Kerala High Court
K.L.Joseph vs Nishad K.Mohan on 16 February, 2022
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE ZIYAD RAHMAN A.A.
WEDNESDAY, THE 16TH DAY OF FEBRUARY 2022 / 27TH MAGHA, 1943
CRL.MC NO. 4554 OF 2016
AGAINST THE COMPLAINT FILED IN CC 252/2010 OF JUDICIAL MAGISTRATE
OF FIRST CLASS -I,THRISSUR
PETITIONERS/ACCUSED Nos.2,3,6,8 & 9:
1 K.L.JOSEPH
KSHEMANIDHI KURIES & LOANS (P) LTD,VIMALA BUILDINGS,
RICE BAZAR, THRISSUR - 1,S/O. LONAPPAN, KOZHILIPARAMBIL
HOUSE,NELLIKKUNNU DESOM, OLLUKKARA VILLAGE, THRISSUR.
2 DAVI V. THATTIL FORMER DIRECTOR
KSHEMANIDHI KURIES & LOANS (P) LTD,VIMALA BUILDINGS,
RICE BAZAR, THRISSUR - 1, S/O. VAREETH, THATTILPIDIYAN
HOUSE,OLLUR VILLAGE, CHELEKKOTTUKARA DESOM, THRISSUR.
3 K.P.FRANCIS FORMER DIRECTOR
KSHEMANIDHI KURIES & LOANS (P) LTD,VIMALA BUILDINGS,
RICE BAZAR, THRISSUR - 1, S/O.PAILY, KOYIKKARA HOUSE,
CHIYYARAM VILLAGE, KURIYACHIRA DESOM, THRISSUR
4 C.L.JOSEPH, FORMER DIRECTOR, KSHEMANIDHI KURIES & LOANS
(P) LTD, VIMALA BUILDINGS, RICE BAZAR, THRISSUR-1, S/O.
LONAPPAN, CHIRAMMAL HOUSE, KARSHAKA NAGAR, KODANNUR,
THRISSUR.
K.P.FRANCIS, FORMER DIRECTOR
5 KSHEMANIDHI KURIES & LOANS (P) LTD, VIMALA BUILDINGS,
RICE BAZAR, THRISSUR - 1, S/O. PAILOTH, KOLLANNUR
HOUSE,ARANATTUKARA, THRISSUR
BY ADVS.
SRI.DINESH R.SHENOY
SRI.EBIN MATHEW
SMT.K.K.JYOTHILAKSHMY
SRI.A.JOSEPH GEORGE
RESPONDENTS/COMPLAINANT & ACCUSED Nos.1,4,5 & 7
1 NISHAD K.MOHAN
S/O. K.S.MOHAN, KINASSERY HOUSE,P.O.ALAGAPPA NAGAR,
THRISSUR - 680 302.
CRL.MC No.4554 of 2016 2
2 KSHEMANIDHI KURIES LOANS (P) LTD
EASTEND PLAZA, RICE BAZAR, THRISSUR - 680 001, REP.
BY THE OFFICIAL LIQUIDATOR,HIGH COURT OF KERALA,
(WORNGLY SHOWN AS REPRESENTED BY ITS MANAGING
DIRECTOR BEFORE THE COURT BELOW)
3 T.L.GEORGE
THATHRATHIL HOUSE, SN PARK,POOTHOLE, THRISSUR (DIED).
4 M.C.GEORGE DIRECTOR
KSHEMANIDHI KURIES & LOANS (P) LTD,VIMALA BUILDINGS,
RICE BAZAR, THRISSUR,S/O. CHAKU, MAPRANI HOUSE, OLLUR
DESOM,EDAKKUNNI VILLAGE, THRISSUR TALUK,PIN - 680 001
(DIED).
5 K.C.PORINJU DIRECTOR
KSHEMANIDHI KURIES & LOANS (P) LTD,VIMALA BUILDINGS,
RICE BAZAR, THRISSUR,S/O. CHAKKUNNI, KUNNAN HOUSE,
OLLUR DESOM,EDAKKUNNI VILLAGE, THRISSUR - 680 001.
6 STATE OF KERALA
REP. BY THE PUBLIC PROSECUTOR,HIGH COURT OF KERALA -
682 031.
BY ADVS.
R1 BY SRI.K.S.MADHUSOODANAN
R6 BY SHRI.SUDHEER GOPALAKRISHNAN, PP
THIS CRIMINAL MISC. CASE HAVING COME UP FOR HEARING ON
16.02.2022, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:
CRL.MC No.4554 of 2016 3
O R D E R
in C.C.No.252/2010 on the file of the Judicial
First Class Magistrate Court-I, 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 calender 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 Shri.Sudheer
Gopalakrishnan, the learned Public Prosecutor for
the 6th 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 15.7.2009
and the same was presented and it was dishonoured
on 25.9.2009. Statutory notice was issued by the
1st respondent on 19.10.2009. 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 15 days after expiry of the
date of receipt of statutory notice dated
19.10.2009 which is after 30.9.2009, the date of
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 C.C.No.252/2010 on
the file of the Judicial First Class Magistrate
Court-I, Thrissur as against the petitioners
herein, are hereby quashed.
Sd/-
ZIYAD RAHMAN A.A.
JUDGE
pkk
APPENDIX OF CRL.MC 4554/2016
PETITIONER'S EXHIBITS:
ANNEXURE-A1 TRUE PHOTOCOPY OF THE COMPLAINT FILED IN CC
NO.252/2010 OF JUDICIAL FIRST CLASS
MAGISTRATE COURT - I, THRISSUR.
