Kerala High Court
C.L.Joseph vs Dency Reginold on 30 November, 2021
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE ZIYAD RAHMAN A.A.
TUESDAY, THE 30TH DAY OF NOVEMBER 2021 / 9TH AGRAHAYANA, 1943
CRL.MC NO. 6032 OF 2014
[AGAINST THE COMPLAINT FILED IN ST NO.921/2010 OF JUDICIAL FIRST
CLASS MAGISTRATE COURT-III, THRISSUR]
PETITIONERS/ACCUSED Nos.2,3,5,6 & 8:
1 C.L.JOSEPH
FORMER DIRECTOR, KSHEMANIDHI KURIES AND LOANS (P) LTD.,
VIMALA BUILDINGS, RICE BAZAR, THRISSUR -1, S/.O.
LONAPPAN, CHIRAMMAL HOUSE, KARSHAKA NAGAR, KODANNUR,
THRISSUR.
2 K.L. JOSEPH
FORMER EXECUTIVE DIRECTOR, KSHEMANIDHI KURIES AND LOANS
(P) LTD., VIMALA BUILDINGS, RICE BAZAR, THRISSUR -1,
S/.O. LONAPPAN, KOLAZHALIPARAMBIL HOUSE, NELLIKKUNNU
DESOM, OLLUKKARA VILLAGE, THRISSUR.
3 DAVI V. THATTIL
FORMER DIRECTOR, KSHEMANIDHI KURIES AND LOANS (P) LTD.,
VIMALA BUILDINGS, RICE BAZAR, THRISSUR -1, S/.O.
VAREETH, THATTILPIDIYAN HOUSE, OLLUR VILLAGE,
CHELAKKOTTUKARA DESOM, THRISSUR.
4 K.P. FRANCIS
FORMER DIRECTOR, KSHEMANIDHI KURIES AND LOANS (P) LTD.,
VIMALA BUILDINGS, RICE BAZAR, THRISSUR -1, S/.O. PAILY,
KOYIKKARA HOUSE, CHIYYARAM VILLAGE, KURIYACHIRA DESOM,
THRISSUR.
5 K.P. FRANCIS
FORMER DIRECTOR, KSHEMANIDHI KURIES AND LOANS (P) LTD.,
VIMALA BUILDINGS, RICE BAZAR, THRISSUR - 1, S/O.
PAILOTH, KOLLANNUR HOUSE, ARANATTU KARA, THRISSUR.
BY ADVS.
SRI.DINESH R.SHENOY
SMT.K.K.JYOTHILAKSHMY
SRI.SANIL JOSE
SMT.S.SOUMYA ISSAC
RESPONDENT/S:
Crl.MC No.6032 of 2014 2
1 DENCY REGINOLD
W/O. PAYYAPPIILLY REGINOLD, KIZHAKKUMPATTUKARA,NEAR
CHUNGAM, MUKKATTUKARA ROAD, THRISSUR - 680657.
(ADDRESS OF RESPONDENT NO.1 CORRECTED AND SUBSTITUTED
AS: "M/S. PEEYAR EXPORTERS, P.R.TOWRS CHURCH CIRCLE,
THRISSUR REPRESENTED BY ACCOUNTANT EXECUTIVE AND
LITIGATION AGENT DENNY C.C., S/O. C.D.CHAKKUNNI,
CHAKKALACKAL HOUSE, P.O. PALISSERY, PALACKAL, THRISSUR"
AS PER ORDER DATED 27.3.2018 IN CRL.MA 1912/15.)
2 MS. KSHEMANIDHI KURIES AND LOANS PVT. LTD.
(UNDER LIQUIDATION), VIMALA BUILDINGS, RICE BAZAR,
THRISSUR REP. BY THE OFFICIAL LIQUIDATOR, HIGH COURT OF
KERALA, KOCHI - 682 031.
3 K.C. PORINJU (DIED)
DIRECTOR, M/S. KSHEMANIDHI KURIES AND LOANS PVT. LTD.
VIMALA BUILDINGS, RICE BAZAR, THRISSUR, S/O. CHAKKUNNI,
KUNNAN HOUSE, OLLUR DESOM, EDAKKUNNI VILLAGE, THRISSUR
- 680 001.
4 STATE OF KERALA
REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF
KERALA, PIN-682 031.
