over till 06.06.2019 and accused have replaced the earlier cheques by new cheques.
3.4 Once again on 31.05.2019, at the request of accused, complainant has advanced additional loan of Rs.15 crores in the form of inter-corporate deposit for 24 days with interest at 14% p.a., on execution of demand promissory note. Except repayment of Rs.10 crores and piecemeal payments accused have failed and neglected to ensure discharge of Principal and interest. Later on to the disappointment of complainant, accused stopped making even their sporadic piecemeal payments since the latter half of 2020, except seeking extension of time and acknowledging the amount due. Accused have replaced the earlier cheques by five cheques dated 30.06.2021 drawn on the account of accused No.1. Despite extension of time, the accused neglected, failed and refused to ensure payment of the amount due. The complainant has advanced the loan and 25 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 extended the time only on the request, assurance, promises and representations filed by accused Nos.2 to 11. Therefore in terms of arrangements between accused and complainant and upon expiry of three weeks post the letter dated 29.07.2021 complainant presented the five cheques for recovery of total sum of Rs.22,75,80,005/-. However, to the utter shock and disappointment of complainant all the cheques were dishonored with endorsement "Funds insufficient". In respect of dishonour of 5 cheques, five separate complaints are filed. These cheques are signed by accused Nos.2 and 10 as authorized signatories of accused No.1.
3.5 Complainant got issued statutory demand notice dated 12.01.2021 through courier and registered post. Despite due service of notice accused have failed, neglected and refused to pay the amount due. However, vide letter dated 30.10.2021, accused have admitted the offence 26 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 complained of, debt owed to the complainant and sought more time to discharge the liability. Without any alternative, the complaint is filed. All the accused are jointly and severally liable to discharge the amount due and liable to be punished for the offence punishable under Section 138 of N.I.Act.
4. After recording sworn statement of the complainant, the trial Court has taken cognizance against accused for the offence punishable under Section 138 of N.I.Act and issued summons. In fact accused have appeared before the trial Court and were released on bail.
5. Being aggrieved by the taking of cognizance against them, accused Nos.8, 9 and 11 have come up with the criminal petitions under Section 482 Cr.P.C on the following:
27
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(i) There are no specific allegations against accused Nos.8, 9 and 11. No documents are produced to show that they are responsible for the day to day affairs and management of accused No.1 - Company and were involved in the alleged transaction between complainant and accused No.1 - Company. They have been arraigned as accused only on the ground that they are associated with accused No.1 -
Company. There are only general allegations. No specific averments are made with regard to the involvement of accused Nos.8, 9 and 11 in the alleged transaction. As per various decisions of this Hon'ble High Court and Hon'ble Apex Court that all the persons of the Company cannot be held responsible for each and every transaction. Continuation of the proceedings would amount to abuse of the process of law. Accused Nos.8, 9 and 11 are not signatories to the cheques allegedly issued in favour of complainant. They are 28 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 mere employees of accused No.1 - Company with specific work in which they are specialized. They cannot be held responsible merely on the basis of their designation or office in the company. In W.P.No.105335, 318, 328, 329 and 332/2022 filed by accused Nos.3 to 6, vide order dated 29.11.2022 this Hon'ble Court pleased to stay further proceedings.
(ii) The trial Court has failed to follow mandatory requirement of Section 202 Cr.P.C as the accused are residing outside the territorial jurisdiction of the trial Court.
(iii) In the absence of specific allegations against accused Nos.8, 9 and 11, the criminal proceedings initiated against them are liable to be quashed and prays to allow the petitions.
29
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6. In support of the criminal petitions filed on behalf of accused Nos.8, 9 and 11, the learned Senior counsel representing them has relied upon the following decisions:
(i) S.M.S. Pharmaceuticals Ltd., Vs. Neeta Bhalla and Anr. (S.M.S. Pharmaceuticals)1
(ii) K.K. Ahuja Vs. V.K. Vora and Anr. (K.K.Ahuja)2
(iii) National Small Industries Corporation Limited Vs. Harmeet Singh Paintal and Anr. (National)3
7. In the writ petitions, accused Nos.3 to 6 have urged the following:
GROUNDS:
(i) The impugned orders taking cognizance is neither maintainable in law nor on facts and as such liable to be quashed. Accused Nos.3 to 6 neither directly responsible nor in control of day to day business of accused No.1 - Company. 1 (2007) 4 SCC 70 2 (2009) 10 SCC 48 3 (2010) 3 SCC 330 30 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 They are not signatories to the subject cheques. They are arraigned as accused only to arm twist and harass them.
