Deep Plastic Industries vs Deep Rubber Products Thro' ...
2021 Latest Caselaw 7340 Guj

     R/SCR.A/1498/2012                             JUDGMENT DATED: 01/07/2021



              IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

             R/SPECIAL CRIMINAL APPLICATION NO. 1498 of 2012


FOR APPROVAL AND SIGNATURE:

HONOURABLE MS. JUSTICE SONIA GOKANI
==========================================================

1      Whether Reporters of Local Papers may be allowed                YES
       to see the judgment ?

2      To be referred to the Reporter or not ?                         YES

3      Whether their Lordships wish to see the fair copy               NO
       of the judgment ?

4      Whether this case involves a substantial question               NO
       of law as to the interpretation of the Constitution
       of India or any order made thereunder ?

==========================================================
            DEEP PLASTIC INDUSTRIES & 1 other(s)
                          Versus
DEEP RUBBER PRODUCTS THRO' BHARATBHAI NATVARLAL SHAH & 1
                          other(s)
==========================================================
Appearance:
MR BHAVESH B CHOKSHI(3109) for the Applicant(s) No. 1,2
MR RAKESH B SHARMA(2521) for the Respondent(s) No. 1
MS JIRGA JHAVERI,ADDL.PUBLIC PROSECUTOR(2) for the Respondent(s)
No. 2
==========================================================
    CORAM:HONOURABLE MS. JUSTICE SONIA GOKANI

                               Date : 01/07/2021

                            ORAL JUDGMENT

1. This is a petition preferred for quashment of criminal

complaint filed by the respondent No.1 herein being

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Criminal Case No.8905 of 2007 against the petitioner

under Section 138 of the Negotiable Instruments Act, 1881

('the N.I.Act' hereinafter) for dishonour of cheque

No.2574257 dated 25.12.2006 drawn on Punjab & Sind

Bank, Indore for Rs.2.70 Lakh alleged to have been issued

by the petitioner No.2 on behalf of petitioner No.1 for the

goods sold to the petitioner No.1 by the respondent No.1.

1.1 On the ground that the transaction has found

fraudulent and allegedly misused by the respondent No.1

in an active collusion of brother-in-law of the petitioner

No.2 Shri Rajendra Singh Rajpal, the petitioner has moved

this petition under Article 226 of the Constitution of India

with Section 482 of the Code of Criminal Procedure with

the following reliefs:

"28...

A. Your Lordships may be pleased to allow the present petition and be further pleased to quash and set aside the impugned criminal complaint being Criminal Complaint No.8905 of 2007 filed before the learned Judicial Magistrate (First Class), Ahmedabad (Rural);

B. Pending admission and final disposal of this petition,

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Your Lordships may be pleased to stay the further proceedings of the Criminal Complaint No.8905 of 2007 filed before the learned Judicial Magistrate (First Class), Ahmedabad (Rural);

C. Such other and further orders as may be deemed just and proper in the facts and circumstances of the case may be granted."

1.2 The petitioner No.2 is the wife of Mr.Trilok Singh

Rajpal, whereas Mr.Rajendra Singh Rajpal is the younger

brother of the husband of the petitioner No.2 and thus

brother-in-law of hers. Petitioner No.2 married to Shri

Trilok Singh Rajpal in the year 1972. Her husband was

working as Assistant Engineer in Madhya Pradesh

Electricity Board ('the MPEB' for short) and Rajendra Singh

Rajpal was his younger brother. He was serving as a clerk

in the Punjab National Bank and was posted at Bilaspur

and thereafter to Jabalpur. From 1982, he lived with the

family of the petitioner No.2. He got married in June, 1984

when the husband of the petitioner No.2. He was serving

as Divisional Engineer in the MPEB at Jabalpur.

1.3 The husband of the petitioner No.2 helped his brother

to start a new firm viz., M/s. Balaji Fasteners in Indore,

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where the youngest brother-in-law of the petitioner

became the partner and Rajendra Singh joined as in-

charge when he shifted to Indore after leaving Bank's

employment at Jabalpur.

1.4 In the year 1990, Darshan Singh retired from the firm

and when the partition took place, M/s. Balaji Fasteners

was taken over by Rajendra Singh and petitioner No.2

became the partner in the firm in the month of

September, 1993. The factory was operating in small shed

of Sector-D and M/s.Balaji Fostners was converted to

M/s.Balaji Cables and shifted to a bigger plot at Plot

No.215-B, Sector F, Sanwer Road, Indore. It was leased by

the District Trade and Industries Centre (DTIC) to Rajendra

Singh Rajpal, proprietor of Balaji Cables.

