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2018 Supreme(AP) 935

IN THE HIGH COURT OF JUDICATURE AT HYDERABAD FOR THE STATE OF TELANGANA AND THE STATE OF ANDHRA PRADESH
T. RAJANI, J.
A.L. Uday Shankar Harishitha and Ors. - Appellant
Versus
State of A.P. and Ors. - Respondent
Criminal Petition Nos. 8268 and 8881 of 2013
Decided On : 29-11-2018

Advocates:
Advocate Appeared:
For the Appellant : K. Venumadhav
For the Respondent: Public Prosecutor and V. Roopesh Kumar Reddy

Headnote:

Negotiable Instruments Act – Section 138, 483, 397, 482 – Petitions filed seeking quash of proceedings against petitioners, who are A3 and A4 respectively, petitioners counsel is tow fold: firstly, he contends that averment made in complaint not explain nature of duty that petitioners have performing in company and secondly, he contends that petitioners submitted resignation prior to date of issuance of cheque and they no longer continue to be directors of A1 company – Held, When investigation not completed, it impermissible for High Court to look into materials, acceptability of which is essentially matter for trial and while exercising jurisdiction it is not permissible for the Court to act as if it trial Judge, observations cannot read to mean that in criminal case where trial is yet to take place and matter is at stage of issuance of summons or taking cognizance, materials relied upon by accused which in nature of public documents or materials which beyond suspicion or doubt, in no circumstances, can looked into by High Court in exercise of its jurisdiction or for that matter in exercise of revisional jurisdiction under Section 397 of Code, High Court fell into grave error in not taking into consideration uncontroverted documents relating to appellants resignation from post of Director of company and these documents considered by High court, it have apparent that appellant resigned much before cheques issued by company –Petitions are allowed.(Para 10, 11)

Facts of the case:

Petitions filed seeking quash of proceedings against petitioners, who are A3 and A4 respectively, petitioners counsel is tow fold: firstly, he contends that averment made in complaint not explain nature of duty that petitioners have performing in company and secondly, he contends that petitioners submitted resignation prior to date of issuance of cheque and they no longer continue to be directors of A1 company.

Findings of the court:

When investigation not completed, it impermissible for High Court to look into materials, acceptability of which is essentially matter for trial and while exercising jurisdiction it is not permissible for the Court to act as if it trial Judge, observations cannot read to mean that in criminal case where trial is yet to take place and matter is at stage of issuance of summons or taking cognizance, materials relied upon by accused which in nature of public documents or materials which beyond suspicion or doubt, in no circumstances, can looked into by High Court in exercise of its jurisdiction or for that matter in exercise of revisional jurisdiction under Section 397 of Code, High Court fell into grave error in not taking into consideration uncontroverted documents relating to appellants resignation from post of Director of company and these documents considered by High court, it have apparent that appellant resigned much before cheques issued by company.

Result: Petitions are allowed.

ORDER :

T. RAJANI, J.

1. Since the petitioners herein are arrayed as A3 and A4 respectively in the same criminal proceedings and the cause of action being the same, the criminal petitions are disposed of by this common order.

2. The criminal petitions are filed seeking quash of proceedings against the petitioners, who are A3 and A4 respectively, in CC. No. 407 of 2013 on the file of the V Additional Chief Metropolitan Magistrate - cum - Juvenile Court, Nampally. The offences alleged are under Section 138 of the Negotiable Instruments Act.

3. Heard the counsel for the petitioners, counsel for the second respondent and the learned Public Prosecutor, appearing for the first respondent.

4. The complaint is filed against the petitioners and others under Section 138 of the Negotiable Instruments Act. The petitioners are shown as Directors of A1 company, the Managing Director of which issued the cheque.

5. The argument of the petitioners counsel is two fold: firstly, he contends that the averment made in the complaint does not explain the nature of the duty that the petitioners have been performing in the company and secondly, he contends that the petitioners have submitted resignation prior to the date of issuance of cheque and they no longer continue to be the directors of A1 company.

6. As regards the first contention, the counsel for the second respondent submits that the averment is nevertheless made in the petition that A3 and A4, who are the Directors of A1 company, are actively involved in the day-to-day affairs of the company of A1. He further contends that the said averment would suffice for continuing the prosecution against the petitioners. He relies on a decision of the Supreme Court in ANITA MALHOTRA v. APPAREL EXPORT PROMOTION COUNCIL 2012 (1) ALD (CRL.) 645 (SC) which is to the effect that the averment that the petitioners were in charge of the day-to-day affairs has to be made.

7. There is no quarrel with the said proposition. Even in the decision in GUNMALA SALES PRIVATE LTD. v. ANU MEHTA [CRLA. No. 2228 of 2014 dated 17.10.2014], relied upon by the counsel for the petitioners, the said proposition was upheld. The Supreme Court while upholding the reiterated principle held that a complaint cannot be quashed merely on the ground that apart from the basic averment no particulars are given in the complaint about the role of the petitioner because ordinarily the basic averment would be sufficient to send him to trial and it could be argued that his further role could be brought out in the trial, also held that the material produced by the accused can be analysed to see whether the averment in the complaint is true or false. The decision of the Supreme Court in SMS PHARMACEUTICALS LTD v. NEETA BHALLA 2005 LAWSUIT (SC) 1265 is to the effect that it is necessary to specifically aver in a complaint under Section 141 of the Negotiable Instruments Act that at the time the offence was committed, the person accused was in charge of, responsible for the conduct of the business of the company. As, such averment is nevertheless made in the complaint, the said decision need not be considered.

8. But the decision in GUNMALA SALES PRIVATE LTD. (supra) would held the petitioners, as the certified copy of Form 32, is filed by the petitioners to prove that their resignation was accepted in pursuance of a resolution passed by the company on 01.10.2012.

9. The counsel for the second respondent opposed the reliance sought to be placed on the said certificate, on the ground that the said fact has to be subjected to trial and cannot on its face value be accepted.

10. In GUNMALA SALES PRIVATE LTD. (supra) the Supreme Court referred to its earlier decision in HARSHENDRA KUMAR D v. REBATILATA KOLEY [(2011) 3 SCC 351] in which also a similar issue came up for consideration. There was an averment in the complaint therein that the appellant was responsible for the day-to-day affairs of the company, despite the said averment the Court quashed the complaint ta

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