Allowed

Vijay Kumar Bansal and Anr. v. Shiv Kumar Grover

Punjab & Haryana HC21 Sept 2012CRM-M/24506/2010

Case brief

AI extract

What is this about?

Petitioner challenged a Section 138 complaint for cheque dishonour allegedly issued to discharge liability to a third-party firm. The High Court quashed proceedings as the complainant lacked personal liability, the principal firm was not impleaded, and the cheque was misused from a joint account during matrimonial discord.

What did the court decide?

Complaint, summoning order, and subsequent proceedings quashed.

Vijay Kumar Bansal and Anr. Vs Shiv Kumar Grover — Cheque Dishonour | Punjab & Haryana HC (2012)

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Crl. Misc. No. M-24506 of 2010

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IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH

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Crl. Misc. No. M-24506 of 2010 Date of decision: September 21, 2012.

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Vijay Kumar Bansal and another

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... Petitioner(s)

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Shiv Kumar Grover

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... Respondent(s)

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Whether Reporters of local papers may be allowed to see the judgment ?

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To be referred to the Reporters or not ?

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Whether the judgment should be reported in the Digest.

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CORAM: HON'BLE MR. JUSTICE PARAMJEET SINGH

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Present: Shri Sumeet Mahajan, Senior Advocate with Shri Amit Kohar, Advocate for the petitioner.

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Shri Adarsh Jain, Advocate for the respondent.

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Paramjeet Singh, J.

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The instant petition has been filed under Section 482 Cr.P.C. for quashing of the complaint No.879/2 dated 9.9.2009, entitled “Shiv Kumar Grover v. Smt. Sheetal Gaurav P. Jain and another”, pending in the court of Judicial Magistrate First Class, Ludhiana (Annexure P-1) and the summoning order dated 9.9.2009 (Annexure P-2) and all subsequent proceedings arising therefrom.

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Brief facts as mentioned in the complaint are to the effect that the petitioners/accused approached the complainant-respondent in the month of March 2009 for purchasing copper scrap. The complainant is

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doing the business of trading/agent of ferrous and non-ferrous scrap and supplying to different persons in India whereas the accused are alleged to be also doing the business of purchasing and selling scrap. It is also mentioned that the complainant-respondent is doing the work of trading/agent only. It is mentioned in the complaint that the complainant-respondent is also an agent of AIP Industries, Office No.2, 5^th Floor, Carnival Complex, Mall Road, Ludhiana. The said company is also doing the business of trading of ferrous and non ferrous metals. On 2.3.2009, the complainant sold scrap through invoice No.213 dated 2.3.2009 and Invoice No.214 dated 3.3.2009 for a sum of Rs.65,70,500/- to both the petitionees. Allegedly, the delivery was taken by the petitioners from the Focal Point, Ludhiana. As such, legally enforceable liability arose and they are legally bound to discharge the liability. In discharge of the said liability, petitioner No.1 – Shital Gaurav P. Jain issued a cheque No.122158 dated 9.3.2009 for a sum of Rs.65,70,500/- drawn on the UTI Bank (now known as Axis Bank). It is alleged that a request was made by petitioner No.1 that the cheque should be deposited in the month of August 2009 so that the same could be encashed. When the respondent-complainant presented the cheque on 13.8.2009 to his banker Punjab National Bank, Ludhiana, it was returned back on 17.8.2009 with the memo bearing remarks “funds insufficient”. The complainant issued a legal notice dated 22.8.2009 under UPC and two registered posts of the same date through his counsel. The said notice was duly served upon the petitioners-accused but in spite of that, no payment was made. Thereafter, complaint under Section 138 of the Negotiable Instruments Act read with Section 420 IPC has been filed. The learned Magistrate, after

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taking into consideration the affidavit of the complainant, on the same day, summoned the petitioners vide order dated 9.9.2009. Hence, this petition.

