IN THE HIGH COURT OF JUDICATURE AT MADRAS

Reserved on

Delivered on

06~01~2022

21~01~2022

Coram:

THE HONOURABLE MR.JUSTICE N.SATHISH KUMAR

Crl.O.P.No.16046 of 2017 &

Crl.M.P.Nos.9925 & 9926 of 2017

1. Nandhi Dhall Mills,

270, Narasimhan Road,

Shevapet, Salem – 636 002.

2. S.A.Kumar

... Petitioners/Accused 1 & 2

Vs

M/s.Kotak Mahindra Bank Ltd.,

Represented by its Chief Manager,

Recovery, Agri Business Group,

12, Bharathi Street,

Swarnapuri, Salem – 636 004.

... Respondent/Complainant

PRAYER: Criminal Original Petition filed under Section 482 of

Criminal Procedure Code, to call for the records and quash the

proceedings on the file of V Judicial Magistrate, Salem

bearing C.C.No.18 of 2014 as against the petitioners for an

offence under section 138 of Negotiable Instruments Act, 1981.

For petitioner : Mr.A.Ramesh, Senior Counsel

for Mr.B.A.Sujay Prasanna

For Respondent : Mr.E.Om Prakash, Senior Counsel

for M/s.Ramalingam Associates

Assisted by Mr.P.Elayarajkumar

O R D E R

This petition has been filed to quash the proceedings

initiated under section 138 of the Negotiable Instruments Act

in C.C.No.18 of 2014 on the file of the V Judicial Magistrate

Court, Salem.

2. The crux of the complaint is that the respondent had

extended financial facility in the form of short term loan to

the petitioner company for the development of business. The

accused have borrowed a sum of Rs.10 crores out of the

https://hcservices.ecourts.gov.in/hcservices/

sanctioned limit of Rs.15 crores as a short term loan and also

executed necessary documents for the above said loan as per

the terms and conditions of the banking rules and regulations.

The accused had also issued a cheque bearing No.72625 dated

02.04.2013 for a sum of Rs.2,90,81,000/-, drawn on ICICI Bank,

Shevapet Branch, Salem towards part payment of the said loan

amount. When the above cheque was presented for encashment on

03.04.2013, the same was dishonoured for 'funds insufficient'

on 04.04.2013. Thereafter, the complainant issued statutory

notice, which was received by the accused 1 and 2 on

06.04.2013. But no reply was sent. Hence the complaint. The

learned Judicial Magistrate took cognizance of the above

complaint. The same is sought to be quashed by the

petitioners mainly on the ground that at the time of availing

financial assistance from the respondent by the petitioners,

the second petitioner has handed over undated cheques while

sanctioning and disbursing the loan as demanded by the bank.

One such cheque was used for the purpose of loan processing

charges and the remaining cheque was used to initiate the

proceedings. It is also stated that in April 2013, the

account of the firm became non performing asset which lead to

issuance of notice under section 13 [2] of the SARFAESI. As a

short circuiting procedure, without even intimating the firm

or its partners, the respondent/ complainant filled up the

cheque in question, which has been given to the borrower at

the time of loan processing fee and initiated the prosecution.

Possession notice issued under SARFAESI Act has also been

challenged before DRT. A stay was granted subject to the

payment of Rs.25 lakhs and the same was also complied.

3.

It is further stated that the petitioners

periodically paid the dues and the liability has been

gradually reduced. Hence, it is his contention that there is

no legally enforcible debt subsisting on the date of

presentation of the cheque. The present cheque in question is

undated cheque which was obtained while sanctioning the loan.

The complaint is also silent as to who has issued the cheque

on 02.04.2013. It is his contention that the cheque issued in

the year 2011 has been used for filing the present case.

4. In addition to the grounds raised in the petition, it

is the main contention of the learned Senior Counsel appea