[Cites 11, Cited by 0]
Gujarat High Court
United Petrofer Ltd vs State Of Gujarat on 7 May, 2026
NEUTRAL CITATION
R/SCR.A/6911/2025 JUDGMENT DATED: 07/05/2026
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CRIMINAL APPLICATION (QUASHING) NO. 6911 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE L. S. PIRZADA
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Approved for Reporting Yes No
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UNITED PETROFER LTD. & ORS.
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MR KUNAL S SHAH(5282) for the Applicant(s) No. 1,2,3
MR DEVEN PARIKH SENIOR ADVOCATE WITH MR NIRAV P SHAH(6475)
for the Respondent(s) No. 2
MR TUSHAR L SHETH(3920) for the Respondent(s) No. 2
MR DHAWAN JAYSWAL APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR.JUSTICE L. S. PIRZADA
Date : 07/05/2026
ORAL JUDGMENT
1. The present petition has been preferred by the
petitioners - original accused under Section 528 of Bhartiya
Nagrik Suraksha Sanhita, 2023 (for short "BNSS, 2023") for
quashing of the complaint filed by respondent No.2 - original
complainant being Criminal Case No.3558 of 2024, pending
before the learned 16th Additional Chief Judicial Magistrate,
Surat.
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2. The factual matrix, leading to the filing of the present
petition, are that one private complaint being Criminal Case
No.3558 of 2024 has been given by one - Mr.Amit Nagindas
Kapadia as a power of attorney holder of Jalaram Jari
Industries, Surat against the accused - United Petrofar
Limited and other Directors for the offence punishable under
Section 138 read with Section 141 of Negotiable Instruments
Act, 1881 (for short, the "N.I. Act").
2.1. As per the case of the original complainant before the
learned trial Court, pursuant to the transaction taken place
between the original complainant and the original accused,
the accused have invited the complainant to join their
business and if they invest some amount, they will get more
profit and pursuant to that, the complainant has given an
amount of Rs.50,00,000/- to the accused on 26.06.2023 and
against that, on 27.06.2023, the accused have given the goods
worth Rs.21,23,115/- and thereafter, again the accused told
the complainant that they have huge quantity of goods and
they will again send some goods and complainant will get
more profit and then again, the complainant has given
Rs.50,00,000/- by cheque of Jalaram Jari Industries firm on
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28.06.2023 but, pursuant to the same, no delivery has been
given by the accused persons and subsequently, a credit note
has been issued by the accused in the name of the
complainant firm on 26.07.2023 for Rs.56,616.40.
Subsequently, the amount has been duped and pursuant to
that, the accused have issued 8 cheques in favour of the
complainant firm, amounting to Rs.74,64,634/- and the said
cheques were presented by the complainant - bank its account
but, the same were returned unpaid on 08.12.2023.
Subsequently, the complainant has given notice to the
accused through advocate on 16.12.2023. The said notice was
duly served to the accused on 18.12.2023 but, they have not
paid heed to the notice and subsequently, after receipt of the
notice, they have paid Rs.11,64,634/- and rest of the amount
of Rs.63,00,000/- was not paid. Hence, the complaint came to
be filed on 12.01.2024 against the accused persons for the
offence punishable under Section 138 of the N.I. Act by
Mr.Amit Nagindas Kapadia as a power of attorney holder of
Jalaram Jari Industries.
2.2. The present petition has been preferred by the accused
for quashment of the criminal complaint mainly on the ground
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that the complaint itself is not maintainable as it has not been
filed by the authorized person or a power of attorney holder.
3. Learned advocate Mr.Kunal S. Shah for the petitioners
submitted that complaint filed against the accused persons is
false, frivolous and vexatious because there is a contradiction
between the facts described by the complainant and in the
complaint, no specific averment has been made regarding how
the power of attorney holder is authorized to maintain the
complaint. It is submitted that if the complaint and the other
documents are accepted even on its face value, the complaint
under Section 138 of the N.I. Act is not maintainable. It is
submitted that looking to the GST Certificate of the
complainant firm, which has been produced along with the
complaint, it appears that the said firm is a proprietary firm
and the proprietor is one Mr.Sanjaykumar Dhansukhlal
Jariwala and looking into the compliant, the power of attorney
has not been given by Mr.Sanjaykumar Dhansukhlal Jariwala
to Mr.Amit Nagindas Kapadia and, therefore, he cannot file a
complaint on the behalf of the proprietary firm and
considering the above admitted documents, the complaint is
not maintainable. Further, it is submitted that the complaint
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under Section 138 of the N.I. Act is maintainable only if it is
made by the payee or holder in due course or by authorized
person or the power of attorney holder. But, in the present
case, the proprietor of Jalaram Jari Industries is one
Mr.Sanjaykumar Jariwala and he has not given any power of
attorney or authority to Mr.Amit Nagindas Kapadia. It is
submitted that, therefore, the complaint is not maintainable.