There is no application of mind while taking cognizance. There are no substantial grounds or specific allegations in the complaint to show their role in dishonor of the cheques.
(ii) There are no documents to show that they were key decision makers, actively involved, incharge and responsible for conduct, running and management of the day to day affairs, operations and business of accused No.1 - Company, including its banking and financial transactions and that they are benefited by moneys extended by the complainant. Form-12 DIR and Form-32 DIR filed with the Registrar of Companies, as per Companies Act, 2013 indicate that accused Nos.3 to 6 are Independent Directors and Non- executive Directors. These documents are of unimpeachable character and shows that they are Non-executive Directors. 31
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(iii) The learned Magistrate has taken cognizance without application of mind. The complaint does not prima facie constitute any offence much less the one under Section 138 r/w Section 141 of N.I.Act and prays to allow the petitions.
8. In support of his arguments, learned Senior counsel for accused Nos.3 to 6 has relied upon the following decisions:
(i) Sunita Palita and Ors. Vs. Panchami Stone Quarry (Sunita)4
(ii) Pooja Ravinder Devidasani Vs. State of Maharashtra and Anr. (Pooja)5
(iii) Ashutosh Ashok Parasrampuriya and Anr., Vs. Gharrkul Industries Pvt. Ltd., and Ors. 6
(Ashutosh)
(iv) Satender Kumar Antil Vs. Central Bureau of Investigation and Anr. (Satender)7 4 2022 SCC OnLine SC 945 5 (2014) 16 SCC 1 6 2021 SCC OnLine SC 915 32 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022
(v) Punjab State Industrial Development Corporation Ltd., Vs. PNFC Karmachari Sangh and Anr. (Punjab)8
9. In the criminal petitions as well as writ petitions, respondent/complainant has filed I.A.No.1/2023 for vacating the stay.
10. Respondent/complainant has filed objections which is nothing but reiteration of complaint averments. It is further averred that the trial Court has taken cognizance in accordance with law after due application of mind. It has examined the contents of the complaint, sworn statement, the documents relied upon and after examining the Managing Director of complainant/Company on oath. There is sufficient compliance of the requirement of Section 202 Cr.P.C, which does not mandate a detailed trial and examination of evidence and is limited to only examining the version of 7 (2021)10 SCC 773 8 (2006)4 SCC 367 33 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 complainant without adverting to any defence that the accused may have. There are adequate averments in the complaint against each of the accused, which requires thorough investigation through trial. Petitioners have actively involved in the commission of offence. Despite receiving the statutory notice petitioners have not ensured payment of moneys owed to the complainant.
11. The perusal of professional profiles of accused as uploaded and maintained by themselves highlights their key roles in the operation of accused No.1 - Company, its day to day affairs and business. As per Section 141 (1) of N.I.Act liability can be fastened vicariously upon individuals under Section 141(2) in the eventuality that an Officer or official of accused - Company has connived and granted his consent to defraud its creditors by deliberately permitting sufficient funds not to be maintained or has failed to exercise due 34 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 diligence by not ensuring that sufficient funds are maintained. Having failed to contest or dispute the complainant's claim on receipt of statutory notice, it is not open to the accused to dispute it at this stage and seek quashing of proceedings and prays to dismiss the petitions.
12. In support of his arguments learned Senior counsel for complainant has relied upon the following decisions:
(i) S.P.Mani & Mohan Diary Vs. Dr. Snehalatha Elangovan(S.P.Mani)9
(ii) Ashutosh Ashok Parasrampuriya and Anr., Vs. Gharrkul Industries Pvt. Ltd., and Ors.
