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IN THE HIGH COURT OF DELHI AT NEW DELHI
Rajnish Bhatnagar, J.
Hiren Mahendra Botadra & Anr. – Appellants
Versus
Nlmk India Service Centre Pvt. Ltd. – Respondent
Crl.M.C. 5216 of 2023
Decided On : 28-07-2023
Section 138 of Negotiable Instruments Act - Quashing of proceedings - [Negotiable Instruments Act, 1881, Section 138] - The court discussed the legal provisions of Section 138 of the Negotiable Instruments Act, 1881 and emphasized the obligation of the accused to take notice under Section 251 of Cr.P.C. and enter his plea of defence before the concerned Metropolitan Magistrate's Court. The court highlighted that the accused alone has the responsibility of spelling out his defense to the court and proving it. The court also emphasized the provisions of summary trial under Sections 143 and 145 of the N.I. Act, enabling the accused to lead defense evidence by way of affidavits and documents.
Fact of the Case:
The complainant filed a complaint under Section 138 of Negotiable Instruments Act, 1881 against the petitioners for non-payment against a dishonored cheque. The petitioners filed a petition under Section 482 Cr.P.C. seeking to quash the order and proceedings before the Metropolitan Magistrate.
Finding of the Court:
The court found that the petitioners' contention that the complaint was false and frivolous was not supported by evidence. The court emphasized the obligation of the accused to present their defense and prove it, and dismissed the petition for being devoid of any merits.
Issues: The issues included the validity of the complaint under Section 138 of the N.I. Act, the petitioners' liability as directors, and the obligation of the accused to present their defense.
Ratio Decidendi: The accused has the responsibility of spelling out their defense to the court and proving it. The provisions of summary trial under Sections 143 and 145 of the N.I. Act enable the accused to lead defense evidence by way of affidavits and documents.
Final Decision: The present petition along with pending application is dismissed being devoid of any merits.
JUDGMENT
Rajnish Bhatnagar, J. (Oral)
CRL.M.A. 19821/2023 (exemption)
Exemption allowed subject to all just exceptions.
The application stands disposed of.
CRL.M.C. 5216/2023 & CRL.M.A. 19820/2023
1. The present petition under Section 482 Cr.P.C has been filed by the petitioners seeking the following reliefs:
"a. Quash the order dated March 17, 2021 passed by the Ld. Metropolitan Magistrate (NI Act), Saket Court (South), New Delhi ("MM"), in C.C. NI ACT 270/2020 titled "M/s. NLMK India Service Centre Pvt. Ltd. v. M/s. Nexus Electro Steel Pvt. Ltd. & Ors.", qua the Petitioners/Accused 3 & 4, and all consequential proceedings arising therefrom;
b. Quash the proceedings pending before the Ld. Metropolitan Magistrate (NI Act), Saket Court (South), New Delhi ("MM"), in C.C. NI ACT 270/2020 titled "M/s. NLMK India Service Centre Pvt. Ltd. v. M/s. Nexus Electro Steel Pvt. Ltd. & Ors." qua the Petitioners/Accused 3 & 4;
c. Pass any other or further orders which this Hon'ble Court deems fit and proper in the facts and circumstances of the present case, in the interests of justice."
2. The complainant (respondent herein) had instituted a complaint under Section 138 of Negotiable Instruments Act, 1881 against the present petitioners in respect of non-payment against one dishonoured cheque for the amount of Rs.99,14,301/- issued by petitioners in favour of the respondent.
3. The Metropolitan Magistrate vide order dated 17.03.2021 in Complaint Case no. 270/2020 issued summons under Section 138 N.I. Act requiring the petitioners to attend the Court.
4. The petitioners feeling aggrieved, filed the present petition invoking jurisdiction of this Court U/s 482 Cr.P.C.
5. It has been mainly argued by the Ld. Counsel for the petitioners that the complaint filed by the complainant under Section 138 of Negotiable Instruments Act, 1881 against the petitioners is false and frivolous. He submitted that the petitioners cannot be held to be vicariously liable for the alleged offence as they were only non-executive directors of M/s Nexus Electro Steel Ltd. at the relevant time when the offence was committed and they were neither in charge of the conduct of business nor the day to day affairs of accused company. He further submitted that the complainant has failed to bring on record any evidence to suggest that the petitioners had knowledge regarding the return of the said cheques. Furthermore, Ld. counsel for the petitioners submitted that no specific roles have been assigned to the present petitioners and the petitioners were neither signatories to the cheque or to the Settlement Agreement under which the cheque was purportedly issued and therefore, it cannot be assumed that there exists a legally enforceable debt or liability against the petitioners.
6. Ld. Counsel for the petitioners in support of his contentions has placed reliance on the following judgments:
7. On the contrary, Learned counsel for the respondent has pointed out that the cheque in question was presented within its validity period, the complainant got the intimation of cheque being dishonored vide return memo dated 07.04.2020 and subsequently, the legal notice was issued on 23.05.2020. He submitted that the petitioners still failed to make any payment and knowing well that the cheque will not be honoured by the drawee bank,
The accused has the responsibility of spelling out their defense to the court and proving it.
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The technical nature of the offence under Section 138 of the N.I. act, the inbuilt defences available to the accused, and the summary trial procedure were central legal principles established in the ....
The accused has the responsibility to present a defense before the Metropolitan Magistrate's Court and follow the due procedure of law as provided under the N.I. Act and the Cr.PC.
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The High Court cannot quash a Section 138 complaint based on defenses that require factual evidence; such defenses must be raised during the trial process.
(1) Dishonour of cheque – A post-dated cheque issued after debt has been incurred would be covered by definition of ‘debt’ – However, if sum payable depends on a contingent event, then it takes colou....
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