Gujarat High Court

Ankitbhai Sureshbhai Lotiya vs State Of Gujarat on 25 September, 2023

Bench: Sandeep N. Bhatt

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     R/CR.MA/17458/2018                                       ORDER DATED: 25/09/2023

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             IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

     R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
                   FIR/ORDER) NO. 17458 of 2018
                              With
          R/CRIMINAL MISC.APPLICATION NO. 17459 of 2018
                              With
          R/CRIMINAL MISC.APPLICATION NO. 17551 of 2018
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                          ANKITBHAI SURESHBHAI LOTIYA
                                     Versus
                          STATE OF GUJARAT & 1 other(s)
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Appearance:
MR PRATIK Y JASANI(5325) for the Applicant(s) No. 1
JEET Y RAJYAGURU(8039) for the Respondent(s) No. 2
MR CHINTAN DAVE, APP for the Respondent(s) No. 1
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 CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT

                                  Date : 25/09/2023

                                   ORAL ORDER

1. These applications are filed under Section 482 of

the Code of Criminal Procedure, 1973 (`the Code' for short)

for quashing and setting aside the complaints being Criminal

Case No.3095 of 2018, 3094 of 2018 and 3096 of 2018

pending before the Court of the learned Chief Judicial

Magistrate, Rajkot filed under the provisions of the

Negotiable Instruments Act (`NI Act' for short).

2. The impugned complaints are filed by the

respondent no.2-complainant for the dishonour of the cheques

issued by the applicant. The legal notice was given to which

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the applicant replied and as the amount was not paid within

the stipulated time limit, the impugned complaints were filed,

which are prayed to be quashed by way of these applications.

4. Heard learned advocate Mr.Jasani for the

applicant, learned APP for the respondent no.1-state and

learned advocate Mr.Rajyaguru for the respondent no.2-

complainant.

4.1 Learned advocate for the applicant submitted that

the impugned complaints against the applicant is abuse of

process of law; that the cheques in question have been

misused by Shri Dhirajlal Viradiya and his son Shri

Sagarbhai Viradiya who had beaten the applicant and his

father, for which FIR is filed by the applicant wherein the

chargesheet is also filed after investigation. He submitted

that as the cheques in question were misused by the accused

named hereinabove, the applicant has no privity of contract

with respondent no.2. He submitted that public notices were

also issued for the misuse of the cheques in question and the

debt as alleged in the impugned complaints is not a legally

enforceable debt against the applicant. He submitted that the

respondent no.2 has not given details about the dates on

which the amount was lent; that there is no mention as to

in whose presence the amount was given to the applicant;

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that the respondent no.2 created the partnership firm in the

name of Shreejikrupa Construction Company overnight and

thereafter has deposited the said cheques in connivance with

other directors of the company. He submitted that from

September, 2016, the company in which the applicant is a

director, i.e. Riddhi Siddhi Cotspin Pvt.Ltd. Has been

classified as NPA for which the bank had issued public

advertisement cautioning the public at large about the said

aspect and the said company has not entered into any

transaction with anyone after the said date and though the

said fact was known to the respondent no.2, the respondent

no.2 has misused the cheque in question with the help of

Shri Dhirajlal Viradiya and others for pressurizing father of

the applicant as he has filed an FIR against them. He,

therefore, submitted that these applications be allowed and

the impugned complaints be quashed and set aside.

5. Per contra, learned APP for respondent no.1-state has objected these applications and submitted that this Court

should not exercise its powers by interfering with the

proceedings of recovery of amount and the proceedings

initiated under Section 138 of the Act are perfectly justified.

6. Learned advocate Mr.Rajyaguru for respondent

no.2-complainant has submitted that the cheques are issued

by the applicant, they bear the signature of the applicant,

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the applicant is the director of the company from which

account the cheque is issued. He, therefore, submitted that

the ingredients of Section 138 of the NI Act are, prima facie,

satisfied and therefore, this Court may dismiss these

applications.

6. I have considered the rival submissions and

perused the material on record.

7. At the outset, the provision of Section 138 of the

NI Act is required to be seen, which read as under:

"138. Dishonour of cheque for insufficiency, etc., of funds in the account.

Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for "a term which may extend to two

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year", or with fine which may extend to twice the amount of the cheque, or with both:

Provided that nothing contained in this section shall apply unless

(a) The cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier.

(b) The payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer, of the cheque, "within thirty days" of the receipt of information by him from the bank regarding the return of the cheques as unpaid, and

(c) The drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

Explanation: For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability."

8. In view of the above provision, if the facts of the

present case are perused, the averments made in the

applications and the submissions made by learned advocate

for the applicant as noted hereinabove are all in the form of

defence. Prima facie, the ingredients of Section 138 of NI Act

are made out. The signature is not disputed, the amount is

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not paid is not disputed. The cheque is stolen, it is misused,

whether it is given against any legally enforceable debt, in

what capacity the cheque is issued are all disputed facts,

which needs to be tested at trial. The contentions put

forward by the learned advocate for the applicant that the

cheques were taken forcibly, the complaints are filed for the

same and thereafter the cheques were deposited by creating a

partnership firm overnight, are all points to be tested by a

full fledged trial. This Court, at this stage of quashing of the

complaints, has to take whether prima facie, the ingredients

of Section 138 of the NI Act are satisfied, which in my

opinion, on perusal of the cheques in question and the papers

on record, are satisfied. This Court cannot conduct mini trial

or roving inquiry at the stage of exercising the powers under

Section 482 of of the Code and therefore, this Court cannot

exercise the powers under Section 482 of Code at this initial

stage.

9. At this stage, it is also fruitful to refer to the

judgment rendered by the Hon'ble Apex Court in the case of

Raj Kumar Khurana V/s State of (NCT of Delhi) and Another, reported in (2009)6 SCC 72, the head note of which reads as under:

"A.Negotiable Instruments Act, 1881 - S.138 - Cheque

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dishonoured as cheque reported as lost - Whether constitutes an offence under S.138 - Held, S.138 creates a legal fiction of deemed commission of offence when a cheque is dishonoured either due to insufficiency of funds or the amount mentioned in the cheque exceeds the amount arranged to be paid from a particular account by an agreement with the bank - The fiction does not extend to lost cheque - Hence dishonour of cheque on this ground does not constitute an offence under S.138 - Interpretation of Statutes - Particular statutes and provisions - Penal provisions - penal provision creating legal fiction, held, must receive strict construction."

10. It is also fruitful to refer to the judgment in the

case of S.Krishnamoorthy V/s Chellammal reported in (2015)4

SCC 559, wherein the Hon'ble Apex Court has held in

paragraphs nos.5,7 and 8 of which read as under:

"5. The above defence of the respondent (accused) before the High Court, in the petition filed under Section 482 of the Code, is nothing but absolutely factual in nature, which is neither admitted by the complainant, nor apparent on the face of the record. Such type of disputed factual defences could have been appreciated only by the trial court, after the parties led their evidence. In our opinion, the High Court committed grave error of law in examining the allegations and counter allegations which are disputed and

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factual in nature in a proceeding under Section 482 of the Code.

7. In view of the above position of law, we have no option but to set aside the order passed by the High Court as it has entered into highly disputed questions of fact and concluded that the material before it was sufficient to cause reasonable suspicion in the case of the complainant. That is not the ground on which powers under Section 482 of the Code can be exercised by the High Court.

8. Therefore, the appeal is allowed. The impugned order dated 5.8.2009 passed by the High Court of Judicature at Madras in Criminal O.P. No. 7989 of 2009 is hereby set aside. The Criminal complaint (CC No. 120 of 2007) pending before the Judicial Magistrate, Dharapuram, shall stand revived. The trial court shall proceed in accordance with law."

11. In view of above discussion as well as settled

position of law and after considering the facts as alleged in

the complaint filed under Section 138 of the NI Act and

circumstances of the present case and considering that the

averments and submissions made are in the form of defence

and that disputed questions are involved in the matters

which are required to be tested by a proper trial of the

matters, I am of the opinion that this is not a fit case to

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exercise the inherent powers under Section 482 of the Code