The petitioner is the sole accused of C.C.No.139 of 2017 on the file of Judicial Magistrate of First Class for Prohibition & Excise, Guntur, where the learned Magistrate has taken cognizance for the offence under Section 138 of the Negotiable Instruments Act (for short the Act) against him on the private complaint of the 2nd respondent for the so called dishonour of 2 cheques for Rs.55,00,000/- (cheque bearing No.657426 for Rs.25,00,000/- and another cheque bearing No.657427 for Rs.30,00,000/- dated 12.03.2017 drawn on SBH, Secunderabad).

2. Before coming to the contentions in the quash petition, as per the complaint averments, said cheques when presented for collection at SBI, Personal Banking Division, Brundavan Gardens Branch, Guntur, on 13.03.2017 same were returned dishonoured on 15.03.2017 and the complainant issued statutory notice dated 16.03.2017 that was returned saying refused and from accrual of cause of action in filing the complaint. The complaint averments further show that the accused promoted a company and registered as unlisted company in ROC with CIN No. U85100 TG 2009 PTC 065599 by name M/s. Kiranmaye Institute of Medical Sciences Private Limited on 23.10.2009 with registered office at Gagan Mahal, Domalguda, Hyderabad, and the accused is the Chairman and Whole Time Director of it and one Dr. K.S. Varaprasad was appointed as Managing Director of it from 22.02.2014 and the business was while running in loss from the beginning, the Managing Director taken over responsibility of running the company from 12.02.2015 and even he tried his best, he could not and on the request of accused Mr. Myneni Sambasivarao and one Dr. N. Kishore, who is one of the additional Directors of the company, he arranged funds from his available source to pay to the bank otherwise the account leads to NPA and in that period the Managing Director Dr. Varaprasad requested the complainant Smt. K. Jyothi to invest amount for the company and the accused also expressed his willingness to take over assets and liabilities of the company along with his associates and it is on the request of Varaprasad and Kishore supra along with their associates, Dr. Rambabu and Dr. Nageswararao accepted to act as mediators and after discussions of all points before mediators supra, there was a compromise-cum-settlement agreement dated 20.03.2016 and there was another modified settlement agreement on 11.01.2017 and at that time the accused issued 2 post dated cheques in compliance to the total sale consideration of Rs.9 crores and as per condition No.3 of the agreement, it is agreed that the transferee will issue cheque for the balance amount of Rs.55 lakhs and hand it over to arbitrators to be passed on to the lenders and one of the arbitrators Dr. Rambabu handed over the said cheques to the complainant one of the lenders and when she presented the cheques, same were returned dishonoured. Thereby the complaint from non-payment despite statutory notice. Along with the complaint, there are 7 documents filed viz., the cheques presented for collection, return memo, statutory notice with postal receipt and returned legal notice as refused and copy of the agreement dated 11.01.2017. The original agreement dated 20.03.2016 not filed with the complaint for whatever the reason.

3. The contentions in the quash petition impugning the said complaint maintainability and the taking of cognizance and its sustainability including as to any giving of cheque much less for any debt or legally enforceable liability concerned in nutshell are that the condition No.3 of the modified agreement dated 11.01.2017 in fact speaks of the transferee to issue cheque for the balance amount of Rs.55 lakhs and hand it over to arbitrators to be passed on to the external lenders and the complainant is not an external lender, for she being one of the additional directors of the company with effect from 06.06.2013 having 21.54% holding in the company and also no other than wife of Dr. K.S. V