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The petitioners have sought quashing of the complaint and the summoning order and subsequent proceedings on the ground that it has been filed with mala fide intention and ulterior motive to harass the petitioners. In fact, petitioner No.2 was married to Gaurav P. Jain on 27.9.2006. However, the matrimonial discord occurred between the parties on account of alleged maltreatment etc. as a result of which FIR No.15 of 2009 was registered at Police Station 'A' Division, Bhavnagar for the offences under Sections 406, 420, 498-A and 114 IPC. Another complaint was filed by petitioner No.2 under the Protection of Women from Domestic Violence Act, 2005. It is alleged in the petition that as a counter-blast to the above complaints, the instant complaint has been filed as the complainant is a close friend of the husband of petitioner No.2 and no transaction as alleged in the complaint had ever taken place between the parties. It is alleged that the complaint is a sheer misuse of process of law. The matrimonial dispute between petitioner No.2 and her husband was solved with the intervention of respectables. Resultantly, a compromise dated 24.9.2009 Annexure P-3 between the petitioners and husband of petitioner No.2 and others has been effected. In the compromise Annexure P-3, it has been acknowledged that blank cheques of the parties are lying with each other. It is also one of the terms of the agreement that parties undertake that in case any cheque or blank signed papers regarding the said account are used, then the party using the cheque or the blank paper shall be responsible for all the consequences and will get the proceedings against the other

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quashed at its own risk and responsibility. It is the case of the petitioners that the complaint Annexure P-1 has been lodged at the instance of husband of petitioner No.2 by misusing the cheque which is of joint account of petitioner No.2 and her husband Gaurav Jain.

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Another compromise has been effected between the parties on 22.12.2009 in which the respondent is a party in addition to the petitioners which is placed on record as Annexure P-4. In the said compromise it has been mentioned that complaint filed by the respondent under Section 138 of the Negotiable Instruments Act titled as Shiv Kumar Grover v. Sheetal G.P. Jain and another pending in the court of JMIC has been filed due to misunderstanding. Now the misunderstanding has been removed with the intervention of the respectables and the parties have settled the dispute by way of compromise and the said complaint will be got withdrawn from the court with immediate effect. Another sworn affidavit has been given by the respondent-complainant on 24.9.2009, relevant part of which is reproduced below:-

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“Affidavit

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I, Shiv Kumar Grover son of Sh. Ashok Grover, resident of House No.810/19-A, Street No.1, New Deep Nagar, Civil Lines, Ludhiana do hereby solemnly affirm and declare as under:-

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1. That the deponent has filed a complaint under Section 138 of NIA titled as Shiv Kumar Grover Vs. Sheetal Gaurav Jain and another which is pending in the court of Sh. Amit Thind, JMIC, Ludhiana and is fixed for 30.10.2009, which was filed due to misunderstanding and now the said misunderstanding has been removed with the intervention of the respectable persons from both the sides.

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2. The deponent will not pursue the complaint under Section 138 of the NIA mentioned above against Sheetal Gaurav Jain and Vijay Kumar Kaka RamBansal and will get the same withdrawn from the court with immediate effect.

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3. The deponent undertakes to make suitable statement in the court for the withdrawal of the said complaint.”

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It is also pertinent to mention that some proceedings for

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quashing of the FIR have been filed by Gaurav Jain in the High Court of Gujarat at Ahmedabad in which the interim order has been passed in his favour.