(Ashutosh)10
(iv) Sunil Todi and Ors. Vs. State of Gujarat & Anr. (Sunil Todi)11
(v) Gunmala Sales Private Limited Vs. Anu Mehta (Gunmala)12 9 2022 SCC OnLine SC 1238 10 2021 SCC OnLine SC 915 11 2021 SCC OnLine SC 1174 35 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022
(vi) N. Rangachari Vs. BSNL (N. Rangachari)13
(vii) S.M.S. Pharmaceuticals Ltd., Vs. Neeta Bhalla and Anr. (S.M.S. Pharmaceuticals)14
(viii) K.K. Ahuja Vs. V.K. Vora and Anr., (K.K.Ahuja)15
(ix) A.R. Radha Krishna Vs. Dasari Deepthi (A.R.Radha Krishna)16
(x) G. Ramesh Vs. Kanike Harish Kumar Ujwal (G. Ramesh)17
(xi) S.V. Muzumdar Vs. Gujarat State Fertilizer Co., Ltd., (S.V.Muzumdar)18
(xi) Standard Chartered Bank Vs. State of Maharashtra(Standard Chartered Bank)19
(xii) OMR Investments LLP Vs. Pardhanani Chatrabhuj Bassarmal (OMR)20
(xiii) Heena Thirumali Sateesh Vs. Minimelt Engineers India (Heena)21 12 (2015) 1 SCC 103 13 (2007) 5 SCC 108 14 (2007) 4 SCC 70 15 (2009) 10 SCC 48 16 (2019) 15 SCC 550 17 (2020) 17 SCC 239 18 (2005) 4 SCC 173 19 (2016) 6 SCC 62 20 W.P.Nos.8225/2022 and 8227/2022 36 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022
(xiv) Arunkumar and Ors. Vs. Sri. Sharanabasaveshwara Trading Co. & Ors. (Arunkumar)22
(xv) Indian Bank Association and Ors. Vs. Union of India and Ors. (Indian Bank)23 (xvi) Vijay Dhanuka Vs. Najima Mamtaj (Vijay Dhanuka)24 (xvii) Baburao Chinchanasur Vs. Anjana A. Shanthaveer(Baburao)25
13. Heard elaborate arguments of both sides and perused the record.
14. Thus, in these two sets of 5 petitions each i.e., 5 writ petitions filed by accused Nos.3 to 6 and 5 criminal petitions filed by accused Nos.8, 9 and 11, the criminal proceedings initiated against them are sought to be quashed 21 Crl.P.No.2340/2022 22 Crl.P.Nos.100169/2021 and Ors.
23(2014) 5 SCC 590 24 (2014) 14 SCC 638 25 (2017) 2 AIR Kant R 371 37 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 on the ground that they being not the Managing Director/Joint Managing Director or signatories to the cheques and not incharge and responsible for day to day management and affairs of accused No.1 - Company, are not vicariously liable for the dishonor of cheques issued for and on its behalf. They have also contended that there are no specific averments that they are incharge and responsible for the day to day management and affairs of accused No.1 - Company and therefore they cannot be prosecuted.
15. On the other hand it is contended on behalf of the complainant that along with the remaining accused, accused Nos.3 to 6, 8, 9 and 11 are not only responsible for the day to day management and affairs of the accused No.1 - Company, but also they form the core management team who were responsible for complainant - company to agree for extending the loan by way of inter-corporate deposit and 38 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 extending the period of repayment from time to time. Consequently, these accused are also equally liable to answer the claim of the complainant.
16. In the light of the specific grounds urged by these accused and the contention taken by the complainant, it is necessary to examine whether any justifiable grounds are made out to grant the reliefs sought in these petitions.
17. Before considering the merits of the case, it is relevant to refer to the decisions relied upon by both learned Senior counsel representing the complainant and accused herein.
(i) In Sunita, on fact, the Hon'ble Supreme Court held that non-executive Directors of Company cannot be held liable for dishonour of cheque as they are in no way responsible for the day to day affairs of the company.
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(ii) In Pooja, Hon'ble Supreme Court held that to make Directors liable there must be specific averments as to how and in what way he/she is responsible. They would be liable only when incharge of and responsible for the conduct of business of company.
(iii) In Ashutosh, which is relied upon by both complainant and accused herein, on facts the Hon'ble Supreme Court held that in the absence of specific averments, the Director is not liable for the dishonor of cheque.
(iv) In SMS Pharmaceuticals which is relied upon by both complainant and accused herein, the Hon'ble Supreme Court held that in order to attract vicarious liability of the Directors and other officials, there must be necessary averments in the complaint that they are incharge and responsible of the company for the conduct of its business.
(v) In K.K.Ahuja which is also relied upon by both complainant and accused herein, Hon'ble 40 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 Supreme Court held that persons/Officers who were incharge of and also responsible for conduct of business of the company are vicariously liable and no specific averments as to the role of each is required.
However, in case of complaint against persons/Officers who were either not responsible for conduct of business of the company or were not incharge of company, there must be specific averments as to their positions, duties and role in the issue of dishonored cheque, disclosing consent, connivance or negligence.
(vi) In National, it was held that in order to make Director responsible for the dishonor of cheque, there must be specific averments that in what manner he was incharge of or was responsible to the accused-company for conduct of business.
(vii) In S.P.Mani, the Hon'ble Supreme Court held that a complainant is supposed to have only general knowledge of persons incharge of company/firms affairs and it is for the Director/Partner to show that he is not concerned with the issuance of cheque and 41 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 for this he requires to lead unimpeachable and incontravertable evidence.
