Under Section 138 of the Negotiable Instruments Act, criminal liability arises solely against the drawer of the cheque. Furthermore, a statutory notice must be issued strictly within 30 days of receiving information of the dishonour, and any delay renders the complaint non-maintainable.

: O R D E R :

This Criminal Petition has been filed under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, by the petitioner/accused seeking to quash the proceedings in STC.NI.No.310 of 2024 on the file of the II Additional Junior Civil Judge-cum-X Additional Metropolitan Magistrate, Ranga Reddy District, registered for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the N.I. Act’).

2. Brief facts of the case:

2.1. On 28.02.2024, respondent No.2-Sri Enterprises, represented by V. Shilpa and A. Sridevi have filed a private complaint under Section 200 Cr.P.C. before the Hon’ble II Additional Junior Civil Judge- cum-X Additional Metropolitan Magistrate, Ranga Reddy District, against Soukhyaa Enterprises, represented by authorized partners, the petitioner stating that G. Sarojini Devi, representative of the complainant’s firm entered into a business arrangement with the petitioner firm-Soukhyaa Enterprises, represented by its partners Smt. Sucheta Acharya and the petitioner, and obtained distribution rights to market and sell their products. In connection with the said business transaction, the complainant paid a total advance amount of Rs.38,00,000/- to the petitioner’s firm on various dates through bank transfers, PhonePe transactions, and cash. Out of the said amount, the petitioner repaid a sum of Rs.18,00,000/- in two installments to the bank account of Smt. Angaru Sridevi, leaving a balance amount due and payable. To discharge the subsisting liability, the petitioner issued two cheques bearing No. 010860 dated 04.09.2023 for Rs.9,00,000/- in favour of Angaru Sridevi and Cheque bearing No. 010861 dated 04.10.2023 for Rs.6,00,000/- in favour of Vandanapu Shilpa, both drawn on ICICI Bank, Vijayawada Branch. When respondent No.2 presented the said cheques for encashment, they were dishonoured on the ground of “Funds Insufficient.” Despite repeated requests and issuance of a statutory legal notice, the petitioner failed to make payment of the cheque amounts, thereby committed an offence punishable under Section 138 of the N.I. Act.

3. Heard Mr. Naresh Kumar Neemkar,, learned counsel for the petitioner, Ms. Lavanya Peddiredy, learned counsel for respondent No.2 and Mr. Jithender Rao Veeramalla, learned Additional Public Prosecutor appearing on behalf of respondent No.1 State.

4. Submissions of learned counsel for the petitioner:

4.1. Learned counsel for the petitioner submitted that the allegation made in the complaint that respondent No.2 paid an amount of Rs.38,00,000/- towards distribution rights is false and incorrect, and in fact, respondent No.2 had paid only a sum of Rs.23,00,000/-and the further allegations that respondent No.2 received Rs.9,00,000/- and Rs.6,00,000/- in cash are also false and that the petitioner’s firm neither received the said amounts in cash nor acknowledged receipt of the same. He further submitted that respondent No.2 itself admitted the receipt of Rs.18,00,000/- from the petitioner’s firm through bank transfers, which clearly establishes that substantial payments were already made towards the alleged liability. Even though respondent No.2 entitled only to an amount of Rs.23,00,000/- , with a malafide intention forced the petitioner to issue cheques for Rs.9,00,000/-, Rs.9,00,000/- and Rs.6,00,000/- as security. The said cheques are personal cheques of the petitioner and he was not issued on behalf of Soukhyaa Enterprises, and, therefore, the petitioner cannot be held personally liable.

4.2. He further submitted that respondent No.2 had already received an amount of Rs.9,00,000/- against one of the cheques