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Notice of motion was issued by this Court. In pursuance to the notice of motion, reply has been filed by the respondent. It is submitted that the statement of charges has been framed against both the petitioners. Evidence of the complainant by way of examination-in-chief has been recorded by the trial court on 3.10.2011. It is also mentioned in the reply that goods worth Rs.65,70,500/- had been supplied by the complainant to the petitioners vide invoice No.213 and 214 dated 2.3.2009 and 3.3.2009 respectively. The cheque has been dishonoured. The respondent has denied the averments made in various paragraphs of the petition. The respondent has not denied specific allegations in para 3(i) that the complaint has not been instituted at the instance of husband of petitioner No.2. There is also no specific denial of para No.4 of the petition in which it has been stated, “it is denied for want of knowledge”. The respondent has not specifically denied the averments made in para No.5 specifically with regard to the compromise effected between the petitioners and the respondent wherein the respondent agreed to withdraw the complaint Annexure P-1 and had also given affidavit dated 24.9.2009, rather reply to the specific averment is that:-

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“5. Contents of para 5 of the petition are wrong and it is

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denied that the present complaint has been filed by misusing cheque or that petitioners have paid any amount against the dishonoured cheque either before 22.9.2009 or thereafter. The petitioners have never takenup this plea before the trial court or even on 14.6.2011, when notice of acquisition, were framed against both the petitioners.”

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The complainant-respondent has not denied specifically the averments about Annexures P-4 and P-5. With a purpose to put pressure on petitioner No.2 to forgo the amount of Rs.30.00 lacs, present complaint has been filed. The respondent has denied that the compromise between petitioner No.2 and her husband has been enforced. This is clear from the reply to paras 6 and 7 of the reply.

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I have heard learned Counsel for the parties and perused the

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record.

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Admittedly, the complaint has been filed by the respondent with regard to the liability which is alleged to have been created on account of invoice Nos.213 dated 2.3.2009 and 214 dated 3.3.2009. The said invoices have been shown to this Court during the course of arguments which are of AIP Industries in favour of M/s Sai Baba Ispat (P) Ltd., Bhavnagar (Gujarat). The respondent has not mentioned whether he was authorized to institute a complaint in regard to the liability of the firm known as AIP Industries and has also not mentioned in the complaint how the petitioners are related to M/s Sai Baba Ispat (P) Ltd., whether they are Directors of the said firm and has not placed on record any document in reply to indicate that any notice was given to the firm M/s Sai Baba Ispat (P) Ltd., nor the

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said firm has been impleaded as a party.

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Learned Counsel for the petitioners further argued that the complainant cannot file the present complaint under Section 138 by mentioning his name in lieu of the alleged liability towards M/s AIP Industries. It is further mentioned that alleged liability is inter se between the AIP Industries and M/s Sai Baba Ispat (P) Ltd. The cheque has been issued from the joint account of petitioner No.2 and her husband which has altogether no relation with regard to the alleged liability of AIP Industries. Admittedly, there is a matrimonial discord between petitioner No.2 and her husband for which compromise has already been effected. In the compromise Annexure P-3, it has been specifically mentioned in para 3 that both the parties also undertake that they will not use the cheque lying with them and it will be destroyed. Both the parties are ready to move the application for closure of the said account. Both the parties also undertook that in case any cheque or blank signed paper has already been used regarding the said accounts, then the parties using that cheque or blank paper shall be responsible for all the consequences and will get the proceedings quashed against the other party at its own costs and responsibility.

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Learned Counsel for the petitioners has further argued that the affidavit of the respondent and the agreement executed by the respondent also clearly indicate that he will withdraw the complaint in question which is the only complaint pending between the parties, coupled with the fact that the cheque has been issued from joint account by the husband which is clear from the record that the petitioner had questioned the blank cheques being

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husband and wife, that cheque has been misused by the husband with a purpose to harass the petitioners.

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Counsel for the petitioners has further submitted that admittedly the petitioners are residing in Gujarat and the complaint has been filed in Ludhiana and the petitioners have been erroneously summoned without making enquiry as required under Section 202 Cr.P.C. In any case, the name of petitioner No.1 is not at all related to the cheque in question neither the cheque has been issued by him nor it is from account of petitioner No.1.

