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2022 (8) TMI 1330 - HC - Indian LawsDishonor of Cheque - insufficiency of funds - vicarious liability of the director - it is the case of petitioner that they were not functional directors at the time of issuance of cheque - HELD THAT - It is apparent that when the complaint was filed, the petitioner was not the Director of the accused no. 1 as named in the original complaint and he had already resigned on 23.07.2011. Petition allowed.
Issues:
Petition for quashing of summoning order under section 482 Cr.P.C. Analysis: The respondent filed a complaint under section 138 of the Negotiable Instruments Act, 1881 against multiple accused, including the petitioner, for issuing cheques that bounced due to insufficient funds. The Magistrate, based on presummoning evidence, issued summons to all accused, including the petitioner. The petitioner challenged the summoning order, claiming to have resigned as Director of the accused company before the issuance of the cheques. The petitioner presented evidence of resignation through FORM 32 and relied on relevant case laws to support the claim. During the proceedings, it was established that at the time of cheque issuance, the petitioner was not a functional Director of the accused company as mentioned in the complaint. The respondent acknowledged this discrepancy and did not oppose the quashing of proceedings against the petitioner. It was evident that the petitioner had resigned from the directorship before the alleged offense took place. Considering the facts and submissions, the court allowed the petition and quashed the proceedings against the petitioner in the complaint. The court disposed of the petition along with any pending applications. The judgment emphasized the importance of verifying the status of accused individuals at the time of alleged offenses to ensure fair legal proceedings and avoid unnecessary harassment.
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