1.5 M/s.Balaji Cables was converted into M/s.Balaji

Cables Pvt.Ltd in the year 1996, where the son of

petitioner No.2 Jasdeep Singh became the director with his

uncle - Rajendra Singh Rajpal. It is averred that the

petitioner No.2 was out from Indore from July 1998 to

October, 2003 and the entire control of M/s.Balaji Cable

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was in the hands of brother-in-law Mr.Rajendra Singh.

Jasdeep Singh was not permitted to look into any of the

activities, being young and nephew of Rajendra Singh. It is

alleged that Rajendra singh became greedy and indulged

into dishonest activities behind the back of the petitioner

No.2.

1.6 It is alleged that in the year 1998, he asked the

petitioner No.2 to sign some of the documents on the

ground that it is meant for the business purpose of the

M/s.Balaji Cables, keeping faith in him, the petitioner No.2

signed the papers.

1.7 It is further averred that the brother-in-law Rajendra

Singh had unilaterally opened a firm namely M/s.Deep

Plastic Industries, wherein the petitioner No.2 was shown

as a proprietor. Upon inquiry, he informed that it was for

the purpose of saving the electricity bills and tax-planning.

1.8 The address of the firm was Plot No.215/B, Sector F,

Indore. The Bank Account No.CA 3032 was opened in the

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Punjab and Sind Bank. The Plot No.215/B was leased to

Rajendra Singh Rajpal in the name of M/s.Balaji Cables. He

also obtained the cheque book for the said account and

asked the petitioner No.2 to sign some of the cheques for

the business purpose and she trusting him had so done it.

1.9 On 31.10.2003, the husband of the petitioner No.2

retired from the MPEB as Additional Chief Engineer. He

desired to join his brother in the business and it was

conveyed to him that the entire business was of Rajendra

Singh and of no one else. Jasdeep singh also was removed

as Director from M/s.Balaji Cable in the month of March,

2002. Thus, the disputes and difference between the

family arose and the petitioner's husband Trilok Singh had

contemplated to initiate the legal proceedings, but

because of the mediation of elderly members of the

family, it did not result into that.

1.10 In the month of June, 2004, Rajendra Singh

opened a Bank Account fraudulently in the name of

petitioner No.2 in the State Bank of Indore, Khatiwala Tank

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Branch and deposited a Demand Draft of Rs.3.95 Lakh,

which was in favour of the petitioner No.2, he withdrew

the amount and the account was closed.

2. According to the petitioner No.2, her husband met

with the car accident and the insurance company had sent

an account payee cheque of Rs.21,836/- in her husband's

name, which was also illegally diverted by his brother.

Upon knowing this, Trilok Singh had filed an FIR against

Rajendra Singh his wife-Indrajit Kaur and the Bank Clerk

Mr.Ravi Manhotra on 12.09.2006.

2.1 As a counter blast, the signed cheques of petitioner

No.2 have been misused and without any lawful reasons,

the complaint under the N.I. Act had been initiated.

3. This Court on 04.07.2012 issued the notice to the

respondents and ad-interim relief granted in terms of para

28(B). This relief has been continued as on 05.05.2018

and the Court had continued the same till final disposal of

this petition.

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4. Affidavit-in-reply for and on behalf of the original

complainant has come on the record, who has denied all

the averments and allegations. According to this

respondent, the cheque in question was signed by the

petitioner No.2 and it was drawn from her Bank account

and was issued by the petitioner No.1 and was deposited

in consideration of sale of goods to her, this cheque has

been dishonoured and therefore, the ingredients of

Section 138 of the N.I.Act would be satisfied.

4.1 It is her say that the complaint filed before the trial

Court is maintainable and need not be quashed. It is

denied that any complaint has been lodged in respect of

the misuse of fraud committed by the brother in law of the

petitioner in respect of the cheque in question. It is further

the say of the complainant that Trilok Singh himself has

taken the delivery of goods and loaded the same in the

lorry and subsequently sent a copy of lorry receipt.

4.2 It is further her say that the goods were delivered at

the instance of the husband of the petitioner No.2 as

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corroborated by the affidavit of one Mr.Mishra, who was

the employee of the petitioner that the goods have been

unloaded in his presence. It is wrong to say that the goods

have not been delivered.

