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2023 Supreme(Cal) 286

IN THE HIGH COURT AT CALCUTTA
SHAMPA DUTT (PAUL), J.
Ideal Real Estates Pvt. Ltd. & Others - Appellant
Versus
Aris Capital Pvt. Ltd. - Respondent
CRR. No. 2618 of 2019
Decided On : 27-02-2023

Advocates appeared:
For the Petitioners:Dipanjan Dutt, Surojit Saha, Sonia Nandy, Sonia Ojha, Advocates.

The main legal point established in the judgment is the requirement for specific averments to establish vicarious liability under Section 141 of the Negotiable Instruments Act, and the court's power to quash proceedings upon payment of the cheque amount, even without the consent of the complainant.

Headnote:

Negotiable Instruments Act - Quashing of Proceeding - Section 138 - 141 of the Negotiable Instruments Act, 1981 - The court discussed the application of Section 138 and 141 of the Negotiable Instruments Act, 1981, and the legal principles related to vicarious liability. The court highlighted the requirement for specific averments in the complaint to establish vicarious liability and the power of the court to quash proceedings upon payment of the cheque amount, even in the absence of consent from the complainant.

Fact of the Case:

The petitioners sought to quash the proceeding under Section 138 of the Negotiable Instruments Act, stating their readiness to pay the amount of the dishonoured cheque. The opposite party refused the payment, citing the pending case under the Insolvency and Bankruptcy Code, 2016. The court found the complaint not maintainable due to its timing and discussed the legal principles related to vicarious liability and compounding of the offence.

Finding of the Court:

The court found the complaint not maintainable due to its timing and the absence of specific averments to establish vicarious liability. It also emphasized the power of the court to quash proceedings upon payment of the cheque amount, even without the consent of the complainant.

Issues: The issues revolved around the maintainability of the complaint, vicarious liability under Section 141 of the Negotiable Instruments Act, and the power of the court to quash proceedings.

Ratio Decidendi: The court held that the complaint was not maintainable due to its timing and the absence of specific averments to establish vicarious liability. It also emphasized the power of the court to quash proceedings upon payment of the cheque amount, even without the consent of the complainant.

Final Decision: The court set aside the order rejecting the petitioners' application and remitted the matter to the trial court to dispose of the case in view of the settlement between the parties, ensuring the presence of both sides within one month.

JUDGMENT

The revisional application has been preferred praying for quashing of the proceeding of Case No. C - 5223 of 2018 under Section 138 of the Negotiable Instruments Act, pending before the Court of the Learned Additional Chief Judicial Magistrate, Bidhannagar, North 24 Parganas, and all orders passed therein and an order dated 18.06.2019 passed by the Learned Additional Chief Judicial Magistrate, Bidhannagar, North 24 Parganas in Case No. C – 5223 of 2018, thereby rejecting the application of the petitioners, wherein inter alia the petitioner No. 1 sought to pay the amount of the dishonoured cheque and the petitioners prayed that the impugned proceedings may be closed and the petitioners herein may be discharged.

The petitioner’s case is that the petitioner no. 1 is a company incorporated under the Companies Act, 1956, having its registered office situated at 50, Jawahar Lal Neheru Road, Kolkata – 700 071. The petitioner nos. 2 to 5 are the Directors of the petitioner no. 1 company and the petitioner no. 2 is the father of the petitioner no. 3. By a Board Resolution dated 20.02.2019 Shir Manoj Kumar Srivastava of the petitioner no. 1 company, has been authorized to represent the petitioner no. 1 company.

That Case No. C-5223 of 2018 was registered on the basis of a petition of complaint filed by the opposite party, therein alleging commission of offences by the petitioners punishable under Section 138 of the Negotiable Instruments Act.

The Learned Additional Chief Judicial Magistrate, Bidhannagar, upon receipt of the aforesaid petition of complaint, was pleased to take cognizance of the offence under Section 138 of the Negotiable Instruments Act, 1981, against the accused persons by an order dated 07.12.2018. By an order of even date, the Learned Magistrate took on record the affidavit under Section 145 of the Negotiable Instruments Act, 1881 filed by the representative of the opposite party and examined him on oath, and upon consideration of the materials on record, the Learned Additional Chief Judicial Magistrate, Bidhannagar, was pleased to find a prima facie case made out against the petitioners under Section 138 of the Negotiable Instruments Act, 1981 and was thus pleased to direct issuance of process against the petitioners and fixed on 25.02.2019 for service return and appearance.

That 25.02.2019 was the first date of hearing of the impugned proceeding after service of summons on the petitioners. On the said date, the petitioners appeared before the Court of the Learned Additional Chief Judicial Magistrate, Bidhannagar, in connection with Case No. C- 5223 of 2018, and filed an application, therein stating that inter alia the petitioner no. 1 is ready to pay the amount of the dishonoured cheque (in respect whereof the impugned proceeding has been initiated by the opposite party) and inter alia prayed that, the said amount may be accepted and the impugned proceedings may be closed and the petitioners herein may be discharged. In the said application, a copy to the demand draft prepared by the petitioner no. 1 for satisfaction of the amount of the aforesaid dishonoured cheque was annexed and the particulars thereof was stated, viz. demand draft no. 062776, dated 22.02.2019 drawn on Bank of India, for an amount of Rs. 6,59,096/- (Rupees Six Lakhs Fifty Nine Thousand and Ninety Six only) in favour of the opposite party.

The opposite party filed a Reply-in-Affidavit to the application filed by the petitioners, wherein inter alia the petitioner sought to make payment of the amount of the dishonoured cheque and prayed for closing of the proceedings. The sum and substance of the aforesaid reply filed by the opposite party, is inter alia to the effect that the payment tendered by the petitioner no.1 by way of the said application may be treated as a payment only for the purposes of compounding of the instant case and may not be treated as a waiver of the proceedings initiated by the opposite party against the petitioner no.1 comp

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