It is further submitted that Mr.Amit Nagindas Kapadia is not a
proprietor of the firm and as he has no connection with the
firm, he cannot file a complaint and considering the same, the
present complaint is required to be quashed and set aside.
3.1. Further, it is submitted that as per the provisions of the
BNSS, 2023 and, more particularly, as per Section 223(1), the
Court cannot take cognizance without hearing the accused
and this is a new Amended Act and earlier in the old Act of
Code of Criminal Procedure, 1973, this provision was not
there. In the present case, before taking cognizance, the
Court has not issued any notice to the accused persons and
has not heard them and, therefore, also there is a violation of
the mandatory provisions of law and hence, the present
petition is required to be allowed and the complaint is
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required to be quashed and set aside.
3.2. In support of his argument, the learned advocate
Mr.Kunal Shah has relied upon the decisions of this Court in
the case of Vishal Kamlesh Parikh vs. State of Gujarat and
Others, rendered in Criminal Misc. Application (for Quashing
& Set Aside FIR/Order) No.19517 of 2013 dated 27.01.2017.
He Further, relied upon the decision of Hon'ble Apex Court in
the case of (M/s.) Shankar Finance & Investments vs. State of
Andhra Pradesh and Ors., reported in 2009 (1) GLH 297 and
in the case of Milind Shripad Chandurkar vs. Kalim M. Khan,
reported in 2011 (4) SCC 275 and in the case of Kushal
Kumar Agarwal vs. Directorate of Enforcement, reported in
2025 INSC 760.
4. On the other hand, learned A.P.P. Mr.Dhawan Jayswal
for respondent No.1 submitted that there is a dispute between
the private parties and necessary order is required to be
passed.
5. Learned Senior Counsel Mr.Deven Parikh appearing
with learned advocate Mr.Nirav Shah for the respondent No.2
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submitted that the present petition has no merits and the
power of attorney holder can maintain a complaint. It is
submitted that looking to the title of the complaint, it is
specifically stated in the title that Mr.Amit Nagindas Kapadia
is the power of attorney holder of Jalaram Jari Industries firm.
Thus, it has been specifically stated that the power of attorney
holder of the firm has filed this complaint. It is further
submitted that at the time of taking cognizance by the Court,
more particularly, in the cases of complaint under Section 138
of the N.I. Act, at the time of issuance of process, the learned
Magistrate has to prima facie satisfy or is required to see that
issuance of the cheque by the drawer in favour of the
complainant is dishonoured, on presentation of the payee,
issuance of the statutory notice under Section 138 of the N.I.
Act and filing of the complaint within the prescribed statutory
period. It is submitted that at the time of taking cognizance,
the Court has not to examine the merits and controversy
between the parties.
5.1. Further, in support of his argument, learned Senior
Counsel Mr.Parikh has relied upon the decision of Hon'ble
Apex Court in the case of Renuka vs. The State of
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Maharasthra and Another, reported in 2026 INSC 327. He
also relied upon the decision of the Hon'ble Apex Court in the
case of M.M.T.C. Ltd. and Ors. vs. Medchi Chemicals &
Pharma (P) Ltd. and Ors., reported in AIR 2002 SC 182 and
submitted that as per the decision of this Hon'ble Apex Court
and as per Section 142 read with Section 138 of the N.I. Act,
the complaint can be made by payee or holder in due course
and at the time of issuance of process, the Court cannot go
into the question whether the cheque has been issued as a
security and not for any debt or liability and the Court cannot
go into the merits at that time.
5.2. It is submitted that the procedure has already been
provided under Section 142 of the N.I. Act. So, as per Section
223(1) of the BNSS, 2023, the Court is not required to issue
notice to the accused and hear him before issuance of the
process. It is submitted that considering this, present petition
is devoid of any merit and is required to be dismissed.
5.3. Learned Senior Counsel Mr.Parikh has further submitted
that initially, Jalaram Jari industries, a firm, is a proprietary
concern owned by one Mr.Sanjaykumar Dhansukhlal Jariwala
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and initially, he had given power of attorney to Mr.Amit
Nagindas Kapadia on 06.11.2015 and Mr.Sanjaykumar
Jariwala has expired on 11.11.2023 and before his death,
Mr.Sanjaykumar Jariwala had executed a Will and as per the
Will, all the assets of the firm have been transferred to the
family of Mr.Nagindas Kapadia and on the strength of the said
Will, Mr.Nagindas Tulsidas Kapadia, Ms.Geetaben Nagindas
Kapadia and Mr.Mithun Nagindas Kapadia have been given
the assets and the business of the Jalaram Jari Industries.
