A complaint under Section 138 of NI Act is not maintainable against an individual when the issuing company and its directors are not included as accused.

ORDER

This criminal original petition has been filed praying to quash the proceedings in STC.No.2577 of 2022 on the file of Metropolitan Magistrate, III Fast Track Court, Saidapet Chennai

2. The petitioner is the accused in the complaint lodged by the respondent for the offence punishable under Section 138 of NI Act on the allegation that the petitioner approached the respondent for financial assistance to the tune of Rs.30,00,000/- for his business development purpose. The entire loan amount was transferred in favour of the petitioner through RTGS by the respondent. In order to repay the said amount, the petitioner issued cheque towards partial discharge of his liability and on presentation, the same was returned for the reason ‘payment stopped by the drawer’. After causing statutory notice, the respondent lodged complaint and the same was taken cognizance by the trial court.

3. The learned counsel for the petitioner submits that the alleged cheque was issued by the company. However, the respondent failed to implead the company as an accused and also failed to implead the other directors of the company.

4. Though notice was served on the respondent and his name has been printed in the cause list, no one appeared before this Court on behalf of the respondent either by person or through pleader.

5. Heard, the learned counsel for the petitioner and perused all the materials placed before this Court.

6. On perusal of the alleged cheque, it is revealed that it was issued by the company called ‘Metronic Engineering Private Limited’ signed by one of the directors i.e. the petitioner herein. However, the respondent caused statutory notice only to the petitioner and filed complaint only as against the petitioner. On perusal of the cause title also, it is revealed that the respondent failed to mention whether the petitioner is a director of the company or signatory to the cheque. Admittedly, the cheque was drawn by the company. Therefore, without adding the drawer of the cheque as an accused, the respondent cannot maintain the complaint. In the absence of company being arrayed as an accused, prosecution of a director of the company for the cheque dishonoured, under Section 138 of NI Act, is not maintainable. On this sole ground, the complaint cannot be sustained and the same is liable to be quashed. 7. Accordingly, the entire proceedings in STC.No.2577 of 2022 on the file of Metropolitan Magistrate, III Fast Track Court, Saidapet Chennai, is quashed and this criminal original petition stands allowed.

Consequently, connected miscellaneous petition is closed.

16.03.2026 Index : Yes/No Neutral citation : Yes/No Speaking/non-speaking order lok G.K.ILANTHIRAIYAN, J.

lok To Metropolitan Magistrate, III Fast Track Court, Saidapet Chennai