Karnataka High Court
Sri. Ashok Chowriappa vs Sri. Ramakrishnam Raju S/O ... on 10 August, 2023
Bench: M.Nagaprasannapresided Bymnpj
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NC: 2023:KHC-D:8752
CRL.P No. 103113 of 2022
IN THE HIGH COURT OF KARNATAKA,
DHARWAD BENCH
DATED THIS THE 10TH DAY OF AUGUST, 2023
BEFORE
THE HON'BLE MR JUSTICE M.NAGAPRASANNA
CRIMINAL PETITION NO. 103113 OF 2022
BETWEEN:
SRI. ASHOK CHOWRIAPPA,
AGE. 50 YEARS, OCC. MANAGING DIRECTOR
OF M/S. CHOWRIAPPA CONSTRUCTIONS PVT.LTD.,
OFFICE AT NO.41, 6TH FLOOR,
CHIRSTU COMPLEX, LAVELLE ROAD,
BANGALORE-560001.
... PETITIONER
(BY SRI. V.M. SHEELVANT &
SRI. M.L. VANTI, ADVOCATES)
AND:
VISHAL SRI. RAMAKRISHNAM RAJU S/O RAMRAJU,
AGE. 72 YEARS, OCC.
NINGAPPA R/O.PRO OF SRI VIJAYALAXMI GAS AGENCY,
PATTIHAL HARAPANAHALLI TOWN & TALUK,
BALLARI DIST.-583101.
Digitally signed by ... RESPONDENT
VISHAL NINGAPPA (BY SRI. ANOOP G. DESHPANDE, ADVOCATE)
PATTIHAL
Date: 2023.08.14
11:10:11 +0530 THIS CRIMINAL PETITION IS FILED U/S 482 OF CR.P.C.,
SEEKING TO QUASH PROCEEDINGS AGAINST THE PETITIONER IN
CC NO.87/2020 (PCR NO. 5/2020) FOR THE OFFENCES PUNISHABLE
UNDER SECTION 138 OF NEGOTIABLE INSTRUMENTS ACT PENDING
ON THE FILE OF HON'BLE CIVIL JUDGE AND JMFC COURT,
HARAPPANAHALLI, DISTRICT BELLARY.
THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, THE
COURT MADE THE FOLLOWING:
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CRL.P No. 103113 of 2022
ORDER
1. The petitioner is before this Court calling in
question the proceedings in C.C. No.87/2020 registered
for the offence punishable under Section 138 of the N.I.
Act.
2. Heard the learned counsels Shri V.M.
Sheelavant and Shri M.L. Vanti appearing for the petitioner
and the learned counsel Shri Anoop G. Deshpande
appearing for the respondent.
3. Facts in brief, germane are as follows:
The petitioner is said to have borrowed an amount of
Rs.10,00,000/- (Rupees ten lakhs only) from the
respondent. In furtherance of which certain cheques were
issued in favour of the respondent - complainant. Those
cheques having been presented are dishonoured for want
of sufficient funds. Dishonouring of cheques leads the
complainant before the concerned Court invoking Section
200 of the Cr.P.C for the offence punishable under Section
138 of the N.I. Act.
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CRL.P No. 103113 of 2022
4. In the said proceedings, the cheque which had
been issued on behalf of the Company is not made an
accused. This is an admitted fact and the proceedings in
which the Company is not made a party would not be
maintainable in the light of the judgment of the Apex
Court in the case of Aneeta Hada Vs. Godfather Travels
and Tours Private Limited reported in (2012)5 SCC
661, wherein, it is held as under:
"58. Applying the doctrine of strict
construction, we are of the considered opinion that
commission of offence by the company is an
express condition precedent to attract the vicarious
liability of others. Thus, the words "as well as the
company" appearing in the Section make it
absolutely unmistakably clear that when the
company can be prosecuted, then only the persons
mentioned in the other categories could be
vicariously liable for the offence subject to the
averments in the petition and proof thereof. One
cannot be oblivious of the fact that the company is
a juristic person and it has its own respectability. If
a finding is recorded against it, it would create a
concavity in its reputation. There can be situations
when the corporate reputation is affected when a
director is indicted.
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CRL.P No. 103113 of 2022
59. In view of our aforesaid analysis, we
arrive at the irresistible conclusion that for
maintaining the prosecution under Section 141 of
the Act, arraigning of a company as an accused is
imperative. The other categories of offenders can
only be brought in the dragnet on the touchstone of
vicarious liability as the same has been stipulated in
the provision itself. We say so on the basis of the
ratio laid down in C.V. Parekh (supra) which is a
three-Judge Bench decision. Thus, the view
expressed in Sheoratan Agarwal (supra) does not
correctly lay down the law and, accordingly, is
hereby overruled. The decision in Anil Hada (supra)
is overruled with the qualifier as stated in
paragraph 51. The decision in Modi Distilleries
(supra) has to be treated to be restricted to its own
facts as has been explained by us hereinabove.
60. We will be failing in our duty if we do
not state that all the decisions cited by the learned
counsel for the respondents relate to service of
notice, instructions for stopping of payment and
certain other areas covered under Section 138 of
the Act. The same really do not render any aid or
assistance to the case of the respondents and,
therefore, we refrain ourselves from dealing with
the said authorities. Resultantly, the Criminal
Appeal Nos. 838 of 2008 and 842 of 2008 are
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CRL.P No. 103113 of 2022
allowed and the proceedings initiated under Section
138 of the Act are quashed."
5. In the light of the issue being considered by the
Apex Court in the afore quoted, permitting the further
proceedings would become contrary to law and results in
miscarriage of justice. For the aforesaid reasons, the
following:
ORDER
(i) The petition is allowed.
(ii) The proceedings in C.C. No.87/2020
registered for the offence punishable under
Section 138 of the N.I. Act stands
quashed.
Sd/-
JUDGE
Vnp*/Ct:Bck