They have executed a general Power of Attorney in favour of
Mr.Amit Nagindas Kapadia on 16.12.2023 pursuant to which,
a complaint has been filed on behalf of the firm.
6. After hearing the rival submissions of the learned
advocates appearing for the respective parties, the only
controversy raised before this Court is that the case is made
out by the petitioner that whether the complaint under
Section 138 of the N.I. Act is maintained by the Power of
Attorney holder or not?
7. In the present case, now, it is required to consider the
title of the complaint, which reads as under:-
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"Amit Nagindas Kapadia Te
"Jalaram Jari Industries" Pedhi Na Powerdar
Aged: 37, Occupation: Business,
Address: Surat"
8. So, from the title of the complaint, it appears that the
complaint has been filed by Mr.Amit Nagindas Kapadia, who
is the power of attorney holder of the firm, namely, Jalaram
Jari Industry. Along with the complaint, a copy of the power-
of-attorney is also attached. It is an admitted position that the
power-of-attorney holder can maintain a complaint. In this
regard, learned advocate Mr.Shah for the petitioners has
heavily relied upon the decision of the Hon'ble Apex Court in
the case of (M/s.) Shankar Finance & Investments (supra)
wherein, the Hon'ble Apex Court, in para 9, has observed as
under:-
"9. The next question is where a proprietary
concern carries on business through an Attorney
holder, whether the Attorney holder can lodge the
complaint? The Attorney holder is the agent of the
grantor. When the grantor authorizes the Attorney
Holder to initiate legal proceedings and the
Attorney holder accordingly initiates legal
proceedings, he does so as the agent of the
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grantor and the initiation is by the grantor
represented by his Attorney holder, and not by the
Attorney holder in his personal capacity.
Therefore where the payee is a proprietary
concern, the complaint can be filed: (i) by the
proprietor of the proprietary concern, describing
himself as the sole proprietor of the 'payee'; (ii)
The proprietary concern, describing itself as a
sole proprietary concern, represented by its sole
proprietor, and (iii) the proprietor or the
proprietary concern represented by the Attorney
holder under a Power of Attorney executed by the
sole proprietor. It follows that in this case the
complaint could have been validly fled by
describing the complainant in any one of the
following four methods
"Atmakuri Shankara Rao, sole proprietor of M/s.
Shankar Finance & Investments"
Or
"M/s. Shankar Finance & Investments a sole
proprietary concern represented by its proprietor
Atmakuri Shankara Rao"
Or
"Atmakuri Shankara Rao, sole proprietor of M/s.
Shankar Finance & Investments, represented by
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his Attorney Holder Thamada Satyanarayana"
Or
"M/s. Shankar Finance & Investments, a
proprietary concern of Atmakuri Shankara Rao,
represented by his Attorney Holder Thamada
Satyanarayana". What would have been improper
is for the Attorney holder Thamada Satyanarayana
to file the complaint in his own name as if he was
the complainant."
9. Even from said decision, it clearly emerges that the
power-of-attorney holder can initiate the legal proceedings
and when the payee is a proprietary concern, the complaint
can be filed (i) by the proprietor of the proprietary concern,
describing himself as a sole proprietor of the payee (ii)
proprietary concern, describing itself as a sole proprietor
concern, represented by its sole proprietor (iii) proprietor or
the proprietary concern, represented by the attorney holder
under a power-of-attorney executed by the proprietor. Also,
the method has been shown by the Hon'ble Apex Court and as
per method No.4 - M/s. Shankar Finance & Investments, a
proprietary concern of Atmakuri Shankara Rao, represented
by his Attorney Holder Thamada Satyanarayana".
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10. In the present case also, the complaint has been filed by
Mr.Amit Nagindas Kapadia, who, as per the title of the
complaint, is a power-of-attorney holder of Jalaram Jari
Industries,. Further, reliance has also been placed on the
decision of this Court in the case of Vishal Kamlesh Parikh
(supra) wherein, this Court while relying upon the decision of
A.C. Narayan (Supra), in paragraph No.5.1, has observed as
under:
"5.1 The Apex Court in the decision of A.C.
Narayanan (supra) cited by Mr. Thakkar, learned
advocate for respondent no. 2, after considering
several judgements on this issue categorically
observed in para 31 of the judgement as under:
"31. In view of the discussion, we are of the
opinion that the attorney holder cannot file a
complaint in his own name as if he was the
complainant, but he can initiate criminal
proceedings on behalf of his principal. We
also reiterate that where the payee is a
proprietary concern, the complaint can be
filed:
(i) by the proprietor of the proprietary
concern, describing himself as the sole
proprietor of the "payee";
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(ii) the proprietary concern, describing
itself as a sole proprietary concern,
represented by its sole proprietor; and
(iii) the proprietor or the proprietary
concern represented by the attorney
holder under a power of attorney
executed by the sole proprietor."
