ORDER :

1. Petitioner who is arraigned as accused No.3 in C.C.No.26511/2016, which proceedings has been initiated by respondent herein alleging that accused persons have committed an offence punishable under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as ‘NI Act’ for short), is before this Court for quashing of said proceedings.

BRIEF FACTS:

2. Respondent herein filed a complaint under Section 200 Cr.P.C. r/w Sections 138 and 141 of the NI Act alleging it is a company registered under the Companies Act and so also accused No.1 of which accused Nos.2 and 3 are the Directors and actively involved on day-to-day basis for the activities of the accused No.1company. It was further alleged that accused No.4 as a Concern connected with and/or managed by accused Nos.1 to 3 had issued a cheque on behalf of accused No.1 and confirmed by the accused No.1company, which is liable for being punished under Section 138 of the NI Act as the cheque having been issued by it on behalf of accused Nos.1 to 3.

3. At this juncture itself it would be apt and appropriate to notice that one more petition had been filed arraying the present petitioner (i.e., petitioner in Crl.P.No.8031/2017) as petitioner No.3 in Crl.P.No.2772/2017. By filing a memo on 28.02.2017 said petition has been withdrawn by accused Nos.1, 2 and 4. Since accused No.3 had not affixed his signature to the vakalathnama and an affidavit tendering unconditional apology came to be filed by accused No.2, who is the Director of accused No.1 and authorized signatory of accused No.4, same came to be accepted by this Court conditionally by mulcting him with exemplary costs and Crl.P.No.2772/2017 came to be dismissed as withdrawn.

4. I have heard the arguments of Sri.Shashikiran Shetty, learned Senior Counsel appearing along with Ms.Princy Ponnan on behalf of M/s.Murali & Co. for petitioner and Sri.K.Chandrashekara, learned counsel appearing on behalf of Sri.Kiran S. Javali for respondent. Perused the records.

5. It is the contention of Sri.Shashikiran Shetty, learned Senior Counsel appearing for petitioner that averments made in the complaint did not prima facie establish the role and complicity of petitioner and as such there has been no judicious application of mind by the learned Magistrate for issuing process. He would further submit that even according to complainant accused No.4 had issued cheque which is a proprietary Concern, of which petitioner does not have any nexus and petitioner not being authorized signatory nor concerned with the affairs of accused No.4, proceedings ought not to have initiated against him. It is also further contended that petitioner never participated in the affairs of accused No.1company and he was only a non executive Director on record and as such, complaint ought to have been rejected against the petitioner at the threshold without issuing process by the learned Magistrate, inasmuch as, being incharge of affairs of the accused No.1company is sine qua non to make the Directors vicariously liable under Section 141 of NI Act. He would also further contend that even otherwise as on the date of cause of action arose for filing the complaint, petitioner was not the Director and has resigned from the Board of Directors of the company with effect from 02.03.2016, which is also intimated to the jurisdictional Registrar of Companies as accepted by them indicating that petitioner has seized to be the Director with effect from 02.03.2016 and non consideration of these aspects has resulted in great prejudice to the petitioner. In support of his submission he has relied upon the following judgments:

(i) AIR 2008 SC 2255: DCM FINANCIAL SERVICES LTD. v. SAREEN AND ANR.

(ii) (2010) 12 SCC 146: P.J.AGRO TECH LIMITED AND OTHERS v. WATER BASE LIMITED

6. Per contra, Sri.K.Chandrashekara, learned counsel appearing on behalf of Sri.Kiran S. Javali for respondent would submit that at the threshold complaint cannot be quashed, inasmuch as, complainant has speci