IMPORTANT POINTS
(1) Dishonour of cheque – Offence by Partnership Firm – Merely putting forth resignation or Partners entering into agreement or drafting a deed or/and accepting resignation of a partner of Firm is insufficient for discharging liability of a partner of Firm unless a proper entry having been recorded in office of Registrar of Firms.
(2) Mixed questions of fact and law touching on anvil of disputed questions calling for proof by way of evidence, cannot be gone into and decided in a proceeding under Section 482 Cr.P.C.

JUDGMENT :

AUGUSTINE GEORGE MASIH, J.

1. Present Appeal is challenging the order dated 23.09.2023 passed by the Single Judge of the High Court of Karnataka at Bengaluru, whereby the petition filed under Section 482 of the Code of Criminal Procedure, 1973 (hereinafter “Cr.P.C.”) challenging the proceedings arising out of a complaint filed by the Appellant under Section 200 Cr.P.C. for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter “NI Act”) has been allowed at the behest of Respondent-Accused No. 4.

2. In brief, the facts leading to the filing of the petition before the High Court were that the Appellant had filed a complaint against M/s AVS Constructions - a Partnership Firm (Accused No. 1) and its partners i.e. S. Yuvaraju (Accused No. 2), S. Sundaraiah (Accused No. 3 and S. Srinivasan (Accused No. 4) for dishonouring of twelve cheques of Rs. 50,00,000/- (Rupees Fifty Lakhs) each aggregating Rs. 6,00,00,000/- (Six Crore) towards the refund of sale consideration as issued by accused No. 1-M/s AVS Constructions (hereinafter “Partnership Firm”) being signed by Accused No. 2, the authorized signatory. The cheques, upon presentation, stood dishonoured due to ‘stop payment’ instructions issued by the drawee.

3. After duly serving the Statutory notice upon the Respondent and the other accused, when no amount was received of the dishonoured cheques, a complaint under Section 200 Cr.P.C. for an offence punishable under Section 138 of the NI Act was preferred. After recording the preliminary evidence, summons was issued to the accused on taking cognizance of the offence under Section 138 of the NI Act.

4. At this stage, S. Srinivasan (Accused No. 4) (Respondent herein), preferred a petition under Section 482 Cr.P.C. before the High Court, taking the plea that the proceedings against the Respondent could not be continued as he had ceased to be a partner of the Partnership Firm (Accused No. 1).

4A. It was asserted therein that in reply to the legal notice which was served upon the Accused by the Appellant-Complainant, Respondent-Accused No. 4 brought to the notice of the Appellant the fact that he had retired from the Partnership Firm on 01.04.2015, and hence the proceedings could not be sustained against him.

5. Upon notice being issued, the Appellant appeared and filed his response wherein it was clearly stated that the Statutory mandates as provided under Sections 32, 62 and 63 of the Indian Partnership Act 1932 (hereinafter “Partnership Act”) had not been complied with.

5A. The Appellant obtained a certified copy of Form-A on 27.08.2020, maintained by the Registrar of Firms, which depicted that the Respondent is the partner of Partnership Firm (Accused No. 1). It was only after verifying the said aspect that the legal notice was issued to the Respondent. Allegations were also made that the Respondent, in an attempt to escape his liability, had fabricated a backdated retirement deed in connivance with the other accused and got an entry made in the ledger of the Registrar of Firms on 20.10.2020 that he had ceased to be a partner.

5B. It is asserted that this entry in the Register maintained by the Registrar of Firms is subsequent to the date of issuance of the cheques as also after the issuance of the legal notice.

5C. Section 72 of the Partnership Act has also not been complied with, which mandates and requires a retired partner to publish a public notice in one of the vernacular newspapers circulated in the district where the Firm is located. No such document or publication had been produced, nor any such public notice mentioned to have been published in any newspaper in the reply filed to the legal notice. The mandate of the Statute has not been followed, and in the absence of public notice, the Respondent cannot wriggle out of the liability as a partner of the Firm.

5D. Another aspect which has been asserted is that after cognizance was taken by the Court, an application under Section 239 of the