High Court Of Delhi
A. K. Sikri
J.T.THANAWALA - Appellant
Versus
STATE OF DELHI - Respondents
Crl. M. 8459 Of 2006
Decided On : 10/11/2006
Negotiable Instruments Act - Exemption from Personal Appearance - Section 138 of the Act - 205, Cr. P. C. - 138 of N. I, Act - 138 of the Negotiable instruments Act, 1881
Fact of the Case:
The case involved a dispute arising from an Asset Purchase Agreement and supplementary agreement between the parties. The petitioner issued 'stop Payment' instructions for post-dated cheques, leading to complaints under Section 138 of the Negotiable Instruments Act, 1881.
Finding of the Court:
The court found that negotiations for settlement were ongoing between the parties, and the complainant was not leading evidence, seeking adjournments. The court held that the petitioners should be granted exemption from personal appearance through their Counsel, considering the nature of the proceedings and the absence of serious offences under the IPC.
Issues: The issues included the grant of exemption from personal appearance, imposition of costs, and the ongoing settlement negotiations between the parties.
Ratio Decidendi: The court emphasized that exemption from personal appearance should be granted when it does not prejudice the progress of the trial, and when the accused is not likely to be put to avoidable hardship and harassment.
Final Decision: The petitions and applications were allowed, setting aside the order declining personal exemption and the imposition of costs. The petitioners were granted exemption from personal appearance through Counsel before the trial court, with the trial court retaining the right to enforce their attendance when necessary.
A. K. SIKRI, J.
( 1 ) THESE petitions arise out of the same transaction and are, therefore, heard and disposed of by this common order. For the sake of convenience, the facts of Crl. M. C. Nos. 4983-87/2006 are mentioned below:
( 2 ) THE respondent No. 2 entered into an Asset Purchase Agreement dated 28. 12. 2002 with the petitioner No. 5 herein, Geep Batteries (India) Pvt. Ltd. , for sale of its business of batteries, torches and flash light under the brand name 'geep'. They also entered into a supplementary agreement dated 19. 9. 2003 in respect of transfer of inventory, etc. Various post-dated cheques were issued to the respondent No. 2 on behalf of the petitionerno. 5. The total consideration involved in these two agreements was approximately Rs. 40 crores out of which Rs. 36 crores has admittedly been paid by the petitioner No. 5. Subsequently, certain disputes arose between the parties and the petitioner No. 5 issued 'stop Payment' instructions to its bankers in respect of the remaining post-dated cheques. On the threats extended by the respondent No. 2 for cancellation of the agreement and disposing of the intellectual property assets, the petitioner No. 5 filed a petition before this court under Section 9 of the Arbitration and Conciliation Act, 1996. Vide judgment and order dated 7. 4. 2005, this Court restrained the respondent No. 2 from disposing of the intellectual property assets, etc. This Court further permitted the respondent no. 2 to withdraw Rs. 1. 5 crores deposited by the petitioner No. 5 in the Court. It may be noted here that the dispute was also referred to an Arbitral Tribunal. Despite the instructions given by the petitioner No. 5 to its bankers for 'stop Payment', the respondent No. 2 kept on presenting the post-dated cheques and began filing complaints under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'the Act' ). On the complaints filed by the respondent No. 2, the learned trial Court issued summons for their personal appearance and imposed costs. Feeling aggrieved by those orders, these petitions are filed with various prayers.
( 3 ) FIRSTLY, learned Counsel for the petitioners submits that the petitioners were granted permanent exemption from personal appearance in cases pending before other Courts below, details whereof are mentioned at para 5 ( Page 6) of the petition, and in certain cases bail was granted and costs were also imposed. It is the contention of learned Counsel for the petitioner that even in the arbitration proceedings neither of the parties filed claim or counter claim till date. It is stated that the matter is being adjourned before the Arbitral Tribunal for the past six dates solely because of the representations made by the parties that their dispute is likely to be settled.
( 4 ) SECONDLY, it is submitted that the learned trial Court completely overlooked the fact that the petitioner Nos. 1 to 4 are permanent residents of Thane, maharasthra and that petitioner Nos. 1 and 3 are senior citizens. It is argued that even if the petitioners were given exemption from their personal appearance, there would be no hindrance to the proceedings before the learned trial Court as the petitioners were being represented by duly authorized Counsel.
( 5 ) THIRDLY, learned Counsel argued that the instant proceedings are under section 138 of the Act and that petitioners have not committed any serious offence for not being granted exemption. It is submitted that out of the total consideration amounting to Rs. 40 crores, admittedly, the petitioner No. 5 had made a payment of Rs. 36 crores to the respondent No. 2. ' Stop Payment' instructions for the balance amount were issued as certain disputes arose and the same are now being adjudicated by the Arbitral Tribunal.
( 6 ) SUMMING up all the contentions, the reliefs prayed for by the petitioners are as under:
(a) setting aside the summoning orders issued against the petitioners; and (b) waiver of the costs imp
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