4.3 It is also the say of the complainant that Mr.Rajpal by

way of an affidavit has stated that the husband of the

petitioner No.2 created false and frivolous undertaking

with a view to take advantage in the present matter.

4.4 It is further the say of the complainant that the

petitioner No.2 is an active business person, she was

involved in the various activities & hence, it is wrong to

say that anyone has taken disadvantage of her position.

4.5 It is further urged that Form No.49 and Form No.402

have been field and Form No.49 is required by the firm

registered in the commercial tax office in the State of M.P.

to import the materials from outside the State of M.P. It is

further urged that the scope of interference under Section

482 is limited and various decisions speak of the sparing

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use of this provision.

5. The rejoinder-affidavit has been filed by the

petitioner and additional affidavit has also been further

filed by her which would not require further elaboration.

6. This Court has heard extensively the learned

advocate, Mr.Bhavesh Chokshi, who has urged that deep

rooted conspiracy has resulted into lodgment of this FIR. It

is the dispute between the brothers, which culminated into

this malicious prosecution on the part of the brother, who

has made the present complaint a scapegoat. It is further

his say that there is no such transport company as Laxmi

Transport. The lorry receipt has also been tampered, the

notice of dishonour of the cheque has been issued by the

lawyer of Indore. For filing this complaint, the bogus lorry

receipt and bogus transport company have been forged.

It's courier receipt could not have been in possession of

the complainant. The reply under the RTI Act is received

from the check post at Pitol, District Jhabua, that no such

goods have been received. There is a clear answer of the

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part of check post at Pitol that from 16.12.2006 to

25.02.2007 in the lorry, there was no such goods received

from M/s. Deep Plastics. Issuance of Form No.49 also has

not happened and the VAT provision also needed that

invoice was to be stamped which is absent in the instant

case and the reply of the authority under the RTI was

quite glaring. The factory of the petitioner had been closed

at Sector 21-B and the electricity connection as per the

communication dated 25.01.2007 has been disconnected

on the permanent basis.

6.1 He has relied on the following paragraphs of the

decision of the Apex Court rendered in case of

Suryalakshmi Cotton Mills Ltd vs Rajvir Industries

Ltd. & Ors, reported in 2008 (13) SCC 678 :

"21. In All Cargo Movers (I) Pvt. Ltd. & Ors. v. Dhanesh Badarmal Jain & Anr. [2007 (12) SCALE 391], it was opined:

"16.We are of the opinion that the allegations made in the complaint petition, even if given face value and taken to be correct in its entirety, do not disclose an offence. For the said purpose, This Court may not only take into consideration the admitted facts but it is also permissible to look into the pleadings of the plaintiff-

R/SCR.A/1498/2012 JUDGMENT DATED: 01/07/2021

respondent No. 1 in the suit. No allegation whatsoever was made against the appellants herein in the notice. What was contended was negligence and/or breach of contract on the part of the carriers and their agent. Breach of contract simplicitor does not constitute an offence. For the said purpose, allegations in the complaint petition must disclose the necessary ingredients therefor. Where a civil suit is pending and the complaint petition has been filed one year after filing of the civil suit, we may for the purpose of finding out as to whether the said allegations are prima facie cannot notice the correspondences exchanged by the parties and other admitted documents. It is one thing to say that the Court at this juncture would not consider the defence of the accused but it is another thing to say that for exercising the inherent jurisdiction of this Court, it is impermissible also to look to the admitted documents. Criminal proceedings should not be encouraged, when it is found to be mala fide or otherwise an abuse of the process of the Court. Superior Courts while exercising this power should also strive to serve the ends of justice."

23.The High Court, however, in this case went into various facts including the backdrop of dispute between the parties. It proceeded on the basis that in view of the demerger scheme, the conduct of the appellant in keeping mum for a long time for getting the unused blank cheques returned is

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tell tale. It entered into the question as to whether the complaint petition was filed only with a view to pre-emt the respondents herein to take recourse to the remedies available to them to initiate a criminal proceeding under Section 138 of the Negotiable Instruments Act or the complaint petition in effect and substance should be permitted to be raised only by way of defence. What has failed to attract the attention of the High Court was that maintainability of a criminal proceeding like the present one should not be determined only upon raising a presumption in terms of Section 139 of the Negotiable Instruments Act, it being a rebuttable one."

