Punjab-Haryana High Court
Dr. Sumita Singh Wife Of Dr. Amardeep ... vs Haqiqat Singh Mangat Son Of Sh. Bagh ... on 18 February, 2010
Criminal Misc. No. M-35458 of 2007 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
Criminal Misc. No. M-35458 of 2007
Date of Decision: 18.02.2010
1. Dr. Sumita Singh wife of Dr. Amardeep Singh, r/o 3297,
Gurdev Nagar, Ludhiana.
2. Dr. Amardeep Singh son of Sh. Mohinder Singh, r/o
3297, Gurdev Nagar, Ludhiana.
... Petitioners
Versus
Haqiqat Singh Mangat son of Sh. Bagh Singh, r/o 305/1,
Guru Nanak Pura, Civil Lines, Ludhiana.
...Respondent
CORAM: HON'BLE MR. JUSTICE SHAM SUNDER
Present: Mr. Rakesh Bhatia, Advocate,
for the petitioners.
Mr. H.S. Dhindsa, Advocate,
for the complainant/respondent.
SHAM SUNDER, J.
This petition under Section 482 Cr.P.C., for quashing the complaint dated 16.08.04 (Annexure P1), the summoning order dated 16.10.04 (Annexure P2), passed in the complaint, under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter to be called as the 'Act' only), titled as, 'Haqiqat Singh Mangat Vs. Sigma Diagnostics Ltd., pending in the Court of Judicial Magistrate 1st Class, Ludhiana, and the subsequent proceedings, arising out of the same, has been filed by the petitioners.
Criminal Misc. No. M-35458 of 2007 2
2. The facts, in brief, are that, the petitioners, being the Director and Managing Director respectively, of M/s Sigma Diagnostics Ltd., took a loan of Rs. 5 lacs, by way of cheque, on 17.11.03, and Rs. 5 lacs, in cash, on 24.12.03 from the Complainant/respondent. They also agreed to pay interest @18/- per annum. The accused(now petitioners) in discharge of their legally enforceable liability, issued cheque No. 440378, dated 18.01.04, amounting to Rs. 5 lacs, drawn on Punjab and Sind Bank, Haibowal Kalan, Ludhiana, in favour of the complainant/respondent, assuring that the same would be encashed, on presentation. However, when the same, was presented, on 20.01.04, by the complainant, before his Banker, it was received back dishonoured, with the remarks 'Funds Insufficient'. As such, the accused, played fraud with the complainant, causing wrongful gain, to themselves, and wrongful loss to him. The accused, issued the aforesaid cheque, knowing fully well, that they were not having sufficient funds, in their account. The complainant brought the aforesaid fact to the notice of the petitioners, who felt sorry and requested him, to present the cheque, in question, again, in the month of April, 2004. However, when the same was presented, in the last week of April, 2004, for its encashment, it was dishonoured, on 28.04.04. The matter was again brought, to the notice of the petitioners, who again felt sorry and only returned a sum of Rs. 5 lacs, to the complainant, by way of banker cheque, out of the principal amount of Rs. 10 lacs, and assured that the same, on presentation, in the second week of June, Criminal Misc. No. M-35458 of 2007 3 2004, shall be encashed. However, when the same, was presented, it was dishonoured, on 11.06.04, with the remarks "Insufficient Funds." After the dishonour of the cheque, in question, a legal notice, dated 07.07.04, was issued, by the complainant, to the accused, through registered AD, calling upon them, to make the payment of loan amount within a period of 15 days, from the date of receipt of the same. However, even after receiving the legal notice, the accused, did not make the payment of amount of the dishonoured. Ultimately, a complaint under Section 138 of the Act, was filed.
3. I have heard the Counsel for the parties, and, have gone through the documents, on record, carefully.
4. The Counsel for the petitioners, submitted that the respondent advanced a friendly loan, to the company, owned by Dr. Amardeep Singh, petitioner No. 2, in the sum of Rs. 5 lacs, in the month of November, 2003. He further submitted that the son of the respondent Dr. Ajay Pal Singh was a friend of petitioner no. 2 and he approached his father for getting a loan, and, in lieu of friendly loan petitioner no. 2 secured his amount by way of cheque bearing no. 440378 dated 18.01.2004 for a sum of Rs. 5 lacs and when the said amount was returned in the month of February and March 2004, petitioner no. 2 requested for the return of security cheque , but he did not return on one pretext or the other. He further submitted that the cheque, was not issued, by the petitioners, with a view to discharge the legally enforceable liability. He further submitted that, Criminal Misc. No. M-35458 of 2007 4 as such, no offence, punishable under Section 138 of the Act, was committed by the petitioners. He further submitted that, even in the complaint, nothing was mentioned, as to whether, the petitioners, were incharge of and responsible, to the company, for the conduct of its day to day business, and, as such, they could not be summoned, for the offence, punishable under Section 138 of the Act. He further submitted that continuation of the complaint and the summoning order, would, thus, amount to sheer abuse of the process of the Court, and are liable to be quashed.
5. On the other hand, the Counsel for the respondent, submitted that the cheque, in the sum of Rs. 5 lacs, was issued, by Dr. Amardeep Singh, in the discharge of his legally enforceable liability. He further submitted that the cheque, was not given by way of security. He further submitted that, in the complaint, in para No. 3, it was, in clear-cut terms stated, that accused No. 2 and 3 (petitioners), being Director and Managing Director of M/s Sigma Diagnostics Ltd., were managing and looking after the day to day business of accused No. 1, and the cheque, in question, was issued, by accused No. 2, in consultation with accused No. 3 (petitioners), on behalf of M/s Sigma Diagnostics Ltd.. He further submitted that, since there were specific averments, in the complaint, that the petitioners, were incharge of and responsible, to the Company, for the conduct of its day to day business, they were liable for the offence, punishable under Section 138 of the Act.
