Karnataka High Court
T Dilipkumar Shetty vs Srikanth C on 20 March, 2025
Author: Mohammad Nawaz
Bench: Mohammad Nawaz
-1-
NC: 2025:KHC:11734
CRL.P No. 347 of 2020
C/w CRL.P.NO.875/2020
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 20TH DAY OF MARCH, 2025
BEFORE
THE HON'BLE MR JUSTICE MOHAMMAD NAWAZ
CRIMINAL PETITION NO. 347 OF 2020
482(Cr.PC) / 528(BNSS)
C/W
CRIMINAL PETITION NO. 875 OF 2020
(482(Cr.PC) / 528(BNSS))
IN CRL.P.NO.347/2020:
BETWEEN:
KAVITHA D. SHETTY
W/O T.DILIPKUMAR SHETTY,
AGED ABOUT 44 YEARS,
M/S. YAJNACHITS PRIVATE LTD
NO.2891, 2ND FLOOR, KALIDASA ROAD,
V.V.MOHALLA,MYSORE-570 002,
KARNATAKA.
...PETITIONER
(BY SRI. T. MOHANDAS SHETTY, ADVOCATE)
Digitally signed
by LAKSHMI T AND:
Location: High 1. SRIKANTH C.,
Court of NO.724, 1STFLOOR,
Karnataka S. V. M. COMPLEX, RAMANUJA ROAD,
FORT MOHALLA, MYSORE-570 002
KARNATAKA.
2. T.DILIPKUMAR SHETTY,
S/O HIRIYANNA SHETTY,
R/AT YAJNACHITS PRIVATE LTD,
NO.2891, 2ND FLOOR,
KALIDASA ROAD, V.V.MOHALLA,
MYSORE-570 002, KARNATAKA.
...RESPONDENTS
-2-
NC: 2025:KHC:11734
CRL.P No. 347 of 2020
C/w CRL.P.NO.875/2020
(R-1 AND R-2 ARE SERVED)
THIS CRL.P FILED U/S 482 OF CR.P.C., PRAYING TO
QUASH THE PROCEEDINGS INITIATED AGAINST THE
PETITIONER HEREIN IN C.C.NO.5557/2019 ON THE FILE OF I
ADDITIONAL I CIVIL JUDGE AND J.M.F.C., MYSURU.
IN CRL. P.NO. 875 OF 2020 :
BETWEEN:
T. DILIPKUMAR SHETTY,
S/O. HIRIYANNA SHETTY,
AGED ABOUT 51 YEARS,
R/AT. YAJNACHITS PRIVATE LTD.
NO.2891, 2ND FLOOR, KALIDASA ROAD,
V.V.MOHALLA, MYSORE-570 002.
KARNATAKA.
...PETITIONER
(BY SRI. T. MOHANDAS SHETTY, ADVOCATE)
AND:
1. SRIKANTH C.,
NO.274, 1ST FLOOR,
S V M COMPLEX, RAMANJUNA ROAD,
FORT MOHALLA, MYSORE - 570002,
KARNATAKA.
2. KAVITHA D SHETTY,
W/O. T DILIPKUMAR SHETTY,
AGED ABOUT 44 YEARS,
R/AT YAJNACHITS PRIVATE LTD.
NO.2891, 2ND FLOOR, KALIDASA ROAD,
V.V.MOHALLA, MYSORE-570 002.
KARNATAKA.
...RESPONDENTS
(R1 AND R2 ARE SERVED)
THIS CRL.P FILED U/S 482 CR.PC PRAYING TO QUASH
THE PROCEEDINGS INITIATED BY THE 1ST RESPONDENT
AGAINST THE PETITIONER HEREIN C.C.NO.5557/2019 ON THE
FILE OF THE 1st ADDITIONAL CIVIL JUDGE AND JMFC AT
MYSURU.