7. Learned advocate, Mr.Rakesh Sharma appearing for

respondent No.1 has extensively argued urging that the

cheque was issued from the Bank account which has been

maintained by the petitioner. There is a presumption

available under Section 139 of the N.I.Act and no reply to

the notice has been given. All the elements which are

necessary for attracting the provisions of N.I.Act are

existing on the record. He emphatically urged that this is

not the stage of appreciation. A private complaints have

also been filed by the petitioners, which have also not

been entertained by the learned Judicial Magistrate First

Class, Indore and this is not the stage for the Court to

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enter into the disputed question of fact. He has sought to

rely on the following authorities:

(1) Sampelly Satyanarayana Rao vs. Indian

Renewable , reported in AIR (2016) SC 4363

(2) Satish Menon vs. State of Gujarat & ANR,

reported in 2017 (4) GLR 3385

(3) Ravindra Kumar Madhanlal Goenka and anr vs.

Rugnimi Ram Raghav Spinners Private Limited,

reported in 2009 (11) SCC 529.

7.1 He has also urged that the decision sought to be

relied upon by the other side of Suryalakshmi Cotton

Mills Ltd vs Rajvir Industries Ltd. & Ors has already

been dealt with in the decision of Sampelly

Satyanarayana Rao vs Indian Renewable Energy

Development Agency Limited, reported in AIR 2016

SC 4363.

8. Learned APP has supported the case of the

complainant.

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9. Having thus heard the learned advocates on both the

sides and also having examined the material on the

record, at the outset the authorities which are sought to

be relied upon shall need to be regarded.

9.1 It would be profitable to reproduce necessary findings

and observations of the Apex Court in case of Ravindra

Kumar Madhanlal Goenka and Anr vs. Rugmini Ram

Raghav Spinners Private Limited (supra).

"18. While entertaining a petition under Section 482 CrPC, the materials furnished by the defence cannot be looked into and the defence materials can be entertained only at the time of trial. It is well settled position of law that when there are prima facie materials available, a petition for quashing the criminal proceedings cannot be entertained. The investigating agency should have had the freedom to go into the whole gamut of the allegations and to reach a conclusion of its own. Pre-emption of such investigation would be justified only in very extreme cases.

19. While considering the facts of the present case, we are of the considered opinion that the present case is not one of those extreme cases where criminal prosecution can be quashed by the court at the very threshold. A

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defence case is pleaded but such defence is required to be considered at a later stage and not at this stage. The appellants would have ample opportunity to raise all the issues urged in this appeal at an appropriate later stage, where such pleas would be and could be properly analysed and scrutinized.

20. In view of the aforesaid position, we decline to interfere with the criminal proceeding at this stage. The appeal is consequently dismissed."

9.2. In the matter before the Apex Court in case of

Sampelly Satyanarayana Rao vs Indian Renewable

Energy Development Agency Limited the question for

consideration was whether in the given set of facts, the

dishonour of a post-dated cheque given for repayment of

loan, the installment described as a "security" in the loan

agreement is covered by Section 138 of the N.I.Act or not.

The company there was engaged in the field of power

generation, respondent was engaged in development of

renewable energy and is a Government of India

enterprise. Vide the loan agreement, the respondent

agreed to advance loan of Rs.11.50 crore for setting up of

4.00 MW Biomass based Power Project in the State of

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Andhra Pradesh. The agreement recorded that post-dated

cheques towards payment of installment of loan (principal

and interest) were given by way of security. The cheques

carried different dates depending on the dates when the

installments were due and upon dishonour, the complaints

came to be filed by the respondent in the court of learned

Magistrate at New Delhi.

9.3 The appellant approached the High Court for

quashing of the complaints arising out of 18 cheques of

the value of about Rs.10.3 crore with the contention that

they were given by way of security as mentioned in the

agreement and on the date the cheques were issued, no

debt or liability was due. Therefore, dishonour of post-

dated cheques given by way of security did not fall under

Section 138 of the Act.

9.4 The High Court did not accept the said

contention and held that the loan had been sanctioned

and hence, the same falls in the first category that if they

were cheque issued for a debt in present, but payable in

future, no quashment is permissible.