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Learned counsel for the respondent vehemently denied the contentions raised by Counsel for the petitioners and contended that the cheque has been issued although from the joint account but is in discharge of the liability which has accrued on account of invoice Nos.213 and 214 for a sum of Rs.65,70,500/-. Although the complainant-respondent is not authorized by the AIP Industries, he is only the agent of AIP Industries and is transacting the business for the said firm. As a result of this, the cheque issued in his name is in discharge of liability of the said firm. It is also submitted that even to discharge the liability of a firm, a cheque issued in the name of agent is a valid cheque and he has right to enforce that liability. I have considered the rival contentions of learned Counsel for the parties.

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Admittedly, there is no legal liability inter se between the complainant-respondent and petitioner No.2. The invoices clearly indicate that those were issued by AIP Industries in favour of M/s Sai Baba Ispat (P) Ltd. It has been admitted in the affidavit as well as in the agreement by the

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respondent, which are on record as Annexure P-5 and P-4, in which it has been specifically mentioned that complaint under Section 138 of the Negotiable Instruments Act, titled “Shiv Kumar Grover v. Sheetal Gaurav P. Singh” is the result of misunderstanding and misunderstanding stood removed and the respondent has specifically stated that he will make a suitable statement in the court for withdrawal of the said complaint and this fact stands strengthened from the affidavit Annexure P-5. It is, thus, clear that complaint has been filed with an ulterior motive apparently as there is no liability inter se between the complainant and the petitioners who are respondents in the complaint. As such, the complaint could not have been filed. The respondent has not specifically denied the contents of Annexures P-5 and P-4 in the reply to the instant petition.

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In view of the above, I am of the definite view that complaint itself is not maintainable as the complainant has no right to enforce the liability of third parties, i.e., M/s Sai Baba Ispat (P) Ltd. in whose favour AIP Industries has issued invoices. When there is no liability inter se between the complainant and the petitioners, then certainly the complaint is misuse and abuse of process of law and as such is not sustainable.

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The complaint is not maintainable also for the reason that AIP Industries as well as M/s Sai Baba Ispat (P) Ltd., against whom the alleged liability allegedly arises, have not been impleaded as parties. The Hon'ble Supreme Court in the case of Aneeta Hada v. Godfather Travels and tours Private Limited, (2012)5 SCC 661 held that the prosecution against the individuals, without arraying the company as accused, is not maintainable. None of the aforesaid two companies have been impleaded as such the

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complaint itself is not maintainable. In addition to it, it has not been brought on record as to who were the principals/persons doing the day-today business of the company, directors and managers of the aforesaid companies. The judgment cited by learned counsel for the respondent titled as Anil Sachar and another v. Shree Nath Spinners Private Limited and others, (2011)13 SCC 148 is not applicable to the facts of the present case. None of the petitioners have been shown to be related with M/s Sai Baba Ispat (P) Ltd., nor there is an averment in this regard. As such, the complaint is not maintainable and is liable to be dismissed.

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The alleged cheque is from the joint account of petitioner No.2 and her husband which has been misused by the respondent-complainant at the instance of husband of petitioner No.2 as otherwise there was no occasion for not returning the cheque by her husband when the joint account was closed nor it was necessary for the petitioners to issue a payee's account cheque in the name of the complainant-respondent as they were not required to discharge any liability of the respondent. It is beyond imagination that the cheque would be issued from the joint personal account when the transaction is of a particular firm, i.e., M/s Sai Baba Ispat (P) Ltd. Agreement dated 22.9.2009 Annexure P-4 between respondent and petitioner shows that complaint has been filed due to misunderstanding and in clause 2 of this agreement, respondent has undertaken to withdraw the complaint. Reading of the documents makes it clear that complaint has been filed at the instance of petitioner No.2's husband, complaint is result of mala fide, specially when in the compromise Annexure P-3 it has been specifically mentioned that no party will use cheques. Petitioner No.2

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during the cordial relationship between husband and wife had signed the blank cheque of joint account. That cheque has been misused.

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In view of the discussions above, present petition is allowed.

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The complaint, summoning order as well as all the subsequent proceedings

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arising therefrom are quashed.