Allowed

M/s. Cellix Bio Pvt. Ltd. , (a- 1) v. State of Telangana

Telangana HC11 Sept 2024CRLP/163/2024

Case brief

AI extract

What is this about?

Quash petition by two former directors of a company accused in a Section 138 NI Act complaint. The court found from Form 32 records that both resigned before the cheque date and held continuation against them an abuse of process.

What did the court decide?

Proceedings against petitioners/accused Nos.4 and 5 in S.T.C.(NI) No.790 of 2022 quashed; pending miscellaneous applications closed.

M/s. Cellix Bio Pvt. Ltd. , (a- 1) Vs State of Telangana — Cheque Dishonour | Telangana HC (2024)

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t32171

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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD

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TUESDAY, THE TWENW NINTH DAY OF JULY TWO THOUSAND AND TWENTY FIVE

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PRESENT

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THE HONOURABLE SRI JUSTICE N.TUKARAMJI

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CRIMINAL PETITION NO: 1683 OF2024

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Between:

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E.Yella Reddy, S/o E.Venugopal Reddy, Aged. 54 years, Occ. Business, R/o Plot No. 2078, Sector 9, Malamaruti Extension, Belgaum, Karnataka.

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K.Ramachandra Rao, S/o A.Keshava Murthy Rao, Aged 78 years, Occ. Business, R/o 506, 6th Main, 4th Stage, BEML Layout, R.R.Nagar, Bangalore, Karnataka.

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...PETITIONERS'ACCUSED NOS.4 & 5

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AND

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The State of Telangana, Rep by its Public Prosecutor, High court for the state of Telangana.

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M/s. RP Projects, Rep by its Managing Partner Mr. MVSS Prasad, S/o. M Venkat Rao Aged 57 years, Occ. Business, R/o. G-1, Rashmitha Enclave, Bank of lndia Lane, Bhagyanagar Colony, Opp KPHB Colony, Kukapally Post, Hyderabad - 50007 2.

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...RESPONDENT'COMPLAINANTS

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Petition under Section 482 OF CRPC praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to quash the proceedings against the petitioners/ accused No. 4 and 5 in S.T.C (Nl) No. 790 ot 2022 on the file of Learned I Addl. Junior-cum-Xll Addl. Metropolitan Magistrate, Medchal-Malkajgiri District at Kukatpally.

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l.A. NO: 1OF 2024

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to stay all further proceedings including appearance of the petitioners/ accused No.4 and 5 in S.T.C (Nl) No. 790 of 2022 on the file of Learned I Addl. Junior-cum-Xll Addl. Metropolitan Magistrate, Medchal-Malkajgiri District at Kukatpally.

.A. NO: 2OF 2025

Between:

M/s. RP Projects, Rep by its Managing Partner Mr. MVSS Prasad, S/o. M Venkat Rao Aged 57 years, Occ. Business, R/o. G-1, Rashmitha Enclave, Bank of lndia Lane, Bhagyanagar Colony, Opp KPHB Colony, Kukatpally Post, Hyderabad - 500072.

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...VACATE PETITIONER/RESPONDENT

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AND

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't. E.Yella Reddy, S/o E.Venugopal Reddy, Aged.54 years, Occ. Business, R/o Plot No. 2078, Sector 9, Malamaruti Extension, Belgaum, Karnataka.

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K.Ramachandra Rao, S/o A.Keshava Murthy Rao, Aged 78 years, Occ. 9usiness,^{R/o 506, 6th Main, 4th Stage, BEML Layout, R.R.Nagar, Bangalore,} Karnataka.

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.....RESPONDENTS/ PETITIONERS'ACCUSED NOS. 4 & 5

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The State of Telangana, Rep by its Public Prosecutor, High court for the state of Telangana.

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...RESPONDENT/RESPONDENT

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to vacate the interim stay Dt. 1310212024 in the 1.A.1 ol 2024 in Crl P No 1683 ot2024.

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This Petition coming on for hearing, upon perusing the Memorandum of Grounds of Criminal Petition and upon hearing the arguments of Sri T BALA MOHAN REDDY, Advocate for the Petitioner and SRI JITHENOER RAO VEERAMALLA, the Additional Public Prosecutor for the Respondent No.1 and of Sri E PHANI KUMAR, Advocate for the Respondent No.2.