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9.5 The Apex Court after recording in detail the

provisions of law and also on considering the findings and

observations of the Apex Court in case of Indus Airways

Private Limited versus Magnum Aviation Private

Limited distinguished the judgment and held that liability

arose out of the claim for breach of contract under Section

138, which arises on account of dishonour of cheque

issued was not by itself at par with criminal liability

towards discharge of acknowledged and admitted debt

under a loan transaction. "Dishonour of cheque issued for

discharge of later liability is clearly covered by the statute in

question. Admittedly, on the date of the cheque there was a

debt/liability in presenti in terms of the loan agreement, as

against the case of Indus Airways (supra) where the purchase

order had been cancelled and cheque issued towards advance

payment for the purchase order was dishonoured. In that case,

it was found that the cheque had not been issued for

discharge of liability but as advance for the purchase order

which was cancelled. Keeping in mind this fine but real

distinction, the said judgment cannot be applied to a case of

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present nature where the cheque was for repayment of loan

installment which had fallen due though such deposit of

cheques towards repayment of installments was also described

as "security" in the loan agreement. In applying the judgment

in Indus Airways (supra), one cannot lose sight of the

difference between a transaction of purchase order which is

cancelled and that of a loan transaction where loan has

actually been advanced and its repayment is due on the date

of the cheque."

9.6 Crucial question to determine is the applicability

of Section 138 of the Act as to whether the cheque

represents discharge of existing enforceable debt or

liability or whether it represents advance payment without

there being subsisting debt or liability. While approving

the views of different High Courts noted earlier, this is the

underlying principle as can be discerned from discussion

of the said cases in the judgment of this Court. In Balaji

Seafood Exports (India) Ltd. Vs. Mac Industries Ltd.,

the Madras High Court noted that the cheque was not

handed over with the intention of discharging the

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subsisting liability or debt. There is, thus, no similarity in

the facts of that case simply because in that case also,

loan was advanced. It was noticed specifically therein - as

was the admitted case of the parties - that the cheque

was issued as "security" for the advance and was not

intended to be in discharge of the liability, as in the

present case. In HMT Watches Ltd. versus M.A. Abida,

reliance upon on behalf of the respondent, this Court dealt

with the contention that the proceedings under Section

138 were liable to be quashed as the cheques were given

as "security" as per defence of the accused. Negatiying

the said contention, the Apex Court held :-

"10. Having heard the learned counsel for the parties, we are of the view that the accused (Respondent 1) challenged the proceedings of criminal complaint cases before the High Court, taking factual defences. Whether the cheques were given as security or not, or whether there was outstanding liability or not is a question of fact which could have been determined only by the trial court after recording evidence of the parties. In our opinion, the High Court should not have expressed its view on the disputed questions of fact in a petition under Section 482 of the Code of Criminal Procedure, to

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come to a conclusion that the offence is not made out. The High Court has erred in law in going into the factual aspects of the matter which were not admitted between the parties. The High Court further erred in observing that Section 138(b) of the NI Act stood uncomplied with, even though Respondent 1 (accused) had admitted that he replied to the notice issued by the complainant. Also, the fact, as to whether the signatory of demand notice was authorised by the complainant company or not, could not have been examined by the High Court in its jurisdiction under Section 482 of the Code of Criminal Procedure when such plea was controverted by the complainant before it."

9.7 In case of Suryalakshmi Cotton Mills Ltd. v.

Rajvir Industries Ltd., reported in (2008) 13 SCC 678,

following findings and observations are made explaining

the parameters of jurisdiction of the High Court in

exercising its jurisdiction under Section 482 of the Code of

Criminal Procedure:

"17. The parameters of jurisdiction of the High Court in exercising its jurisdiction under Section 482 of the Code of Criminal Procedure is now well settled. Although it is of wide amplitude, a great deal of caution is also required in its exercise. What is required is application of the well- known legal principles involved in the matter.

***

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22. Ordinarily, a defence of an accused although appears to be plausible should not be taken into consideration for exercise of the said jurisdiction. Yet again, the High Court at that stage would not ordinarily enter into a disputed question of fact. It, however, does not mean that documents of unimpeachable character should not be taken into consideration at any cost for the purpose of finding out as to whether continuance of the criminal proceedings would amount to an abuse of process of court or that the complaint petition is filed for causing mere harassment to the accused. While we are not oblivious of the fact that although a large number of disputes should ordinarily be determined only by the civil courts, but criminal cases are filed only for achieving the ultimate goal, namely, to force the accused to pay the amount due to the complainant immediately. The courts on the one hand should not encourage such a practice; but, on the other, cannot also travel beyond its jurisdiction to interfere with the proceeding which is otherwise genuine. The courts cannot also lose sight of the fact that in certain matters, both civil proceedings and criminal proceedings would be maintainable."

