In a Section 138 NI Act proceeding, allegations involving disputed signatures, existence of a legally enforceable debt, and underlying financial settlements are triable issues which cannot be decided in a petition for quashing the prosecution under Section 482 of the Cr.P.C.

ORDER:

This Criminal Petition is filed by the petitioner-accused seeking to quash the proceedings against him in S.T.C.(N.I.).No.1172 of 2025 on the file of learned X Additional Chief Metropolitan Magistrate, Secunderabad, registered for the offence under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘NI Act’).

2. Heard Sri Vikram Pooserla, learned Senior Counsel representing Ms. Deepti Anand, learned counsel for the petitioner, Sri Raja Sripathi Rao, learned Senior Counsel representing Sri P. Raghavendra, learned counsel for respondent No.2 and Sri Jithender Rao Veeramalla, learned Additional Public Prosecutor for respondent No.1-State.

3. The crux of the complainant’s case is that the petitioner has issued a cheque towards a loan taken from it and the said cheque was dishonoured following which, the complainant filed S.T.C.(N.I.).No.1172 of 2025 for the offence under Section 138 of the NI Act. Now, the present Criminal Petition is filed by the accused in the said case seeking quashment of the same.

4. Learned Senior Counsel for the petitioner submitted that the petitioner herein disputes his signature on the alleged cheque and that the petitioner has also sent the cheque to the Truth Labs, which has given a report stating that the signature on the cheque does not pertain to the petitioner. He further submitted that the complainant has given a legal notice, but has not mentioned any details and has not submitted any documents supporting the notice. He further submitted that in the legal notice annexure–I was referred, but the same was not furnished to the petitioner. He further submitted that the petitioner has addressed a reply notice, but the complainant has failed to comply with the request of furnishing the relevant documents. When the necessary material is not supplied to the petitioner, he is not obligated to respond to the said legal notice. He further submitted that the said principle is laid down by the Honourable Supreme Court in Rekha Sharad Ushir v. Saptashrungi Mahila Nagari Sahkari Patsansta Ltd. ¹2025 SCC OnLine SC 641 and since the complainant failed to furnish necessary material to the petitioner in response to his reply notice, the petitioner is not under obligation to comply with the legal notice. He further submitted that since there is no legally enforceable debt, the petitioner is not required to pay any amount to the complainant, as alleged in the complaint. He further submitted that the petitioner was at South Africa and he has come down to India at the request of his maternal uncle i.e., A.M. Emanuel and continued to do business with him, but in the year 2018, he resigned due to some internal disputes and on 06.08.2024, the settlement was arrived at and he was paid an amount of Rs.17 crores towards full and final settlement. Thus, the counsel contends that if at all the petitioner herein is due to pay an amount of Rs.4,19,23,713/-, the complainant could not have settled his account by paying Rs.17 crores. That itself falsifies the contention of the complainant. He further submitted that pursuant to the MoU entered into between the parties, the petitioner has initiated proceedings before the Arbitrator and the complainant pretty well knows that he cannot succeed before the Arbitrator and has lodged the present complaint with false allegations. He further submitted that the cheque is supposed to have been issued towards the loan taken at various intervals. But, the cheque book pertaining to the alleged cheque was issued to the petitioner on 17.02.2020. Therefore, the petitioner could not h