Employees Welfare Fund & Ors. vs Kra Infrasturcture Developers ...
2019 Latest Caselaw 5771 Del

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*        IN THE HIGH COURT OF DELHI AT NEW DELHI

                                                  Date of decision: 19.11.2019

+        CRL.M.C. 746/2017
         EMPLOYEES WELFARE FUND & ORS.                      ..... Petitioners
                            Through      Mr. Vikas Gupta & Mr. Ieshaan
                                         Gupta, Advs.

                            versus

         KRA INFRASTURCTURE DEVELOPERS P.LTD.
                                                                ..... Respondent
                            Through      Mr. Nimesh Chib & Mr. Siddharth
                                         Chaturvedi, Advs.

         CORAM:
         HON'BLE MR. JUSTICE SURESH KUMAR KAIT

                            J U D G M E N T (ORAL)

1. Vide the present petition, petitioner seeks directions thereby to quash

the complaint case No. 10764/16 filed under Section 138 read with Sections

141 and 142 of the Negotiable Instruments Act pending adjudication in the

Court of Metropolitan Magistrate - 01 (Nl Act), West, Tis Hazari Courts,

Delhi.

2. The case of the respondent/ complainant is that petitioners have drawn

the cheques referred in the complaint for a sum of Rs 4.1 crore in favour of

the respondent in discharge of legally recoverable debt pursuant to the terms

of the MOU/ Agreement to Sell dated 19.6.2015 but the said chequs, upon

presentation for encashment got dishonoured.

3. Learned counsel for the petitioners submits that upon a meaningful

reading of the complaint and the documents produced along with it; it

clearly indicates that the proceeding initiated by the respondent is vindictive

in nature. The proceeding is initiated abusing the process of law with a mala

fide intention of harassing the petitioners. As per the MOU/ Agreement to

Sell dated 19.6.2015, the cheques referred in the complaint were issued

towards the payment of advance sale consideration and as on date of

issuance of the cheque no debt or other liability as defined under the

provisions of Section 138 of Negotiable Instrument Act was in existence.

The reading of the complaint, statement, and the documents produced by the

respondent along with the complaint does not satisfy the ingredients of the

offence punishable under section 138 of Negotiable instrument.

4. Further, the petitioner No. 1 is a Society of the employees of

Hindustan Aeronautics Limited Bangalore and registered under the

Karnataka Societies Registration Act, 1960 with its registered office at

Vimanapura, Bengaluru, 560107 Karnataka.

5. During 2015, the respondent herein approached the petitioner society

representing that it is intending to construct residential apartments near

Hosakote Town, Old Madras Road, Bangalore District Bangalore and

offered to sell the apartments to the members of the petitioner society. The

respondent requested the petitioner society to facilitate the transaction on

behalf of the members so that the respondent herein could deal at one point

contact instead of dealing with the individual employees separately. Under

this circumstance, the petitioner society signed the MOU and in terms of

Clause 1.3 of the MOU, the sale of the individual apartments would be made

to "members" of the Petitioner and each such transaction would entail a

separate "Agreement to Sell" between the respondent and the "member" to

be intimated to the respondent by the petitioner. In effect, the apartments

were actually to be purchased, from the respondent, individually and

separately by members of the Employees Welfare Fund of the petitioner

society and the MOU was entered into, by the petitioner society with the

respondent, only for facilitating the transaction. The petitioner society has

not incurred any debt or other liability under the said agreement.

6. Learned counsel for the respondent submits that the respondent

agreed to construct the houses for the members of the petitioner society and

accordingly, MOU, as mentioned above was signed. Pursuant thereto, in the

month of June, four cheques amounting to ₹4.01 crores, of different dates,

were issued in favour of the respondent, to be honoured in the month of

July, 2015. However, the said cheques got dishonoured on 09.10.2105 itself

when the same were presented by the respondent in its bank. Thus, as per

the agreement entered into with the respondent, the petitioner society is

under legal debt / liability.

7. The fact remains that the amount was paid by the society on behalf of

its individual member to facilitate the transaction in getting their houses

constructed by the respondent. Since the individual members of the

petitioner society immediately doubted whether the respondent would be

able to complete the flats, they did not deposit the amount with the society

and thus, the cheques issued by the society got dishonoured.

8. It is not disputed that the society was constituted for the welfare of its

members who were interested in getting their houses constructed by the

respondent. Therefore, the society played a role only to facilitate its

members in getting their houses constructed and the society had no liability

as per Section 138 NI Act on the date of signing of the MOU.

9. Even if it is presumed that the said amount was paid to the respondent

as advance money, even then there appears to be no criminal liability or any

liability which is recoverable under provisions of Section 138 NI Act.

10. The petition is accordingly allowed and the complaint case No.

10764/16 filed under Section 138 read with Sections 141 and 142 of the

Negotiable Instruments Act and all consequent proceedings emanating

therefrom are hereby quashed.

11. Order dasti.

(SURESH KUMAR KAIT) JUDGE NOVEMBER 19, 2019 sm