9.8 In case of Rallis India Ltd. v. Poduru Vidya

Bhushan, reported in, (2011) 13 SCC 88, this Court

expressed its views on this point as under:

"12. At the threshold, the High Court should not have interfered with the cognizance of the complaints having

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been taken by the trial court. The High Court could not have discharged the respondents of the said liability at the threshold. Unless the parties are given opportunity to lead evidence, it is not possible to come to a definite conclusion as to what was the date when the earlier partnership was dissolved and since what date the respondents ceased to be the partners of the firm." We are in respectful agreement with the above observations. In the present case, reference to the complaint shows that as per the case of the complainant, the cheques which were subject matter of the said complaint were towards the partial repayment of the dues under the loan agreement. As is clear from the above observations of this Court, it is well settled that while dealing with a quashing petition, the Court has ordinarily to proceed on the basis of averments in the complaint. The defence of the accused cannot be considered at this stage. The court considering the prayer for quashing does not adjudicate upon a disputed question of fact. In Rangappa versus Sri Mohan, this Court held that once issuance of a cheque and signature thereon are admitted, presumption of a legally enforceable debt in favour of the holder of the cheque arises. It is for the accused to rebut the said presumption, though accused need not adduce his own evidence and can rely upon the material submitted by the complainant. However, mere statement of the accused may not be sufficient to rebut the said presumption. A post dated cheque is a well recognized mode of payment."

9.9 The reference of Suryalakshmi Cotton Mills Ltd

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(supra), is for the purpose that ordinarily a defence of an

accused which appears to be plausible, according to the

Apex Court, should not be taken into consideration for

exercise of the jurisdiction under Section 482 of the Code

of Criminal Procedure, which is of course has a wide

amplitude and a great deal of caution is necessary. The

Court also said that the High Court at that stage would not

enter into the disputed question of fact. It however would

not mean that documents of unimpeachable character

should not be taken into consideration at any cost for the

purpose of finding out as to whether continuance of the

criminal proceedings would amount to an abuse of the

process of Court or that the complaint petition is filed for

causing mere harassment to the accused. The Court also

held that it is not oblivious of the fact that although a

large number of disputes should ordinarily be determined

only by the civil courts, but criminal cases are filed only

for achieving the ultimate goal namely to force the

accused to pay the amount due to the complainant

immediately. The Court should not encourage such a

practice; but, it cannot also travel beyond its jurisdiction

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to interfere with the proceeding which is otherwise

genuine. The Courts cannot lose sight of the fact that in

certain matters, both civil proceedings and criminal

proceedings would be maintainable.

9.10 The reference of Rallis India Ltd. vs. Poduru

Vidya Bhusan & Ors is for the purpose where it is held

that the High Court could not have discharged the

respondents of the said liability at the threshold. Unless

parties are given opportunity to lead evidence, as there

are may disputed questions of facts existed.

9.11 The reference is also made of Rangappa

versus Sri Mohan where the Apex Court held that once

there is an issuance of the cheque under signature

thereon is admitted presumption of a legally enforceable

debt in favour of the holder of the cheque arises in such

case. It is for the accused to rebut the said presumption

though accused need not adduce his own evidence and

can rely upon the material submitted by the complainant,

but the mere statement of the accused; however, may not

be sufficient to rebut the said presumption.

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9.12 In case of Zandu Pharmaceutical Works Ltd.

v. Mohd. Sharaful Haque, reported in (2005) 1 SCC

122 the Apex Court held and observed as under:

"11. The powers possessed by the High Court under Section 482 of the Code are very wide and the very plenitude of the power requires great caution in its exercise. Court must be careful to see that its decision in exercise of this power is based on sound principles. The inherent power should not be exercised to stifle a legitimate prosecution. The High Court being the highest court of a State should normally refrain from giving a prima facie decision in a case where the entire facts are incomplete and hazy, more so when the evidence has not been collected and produced before the court and the issues involved, whether factual or legal, are of magnitude and cannot be seen in their true perspective without sufficient material. of course, no hard-and-fast rule can be laid down in regard to cases in which the High Court will exercise its extraordinary jurisdiction of quashing the proceeding at any stage. It would not be proper for the High Court to analyse the case of the complainant in the light of all probabilities in order to determine whether a conviction would be sustainable and on such premise arrive at a conclusion that the proceedings are to be quashed. It would be erroneous to assess the material before it and conclude that the complaint cannot be proceeded with. In a proceeding instituted on complaint, exercise of the inherent powers to quash the proceedings is called for only in a case

