Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram

Home Case Index All Cases Indian Laws Indian Laws + HC Indian Laws - 2022 (9) TMI HC This

  • Login
  • Cases Cited
  • Summary

Forgot password       New User/ Regiser

⇒ Register to get Live Demo



 

2022 (9) TMI 995 - HC - Indian Laws


Issues Involved:
1. Whether the agreement between the parties is void due to unlawful consideration and against public policy.
2. Whether the cheque issued by the petitioner was given as security and its implications under Section 138 of the Negotiable Instruments Act.
3. Whether the proceedings under Section 482 Cr.P.C. to quash the criminal case are justified.

Issue-wise Detailed Analysis:

1. Void Agreement Due to Unlawful Consideration and Public Policy:
The petitioner argued that the agreement entered into with the respondent was void as the consideration was unlawful and against public policy, as per Section 23 of the Indian Contract Act. The petitioner contended that the work done by the respondent was unauthorized and thus the agreement for payment was void. The court noted that the petitioner failed to provide detailed elaboration on how the consideration was illegal or against public policy. The court emphasized that Section 23 of the Indian Contract Act limits the freedom to enter into contracts if they involve illegal acts, are prohibited by law, or cannot be performed without disobedience of the law. However, the court found no evidence to support the petitioner's claim that the agreement was void or the consideration illegal.

2. Cheque Issued as Security:
The petitioner claimed that the cheque was issued as a security for the debt incurred by his partner and should not attract Section 138 of the Negotiable Instruments Act. The court referred to several Supreme Court judgments, including *Sunil Todi vs. State of Gujarat* and *Sripati Singh vs. State of Jharkhand*, which clarified that a cheque issued as security can still be considered for the discharge of a legally enforceable debt. The court held that the petitioner's argument that the cheque was given as security does not negate its character as an instrument for a legally enforceable debt. The court concluded that whether the cheque was issued as security and not for the discharge of a debt is a matter to be determined during the trial, not in proceedings under Section 482 Cr.P.C.

3. Justification for Quashing Proceedings under Section 482 Cr.P.C.:
The petitioner sought to quash the criminal proceedings, arguing that the complaint did not attract the ingredients of Section 138 of the Negotiable Instruments Act and was an abuse of the court process. The court, however, found that the complaint and other records made out a prima facie case against the petitioner. The court cited the Supreme Court's decision in *Dhruvaram Murlidhar Sonar vs. State of Maharashtra*, which stated that the exercise of powers under Section 482 Cr.P.C. to quash proceedings should be an exception and not a rule, to be exercised sparingly and with caution. The court concluded that the petitioner's contentions could not be entertained at this stage as they required evidence to be established during the trial.

Conclusion:
The court dismissed the Criminal Original Petition, noting that the complaint made out a prima facie case and there were sufficient grounds for proceeding against the petitioner. The court directed the Judicial Magistrate (Fast Track Court), Thoothukudi, to complete the trial and dispose of the case expeditiously, preferably within three months.

 

 

 

 

Quick Updates:Latest Updates