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2024 (3) TMI 222 - HC - Indian LawsDishonour of Cheque - security cheque or not - lease deed has been obtained by misrepresentation or not - rebuttal of presumption u/s 139 of the NI Act - HELD THAT - In the present case, as the debt or liability in terms of the Agreement to Sell and/or the Addendum itself had not arisen, Section 138 of the NI Act was not attracted and the ingredients of the offence were not satisfied - Though the power under Section 482 of the Cr.P.C. is to be exercised sparingly and in the rarest of rare cases, at the same time, where, from a bare reading of the complaint, the offence is not made out, the power must be exercised to quash such a complaint. In S.P. Mani Mohan Dairy v. Snehalatha Elangovan, 2022 (9) TMI 846 - SUPREME COURT , the Supreme Court has held The Court concerned would owe a duty to discharge the accused if taking everything stated in the complaint is correct and construing the allegations made therein liberally in favour of the complainant, the ingredients of the offence are altogether lacking. Applying the abovementioned principles enunciated by the Supreme Court to the facts of the present case, as the Complaint filed by the respondent lacks the necessary averments that would give rise to the debt and/or liability of the petitioners for which the cheque had been issued, the complaint filed by the respondent deserves to be quashed. Complaint, being pending before the Court is hereby quashed - Petition allowed.
Issues Involved:
1. Quashing of Complaint under Section 138 read with Section 142 of the Negotiable Instruments Act, 1881. 2. Maintainability of the Complaint based on the Agreement to Sell and Addendum. 3. Applicability of Section 138 of the NI Act and presumption under Section 139 of the NI Act. 4. Exercise of power under Section 482 of the Cr.P.C. Summary: Issue 1: Quashing of Complaint under Section 138 read with Section 142 of the Negotiable Instruments Act, 1881 The petitioners sought quashing of the complaint filed by the respondent under Sections 138 and 142 of the NI Act, arguing that the cheque for Rs. 75,00,000/- was issued as security and not for a legally enforceable debt. The respondent alleged that the petitioners failed to discharge their liability, leading to the cheque's dishonor due to insufficient funds. Issue 2: Maintainability of the Complaint based on the Agreement to Sell and Addendum The petitioners contended that the complaint did not state that the respondent had to make any payment to its own debtors, which was a condition for the cheque's encashment. The respondent argued that the matter involved disputed facts best determined by the Trial Court. The court noted that the Agreement to Sell and Addendum required the petitioners to pay certain dues, failing which the respondent could encash the cheque. Issue 3: Applicability of Section 138 of the NI Act and presumption under Section 139 of the NI Act The court highlighted that for an offence under Section 138 of the NI Act, the cheque must represent a legally enforceable debt. The court observed that the complaint lacked averments that the respondent had to make payments due to the petitioners' default, thus no liability arose for the cheque's encashment. The presumption under Section 139 of the NI Act was negated by the Agreement to Sell and Addendum terms. Issue 4: Exercise of power under Section 482 of the Cr.P.C. The court emphasized that power under Section 482 of the Cr.P.C. should be exercised sparingly. However, if the complaint does not make out an offence, the power must be exercised to quash it. The court referred to precedents where complaints lacking necessary averments were quashed to prevent abuse of the process of the court. Conclusion: The court concluded that the complaint filed by the respondent lacked necessary averments to establish the petitioners' liability for which the cheque was issued. Thus, the ingredients of the offence under Section 138 of the NI Act were not satisfied. The petition was allowed, and the complaint was quashed. No order as to costs.
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