11. It has been specifically observed by this Court that
considering the Judgment of Hon'ble Apex Court in the case
of A.C. Narayan (supra), Power of Attorney holder cannot file
a complaint in his own name as he is the complainant but, he
can initiate the criminal proceedings on behalf of the principal
and he can maintain the complaint as proprietary concern
represented by the attorney holder under the Power of
Attorney executed by the proprietor. So, from the decision on
which, the learned advocate for the petitioners is heavily
relying upon, looking into the facts of the present case, a
complaint has been filed by Mr.Amit Nagindas Kapadia not in
a personal capacity but, he has initiated the proceedings as a
Power of Attorney holder of the propitiatory firm.
12. Further, the another limb of argument of learned
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advocate Mr.Kunal Shah is that as per Section 223(1) of the
BNSS, 2023, before taking cognizance, the Court is required
to hear the accused. In this regard, it is required to consider
that so far as Negotiable Instruments Act, 1881 is concerned,
it is a complete Code in itself and under Section 142 of the
N.I. Act, a procedure has been prescribed for taking
cognizance, which reads as under:-
"142. Cognizance of offences.--
(1)Notwithstanding anything contained in the Code of
Criminal Procedure, 1973 (2 of 1974)--
(a)no court shall take cognizance of any
offence punishable under section 138 except
upon a complaint, in writing, made by the
payee or, as the case may be, the holder in
due course of the cheque;
(b)such complaint is made within one month
of the date on which the cause of action
arises under clause (c) of the proviso to
section 138:
Provided that the cognizance of a complaint may
be taken by the Court after the prescribed period,
if the complainant satisfies the Court that he had
sufficient cause for not making a complaint within
such period.
(c)no court inferior to that of a Metropolitan
Magistrate or a Judicial Magistrate of the
first class shall try any offence punishable
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under section 138.
(2)The offence under section 138 shall be inquired
into and tried only by a court within whose local
jurisdiction,--
(a)if the cheque is delivered for collection
through an account, the branch of the bank
where the payee or holder in due course, as
the case may be, maintains the account, is
situated; or
(b)if the cheque is presented for payment by
the payee or holder in due course, otherwise
through an account, the branch of the
drawee bank where the drawer maintains
the account, is situated.
Explanation.-- For the purposes of clause (a),
where a cheque is delivered for collection at any
branch of the bank of the payee or holder in due
course, then, the cheque shall be deemed to have
been delivered to the branch of the bank in which
the payee or holder in due course, as the case may
be, maintains the account."
13. Considering the above the provisions of the Negotiable
Instruments Act, a procedure has been provided for taking
cognizance and Section 223(1) of the BNSS, 2023 has not
been attracted in the cases where, the complaint has been
filed for the offence punishable under Section 138 of the N.I.
Act. Further, at this stage, it is also pertinent to note and it is
brought to the notice of this Court that in the present case,
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the plea of the accused has already been recorded,
complainant has presented his examination-in-chief, the cross-
examination of the complainant has already been started and
even the learned advocate for the accused before the learned
trial Court has also put a question to the complainant i.e.
Power of Attorney holder, who has initiated the proceedings
on behalf of the propitiatory firm, regarding his knowledge of
the transaction and his capacity as a Power of Attorney
holder.
14. So, when the trial has already been commenced and the
complainant, who is the Power of Attorney holder of the
proprietary concern, is in the witness box and cross-examined
by the learned advocate for the accused before the trial Court,
from the face of the complaint, it cannot be said that the
controversy can be decided by this Court by invoking power
under Section 528 of BNSS, 2023 as the said controversy or
the defence can be put by the petitioners during the trial as
the complainant is already in the witness-box and his cross-
examination is going on.
15 Considering the above observations, no case is made out
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by the petitioners to quash the complaint under Section 528 of
BNSS, 2023 at this stage and the points, which have been
raised by the petitioners - original accused before this Court,
can be decided at the time of trial only.
16. Hence, I did not find any merits in the present petition.
17. Accordingly, present Special Criminal Application
No.6911 of 2025 is hereby dismissed. Rule is discharged.
Interim relief granted earlier stands vacated forthwith.
(L. S. PIRZADA, J)
18. After pronouncement of the judgment, learned advocate
Mr.Kunal S. Shah for the petitioners requests to stay the
execution and implementation of this judgment for a period of
four weeks as the petitioners want to approach the Hon'ble
Apex Court.
19. Looking to the facts of the case and considering the fact
that the complaint is at the stage of further cross-examination
of the complainant, request of learned advocate Mr.Shah to
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stay the execution and implementation of this judgment
cannot be accepted and the same is hereby rejected.
(L. S. PIRZADA, J)
Hitesh
