( 1 ) THESE two criminal petitions have been filed under Section 482 of Cr. PC for quashing the relative proceedings in cc Nos. 727 and 729 of 1998 on the file of the XVII Metropolitan Magistrate, hyderabad in which the petitioners are the accused and respondent No. 1 is the complainant. Accused No. 1 is a company and accused No. 2 is its Managing Director. Accused No. 3 is the sole proprietary firm represented by accused Nos. 4 and 5. The complaint has been filed by the Banaras state Bank Limited, a Scheduled Bank.

( 2 ) THE allegations as stated in the complaint briefly are as follows: accused No. 2 is the Managing Director of accused No. 2 company (petitioners herein) accused No. 1 Company was sanctioned by the complainant Bank credit facilities like cash credit to the bills discounted, cheques discounted etc. , in a limit of Rs. 280 lakhs. The accused No. 1 has withdrawn the said amount and failed to update the accounts. Inspite of demands for payment, the accused did not regularise the accounts. When the complainant was about to take steps for recovery of outstandings, accused No. 2 as Managing director of accused No. 1 deposited with the complainant Bank at their Branch Office situated at Narayanaguda three cheques amounting to Rs. 9,31,140/- in Crl. P No. 4461 of 1999 and four cheques amounting to rs. 30,41,219/ in Crl. P No. 4462 of 1999. The said cheques were issued by accused no. 3 as sole proprietor of his firm towards outstanding to adjust the overdrafts in the account of accursed No. 1. The complainant bank bonafidely believing the representation of accused Nos. 1 and 2 had discounted the aforementioned cheques on 31-3-1998 and the same was credited to the account of accused No. 1 and adjusted towards overdue of liabilities of accused No. 1 with the complainant bank in bill discounted accounts in anticipation that the said cheques will be honoured, on the said representation.

( 3 ) THE said cheques were returned unpaid on 9-4-1998. This was brought to the notice of accused Nos. 1 and 2. Subsequently, the said cheques were represented on 25-5-1998 in State Bank of hyderabad, Bhavanipuram Branch, vijayawada with the Bankers of accused no. 3. The said cheques were again returned unpaid with endorsement funds insufficient . The complainant received intimation of dishonour of said cheques through memorandum dated 3-6-1998. It is stated that accused Nos. l, 2 and 3 had conspired together and issued the cheques in question with a dishonest intention and to cheat the complainant Bank.

( 4 ) THE complaint got issued legal notice dated 10-6-1998 and 5-6-1998 in crl. P Nos. 4461 and 4462 of 1998 respectively bringing to the notice of all the accused about the return of the cheques and calling upon them to arrange payments within 15 days though acknowledgments were not received but as the notices were sent to addresses to A1 to A3 under certificate of posting, they must be deemed to have received the notices. The accused failed to repay the amounts covered by those cheques, it is stated that the accused issued the cheques without any intention to make arrangements to honour the said cheques and they mis-represented the bank and got the said cheques discounted with a view to cheat the complainant bank. Thus, all the accused must be held to have intention to cheat the complainant. With these allegations, the complaint was filed for offences under Sections 138 of the Negotiable Instruments Act and under section 420 of the Indian Penal code.

( 5 ) IT is stated in the petitions that the learned Magistrate on the basis of the above complaints took cognizance of offence under section 138 of the Negotiable Instruments act.

( 6 ) THE learned Counsel for the petitioners Sri A. Ramanarayana seeks quashing of these proceedings on the sole ground that under Section 138 of the negotiable Instruments Act, it is the drawer of the cheque who can be liable for the offence under Section 138 of the Negotiable instruments Act and no