Karnataka High Court
Dipesh J Thacker vs M/S Smartsync Innovation Pvt Ltd on 17 August, 2022
Author: M.Nagaprasanna
Bench: M.Nagaprasanna
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CRL.P No. 9600 of 2021
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 17TH DAY OF AUGUST, 2022
BEFORE
THE HON'BLE MR JUSTICE M.NAGAPRASANNA
CRIMINAL PETITION NO. 9600 OF 2021
BETWEEN:
DIPESH J. THACKER
S/O. JITENDRA V. THACKER,
AGED ABOUT 36 YEARS
R/O. FLAT NO. 503,
LAXMI APARTMENT,
SHASTRI NAGAR WEST,
NEAR JAIN MANDIR,
DHANBAD,
JHARKHAND - 826 001
...PETITIONER
(BY SRI. BHARATH KUMAR V., ADVOCATE)
AND:
M/S SMARTSYNC INNOVATION PVT LTD
(COMPANY INCORPORATED UNDER PROVISIONS OF
COMPANIES ACT 2013),
BEARING CIN:074120KA2016PTC085600
HAVING OFFICE AT: NO.15, SAI MAIN,
Digitally signed by 1ST CROSS, J.C. ROAD,
PADMAVATHI B K
Location: HIGH NEAR POORNIMA THEATRE,
COURT OF
KARNATAKA BENGALURU 560027
REPRESENTED BY ITS DIRECTOR,
Mr. ANKIT JAIN,
FATHER NAME: RATAN LAL JAIN,
AGED ABOUT 32 YEARS.
...RESPONDENT
(BY SRI. SUSHANT VENKATESH PAI, ADV.)
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CRL.P No. 9600 of 2021
THIS CRL.P IS FILED U/S.482 CR.P.C PRAYING TO a) QUASH
THE COMPLAINT PREFERRED BY THE RESPONDENT IN MATTER
BEARING P.C.R.NO.53952/2020 AND CURRENTLY RENUMBERED AS
C.C.NO.54549/2021, PENDING ON THE FILE OF XIV ADDL.C.M.M.,
MAYO HALL UNIT, BENGALURU AS AGAINST THE PETITIONER
HEREIN ALONE, WHO IS ARRAIGNED AS ACCUSED NO.3 FOR THE
ALLEGED OFFENCES P/U/S 138 OF N.I. ACT (ANNEXURED VIDE
ANNEXURE-A) b) QUASH THE ENTIRE PROCEEDINGS IN MATTER
BEARING P.C.R.NO.53952/2020 AND CURRENTLY RENUMBERED AS
C.C.NO.54549/2021, PENDING ON THE FILE OF XIV ADDL.C.M.M.,
MAYO HALL UNIT, BENGALURU AS AGAINST THE PETITIONER
HEREIN ALONE, WHEREIN, THE PETITIONER HEREIN IS ARRAIGNED
AS ACCUSED NO.3, FOR THE ALLEGED OFFENCE P/U/S 138 OF N.I.
ACT (ANNEXED VIDE ANNEXURE-B).
THIS CRIMINAL PETITION COMING ON FOR ORDERS THIS
DAY, THE COURT MADE THE FOLLOWING:
ORDER
Heard Sri.Bharath Kumar V., learned counsel appearing for the petitioner and the learned counsel Sri.Sushant Venkatesh Pai, appearing for the respondent.
2. This Court concerning the very same parties, has quashed the proceedings in Crl.P.No.9492/2021 c/w Crl.P.No.3259/2021 disposed on 08.06.2022 qua the petitioner herein was the petitioner in those petitions as well on the following reasons:
" 3. Petitioner is accused No.3. Petitioner at the relevant point in time was a Director of accused -3- CRL.P No. 9600 of 2021 No.1-M/s.Wardwiz India Solutions Pvt. Ltd., ('Company' for short) incorporated under the Companies Act, 2013 and accused No.2 is also the Director of the Company. The Company and the complainant entered into an agreement for providing of services with regard to installation of antivirus to which the petitioner is the signatory in the capacity of being a Director, at the time when an agreement was entered into between the parties. The said agreement which bears the signature of the petitioner as its Director was entered into on 17.08.2018. The petitioner after the agreement so entered submits his resignation as Director of the company on 04.7.2019 and the same is accepted. The documents before the Registrar of Companies depicts that the petitioner has resigned from the post of Director with effect from 04.07.2019.
