Point of law : While quashing the complaint, the High Court did not keep in view that untii the accused discharges his burden the presumption under Section 13S of the N.I.Act will continue to remain. It was held that it was for the accused to rebut the statutory presumption. It was further held that when disputed questions of facts are involved which need to be adjudicated after the parties adduce evidence, the complaint under Section 138 of the N.I. Act ought not to have Deen quashed by the High Court by taking recourse co Section 482 of the Cr.P.C..

ORDER :

1. Petitioner in Crl.P.No.6163/2017 is the husband of petitioner in Crl.P.No.6164/2017. Petitioner in Crl.No.6165/2017 is the daughter of the petitioners in Crl.P.Nos.6163/2017 and 6164/2017.

2. The particulars of the criminal cases out of which these petitions arise are set out in the table below.

3. The petitioners are being prosecuted in the aforesaid criminal cases for the offence punishable under Section 138 of the Negotiable Instruments Act (for short ‘the N.I. Act’) on the basis of the complaints filed by the respondent against them.

4. The respondent is said to be registered company engaged in business of conducting chit transactions. The case of the respondent is as follows:

The petitioners in Crl.P.Nos.6163/2017 and 6164/2017 were the chit subscribers and they received price amount of Rs.37,50,000/-each. The petitioner in Crl.P.No.6165/2017 was the surety for her parents for the said chit transactions and she had executed the required documents. They committed default in paying the subscription amount. The petitioners issued cheques towards payment of the amount due under the said chit subscription transactions. When those cheques were presented for realization, they were dishonoured for want of sufficient funds.

The particulars of the cheques, the date of cheques, amount of cheques, the drawee bank, the date of dishonour and the chit ticket number are as follows:

5. The respondent got issued statutory notices to the petitioners on 10.03.2017 calling upon them to pay the cheque amount or else to face the prosecution. The said notices were returned with the postal endorsement “addressee refused, hence returned to the sender”. Therefore, the respondent filed complaints against the petitioners before the trial Court seeking their prosecution for the offence punishable under Section 138 of the N.I.Act. The learned Magistrate by order dated 28.04.2017 took cognizance of the offence and summoned the petitioners to face the prosecution.

6. The petitioners are seeking quashing of the said proceedings under the above revision petitions on various grounds.

7. Shri M.Veerabhadraiah, learned counsel for the petitioners reiterating the grounds of the petitions seeks to quash the impugned proceedings on the following grounds:

i) The cheques and documents in issue not at all pertained to the chit transaction as claimed in the complaint. They were given for the chit transaction of the year 2009-2010. The dues under those transactions were cleared long back.

ii) Despite such clearance, the cheques and documents were not returned to the petitioners. Misusing those documents, false complaints are filed.

iii) The bank account of the petitioner in Crl.P.No.6165/2017 was non-operative since 2012.

iv) The alleged chit transactions were contrary to Sections 6, 7, 10, 32 and 33 of the Chit Funds Act, 1982 and Section 25 of the Madras Chit Funds Act, 1961, Rules 64 and 65 of the Chit Funds Rules. Therefore, there was no legally recoverable liability. v) For the same liability, respondent has initiated arbitration proceedings. The initiation of the criminal prosecution simultaneously with arbitration proceedings is abuse of the process of the Court.

vi) Despite in