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IN THE HIGH COURT OF JUDICATURE AT MADRAS
G. JAYACHANDRAN, J.
Dr. K. Pruthvinath & Another - Appellant
Versus
The Sub-Inspector of Police, Chennai & Another - Respondent
Criminal Original Petition Nos. 2946 & 2948 of 2019 & Crl.M.P. Nos. 1966 & 1968 of 2019
Decided On : 20-06-2022
Cheque - Misuse - Sections 408 and 420 of I.P.C. - Summary of Acts and Sections: Sections 408 and 420 of the Indian Penal Code (I.P.C.) - The court analyzed the misuse of a cheque by the accused, the authorization of signatories, and the lack of prima facie evidence for the alleged offenses under Sections 408 and 420 of the I.P.C. The court referred to the legal provisions and their interpretations to determine the lack of evidence for the offenses, ultimately allowing one petition and dismissing the other.
Fact of the Case:
The case involved a complaint against two accused for the misuse of a cheque issued by one accused to discharge a personal loan, leading to allegations of misappropriation and cheating.
Finding of the Court:
The court found that there was no prima facie evidence to proceed against one of the accused, as the allegations of misuse and connivance were not supported by the facts and lacked credibility. However, the other accused was required to explain the circumstances surrounding the issuance of the cheque to discharge a personal loan.
Issues: The issues revolved around the misuse of the cheque, authorization of signatories, and the prima facie evidence for the alleged offenses under Sections 408 and 420 of the I.P.C.
Ratio Decidendi: The court held that there was no prima facie case to proceed against one of the accused, citing lack of evidence and credibility of the allegations. However, the other accused was required to explain the circumstances surrounding the issuance of the cheque to discharge a personal loan.
Final Decision: The Criminal Original Petition filed by one accused was allowed, quashing the FIR against them, while the petition filed by the other accused was dismissed, requiring further investigation.
JUDGMENT
(Prayer in Crl.O.P.Nos.2946 & 2948 of 2019: Criminal Original Petition are filed under Section 482 of Cr.P.C., to call for the records and quash the proceedings in F.I.R.No.32 of 2019 on the file of the Sub-Inspector, S10, Pallikaranai Police Station for offence under Sections 408 and 420 of I.P.C.)
Common Order
1. These two Criminal Original Petitions are filed separately by two accused namely Dr.K.Pruthvinath (in Crl.O.P.No.2946 of 2019) & Dr.Badrikrishnaswami (in Crl.O.P.No.2948 of 2019), to quash the F.I.R No.32 of 2019, on the file of 1st respondent police.
2. The gist of the F.I.R registered pursuant to the complaint given by one Dinesh Kumar Mishra, General Manager, Finance and Accounts Department of M/s.Ravindranath GE Medical Associations Private Limited against Dr.Badrikrishnaswami (the petitioner in Crl.O.P.No.2948 of 2019), Dr.K.Pruthvinath, (the petitioner in Crl.O.P.No.2946 of 2019) and M/s.Paceman Finance India Limited is that, the defacto complainant company is having its registered Office at Perumbakkam, Chennai. On 07.09.2018, the company recovered a legal notice from M/s.Paceman Finance India Limited (hereinafter referred as “M/s.Paceman”) and on perusing the said notice of the defacto complainant/Dinesh Kumar Mishra came to know that cheque of the defacto complainant for Rs.12 lakhs drawn at HDFC Bank, Madipakkam Branch, maintained by the defacto complainant Company alleged to have been issued to M/s.Paceman on 28.08.2018 for the repayment of the loan availed by Dr.K.Pruthvinath, Ex-Director of the Company and same was dishonoured on presentation. On verification of the records, the complainant alleges that the said cheque pertains to the period between 2013 to 2014. When the 1st accused was serving with the defacto complainant Company as Financial Manager. Their enquiry revealed that, the 1st accused/Badrikrishnaswami with ulterior motive given the cheque to Dr.K.Pruthvinath, for to be misused. Accordingly, for the personal loan of Dr.K.Pruthvinath, the cheque stealthy handed over to Dr.K.Pruthvinath, has been fraudulently used for discharging the personal loan transaction of Dr.K.Pruthvinath.
3. It was specifically alleged that 1st accused/Badrikrishnaswami was the Executive Director, Finance and Accounts Department of the defacto complainant between 2011 till 2014. At that time, Dr.K.Pruthvinath was authorized signatory for the cheques. They both in connivance had misused the cheque bearing No.003708 pertaining to the bank account at HDFC bank maintained by the defacto complainant. Badrikrishnaswami in connivance with Dr.K.Pruthvinath have committed misrepresentation with intent to cheat by issuing the said cheque to M/s.Paceman for the fraudulent transaction.
4. Based on this complaint, a case has been registered in F.I.R.No.32 of 2019 on the file of 1st respondent police, for the offences under Section 408 and 420 of I.P.C.
5. The Learned Counsel appearing for the petitioner/ Badrikrishnaswami (in Crl.O.P.No.2948 of 2019) submitted that, from the complaint, it appears that the cheque drawn by 2nd accused Dr.K.Pruthvinath from relates to the bank account maintained by defacto complainant. The said cheque for Rs.12,00,000/- has been issued by Dr.K.Pruthvinath, to discharge the personal loan availed by Dr.K.Pruthvinath. The present complaint has been lodged presuming that, the said cheque issued by Dr.K.Pruthvinath to M/s.Paceman (3rd accused) was given to the 2nd accused by Badrikrishnaswami (1st accused). While, 1st accused/petitioner was working as an Executive Director in the defacto complainant's company during the period 2011 and 2014 and entrusted with the cheque book by the complainant. Crl.O.P.No.2946 of 2019
6. The Learned Counsel appearing for the petitioner/2nd accused/Dr.K.Pruthvinath (in Crl.O.P.No.2946 of 2019) submitted that, Dr.K.Pruthvinath, availed personal loan from M/s.Paceman, (3rd accused) and he has discharged the said loan and as on the date there is no due payable to M/s.Paceman
The main legal point established in the judgment is the requirement of prima facie evidence to proceed with allegations under Sections 408 and 420 of the I.P.C., and the lack of credibility in unsupp....
The main legal point established in the judgment is that the lack of prima facie evidence to support allegations of misuse and deception can lead to the quashing of a complaint under relevant legal p....
Dishonoring postdated cheques does not automatically constitute a criminal offense under IPC sections 406 or 420, without evidence of fraudulent intention at issuance.
The absence of specific allegations of dishonest intent at the time of cheque issuance negates the establishment of an offense under S.420, IPC.
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