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The Court made the following: ORDER

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i I I I t; t: t,

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THE HONOURABLE SRI JUSTICE N.TUKARAMJI

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GRIMINAL PETITION No. 1683 OF 2024

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ORDER

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This petition is filed under Section 482 of the Code of Criminal Procedure,l973 (CrPC) seeking quashment of the proceedings in S.T.C. (Nl) No.79O ot 2022, on the file of learned I Additional Junior Civil Judge-cum-Xll Additional Metropolitan Magistrate, MedchalMalkajgiri District at Kukatpally, against the petitioners/accused Nos.4 and 5.

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I have heard Mr.T.Bala Mohan Reddy, learned counsel for petitioners, Mr.Jithender Rao Veeramalla, learned Additional Public Prosecutor appearing for the respondent No.1-State.

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The petitioners are arrayed as accused Nos.4 and 5 in S.T.C. (Nl) No.79O of 2022 facing accusation under Section 200 of Cr.P.C r/w. Section 138 of Negotiable lnstruments Act,1881(foe short^'the Nl Act').

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Stripped of extraneous detail, the petitioners serve as

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Directors of Accused No. 1 Company. Respondent No. 2 demanded repayment of an aggregate amount of Rs.13,91,992/-. ln purported discharge of this liability, Accused No. 1 issued a cheque dated 31.03.2021. Upon presentation to its banker, HDFC Bank Lirnited, I

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Vivekananda Nagar Colony, Kukatpally the cheque was returned unpaid on 25.06.2021, with the endorsement'funds insufficient.' lt is stated that a legal notice was issued on 09.07.2021, 'ahereafter the complaint.

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Learned counsel for the^petitioners submits that, although the petitioners were formerly Directors of the company, they had tendered their resignations in the^years 2011 and 2013, respectively. The transaction Forming the subject matter of the complaint is alleged to have occurred subsequent to their resignations. Therefore, initiating or continuing criminal prosecution against them constitutes a clear abuse of the process of law. It is contended that the trial court, without duly appreciating this foundational fact, has^proceeded with the matter. In view 0f the foregoing, learned counsel^prays that this Hon'ble Court may be pleased to exercise its inherent^jurisdiction and quash the proceedings insofar as they pertain to the petitioners, arrayed as Accused Nos. 4 and 5.

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I have perused the materials placed on record

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As per the entries recorded in Form 32 maintained by the Registrar of Companies, Petitioner No. 1 tendered his resignation from Accused No. 1 Company with effect from 01.04.20'1 1, and

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Petitioner No. 2's resignation took effect from 31.09.2013. The cheque in question was issued on 30.03.2021. Thus, as on the date of issuance of the cheque, the petitioners were no longer Directors of the said company. ln view of this essential and undisputed fact, the continuation of criminal proceedings against the petitioners constitutes a manifest abuse of the process of law. Accordingly, the proceedings against them are liable to be quashed, and are hereby quashed.

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Accordingly, this criminal^petition is ailowed. consequenfly, the proceedings against the petitioners, arrayed as Accused Nos. 4 and 5, in s.T.c. (Nl) No. 790 of 2022, pending on the file of the learned I Additional Junior civil Judge-cum-Xll Additional Metropolitan Magistrate, Medchal-Malkajgiri District at Kukatpaily, are hereby quashed.

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Pending miscellaneous applications, if ony, shall stand

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closed

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SD'. AHMED^ABDULLAKHAN ASSISTANT^REGISTRAR

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/TRUE^COPY'I OFFICER

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To,

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The I Addl.^{Junior-cum-xll Addl. Metropolitan Magistrate, Medchal-} rtli"k"igiri^{District at Kukatpally'}

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2.oneCCtoSRlTBALAMoHANREDDYAdvocate[oPUc]

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One^{CC to SRI E PHANI KUMARAdvocate IOPUCI}

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4.TwoCCstoSRlPUBLlqeLgSEcUToR,HighCourtfortheStateof i6r""g"n"'^{HYderabad'IOUTI}

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\r. - t Trern llf.l C.onieS

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HIGH COURT

DATED i2910712025

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cRLP.No.1683 of 2024

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ALLOWING THE CRIMINAL PETITION

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M/s. Cellix Bio Pvt. Ltd. , (a- 1) v. State of Telangana

Case brief

What is this about?

What did the court decide?

M/s. Cellix Bio Pvt. Ltd. , (a- 1) v. State of Telangana

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

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