Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(Tel) 18070

11. Whether Reporters of Local newspapers may be allowed to see the Judgment? : Yes
22. Whether the copies of judgment may be Marked to Law Reporters/Journals? : Yes
33. Whether His Lordship wishes to see the fair copy of the Judgment? : Yes
Counsel for the petitioners : Mr. N. Ashwani Kumar, learned counsel, appearing for Mr. M. Avinash Reddy, learned counsel for the petitioners.
Counsel for respondents : Mr. M.Vivekananda Reddy, learned Assistant Public Prosecutor, appearing for respondent No.1-State. Mr. Katika Ravinder Reddy, learned counsel for Respondent No.2.
Cases referred
1. (2005) 8 SCC 89;
2. (2018) 14 SCC 202;
3. (2023) 8 SCC 152;
44. (1998) 5 SCC 749;
55. (2015) 4 SCC 609;
66. (2021) SCC Online SC 325;
77. 2024 SCC OnLine SC 4107;
88. 2023 SCC OnLine SC 1399;
99. 2025 SCC OnLine SC 2897;
1010. (2023) 10 SCC 685; and
1111. 2025 INSC 759.

Advocates:
For the Appellants/Petitioners: Mr. N. Ashwani Kumar, Mr. M. Avinash Reddy
For the Respondents: Mr. M. Vivekananda Reddy, Mr. Katika Ravinder Reddy

A complaint under Section 138 read with Section 141 of the NI Act must contain specific averments that the accused director was in charge of and responsible for the business of the company; non-signatory directors cannot be prosecuted without such foundational pleadings, and quashing is permissible.

Headnote:(A) Negotiable Instruments Act, 1881 - Sections 138, 141 - Vicarious liability of directors - Complaint must contain specific averments that accused were in charge of and responsible for the conduct of business - Mere designation as director or participation in prior transactions insufficient - Quashing of proceedings justified where complaint lacks foundational pleadings - Principles of parity under Article 14 apply.

(B) Criminal Procedure Code, 1973 - Section 482 - Maintainability of successive quash petitions - Subsequent developments such as dismissal of discharge applications for non-maintainability and quashing of proceedings against co-accused constitute fresh grounds - Petitions maintainable.

Facts of the case:
The petitioners, non-signatory directors of various companies, sought quashing of complaints under Section 138 of the N.I. Act concerning dishonoured cheques issued by the companies. They had previously approached the court and were granted liberty to seek discharge, but their discharge applications were dismissed as not maintainable in summons cases. In connected matters, proceedings against similarly placed accused were quashed.

Findings of Court:
The complaints lacked specific averments as required under Section 141, and the petitioners were not signatories to the cheques. Proceedings against them were quashed.

Issues: Maintainability of successive petitions and compliance with Section 141 requirements.

Ratio Decidendi: The High Court can quash proceedings under Section 482 if the complaint fails to disclose essential ingredients. Successive petitions are maintainable if there are subsequent developments. Result : Criminal Petitions allowed.

Table of Content
1. this group introduces the parties, the nature of the proceedings, and the factual background of the case, including the specific cheques and complaints involved. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11)

1. Whether Reporters of Local newspapers may be allowed to see the Judgment? : Yes

2. Whether the copies of judgment may be Marked to Law Reporters/Journals? : Yes

3. Whether His Lordship wishes to see the fair copy of the Judgment? : Yes

Counsel for the petitioners : Mr. N. Ashwani Kumar, learned counsel, appearing for Mr. M. Avinash Reddy, learned counsel for the petitioners.

Counsel for respondents : Mr. M.Vivekananda Reddy, learned Assistant Public Prosecutor, appearing for respondent No.1-State. Mr. Katika Ravinder Reddy, learned counsel for Respondent No.2.

Cases referred

1. (2005) 8 SCC 89;

2. (2018) 14 SCC 202;

3. (2023) 8 SCC 152;

4. (1998) 5 SCC 749;

5. (2015) 4 SCC 609;

6. (2021) SCC Online SC 325;

7. 2024 SCC OnLine SC 4107;

8. 2023 SCC OnLine SC 1399;

9. 2025 SCC OnLine SC 2897;

10. (2023) 10 SCC 685; and

11. 2025 INSC 759.

COMMON ORDER:

These petitions arise out of multiple proceedings pending before the learned X Judicial Magistrate of First Class, Hyderabad, in complaints filed under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the N.I. Act’) for prosecuting the petitioners in relation to the dishonour of cheques issued by various companies belonging to the same group.

Since the issues raised in these criminal petitions are intertwined, involving the same parties and analogous questions of law, the petitions have been heard together and are being disposed of by this common order.

These petitions are filed seeking quashment of the proceedings dated 24.09.2024 in M.P. No.3705 of 2023 in STC NI No.311 of 2021 in Crl.P. No.15836 of 2024, M.P. No.3718 of 2023 in STC NI No.346 of 2021 and M.P. No.3715 of 2023 in STC NI No.345 of 2021 on the file of X Judicial Magistrate of First Class, Manoranjan Complex, Nampally, Hyderabad.

The petitioners are accused Nos.2 and 3 in the respective complaints.

I have heard Mr. N. Ashwani Kumar, learned counsel, appearing for Mr. M. Avinash Reddy, learned counsel for the petitioners, Mr. M. Vivekananda Reddy, learned Assistant Public Prosecutor appearing for respondent No.1-State and Mr. Katika Ravinder Reddy, learned counsel for respondent No.2.

Factual Matrix:

Criminal Petition No. 15836 of 2024 pertains to STC N.I. No. 311 of 2021, wherein the petitioner is arrayed as Accused No. 2 in a complaint concerning the dishonour of cheque bearing No. 000019, dated 23.11.2020, for an amount of Rs.15 crores, allegedly issued by Accused No. 3 therein on behalf of Lingamaneni Ventures Private Limited (LVPL)/Accused No. 1.

Similarly, in Criminal Petition No. 282 of 2025, arising out of STC N.I. No. 346 of 2021, the petitioner is arrayed as Accused No. 3 in relation to the dishonour of cheque No. 790378, dated 23.11.2020, for an amount of Rs.2 crores, allegedly issued by Accused No. 4 on behalf of M/s. Viswaroopi Energy Private Limited/Accused No. 1.

In Criminal Petition No. 284 of 2025, arising out of STC N.I. No. 345 of 2021, the petitioner is arrayed as Accused No. 2 in a complaint relating to the dishonour of cheque No. 290802, dated 23.11.2020, for an amount of Rs.30 crores, allegedly issued by Accused No. 4 on behalf of M/s. Swarna Bhaskar Holdings Private Limited/Accused No. 1.

In all the cases, it is the consistent stand of the petitioners that they are neither signatories to the cheques in question nor directly involved in their issuance. The dispute emanates from a series of commercial transactions and Memoranda of Understanding entered into between the complainant Trust and various group companies of the accused during the period from 2012 to 2016, pertaining to the acquisition of lands and the development of infrastructure and educational institutions. The cheques in question are alleged to have been issued towards discharge of liabilit

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