The High Court dismissed a petition to quash prosecution proceedings under Section 138 of the Negotiable Instruments Act, rejecting the argument that pending arbitration proceedings barred the criminal case, holding they can continue simultaneously.
Petition for quashing of proceedings under Section 482 Cr.P.C was dismissed.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE R. NARAYANA PISHARADI
FRIDAY, THE 17TH DAY OF JANUARY 2020 / 27TH POUSHA, 1941
Crl.MC.No.3177 OF 2019(F)
AGAINST STC 1836/2017 OF JUDICIAL MAGISTRATE OF FIRST CLASS, MATTANNUR
PETITIONER/ACCUSED:
BINDHU.A.V., AGED 40 YEARS S/O. W/O. JITHESH,MANNOOR HOUSE, CHUNNGAKKUNNU (PO), KELAKAM,KANNUR DISTRICT
BY ADVS. SRI.P.V.KUNHIKRISHNAN SRI.P.V.ANOOP
RESPONDENTS/COMPLAINANT & STATE :
1 SREE GOKULAM CHIT AND FINANCE CO. (P) LTD. IRITTY BRACH , REPRESENTED BY ITS POWER OF ATTORNEY HOLDER, MRS. P.M. RAJANI, W/O. C.V. RAJEEV KUMAR, 36 YEARS, LEGAL CLERK, FATHIMATH SHAMSHEENA COMPLEX, IRITTY
2 STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM, KOCHI-682 031 R1 BY ADV. SRI.MAHESH V RAMAKRISHNAN SRI.C.K.PRASAD PP
THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 13-01-2020, THE COURT ON 17-01-2020 PASSED THE FOLLOWING:
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“CR”
R.NARAYANA PISHARADI, J
Crl.M.C.No.3177 of 2019
Dated this the 17th day of January, 2020
O R D E R
The petitioner is the accused in the case S.T.No.1836/2017
on the file of the Court of the Judicial First Class Magistrate, Mattannur.
complaint (Annexure-A) filed against the petitioner by the first respondent (hereinafter referred to as 'the complainant') for an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'the Act').
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Thereafter, he failed to repay the balance chitty amount of Rs.45,27,242/- to the complainant company. The accused was the surety of Mr.George in the chitty transactions. She agreed to repay the amount and issued a cheque dated 20.04.2017 for Rs.45,27,242/- to the complainant in discharge of the liability. The complainant presented the cheque in the bank. It was returned unpaid on 09.05.2017, for the reason that there was no sufficient amount in the account of the accused. On 27.05.2017, the complainant sent a lawyer notice to the accused demanding payment of the amount of the cheque. The accused received the notice on 29.05.2017. She did not send any reply. She did not pay the amount of the cheque.
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subsequent to the institution of Annexure-A complainant against the petitioner, the complainant has initiated arbitration proceedings for realisation of the amount allegedly due from the subscriber of the chitty and also the petitioner in the chitty transactions. Learned counsel for the petitioner contended that, the questions whether the petitioner owes any amount to the complainant company and if so, what is the amount owed by her, could be decided only after the disposal of the arbitration cases.
to attract an offence punishable under Section 138 of the Act. There is no merit in the contention of the petitioner that the averments in Annexure-A complaint do not constitute the ingredients of the offence punishable under Section 138 of the Act.
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Section 138 of the Act.
“We are also of the view that there can be no bar to the simultaneous continuance of a criminal proceeding and a civil proceeding if the two arise from separate causes of action”.
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11. In Trisuns Chemical Industry v. Rajesh Agarwal :
AIR 1999 SC 3499 , it was held that merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. The Apex Court further held as follows:
“We are unable to appreciate the reasoning that the provision incorporated in the agreement for referring the disputes to arbitration is an effective substitute for a criminal prosecution when the disputed act is an offence. Arbitration is a remedy for affording reliefs to the party affected by breach of the agreement but the arbitrator cannot conduct a trial of any act which amounted to an offence albeit the same act may be connected with the discharge of any function under the agreement. Hence, those are not good reasons for the High Court to axe down the complaint at the threshold itself”.
filed against the petitioner cannot be decided in a petition filed
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under Section 482 Cr.P.C (See HMT Watches Limited v. M.A.Abida : (2005) 11 SCC 776 ).
Consequently, the petition is dismissed.
R.NARAYANA PISHARADI, JUDGE
jsr
Crl.M.C.No.3177/2019
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APPENDIX
PETITIONER'S EXHIBITS:
ANNEXURE-A TRUE COPY OF THE COMPLIANT WHICH IS NOW PENDING AS S.T.C. NO.1836/2017 ON THE FILE OF JUDICIAL FIRST CLASS MAGISTRATE, MATTANNUR
ANNEXURE-B TRUE COPY OF THE APPLICATION FOR REFERENCE OF A DISPUTE TO ARBITRATION, WHICH IS NUMBERED AS A.R.C.NO.742/2018 PENDING BEFORE THE ARBITRATION FOR CENTRAL CHENNAI CHIT FUNDS COURT
ANNEXURE-C TRUE COPY OF THE APPLICATION FOR REFERENCE OF A DISPUTE TO ARBITRATION,WHICH IS NUMBERED AS A.R.C.NO.8746/2018 PENDING BEFORE THE ARBITRATOR FOR CENTRAL CHENNAI CHIT FUNDS COURT
RESPONDENTS' EXHIBITS : NIL
TRUE COPY
PS TO JUDGE
2 issues framed by the court
Whether the initiation of arbitration proceedings by the complainant prevents the maintainability of a complaint filed under Section 138 of the Negotiable Instruments Act.
Whether other factual disputes involved in the complaint can be decided in a petition filed under Section 482 Cr.P.C
Colour shows how this judgement treated each authority
Guracharan Singh v. M/s Allied Motors LimitedApplied¶41
Guracharan Singh v. M/s Allied Motors Limited : (2005) 10 SCC 626 · Who else cites this
Palanitkar v. State of BiharApplied¶41
Palanitkar v. State of Bihar : AIR 2001 SC 2960 · Who else cites this
M/s Sri Krishna Agencies v. State of A.PFollowed¶42
M/s Sri Krishna Agencies v. State of A.P : AIR 2009 SC 1011 · Who else cites this
Trisuns Chemical Industry v. Rajesh AgarwalExplained¶46
Trisuns Chemical Industry v. Rajesh Agarwal : AIR 1999 SC 3499 · Who else cites this
HMT Watches Limited v. M.A.AbidaRelied on¶54
HMT Watches Limited v. M.A.Abida : (2005) 11 SCC 776 · Who else cites this
2 provisions across 2 enactments
BINDHU.A.V.
SREE GOKULAM CHIT AND FINANCE CO. (P) LTD.
STATE OF KERALA
R. NARAYANA PISHARADI
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