BY ADVS.
R1 BY ADV. G.UNNIKRISHNAN
SRI.K.MONI, OFFICIAL LIQUIDATOR
OTHER PRESENT:
R4 BY PP-SRI.SUDHEER GOPALAKRISHNAN
THIS CRIMINAL MISC. CASE HAVING COME UP FOR HEARING ON
30.11.2021, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:
Crl.MC No.6032 of 2014 3
O R D E R
The petitioners are accused Nos.2,3,5,6 and 8 in
S.T.No.921/2010 on the file of the Judicial First
Class Magistrate Court-III, Thrissur. The aforesaid
case was registered against them for the offences
punishable under Sections 138 and 142 of the
Negotiable Instruments Act on the basis of a
complaint submitted by the 1st respondent herein.
2. The case pertains to issuance of a cheque by
and on behalf of M/s. Kshemanidhi Kuries & Loans
Private Limited by the accused persons herein who are
the former Director, former Executive Director and
other former Directors of the said Company.
3. This Crl.MC is filed by them seeking to quash
the proceedings in the above S.T. case by invoking
powers of this Court under Section 482 of the Code of
Criminal Procedure (Cr.PC).
4. Heard Sri. Dinesh R. Shenoy, the learned
counsel for the petitioners and the learned Public
Prosecutor for the 2nd respondent.
5. The learned counsel for the petitioners
contends that the cheque was issued on behalf of the
Company which was ordered to be wound up by this
Court as per order dated 30.9.2009 in C.P.No.9/2009.
The cheque which is the subject matter of the
complaint was issued on 30.7.2009 and the same was
presented on 5.10.2009. Statutory notice was issued
by the 1st respondent on 10.10.2009. The specific case
of the petitioners is that the cause of action for
initiating proceedings under Section 138 of the
Negotiable Instruments Act arose after the order of
winding up of the Company was passed. Consequently,
the petitioners herein being the Directors of the
Company stand discharged from their official duties
and responsibilities, and the entire management of
the Company vested upon the official liquidator
appointed in this behalf. The learned counsel places
reliance upon Francis K.P. and Others v. Fair Kuries
Private Limited and Others [2018(3) KHC 101]. The
said case was in respect of a similar proceedings
initiated against the Directors of the very same
Company and this issue was specifically considered by
this Court. After referring to a large number of
decisions of Hon'ble Supreme Court and other High
Courts, this Court in paragraph 27 of the judgment in
Francis's case (supra) has observed as follows:
27. The upshot of the above discussion is that if
the cause of action arose subsequent to the order of
winding up of the company, it cannot be said that the
offence under S.138 of the N. I. Act is completed. The
date on which the cheque was handed over would have no
bearing. The cause of action arises only when the cheque
presented for encashment is dishonoured and the drawer
fails to make payment of the cheque amount within the
statutory period, after the receipt of demand notice.
Therefore, if the company is wound up as per the order of
the Court prior to the completion of the offence under
S.138 of the N. I. Act, no complaint against the company
and its erstwhile Directors, is maintainable. On the
other hand, if the company is ordered to be wound up by
the Court subsequent to the completion of the offence
under S.138 of the N.I. Act, the prosecution under S.138
of the N.l. Act is maintainable against the company and
its Directors notwithstanding the order passed by the
Court for winding up of the company."
6. In this case, it is evident from the records
that the cause of action for initiating proceedings
has arisen after 30.9.2009 which is after the order
of winding up of the Company. In the light of the
above principles that has been laid down by this
Court in the judgment in Francis' case (supra), the
proceedings in this case is liable to be quashed.
In the result, Crl.MC is allowed. All further
proceedings pursuant to S.T.No.921/2010 on the file
of the Judicial First Class Magistrate Court-III,
Thrissur are hereby quashed.
Sd/-
ZIYAD RAHMAN A.A., JUDGE
pkk
APPENDIX OF CRL.MC 6032/2014
PETITIONER'S ANNEXURE:
Annexure A1 TRUE PHOTOCOPY OF THE COMPLAINT FILED IN
S.T.NO.921/2010 BEFORE THE JUDICIAL FIRST
CLASS MAGISTRATE COURT III, THRISSUR.
//TRUE COPY//
SD/- PS TO JUDGE
