Dismissed

Parin Nandlal Bhavsar v. Hdfc Bank Limited and Anr.

Bombay HC13 Dec 2023WP/998/2020

Case brief

AI extract

What is this about?

High Court of Judicature at Bombay dismissed a writ petition filed by an accused signatory challenging a process order issued in a cheque dishonour case. The court held that the signatory is responsible for the dishonoured cheque and merits of the defence should not be examined at this stage.

What did the court decide?

The criminal writ petition was dismissed; the process order was upheld.

Parin Nandlal Bhavsar Vs Hdfc Bank Limited and Anr. — Cheque Dishonour | Bombay HC (2023)

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WP-998-2020.doc

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Chitra Sonawane.

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION Criminal Writ Petition No.998 of 2020

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Parin Nandlal Bhavsar
having his address at:
A-3, Rashmi Bldg, Bhagyadarshini
CHS, Veera Desai Road,
Andheri West, Mumbai – 400 058

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 … Petitioner
(Orig.Accused No.3)

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Versus

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HDFC Bank Limited a company incorporated under the Digitallysigned by CHITRA Companies Act, 2013 (existing CHITRA SANJAY SANJAY SONAWANE SONAWANE Date: within the purview of companies 2023.12.13 Act,1956) and having its registered 17:42:55+0530 office at HDFC Bank House, Senapati Bapat Marg, Lower Parel (West) Mumbai -400 013 and having one of its branch, Office situated at Sandoz House, Dr.A.B Road, Mumbai-400 018 through its authorized representative Mr.Nadeem Ladji ... Respondent No.1 (Orig.Complainant) 2. State of Maharashtra ... Respondents

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Digitallysigned by signed by CHITRA CHITRA SANJAY SANJAY SONAWANE SONAWANE Date: 2023.12.13 17:42:55+0530 +0530

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Mr Arun H. Mehta, Advocate i/b Akshar Laws, for the
Petitioner.
Mr Girish Thanvi i/b Adv. Meghnath Navlani for respondent
No.1.
Mr RM Pethe, APP for State.

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 Page No. 1 of 7
____________________________________________
 13 December 2023

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Chitra Sonawane.

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WP-998-2020.doc

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 Coram : R. N. Laddha, J.

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 Date : 13 December 2023.

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P.C. :

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Heard Mr Arun Mehta, the learned Counsel for the
petitioner; Mr Girish Thanvi, the learned Counsel appearing
on behalf of respondent No.1; and Mr RM Pethe, the
learned Additional Public Prosecutor for the
respondent/State.

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2.The petitioner, who is accused in CC No.945/SS/2019,
has filed this petition under Section 482 of the Code of
Criminal Procedure, 1973 (CrPC), to challenge and nullify
the order dated 11.2.2020 passed by the learned Additional
Sessions Judge, Greater Mumbai, in Criminal Revision
Application No.1395 of 2019. The said order confirmed the
order of learned Metropolitan Magistrate, 7th Court, Dadar,
Mumbai, in CC No.945/SS/2019 dated 11.6.2019, whereby
the learned Magistrate issued a process against the petitioner
and others under Section 138 read with 141 of the
Negotiable Instruments Act, 1881 (for short, the ‘NI Act’).

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3.The complainant alleges that accused No.1 M/s
Pramukh Car Riders Limited, formerly known as Jayabharat
Automobiles Limited, is a Company whose day-to-day

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 Page No. 2 of 7
____________________________________________
 13 December 2023

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Chitra Sonawane. WP-998-2020.doc

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affairs, management and operations are overseen by accused
No.2 to 4, who are directors of the accused company. The
petitioner/accused No.3 is a signatory of the disputed
cheque.

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4.The complainant alleges that in September 2005,
accused No.1/company and accused No.2 to 4 approached
them for grant of credit facility in the form of inventory
funding to purchase vehicles. The complainant granted a
credit facility of Rs.10 Crores, and the necessary documents
were executed. The complainant renewed this credit facility
on 10.2.2013 and 5.5.2017.

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5.As a security measure, the accused provided undated
cheques to the complainant and availed credit facility. Since
there was an outstanding amount, the accused instructed the
complainant/bank to deposit a cheque bearing No.002890
drawn on Bank of Baroda for sum of Rs.4,48,56,000/-. The
cheque was already in possession of the complainant. In
January, the cheque was presented for encashment, but it was
dishonoured. After the necessary mandate, the complainant
filed a complaint in the trial Court, which issued the process
against the accused.

