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2025 Supreme(Online)(Mad) 49663
IN THE HIGH COURT OF JUDICATURE AT MADRAS
G.K. ILANTHIRAIYAN, J
P.Viswanathan – Appellant
Versus
The State – Respondent
Crl.RC.No.982 of 2025 | C.C.No.4302 of 2020
For the Appellants/Petitioners: Mr.G.Rathish Kumar
For the Respondents:Mr.A.Gopinath Government Advocate (Crl.side)
The court ruled that a mere witness without direct operational involvement cannot be held criminally liable for company-related offences.
Headnote:(A) Bharatiya Nagarik Suraksha Sanhita, 2023 - Section 438 r/w 442 - Criminal Revision - Petition to set aside the order dismissing discharge petition in charge of cheating and criminal breach of trust - Court finds the petitioner had no active role in the company's affairs that would implicate him in the alleged crimes. (Paras 8, 9)
(B) Discharge of Accused - The trial court erroneously dismissed the discharge request, as there were no specific overt acts against the petitioner, leading to the conclusion that no conviction is possible based on the evidence. (Paras 7, 8)
Facts of the case:
The petitioner was accused in a case involving dishonored cheques for unpaid dues but claimed he was merely a witness and not directly involved in operational decisions.
Findings of Court:
The order of the trial court is set aside, and the petitioner is discharged from all charges based on lack of material evidence against him.
Issues: The core issue addressed was whether adequate grounds existed to implicate the petitioner in the alleged offences when he had negligible involvement in the company's operations.
Ratio Decidendi: The court ruled that the absence of direct involvement and the resolution of the underlying debts eliminate any grounds for charging the petitioner with crimes related to dishonored cheques.
Result: Revision allowed; order set aside.
| Table of Content |
|---|
| 1. case background and allegations against the petitioner. (Para 2 , 3) |
| 2. arguments regarding the petitioner's involvement. (Para 4 , 6) |
| 3. court's reasoning and final judgment. (Para 8 , 9) |
ORDER
This Criminal Revision has been filed as against the order passed in Crl.M.P.No.4440/2024 in C.C.No.4302 of 2020 on the file of the learned Metropolitan Magistrate, Exclusively for Trial of CCB Cases (Cheating) Cases and CBCID Metro Cases, Egmore, Chennai, thereby dismissing the petition to discharge the petitioner from the charges.
2. The case of the prosecution is that the de facto complainant engaged in the business of Stainless Steels. While being so, in the year 2009 the accused approached the de facto complainant and placed orders to supply materials to their company. Accordingly from the year 2009 the de facto complainant was supplying the materials to the accused on the regular basis. The accused used to withhold a part of the bill amount at the end of every financial year and informed that it will be settled at the earliest. During the year 2014-2015, 2015-2016 there was due to the tune of Rs.2,97,69,856/-. After repeated request the accused have entered into a Memorandum of Understanding with the de facto complainant and agreed to settle the said amount. In order to settle the pending dues, the accused have also issued 22 post dated cheques and when the cheques were presented for collection, they were dishonoured. Therefore, the complainant initiated proceedings under Section 138 NI Act. Thereafter the complainant lodged a complaint and the same has been registered in Cr.No.96/2016 for the offences punishable under Section 406, 420 and 34 of IPC. After completion of investigation, final report has been filed and the same has been taken cognizance by the trial Court in C.C.No.4302 of 2020. While pending for framing charges, the petitioner who is is arrayed as A7, filed a discharge petition and the same was dismissed by the trial Court. Aggrieved over the same, the present Criminal Appeal has been preferred.
3. The learned counsel for the petitioner would submit that the petitioner is neither the Director nor a partner of the first accused company's day to day affairs. He stood as witness to the Memorandum of Understanding entered into between A1 and the de facto complainant. In fact after the dishonour of cheque, the de facto complainant has also filed a complaint for the offence punishable under Section 138 of NI Act. While pending trial the entire amount has been settled by the accused and all the complaints were quashed by this Court. Therefore, the petitioner has nothing to do with the crime alleged to be committed by the other accused.
4. Per contra, the learned Government Advocate (Crl.side) appearing for the first respondent submitted that the petitioner had an active role in A1 company and he signed as witness to the Memorandum of Understanding and he had also undertaken to settle the entire dues in favour of the de facto complainant. Therefore, there are specific overt act and materials available to attract the charges under Section 406 & 420 IPC r/w. 34 IPC against the petitioner.
5. Heard both sides and perused the materials available on record.
Though notice is served on the second respondent and her name is printed in the cause list, none appeared before this Court either in-person or through counsel.
6. A perusal of the records reveals that there are totally 8 accused and the petitioner is arrayed as 7th accused. Admittedly the petitioner is neither a Director nor partner of the first accused company. The petitioner was working as Accountant in the first accused company. A perusal of the Memorandum of Understanding entered into between A1 and the de facto complainant would reveal that he had signed as one of the witness to the said document. As per the Memorandum of Understanding the other accused undertake to settle the dues to the tune of Rs.2,97,69,856/- and they also issued post dated cheques.
7. T
