Delhi High Court

Kunal Dhawan vs State Of Nct Of Delhi & Anr. on 3 September, 2020

$~11
*      IN THE HIGH COURT OF DELHI AT NEW DELHI
%                                  Date of decision: 3rd September, 2020
+      CRL.M.C. 1542/2020 & Crl.M.A. 8397-98/2020
       KUNAL DHAWAN                                        ..... Petitioner
                          Through        Mr. Vikas Pahwa, Sr. Adv. with
                                         Ms.Ruchika Wadhawan, Adv.
                          versus


       STATE OF NCT OF DELHI & ANR.                        .... Respondents
                          Through        Mr. Izhar Ahmed, APP for the State
                                         Mr. Gurpreet Singh, Adv. for R-2

       CORAM:
       HON'BLE MR. JUSTICE SURESH KUMAR KAIT
                    JUDGMENT (ORAL)

The hearing has been conducted through video conferencing.

1. The present petition has been filed by the petitioner under Section 482

Cr.P.C. for quashing of summoning order dated 25.07.2018 and proceedings

in CC No.12442/2018.

2. Learned APP for the State and learned counsel for the respondent No.2

have opposed the present petition by stating that respondent No.2, namely,

the Indian Medical Association (Regd.) (hereinafter referred to as IMA) is a

society duly registered under the provisions of the Societies Registration Act,

1860 vide Certificate No. 325 of 1934-35 issued by the Registrar of Societies

on 19.05.1934. IMA is the national association and organisation of "Doctors

of Modern Scientific Medicine" formed in 1928 which looks after the interest

of the doctors as well as the well being of the community at large. The

respondent No.2 is the largest professional association of medical doctors in

the country and all top academicians and educationalists in the medical

profession are members of the answering opposite party. The membership of

Respondent No. 2 includes Vice Chancellors, eminent professors, Directors

of medical institutions, eminent specialist, doctors, ministers and registered

medical practitioners.

3. It is also submitted that the petitioner i.e. accused No.2 acting for and

on behalf of M/s Rosario Cosmetics Pvt. Ltd., i.e. accused No.1 (a company

registered under the relevant provisions of the Companies Act, 1956,

primarily engaged in the business of manufacturing and marketing of its own

FMCG brands), approached respondent No.2 in the month of March, 2015

and made tall claims and alleged assertions about the varied brands being

manufactured and marketed by accused No.1-Company, in the area of health,

hygiene and sanitization and in view of same requested the respondent No.2

to validate and authenticate the products so manufactured and marketed by

them as the respondent No.2. The Complainant Society being renowned and

known organization within the medical fraternity of the country, whose

predication for legal, social and moral standards is unparalleled. The

respondent No.2 entered in to a Memorandum of Understanding (MoU) dated

08.04.2015, wherein the complainant Society authorized the accused No.1-

Company i.e. M/s Rosario Cosmetics Pvt. Ltd. to use the IMA mark in relation

to various products being manufactured and marketed by it under the brand

name HYGIA for the period starting from 08.04.2015 to 31.07.2017. The said

MoU before it expired was renewed from 01.08.2017 to 31.12.2019 vide MoU

renewal letter dated 03.08.2017.

4. Learned counsel for respondent No.2 further submits that the petitioner

was employed as the Chief Executive Officer with accused No.1 Company

and also held share-holding in the accused No.1 Company. Furthermore, the

petitioner was in charge of hiring and termination of employees along with

day to day management of the accused No.1 Company. The petitioner

represented to the complainant Society that he was the officer in charge and

signatory of the accused No.1 Company and also the person responsible for

the day to day conduct of the affairs of the accused No.1 Company and

assured that all payments in pursuance of the abovementioned MoU would be

made to the respondent No.2/Complainant Society in time. However, in

complete contradiction to the assurances made by the petitioner herein and to

the utter shock and dismay of the respondent No.2/Complainant Society,

certain cheques issued by the accused No.1 Company were dishonoured and

the castle of faith so created by the Accused herein was shattered. In view

thereof, when the accused herein were confronted, they specifically and

categorically, not only admitted to the said financial liability but also agreed

that all the pending payments shall be made by them within a period of six

months and assured that the cheque dated 31.03.2018 shall be duly honoured

as and when presented for encashment. However, when the same was

presented for encashment by respondent No.2, the said cheque was also

returned unpaid by the bank with remarks/reason "FUNDS INSUFFICIENT"

vide returning memo dated 03.04.2018. Accordingly, after completing all the

formalities finally the respondent No.2 filed the present complaint in terms of

Section 138 read with Section 142 of the Negotiable Instruments Act, 1881

(as amended up to date).

5. The case of the petitioner is that as per the Memo of Parties of the

complaint made before the Trial Court, the petitioner never held the position

of Director. The cheque in question was issued at the time of renewal of MoU

for the period from 01.08.2017 to 31.12.2019 whereas earlier MoU was

signed for the period from 08.04.2015 to 31.07.2017. As per the case of the

respondent No.2, the accused promised that payment would be made within

six months and issued cheque dated 31.03.2018 will get honoured, however,

the second cheque got dishonoured.

6. Learned Senior Counsel for the petitioner submits that the petitioner

had resigned on 31.03.2017 as CEO/Consulting Agent and the cheque dated

31.03.2018 was dishonoured on 03.04.2018 pursuant to renewal agreement

for the period between 01.08.2017 to 31.12.2019 i.e much later than the

petitioner resigned.

7. It is further submitted that in the summoning order, the Trial Court

erred in observing that accused being Directors are responsible for day to day

affairs of the company. Accordingly, the summons were issued to the accused

including the petitioner herein based upon the wrong averments made by the

respondent No.2 herein.

8. Learned Senior Counsel for the petitioner has drawn attention of this

Court to the resignation pursuant to which finances were settled vide

settlement dated 29.03.2017 (Annexure A-12) which is reproduced as under:

" FULL AND FINAL SETTLEMENT

Received a cheque vide no.951275 dt.29.03.2017 drawn from State Bank of Patiala of Rs.9,75,261/- (Nine lacs seventy five thousand two hundred sixty one only) from M/s Rosario Cosmetics Pvt. Ltd. towards my Full and final settlement of all my duties pertaining to Professional Charges or any other claim in connection with my said agreement with the management.

Details of payment

1. Professional Charges for the month of Mar.17 Rs.10,000,00/-

2. Sales Commission Charges for the month of Mar.17 Rs.6,494/-

3. Reimbursement of travel exp./entertainment exp. Rs.56,289/-

Total amount payable Rs.10,62,783/-

Less TDS 10% on Professional/Sales Commission Rs.87,522-

Net amount payable Rs.9,75,261/-

I have received all my dues towards full and final settlement. I will not raise any claim or demand in future, whatsoever against the company. Further to that, myself Kunal Dhawan has handed over all document and information to the management and nothing pending from my side."

9. It is not in dispute that the petitioner was not a director in the company

in question and was signatory pursuant to MoU dated 08.04.2015 for the

period from 08.04.2015 to 31.07.2017. The cheque in question dated

31.03.2018 was issued pursuant to renewal of agreement vide letter dated

03.08.2017 for the period from 01.08.2017 to 31.12.2019, whereas the

petitioner herein had already resigned on 31.03.2017 as CEO/Consulting

Agent. Thus, by no stretch of imagination, it can be said that during that period

the petitioner was responsible for the day to day affairs of the company leave

aside being the director of the said company.

10. In view of above, I am of the view that the petitioner is not

liable/responsible for the dishonoured cheque pursuant to renewal of

agreement given for the period 01.08.2018 to 31.12.2019.