4. The allegation now is, after the resignation of the petitioner as a Director of the Company, accused No.1 has issued certain cheques which when presented have been dishonoured with an endorsement "payment stopped by drawer". The complainant on the cheques being returned, issued a notice to the Company and to the petitioner in terms of the Act. The petitioner did not reply to -4- CRL.P No. 9600 of 2021 the said notice while the other Director replied without indicating that the petitioner had resigned from the Directorship of the Company. The complainant initiates proceedings under Section 138 of the N.I.Act arraigning the Directors of the Company as accused. The petitioner is accused No.3. At that juncture, the petitioner knocks the doors of this Court in the subject petition.
5. Learned counsel appearing for the petitioner would contend that the petitioner having resigned as Director of the Company cannot be hauled into these proceedings as he is neither the signatory to the cheque nor was present in the deliberations prior to issuance of the cheque, as he had resigned and would place reliance upon the judgment of the Apex Court in the case of HARSHENDRA KUMAR .D. v. REBATILATA KOLEY AND OTHERS reported in (2011)3 SCC 351 to contend that the proceedings under the N.I.Act against the Ex-Director cannot be maintained.
6. On the other hand, learned counsel appearing for the respondent would vehemently refute these submissions to contend that the petitioner is the signatory to the agreement that was entered into between the complainant and the Company wherein he had represented the -5- CRL.P No. 9600 of 2021 Company. The cheques are issued, albeit, by the other Director, but they are in furtherance of the agreement to which the petitioner was also a privy as he had signed the documents. The petitioner did not even reply to the notices that were sent when the cheques were dishonoured on account of 'stop payment' when they were presented and would submit that the resignation of the petitioner or otherwise is a matter of trial in which the petitioner will have to come out clean, as it is not a case that the petitioner was not at all aware of the transaction that has taken place between the Company and the complainant. He would place reliance upon the following judgments of the Apex Court:
1. SUNIL TODI v. STATE OF GUJARAJ - 2021 SCC ONLINE SC 1174;
2. N.RANGACHARI v. BHARAT SANCHAR NIGAM LTD. - (2007)5 SCC 108;
3. A.S.PATTABIRAMAN v. SHOBHA S. HALDI -
2004 SCC ONLINE KAR 575;
4. PRUDENTIAL ENGINEERS/BUILDERS & DEVELOPERS, BANGALORE v. KUSKOOR BHARATH RAM - 2003 SCC ONLINE KAR 625.
7. I have given my anxious consideration to the submissions made by the learned counsel for the respective parties and perused the material on record.
-6- CRL.P No. 9600 of 20218. The afore-narrated facts are not in dispute. The petitioner in the capacity of being a Director of the Company M/s.Wardwiz India Solutions Pvt. Ltd., had signed the agreement that was entered into between accused No.1 and the respondent- complainant. The agreement was signed on 17.8.2018. Long after execution of the agreement to which the petitioner was signatory, the petitioner tenders his resignation as Director of the company with effect from 04.07.2019. This is accepted and notified in Form No.DIR-11 as per the proviso to Section 168(1) of the Companies Act, 2013 and Rule 16 of the Companies (Appointment and Qualification of Directors) Rules, 2014 and in DIR- 12 as per the proviso to Sections 7(1)(c), 168 and 170(2) of the Companies Act, 2013 and Rule 17 of the Companies (Incorporation) Rules 2014 and 8, 15, 18 of the Companies (Appointment and Qualification of Directors) Rules, 2014. Therefore, Form Nos.DIR-11 and 12 are public documents. The said documents would indicate the date of filing of resignation with the Company to be 4.7.2019 and from that date, the petitioner ceased to be a Director of M/s.Wardwiz India Solutions Pvt. Ltd., -7- CRL.P No. 9600 of 2021
9. The admitted fact is, the cheques were issued in the month of December 2019 and January 2020 not by the petitioner but by accused No.2, the other Director of the Company representing accused No.1/Company of which accused No.2 is the signatory to the instruments involved in the transaction. Therefore, it becomes an admitted fact that the petitioner was not a Director of the Company when the cheques were issued. Therefore, he was an Ex-Director of the Company. The notices though were issued, the petitioner did not reply to the notices, ostensibly on the ground that he has nothing to do with the Company after his resignation. This cannot become a ground for the complainant to initiate proceedings dragging the petitioner, notwithstanding him becoming an Ex-Director on the date of the transaction.