(viii) In Ashutosh also, the Hon'ble Supreme Court held that in the light of specific averments that the High Court was justified in not interfering under Section 482 Cr.P.C and it is for the accused to prove his defence at trial.
(ix) In Sunil Todi also it was held that there was sufficient averments in the complaint to raise a prima facie case against the accused and it is only at the trial that they could take recourse to the proviso to Section 141 and not at the stage of issuance of process.
(x) In Gunmala also the Hon'ble Supreme Court held that the basic requirement under Section 141 is to make specific averment in the complaint that accused Directors, who were neither signatories to the cheques nor Managing Directors/Joint Managing Directors of company at the time of commission of 42 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 offence, were incharge of and responsible to company for conduct of its business.
(xi) In N. Rangachari, the Hon'ble Supreme Court has held that where complaint clearly alleged that the named Directors were incharge of and responsible to the company for the conduct of its business, the High Court rightly refused to quash the proceedings under Section 482 of Cr.P.C.
(xii) In A.R.Radha Krishna, the Hon'ble Supreme Court held that while considering the petition for quashment, the High Court is required to examine whether the averments in the complaint is sufficient or any unimpeachable evidence has been brought on record by the Director to show that he was not incharge of and responsible for conduct of companies business. It was also held that the role of Director of Company is ultimately question of fact and no formula can be fixed for it.
(xiii) In G. Ramesh on facts, the Hon'ble Supreme Court has held that there was sufficient averments 43 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 with regard to description of the nature of partnership firm, the business it carried out and role of the accused in relation to the transaction which took place with the complainant and the term company used in Section 141 includes a partnership firm or association of persons.
(xiv) In S.V.Muzumdar on facts, the Hon'ble Supreme Court has held that the High Court was justified in not accepting the defence which is required to be adjudicated on trial.
(xv) In Standard Chartered Bank, the Hon'ble Supreme Court set aside the order of High Court quashing the criminal proceedings on the ground that in the light of the specific averments in the complaint, the High Court was not justified in interfering under Section 482 of Cr.P.C. (xvi) In Vijay Dhanuka, the Hon'ble Supreme Court has held that the word "shall" used in Section 202 of Cr.P.C cannot always be construed as 44 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 mandatory and the nature of enquiry to be held depends on facts and circumstances of each case.
18. In the light of the ratio in the above decisions, let me examine whether the accused herein have made out any justifiable grounds calling for interference by this Court. At the outset there is no dispute that the complainant has extended loan of Rs.25 crores, 10 crores, 15 crores by way of inter-corporate deposits and the period of repayment is being extended from time to time and several cheques were issued to begin with by way of security and towards repayment on the due date and as and when the repayment period was extended, the accused have replaced the earlier cheques by fresh/new cheques. It is also not in dispute that as on the date of presentation of subject cheques, the amount specified under them was due and the cheques have been dishonored on the ground of "Funds insufficient". In fact in response to the statutory notice, a common reply was 45 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 sent by accused No.2 - V.Mahesh for and on behalf of all the accused, admitting the liability and seeking extension of time to pay the amount due by stating the reasons for the delay. Accused Nos.3 to 6, 8, 9 and 11 have not sent separate reply to the statutory notice disputing their liability and that they were not responsible for the conduct, running and management of day to day affairs, operations and business of accused No.1, including its banking and financial transactions.
19. In fact the statutory notice is nothing but reiterate of the complaint averments wherein the complainant has specifically pleaded that in their capacity as Chairman & Director, Whole Time Director, Directors, Chief Executive Officer, Vice President & Head Business Development and Manager/Company Secretary accused Nos.3 to 6, 8, 9 and 11 are key decision makers, actively and directly involved, 46 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 incharge of and responsible for the conduct, running and management of day to day affairs, operations and business of accused No.1 Company including its Banking and financial transactions and as such, form the core management team. By not sending separate reply within the prescribed time, these accused and having regard to the fact that accused Nos.2 Mahesh Vijayagopal has sent reply on behalf of all the accused admitting the entire transaction and seeking further time to pay the amount due, now it does not lie in the mouth of the present accused that they are not liable and responsible to accused No.1 Company. However, on 12.11.2021, accused No.6 Vijay Kumar Tarimela (T.Vijaya Kumar) has sent reply disputing his liability. It is contrary to the reply dated 30.10.2021 sent by accused No.2 for and on behalf of all the accused.
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20. The complainant has specifically pleaded that not only all the accused persons including the petitioners who have approached this Court, are responsible for day to day conduct of business of accused No.1 Company, but also they are instrumental in persuading the complainant to lend the money by way of inter-corporate deposit and also extending the time for repayment. Having regard to the fact that the alleged offence is committed by accused No.1 Company, the remaining accused are vicariously liable having been incharge of and responsible for its conduct of business.
