Allowed

Md. Shoaib and Anr. v. State of Maharashtra and Anr.

Bombay HC15 Mar 2023WP/201/2022

Case brief

AI extract

What is this about?

The Bench held that a director is not the 'drawer' of a cheque and thus cannot be directed to pay interim compensation under section 143A of the NI Act. The writ petition was allowed, and the impugned order quashed.

What did the court decide?

The rule was made absolute to quash the order under section 143A of the NI Act directing the petitioners to pay interim compensation.

Md. Shoaib and Anr. Vs State of Maharashtra and Anr. — Cheque Dishonour | Bombay HC (2023)

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901-wp201-2022.doc

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AGK

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION

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WRIT PETITION NO.201 OF 2022

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Digitally signed byATUL ATUL GANESH GANESH KULKARNI KULKARNI Date: 2023.04.28 11:54:55 +0530

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Md. Shoaib & Anr.… Petitioners

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V/s.

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The State of Maharashtra & Anr.… Respondents

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Mr. Sukrut Mhatre with Mr. Jyotirmay Deshmukh for
the petitioners.

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Mr. Gautam Ankhad i/by Mr. Tushar Gujjar, Deep
Madnani, & Karan F. i/by SL Partners for respondent
no.2.

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Mr. A.R. Patil, APP for respondent/State.

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CORAM :AMIT BORKAR, J.

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DATED:MARCH 15, 2023

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P.C.:

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1.The writ petition is directed against order dated 7th March
2020 passed by the learned Metropolitan Magistrate 33rd Court,
Ballard Pier, Mumbai directing petitioner (director) to pay 20% of
the cheque amount towards interim compensation in exercise of
powers under section 143A of the Negotiable Instruments Act,
1881 (hereafter “NI Act”, for short). The cheques are issued by
accused nos.1 and 2/companies. Undisputedly, the petitioners are
the directors of accused nos.1 and 2/companies.

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2.For the reasons stated in judgment dated 8th March 2023 in
a group of matters, lead matter being Criminal Application No.886

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901-wp201-2022.doc

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of 2022, this Court has already held that the authorized signatory
of a cheque issued by the accused/company in a proceeding under
section 138 of the NI Act cannot be directed to pay interim
compensation under section 143A of the NI Act as such authorized
signatory is not “drawer” within the meaning of section 143A of
the NI Act.

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3. Drawing the same analogy, the petitioners being directors and not the “drawers”, no order under section 143A of the NI Act could have been passed against the directors .

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4. In that view of the matter, the writ petition succeeds.

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5. Rule is made absolute in terms of prayer clauses (b) and (c).

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6. No costs.

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(AMIT BORKAR, J.)

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Note: This order is modified as per order dated 26 April 2023 to insert the
appearance of the petitioner.

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Md. Shoaib and Anr. v. State of Maharashtra and Anr.

Case brief

What is this about?

What did the court decide?

Md. Shoaib and Anr. v. State of Maharashtra and Anr.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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