-3-
NC: 2025:KHC:11734
CRL.P No. 347 of 2020
C/w CRL.P.NO.875/2020
THESE PETITIONS, COMING ON FOR ADMISSION, THIS
DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE MOHAMMAD NAWAZ
ORAL ORDER
These two petitions arise out of CC No.5557/2019
pending on the file of the Court of I Additional Civil Judge and
JMFC, Mysore. Hence, taken up together for disposal.
2. Heard the learned counsel for petitioners.
Complainant/respondent No.1 is served but unrepresented.
3. Complaint is filed alleging an offence punishable
under Section 138 of Negotiable Instruments Act, 1881 (for
short 'NI Act'). It is stated in the complaint that accused No.1
is the Managing Director and accused No.2 is the Office Bearer
of one 'Yagna Chits Pvt. Ltd.', No.2891, 2nd floor, Kalidasa
Road, V.V.Mohalla, Mysore. During the course of said chit fund
business, the complainant was the successful bidder of the chit,
in respect of which, accused No.1 issued a cheque for
Rs.15,85,400/-. The said cheque, when presented to the Bank,
got dishonoured with an endorsement "Funds Insufficient" and
NC: 2025:KHC:11734
as the accused failed to make payment inspite of issuance of a
legal notice, complaint was filed.
4. The contention raised by the learned counsel
appearing for petitioners is that the complaint which is filed
without making the company as a party is not maintainable and
therefore, the learned Magistrate was not justified in taking
cognizance and issuing process to the complainant. He relied
on a decision of the Hon'ble Apex Court in the case of
'Himanshu v. B.Shivamurthy & another' reported in
(2019) 3 SCC 797.
5. A perusal of complaint averments clearly goes to
show that the petitioners are arraigned as accused in the
capacity of Managing Director and the Office Bearer of one
'Yagna Chits Pvt. Ltd.'. Cheque was allegedly issued by
accused No.1 in the capacity of Managing Director. However,
admittedly the said 'Yagna Chits Pvt. Ltd.' has not been
arraigned as accused in the complaint. The Hon'ble Apex
Court, in the above referred decision has observed, in an
identical circumstance, that in the absence of the company
NC: 2025:KHC:11734
being arraigned as an accused, a complaint was not
maintainable. Para-13 of the judgment is extracted hereunder:
"13. In the absence of the company being arraigned as
an accused, a complaint against the appellant was
therefore not maintainable. The appellant had signed the
cheque as a Director of the company and for and on its
behalf. Moreover, in the absence of a notice of demand
being served on the company and without compliance
with the proviso to Section 138, the High Court was in
error in holding that the company could now be arraigned
as an accused."
6. It is also relevant to extract para-43 of
Judgment of Hon'ble Apex Court in the case of 'Aneeta
Hada v. M/s. Godfather Travels & Tours Pvt. Ltd.'
reported in (2012) 5 SCC 661, which is extracted
hereunder:
"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 which is a three Judge
Bench decision. Thus, the view expressed in Sheoratan
NC: 2025:KHC:11734
Agarwal does not correctly lay down the law and,
accordingly, is hereby overruled. The decision in Anil Hada
is overruled with the qualifier as stated in paragraph 37.
The decision in Modi Distilleries has to be treated to be
restricted to its own facts as has been explained by us
hereinabove."
7. It is also relevant to mention that insofar as
accused No.2 is concerned, admittedly, she is not a signatory
to the cheque in question. She has been arraigned as an
accused alleging that she was one of the Office Bearer of the
said establishment. On such bald allegations, a complaint
alleging an offence under Section 138 of N.I. Act is not
maintainable against the said accused.
8. For the forgoing reasons, the following:
ORDER
i. Both the petitions are allowed.
ii. The entire proceedings in CC No.5557/2019
pending on the file of the Court of I Additional Civil Judge and
JMFC, Mysore, is quashed.
Sd/-
(MOHAMMAD NAWAZ)
JUDGE
TL