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 Page No. 3 of 7

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 13 December 2023

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Chitra Sonawane. WP-998-2020.doc

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6.Mr Arun Mehta, the learned Counsel for the petitioner/
accused No.3 submitted that since the petitioner is a non-
executive director of accused no.1 company, he cannot be
held responsible for the dishonour of the cheque. He invited
attention of this Court to Form 32 issued by the Registrar of
company, which shows the status of the applicant at the
relevant time.

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7.The learned Counsel argued that the complainant’s
statement that all the directors are responsible is insufficient,
and each director must be assigned a specific role. He further
argued that although the cash credit facility was agreed upon,
it was not actually provided. In 2013, when the inventory
funding was renewed, the accused No.1 company issued a
letter to the complainant requesting them to send their
earlier undated cheque No.002890, which is the cheque in
dispute. The complainant obtained an order of issue process
by suppressing material facts. The accused issued another
undated cheque bearing No.003982 for Rs.7.50 Crores by
letter dated 23.7.2013. Therefore, the complainant should
have mentioned in the complaint that they had received
another cheque towards the cheque in question and that the
accused had requested for the return of the cheque in

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 Page No. 4 of 7
____________________________________________
 13 December 2023

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Chitra Sonawane. WP-998-2020.doc

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question. However, the complainant presented the same
cheque. The accused company replied to the notice through
advocate and raised this objection substantially.

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8.On the other hand, Mr Girish Thanvi, learned Counsel
for the respondent/complainant, submitted that the
complainant has adequately described the role of each
accused in the complaint. He stated that accused no.2 to 4
are the directors of accused No.1 company and responsible
for the day to day affairs, management and working of the
accused company. According to the learned Counsel, the
mere fact that the accused demanded their cheque return as
per the letter dated 23.7.2013, does not discharge the
accused from liability. The cheque was given to the
complainant towards a loan facility availed by the accused.
The letter is required to be considered on merit and not at
this stage. He further argued that there are certain
presumptions in favour of the complainant under Section
139 of the NI Act, and it is for the accused to rebut the
presumption. In his view, without a trial, it is not possible to
rebut presumption that is in favour of the complainant.

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9.In the present case, it is not in dispute that the cheque in
question was dishonoured and that the petitioner accused is a

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 Page No. 5 of 7
____________________________________________
 13 December 2023

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Chitra Sonawane. WP-998-2020.doc

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signatory to it. The accused had sent a notice to the
complainant on 23.7.2013, asking for the return of the
cheque in question as the accused had issued another cheque
as security. However, the notice cannot be considered
conclusive proof, and the accused cannot claim discharge
based on it at this stage. The truthfulness of the notice can
only be determined after evaluating the evidence adduced in
the Court. Merely because the complainant did not refer to
the notice dated 23.7.2013, it cannot be inferred that the
complainant had concealed any material particulars that led
the Court to issue process order.

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10.In SMS Pharmaceuticals Ltd. Vs. Neeta Bhalla1,it was
observed by the Hon’ble Supreme Court that the signatory of
a cheque which is dishonoured is concerned, is clearly
responsible for the incriminating act and will be covered
under sub-section (2) of Section 141 of the NI Act.

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11.In the present matter, since the petitioner/accused
specifically refers to the point of time when the cheque was
issued, role of the petitioner as the signatory of the cheque,
presentation and dishonour of the cheque and failure to pay
inspite of statutory notice, and the necessary averments are

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1 (2005)8 SCC 89.

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 Page No. 6 of 7

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____________________________________________
 13 December 2023

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Chitra Sonawane. WP-998-2020.doc

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made in the complaint, the learned trial Court rightly issued
the process against the petitioner accused.

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12.Moreover, the scope of a writ petition challenging the
issuance of process is limited to consider the allegations in
the complaint. By catena of judicial pronouncements, the
legal position to the effect is clear that the merits of the
defence should not be considered at the stage of cognizance.

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13.Resultantly, this criminal writ petition stands dismissed.

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[R. N. Laddha, J.]

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 Page No. 7 of 7

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 13 December 2023

Parin Nandlal Bhavsar v. Hdfc Bank Limited and Anr.

Case brief

What is this about?

What did the court decide?

Parin Nandlal Bhavsar v. Hdfc Bank Limited and Anr.

Case brief

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