21. So far as accused No.11 is concerned who is admittedly the Manager cum Company Secretary. Section 2(51) of the Companies Act, 2013 defines the term "Key Managerial Personnel" means
(i) Chief Executive Officer or the Managing Director or Manager
(ii) The Company Secretary.
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(iii) The Whole Time Director.
(iv) The Chief Financial Officer.
(v) Such other officer, not more than one level below
the Directors, who is in whole time employment, designated as Key Managerial Personnel by the Board.
(vi) Such other officer as may be prescribed.
22. Section 2(53) defines the term "Manager" means an individual, who subject to the superintendence control and direction of the Board of Directors, has the management of the whole, or substantially the whole, of the affairs of the Company and includes a Director or any other person occupying the position of a Manager, by whatever name called, whether under a contract of service or not.
23. Section 205 of Companies Act, 2013 deals with the functions of the Company Secretary. 49
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24. The perusal of these provisions makes it amply clear that accused No.11 who is the Manager-Company Secretary is also incharge of and responsible to the Company for the conduct of his business as well as the Company.
25. In the statutory notice as well as the complaint, the complainant has pleaded in unequivocal terms about the role of the accused persons in the conduct of day to day affairs and business and that they are responsible not only for the complainant agreeing to advance loan by way of inter-corporate deposit, but also extending the time for repayment. Having failed to dispute the same in their reply to the legal notice, the present accused cannot claim that they are not answerable to the charge laid in the complaint.
26. In fact, the perusal of the claims made by accused Nos.8, 9 and 11 on the Company website makes it evident that they fit into the description of Section 141 (1) of 50 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 Negotiable Instruments Act as persons incharge of and responsible to the Company for the conduct of its business as well as to the Company. The copy of the covering letter sent through email dated 15.11.2021 by accused No.6 Vijay Kumar Tarimela goes to show that he has forwarded the reply to the statutory notice with copies to accused Nos.1 to 3. The letter dated 12.11.2021 sent by accused No.6 to the counsel for complainant through whom legal notice was issued claiming that he is not involved in day to day affairs of the company etc is clearly an after thought.
27. The documents produced by the complainant on 05.04.2023, viz., document No.1 indicate that in the notice of AGM, accused No.3 is not shown as a Non Executive/independent Director. The document No.2 state that accused No.4 - Rajath Parthasarathi has consented to be appointed as whole-time Director. Document No.3 state that 51 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 he was appointed as whole-time Director w.e.f., 01.05.2017. The document produced by the complainant on 11.04.2023 shows that accused No.3 Comandur Parthasarathi and accused No.4 Rajath Parthasarathi are promoters of the Company.
28. As held in the various decisions relied upon by both parties, it is evident that except in case of Managing Director/Joint Managing Director or signatories to the cheques, to rope in other Directors and other officials under the mischief of Section 138 of N.I.Act, there must be specific pleadings that they are incharge of and responsible to the company for the conduct of the business of the company as well as the company. As discussed earlier, in the present case there are specific averments that all the accused persons are incharge and responsible for the conduct of the business of the company.
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29. Sub-section (2) of Section 141 of N.I.Act provides that notwithstanding anything contained in sub-section (1), where any offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of or is attributable to, any neglect on the part of, any Director, Manager, Secretary or other Officers of the company, such Director, Manager, Secretary or other Officers shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. In fact as per the proviso to Section 141 of N.I.Act, at trial opportunity is available to the accused to prove that the offence is committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence. In the light of the specific provision contained in Section 141 of N.I.Act and in the light of specific allegations also made against the accused who have approached this Court, this 53 CRL.P NO.100153/2023 C/W CRL.P NO.100154/2023 CRL.P NO.100155/2023 CRL.P NO.100156/2023 CRL.P NO.100157/2023 WP NO.105318/2022 WP NO.105328/2022 WP NO.105329/2022 WP NO.105332/2022 WP NO.105335/2022 Court is of the considered opinion that absolutely there is no justification for quashing the criminal proceedings initiated against them. In the result, both set of petitions are liable to be dismissed and accordingly, the following:
ORDER The Crl.P.Nos.100153, 154, 155, 156 and 157/2023 filed under Section 482 Cr.P.C. by accused Nos.8, 9 and 11 and W.P.Nos.105318, 328, 329, 332 and 335/2022 filed by accused Nos.3 to 6 are dismissed.
In view of disposal of the matter, pending interlocutory applications, if any, do not survive for consideration and are disposed of accordingly.
Sd/-
JUDGE RR