6. After giving my thoughtful consideration, to the rival Criminal Misc. No. M-35458 of 2007 5 contentions, raised by the Counsel for the parties, in my considered opinion, the petition, is liable to be dismissed, for the reasons, to be recorded, hereinafter. It is trite that jurisdiction, under Section 482 Cr.P.C., which saves the inherent power of the High Court, to make such orders, as may be necessary, to prevent the abuse of the process of any Court, or otherwise, to secure the ends of justice, has to be exercised sparingly, and with circumspection. In exercising that jurisdiction, the High Court would not embark upon an enquiry, whether the allegations, in the complaint, are likely to be established by the evidence or not. That is the function of the trial Magistrate, when the evidence comes before him. Though, it is neither possible, nor advisable to lay down any inflexible rules, to regulate such jurisdiction, one thing, however, appears clear that it is that when the High Court is called upon to exercise this jurisdiction, to quash a proceeding, at the stage of the Magistrate, taking cognizance of an offence, it is guided by the allegations, whether those allegations set out, in the complaint, or the charge-sheet, do not, in law constitute, or spell out any offence, and that resort to criminal proceedings, would, in the circumstances, amount to an abuse of the process of the Court, or not. Even in State of Haryana and others Vs. Ch. Bhajan Lal and others AIR 1992 Supreme Court 604(1), it was held that in the following category of cases, the High Court, in exercise of its powers, under Article 226 or under Section 482 of the Code of Criminal Procedure, may interfere, in the proceedings, relating to cognizable offences, to prevent the abuse of the process of any Criminal Misc. No. M-35458 of 2007 6 Court, or otherwise, to secure the ends of justice. However, this power should be exercised sparingly, and that too, in the rarest of rare cases:
1) Where the allegations made in the First Information Report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence, or make out a case against the accused.
2) Where the allegations in the First Information Report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.
3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same, do not disclose the commission of any offence, and make out a case against the accused.
4) Where the allegations in the FIR do not constitute a cognizable offence, but constitute only a non-cognizable offence, no investigation Criminal Misc. No. M-35458 of 2007 7 is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.
5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.
6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party.
7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused, and with a view to spite him due to private and personal grudge.
Where allegtions in the complaint did constitute a cognizable offence justifying Criminal Misc. No. M-35458 of 2007 8 registration of a case and investigation thereon and did not fall in any of the categories of cases, enumerated above, calling for exercise of extraordinary powers or inherent powers, quashing of FIR was not justified.
7. Now adverting to the facts of the instant case, it may be stated here, that the bare perusal of the allegations, contained in the complaint, prima-facie, disclose the commission of offence, punishable under Section 138 of the Act. At the time of exercising the power, under Section 482 Cr.P.C., the Court is only required to go through the allegations, contained in the complaint. If after perusal of the allegations, contained in the complaint, the Court comes to the conclusion that an offence, was made out, then the complaint cannot be quashed. Admittedly, M/s Sigma Diagnostics Ltd., is a private limited company. There is also, no dispute, that petitioners No. 1 and 2, are the Director and Managing Director respectively of the same. The cheque, in question, in the sum of Rs. 5 lacs, was issued, on behalf of the Company. The petitioners, being the Director and Managing Director of the company, were incharge of and responsible to the Company, for the conduct of its business. They were, thus, vicariously liable for the commission of offence, under Section 138 of the Act. In Paresh P. Rajda Vs. State of Maharashtra, 2008(2), Apex Court Judgements, 413 (SC), the principle of law, laid down, was to the effect, that the complaint, Criminal Misc. No. M-35458 of 2007 9 could not be quashed merely, on the ground, that there was no averment therein, that the Chairman, Joint Managing Director, and the Directors, were incharge of and responsible to the company for the conduct of its business. In Malwa Cotton & Spinning Mills Ltd. Vs. Virsa Singh Sidhu & others, 2008(3), Apex Court Judgements, 65 (SC), it was held, that an allegation, in the complaint, that the named accused, were Directors of the Company in 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. 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. Similar principle of law, was laid down, in N. Rangachari Vs. Bharat Sanchar Nigam Limited, 2007(2), Apex Court Judgements, 540 (SC), and Atul Kohli and another Vs. State of Punjab and another, 2006(4), Criminal Court Cases, 452 (P&H). Admittedly, the cheque, in the sum of Rs. 5 lacs, was issued, by M/s Sigma Diagnostics Ltd., Ludhiana. When the same, was presented, it was dishonoured. After receipt of intimation of dishonour, a legal notice, was given, to the petitioners, and when the amount, was not paid, complaint, under Section 138 of the Act, was filed. The offence, punishable under Section 138 of the Act, was, thus, complete. The petitioners, therefore, could not say, that they being only the Director and Managing Director of the company, could not be summoned, as accused, to face trial. Even the probable defence which may be available to the petitioner that the cheque was Criminal Misc. No. M-35458 of 2007 10 allegedly given by way of security being a disputed question of fact cannot be adjudicated upon in these proceedings which are summary in nature. The submission of the Counsel for the petitioners, being without merit, must fail, and the same stands rejected.
8. For the reasons recorded above, Criminal Misc. No. M-35458 of 2007, being devoid of merit, must fail, and the same stands dismissed. Any observation, made in this order, shall not be taken, as an expression of mind, on merits of the case.
9. Registry is directed, to comply with the order, by sending the copies thereof, to the Courts concerned.
18.02.2010 (SHAM SUNDER) Amodh JUDGE