10. The judgments relied on by the learned counsel appearing for the respondent were all concerning the role of Directors in a transaction between the two parties where the Directors were involved in the act of issuance of those cheques therein. The role of an Ex-Director though in some terms is held in the case of N.RANGACHARI, much water has flown after the said judgment of the Apex Court, as the Apex Court in the subsequent judgment in the case of HARSHENDRA KUMAR .D. -8- CRL.P No. 9600 of 2021 v. REBATILATA KOLEY AND OTHERS1 has clearly held that an Ex-Director cannot be hauled into criminal proceedings, particularly, for a proceeding under Section 138 of the N.I.Act. The Apex Court holds as follows:
"25. In our judgment, the above observations cannot be read to mean that in a criminal case where trial is yet to take place and the matter is at the stage of issuance of summons or taking cognizance, materials relied upon by the accused which are in the nature of public documents or the materials which are beyond suspicion or doubt, in no circumstance, can be looked into by the High Court in exercise of its jurisdiction under Section 482 or for that matter in exercise of revisional jurisdiction under Section 397 of the Code. It is fairly settled now that while exercising inherent jurisdiction under Section 482 or revisional jurisdiction under Section 397 of the Code in a case where complaint is sought to be quashed, it is not proper for the High Court to consider the defence of the accused or embark upon an enquiry in respect of merits of the accusations. However, in an appropriate case, if on the face of the documents
-- which are beyond suspicion or doubt -- placed by the accused, the accusations against him cannot stand, it would be travesty of justice if the 1 (2011)3 SCC 351 -9- CRL.P No. 9600 of 2021 accused is relegated to trial and he is asked to prove his defence before the trial court. In such a matter, for promotion of justice or to prevent injustice or abuse of process, the High Court may look into the materials which have significant bearing on the matter at prima facie stage.
26. Criminal prosecution is a serious matter; it affects the liberty of a person. No greater damage can be done to the reputation of a person than dragging him in a criminal case. In our opinion, the High Court fell into grave error in not taking into consideration the uncontroverted documents relating to the appellant's resignation from the post of Director of the Company. Had these documents been considered by the High Court, it would have been apparent that the appellant has resigned much before the cheques were issued by the Company.
27. As noticed above, the appellant resigned from the post of Director on 2-3-2004. The dishonoured cheques were issued by the Company on 30-4- 2004 i.e. much after the appellant had resigned from the post of Director of the Company. The acceptance of the appellant's resignation is duly reflected in the Resolution dated 2-3-2004. Then in the prescribed form (Form 32), the Company informed to the Registrar of Companies on 4-3- 2004 about the appellant's resignation. It is not
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CRL.P No. 9600 of 2021even the case of the complainants that the dishonoured cheques were issued by the appellant. These facts leave no manner of doubt that on the date the offence was committed by the Company, the appellant was not the Director; he had nothing to do with the affairs of the Company. In this view of the matter, if the criminal complaints are allowed to proceed against the appellant, it would result in gross injustice to the appellant and tantamount to an abuse of process of the court."
(Emphasis supplied)
11. In the teeth of the admitted facts, the submission of the learned counsel appearing for the respondent that the petitioner will have to come out clean in a trial, after him producing the documents with regard to resignation is unacceptable, as those documents without doubt are public documents, which would clearly demonstrate that the petitioner has resigned on 4.7.2019. Therefore, those documents being unimpeachable and of that sterling quality as is held by the Apex Court in several judgments, the power under Section 482 of the Cr.P.C. is to be exercised in the case at hand and the proceedings against the petitioner are to be obliterated.
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CRL.P No. 9600 of 202112. For the aforesaid reasons, I pass the following:
ORDER
(i) Criminal Petition is allowed.
(ii) Impugned proceedings in C.C.No.51550/2021 pending on the file of the Hon'ble XIV Additional Chief Metropolitan Magistrate, Mayohall Unit, Bengaluru stand quashed qua petitioner-accused No.3.
It is made clear that none of the observations made herein would bind or influence the proceedings pending against accused Nos.1 and 2.
IN CRL.P.No.3259/2021:
The petitioner is before this Court calling in question the proceedings in C.C.No.132/2021 registered for offences punishable under Section 138 of the Negotiable Instruments Act.
For the reasons rendered in the companion petition Crl.P.No.9492/2021, this Criminal Petition is allowed and the proceedings in C.C.No.132/2021 pending on the file of XXV Additional Chief Metropolitan Magistrate, Bengaluru stand quashed qua the petitioner."
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CRL.P No. 9600 of 20213. Since the issue remains the same, albeit the crime being different, I deem it appropriate to obliterate the present proceedings following the order passed by this Court (Supra).
4. For the aforesaid reasons, the following:
ORDER i. Criminal Petition is allowed. ii. The compliant bearing P.C.R.No.53952/2020 and the proceedings in C.C.No.54549/2021 pending on the file of the XIV Additional Chief Metropolitan Magistrate, Mayo Hall Unit, Bengaluru, stand quashed.
Sd/-
JUDGE KG