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where the complaint does not disclose any offence or is frivolous, vexatious or oppressive. If the allegations set out in the complaint do not constitute the offence of which cognizance has been taken by the Magistrate, it is open to the High Court to quash the same in exercise of the inherent powers under Section 482 of the Code. It is not, however, necessary that there should be meticulous analysis of the case before the trial to find out whether the case would end in conviction or acquittal. The complaint has to be read as a whole. If it appears that on consideration of the allegations in the light of the statement made on oath of the complainant that the ingredients of the offence or offences are disclosed and there is no material to show that the complaint is mala fide, frivolous or vexatious, in that event there would be no justification for interference by the High Court. When an information is lodged at the police station and an offence is registered, then the mala fides of the informant would be of secondary importance. It is the material collected during the investigation and evidence led in court which decides the fate of the accused person. The allegations of mala fides against the informant are of no consequence and cannot by themselves be the basis for quashing the proceedings."

9.13 Apt would be to refer to the decision rendered in

case of SATISH MENON vs STATE OF GUJARAT & 1,

reported in 2017 (4) GLR 3385, where the Court

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concluded thus:

"7. Considering the facts of the case, submissions made by learned advocates of the respective parties and documentary evidence produced on the record by either side, it is a undisputed fact that the petitioner was appointed as Executive Director (Sales) of Wetell Everest Cap Solutions Pvt.Limited at Hyderabad. There is some difference in the appointment date of the petitioner as Executive Director (Sales) viz., such as 16th April, 2009 and 1st August, 2009 shown in the appointment letter as well as in record of the Ministry of Corporate Affairs, respectively. It is a submission of the petitioner that he has resigned from the Company vide letter dated 4th March, 2010 from the Directorship of the Company, which was accepted by the Board of Directors, and the Company relieved the petitioner from the post and he ceased to be a Director with effect from 5th March, 2010. It is pertinent to note that the resignation letter given by the petitioner dated 4th March, 2010 is not produced on record by the petitioner, though some of the correspondence accepting resignation from the petitioner and resolution passed by the Company are produced on the record, relieving the petitioner from the post of Director. As per the Board resolution, it was resolved that the Company had received the resignation of Satish Menon from the post of Executive Director (Sales)/Director of Wetell Everest Cap Solutions Limited vide resignation letter dated 4th March, 2010 and it was resolved by the Company, after due deliberation at the

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Board meeting that it was accepted with effect from 5th March, 2010. The respondent no.2 has challenged the aforesaid resolution passed by the Company stating that the petitioner is continued as a Director in the Company and no such letter was received by him from the company, as alleged that the petitioner had resigned from the post. It is further contended by the respondent no.2 that Company had never informed him about receiving of any letter from the petitioner resigning from the Company. Therefore, the question of resignation from the Directorship of the Company cannot be decided in the present petition filed under Section 482 of the Code, because it is a question of fact, which is required to be adjudicated by the trial court.

It is also pertinent to note that being a Director, the petitioner was obliged to present and forward the Form No. 32 to the Registrar of Companies, but it was not forwarded by the petitioner, in time. Later on, it appears that by paying necessary fees and additional charges, it was received by Ministry of Corporate Affairs on 12th February, 2015 stating that the petitioner has resigned from the Company as Executive Director (Sales) of the Company, but when the respondent no.2 has not accepted and challenged it by saying that the petitioner is still continued as Executive Director of the Company and he had never received letter dated 4th March, 2010 about the resignation of the petitioner from the Directorship of the Company and not received any letter or information from the company accepting the prayer of the petitioner. Thus, this factual

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aspect would not be decided or cannot be decided by the High Court in an application filed under section 482 of the Code of Criminal Procedure and it can only be decided by the trial court by recording necessary evidence from the either sides. In case of Mother Care(India) Ltd v/s. Prof. Ramaswamy P. Aiyar (Supra), it is held that merely because the Company has not filed Form No.32, as required to be filed and same is not registered with the Registrar of Companies, it cannot be said that the applicant continues to be the Director of the company under liquidation.

