IN THE HIGH COURT OF DELHI AT NEW DELHI % Judgment delivered on: 01.04.2025 + CRL.M.C. 3896/2022 & CRL.M.A. 16235/2022 SUNAV STEEL PRIVATE LIMITED & ORS. ..... Petitioner versus STATE OF NCT OF DELHI THROUGH STANDING COUNSEL & ANR. ..... Respondent Advocates who appeared in this case:

For the Applicant : Mr. Pramod Kr. Dubey, Sr. Advocate with Mr. Rinku Garg, Mr. Kunal Narang, Mr. Manik Bhalla, Mr. Prashant, Mr. Piyush Joshi, Ms. Pinky Dubey, Mr. Jitendra Kumar, Mr. Kaustubh Chouhan, Mr. Prince Kumar &

Mr. Ayush Sachan, Advocates.

For the Respondent : Mr. Manoj Pant, APP for the State.

Mr. Amol Sharma, Adv. for R2 CORAM HON’BLE MR JUSTICE AMIT MAHAJAN

JUDGMENT

1. The present petition has been filed seeking quashing of Complaint Case No. 14726/2017 pending before the learned Metropolitan Magistrate (‘MM’), Central District, Tis Hazari Courts, Delhi, for offence under Section 138 read with Section 142 of the Negotiable Instruments Act, 1881 (‘NI Act’).

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2. The petitioners further seek quashing of the summoning order dated 02.07.2018 (hereafter ‘the impugned order’) passed in the said complaint. Brief facts:

3. The petitioner company, Sunav Steel Private Limited & Ors., is engaged in the business of sale, purchase, export, import, and trade of iron and steel. The petitioner company, through its directors – Petitioner Nos. 2 and 3 had initially availed credit facilities from Yes Bank, with a sanctioned limit of ₹7.5 crore.

4. By way of sanction letter dated 20.06.2013, Respondent No.2/HDFC Bank Ltd. agreed to take over the loan account from Yes Bank on more favourable terms and sanctioned an enhanced credit facility of ₹10 crore to the petitioner company to meet its working capital requirements.

5. In pursuance of the said arrangement, Respondent No.2 transferred ₹7.5 crore to Yes Bank to square off the petitioner’s outstanding dues. In exchange, HDFC Bank requested Yes Bank to release the security documents, including title deeds of immovable properties mortgaged by the petitioner company, upon due discharge.

6. In terms of the sanctioned facility, the petitioners pledged various assets and also issued a Cheque bearing no. 850489 (‘subject cheque’) drawn on Yes Bank for a sum of ₹7.5 crore as security towards the repayment of the financial assistance extended by Respondent No.2.

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7. The credit facility was renewed, modified, or enhanced from time to time by HDFC Bank through subsequent sanction letters. However, Petitioner No.1 company failed to maintain financial discipline and defaulted in making payments of the said credit facilities. On 29.04.2017, the petitioners’ account was classified as a Non-Performing Asset (NPA) by Respondent No.2 in terms of the RBI guidelines.

8. Consequently, by notice dated 31.07.2017, Respondent No.2 recalled the credit facilities under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (‘SARFAESI Act’)

9. Thereafter, since no payment for forthcoming, Respondent No.2 presented Cheque No. 850489, drawn on the petitioners’ Yes Bank account towards discharge of the liability. The cheque was returned unpaid with the endorsement ‘Account Closed’ as per the return memo dated 07.09.2017.

10. Following the dishonour of the cheque, Respondent No.2 filed a complaint under Section 138 of the NI Act, alleging that the petitioners had failed to discharge their financial obligations in accordance with the terms of the loan arrangement.

11. In parallel, Respondent No.2 also invoked proceedings under the SARFAESI Act for recovery of the outstanding dues.

12. Pursuant to the complaint filed under Section 138 of the NI Act, the learned Metropolitan Magistrate, Tis Hazari Courts, Delhi, vide Signature Not Verified Signed By:HARMINDER CRL.M.C. 3896/2022 Page 3 of 18 order dated 02.07.2018, took cognizance and issued sum