M/S. Rychold Chemicals vs The State Of Telangana
2022 Latest Caselaw 7024 Tel

     THE HONOURABLE SRI JUSTICE K.SURENDER

         CRIMINAL PETITION No.10325 OF 2022

O R D E R:

This Criminal Petition is filed under Section 482 of the

Code of Criminal Procedure, 1973 (for short 'Cr.P.C.') by the

petitioners/A1 to A3 to quash the proceedings against them

in STC No.5990 of 2022 on the file of X Additional chief

Metropolitan Magistrate, City Civil Court at Secunderabad.

2. Heard learned counsel for the petitioners and learned

Additional Public Prosecutor for 1st respondent-State and

perused the record.

3. Briefly, the facts of the case are that the 2nd respondent-

firm supplied raw material to the accused meant for chemical

industry engineering items such as MS pipes, SS Ball valves,

SS View glass, SS nipple, SS bend and MS bends etc. The 2nd

respondent/Complainant agreed to supply the material, if the

accused pays the bill amount within 15 days, failing which

interest of 27% p.a. has to be paid. The amount of

Rs.3,19,924/- remained unpaid. On 15.04.2021, the

complainant met the 2nd petitioner/A2 and her husband on

which date an amount of Rs.2,500/- was paid as part

payment and for the remaining amount a post dated cheque

bearing No.001205, dated 06.06.2022 for Rs.3,08,299/- was

issued.

4. The said cheque when presented for clearance was

returned unpaid on 08.06.2022. The same was informed to

the 2nd petitioner/A2 who requested to present the cheque

again. Accordingly, the cheque was presented again and it

was returned unpaid on 11.07.2022. A legal notice was

issued on 30.07.2022 and the said notice was returned

unclaimed, however a reply dated 09.08.2022 was issued.

The 2nd respondent/complainant, further stated in the

complaint that he was not aware of the death of the signatory

of the cheque Kolli Koteshwar Rao, however the 2nd and 3rd

petitioners herein who are wife and son were actively

participating in the day-to-day affairs of the firm, for which

reason they are liable.

5. Learned Counsel for the petitioners submits that

admittedly, both 2nd and 3rd petitioners are not signatories to

the cheque. According to the legal notice dt.30.07.2022, the

outstanding arose in the month of July towards six bills and

one bill in the month of December, 2019.

6. The petitioners issued a reply notice on 09.08.2022

stating that these petitioners have nothing to do with the

business operations of the 1st petitioner-firm. 2nd petitioner's

husband Kolli Koteshwar Rao who was running the said firm

died on 25.08.2021 and after his death, 3rd petitioner was

inducted as partner. There was no amount due since the

outstanding amounts were all cleared during the life time of

Kolli Koteshwar Rao, in the month of February 2020.

7. On behalf of the respondents, it was argued that since

the cheque being issued by the 1st petitioner-firm is admitted,

the proceedings have to go on. It is specifically mentioned in

the complaint that the 2nd and 3rd petitioners are responsible

partners who are running the business activity of the 1st

petitioner-firm. In the said circumstances, whether there was

any outstanding or not can be decided after trial, giving

opportunity to the complainant to adduce evidence.

8. He also relied upon the Judgment of this court in

B.Venkat Narendra Prasad and another v. State of A.P. and

another 1 and the Judgment reported in P.Ramchandra

Reddy and another v. Sanghi Enterprises, Hyderabad

and others 2 wherein it was held that every partner is

responsible and cannot escape liability stating that he is

sleeping partner. He also relied upon the Judgment of the

Honourable Supreme Court in S.P.Mani and Mohan Dairy

v. Dr.Snehalatha Elangovan 3 and argued that there

cannot be any hyper technical approach while dealing with a

complaint under Section 138 of the Negotiable Instruments

Act to decide criminal liability of the partners/directors in a

firm. Further, quashing of the complaint is a serious matter

and complaint cannot be quashed unless there is no offence

which is made out against the Director or a partner.

2003 (1) ALD (Crl.) 538 (AP)

2004 (1) ALD (Crl.) 406 (A.P)

2022 (3) ALT (Crl.) (SC) 193 (D.B)

9. On perusal of the record, admittedly the transactions

were in the month of July 2019. The claim of the 2nd

respondent/complainant is that Rs.2,500/- was paid on

15.04.2021 and the post dated cheque with date 06.06.2022

was given for a sum of Rs.03,08,299/-.

11. In the present facts and circumstances of the case,

when the transaction had taken place in July 2019, a post

dated cheque was handed over after 21 months in the month

of April 2021, that too with a date after 14 months. The said

claim of issuance of cheque itself raises any amount of doubt

regarding complainant's version being correct. Further, how

the amount of Rs.3,08,299/- was arrived at is also another

issue.

12. Though this Court under inherent powers cannot decide

upon the correctness or otherwise of the claim made in a

complaint, however, when the circumstances are inherently

improbable and lack prudence, the powers under Section 482

of Cr.P.C. can be invoked to quash such proceedings.

13. In the present case as already stated, the transactions

had taken place in July 2019. 21 months thereafter, a cheque

is issued by the deceased Kolli Koteshwar Rao for making

payments after 16 months which is 06.06.2022. The said

cheque in question was signed by Kolli Koteshwar Rao during

his life time. When the outstanding itself according to the

notice was Rs.3,23,034/- and interest component was 27%

p.a. on the bill amounts, why interest was not added to the

said amount though payment was being received after three

years is intriguing and improbable.

14. During the life time of Kolli Koteshwar Rao, it appears

that the transactions were made and cheque was handed

over. Since the complainant's version appears to be

improbable and suppressing actual facts, this Court finds

that there cannot be criminal prosecution of petitioners 2 and

3 who are made vicariously liable on behalf of 1st petitioner

firm.

15. For the said reasons, proceedings against the 2nd

petitioner and the 3rd petitioner who was inducted after the

death of the husband of the 2nd petitioner into the

partnership of 1st Petitioner firm, cannot be sustained and

liable to be quashed.

16. Accordingly, the Criminal Petition is allowed quashing

the proceedings against petitioners A2 and A3 in STC

No.5990 of 2022 on the file of X Additional chief Metropolitan

Magistrate, City Civil Court at Secunderabad. However the

proceedings may continue against 1st petitioner partnership

firm and any person representing the firm in the case

including the 2nd and 3rd petitioners cannot be sentenced to

imprisonment.

Miscellaneous Petitions, pending if any, shall stand

closed.

__________________ K.SURENDER, J Date: 27.12.2022 tk

THE HON'BLE SRI JUSTICE K.SURENDER

CRIMINAL PETITION No.10325 OF 2022

Dt. 27.12.2022

tk