8. From the other side, learned advocate Mr. PV Patadiya for the respondent no.2 has relied a decision in case of Malwa Cotton and Spinning Mills Limited V/s. Virsa Singh Sidhu and Others (Supra), in which also, the respondent no.1 therein had raised a ground that he had resigned from the Directorship before cheques were issued and the petition was allowed on the ground that no specific allegation against other accused person was made. It was held by the Apex Court that the fact of resignation and its correctness have been established in the trial Court, and therefore, the High Court could not have made the impugned judgment, while dealing with application under Section 482 of the Code. It was further held that what was the effect of delayed presentation of Form No. 32 before the Registrar of Companies was essentially a matter of trial and whether the respondent therein had intimated company and whether there was any resolution made accepting his

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resignation were matters in respect of which, evidence had to be led, and therefore, quashing of proceeding so far as the petitioner therein is concerned is improper and order of the High Court was set aside by allowing the appeal.

9. Here also, resignation of the petitioner and resolution passed by the Company, accepting resignation of the petitioner, is disputed by the respondent no.2, which is a factual aspect. Forwarding of Form No. 32 by the petitioner to the Registrar of Companies would also be a matter of trial, and therefore, this Court cannot enter into the facts of the case, or the dispute, while deciding application for discharge under section 482 of the Code, and therefore, liability, if any, of the petitioner with the Company shall be decided by the trial court, on leading of evidence by either sides and not by this Court, at this juncture. Hence, the present petition fails and is hereby dismissed."

10. Noticing the ratio laid down in the above referred

decisions, for the reasons to follow hereinafter this Court is

not inclined to entertain this petition. It is at the outset

needed to be mentioned that there are robust facts which

are sought to be relied upon by the petitioner which are

by all means the defence of the petitioner in the criminal

matter, where reliance is placed on the some of the

documents is with a view and with a specific defence that

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they are of a unimpeachable character, which shall need

to be regarded by this Court as also has been made

permissible by the Apex Court in case of Suryalakshmi

Cotton Mills Ltd (supra).

11. As could be noticed from subsequent decisions of the

Apex Court not only the reference has also been made of

Suryalakshmi Cotton Mills Ltd.(supra), but the Court

has been emphatic in the decision that ordinarily the Court

is not required to look into this aspect, this Court is of the

firm opinion that the chronology of events, which has been

mentioned by the petitioner at each stage would require

either the adducement of the evidence on the part of the

petitioner-accused , where the rebuttal will be necessary

after the initial presumption, even if, the accused as per

the decision of Rangappa versus Sri Mohan chooses to rely

upon the documents sought to be relied upon by the

complainant and also here is not the stage for this Court

to enter into various details which have been emphasised

upon to exercise its power under Section 482 of the Code

of Criminal Procedure.

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12. The Court notices that there is no disputes with

regard to the signature on the cheuqe and her defence is

that the brother-in-law had obtained her signature under

the pretext that for emergency purpose this would be

required for the use of the cheque in the business. There

is an initial admission of the cheque, the presumption

under Section 139 of the N.I.Act would come into play. It is

also not out of place to make a mention that there is no

reply to the notice issued by the complainant. With the

elements referred to under the N.I.Act existing on record,

it is for the trial Court thereafter to appreciate at an

appropriate stage as to whether the defence put forth by

the accused are worth accepting and would lead to the

stage where this rebuttal can be said to have succeeded.

12.1 It is also necessary to make a mention that the

genesis of this is said to be the disputes between the

brothers in relation to the business. It is alleged that son

of petitioner No.2 who was the Director also was drewn

out and the malicious intent on the part of the brother had

made him part one of the cheques which had been signed

by the petitioner in a capacity as a partner. The present

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complainant is a friend of the brother in law, who has

misused such cheque.

12.2 Private complaint appears to have been filed

before the Court of learned Judicial Magistrate First Class,

Indore, which has been dismissed. The allegation with

regard to the disconnection of the electricity connection

permanently from 10.01.2006, the closure of the factory

at Sector 21-B and the account being dormant so also,

the non-filling of Form No.49 or stamping of the invoice

needed under the VAT are some of the issues which are

inter connected and require the appreciation at the end of

the adducement of the evidence.

13. Resultantly, the petition is dismissed without

further elaboration so as to ensure that rights of the either

side may not be prejudiced. Interim relief stands vacated.

Let the proceedings be initiated at the earliest and

completed within a period of six months from the date of

receipt of a copy of this judgment.

14. A request for exemption as the senior citizen

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shall be considered by the Court; however, at the stage of

recordance of further statement or at an appropriate

stage, if she chooses not to appear in person, she can also

be permitted to appear through the video conference.

(SONIA GOKANI, J) M.M.MIRZA