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Issues Involved:
1. Service of demand notice under Section 138 of the Negotiable Instruments Act (NI Act). 2. Suppression of material facts in the complaint. 3. Effect of Reserve Bank of India (RBI) orders and Delhi High Court stay on criminal proceedings. 4. Vicarious liability of directors and officers under Sections 138 and 141 of the NI Act. 5. Validity of the complaint in light of the accused's resignation and other defenses. Issue-Wise Detailed Analysis: 1. Service of Demand Notice: The petitioners argued that the demand notice was not served by registered post as required under Section 138 of the NI Act, making the complaint invalid. The complainant countered that notice was served by multiple modes, including hand delivery, which is permissible under Section 94 of the NI Act. The court emphasized that service of notice is a factual matter to be proven at trial and that notice can be oral or written, not necessarily by registered post. The court cited the Supreme Court decision in V. Raja Kumari v. P. Subbarama Naidu, which supports the validity of service by other means if the sender can prove it. 2. Suppression of Material Facts: The petitioners contended that the complainant suppressed the fact that the Delhi High Court had stayed all criminal proceedings under Section 138 of the NI Act and that the RBI had frozen the company's accounts. The complainant argued that the stay applied only to the company, not its directors, and that the RBI's order did not prohibit payment of legal obligations. The court found that the RBI's order did not cover inter-corporate deposits and that the stay by the Delhi High Court was limited to the company, allowing proceedings against the directors to continue. The court also noted that the issue had been previously decided, invoking the principle of estoppel. 3. Effect of RBI Orders and Delhi High Court Stay: The court held that the RBI's order and the Delhi High Court's stay did not bar criminal proceedings against the directors under Section 138 of the NI Act. The court emphasized that the RBI's order did not prohibit the payment of debts or legal obligations and that the stay order applied only to the company, not its directors. The court cited the Supreme Court decision in Prudential Capital Mkt. Ltd. v. State of Bihar, which clarified that RBI orders do not bar criminal proceedings for offenses under Sections 420, 120B of IPC, and Section 138 of the NI Act. 4. Vicarious Liability of Directors and Officers: The petitioners argued that they were not responsible for the day-to-day affairs of the company and had resigned, which was not reflected in the complaint. The complainant maintained that the petitioners were involved in the company's daily operations and had signed the cheques. The court found that the complaint contained sufficient allegations against the petitioners, indicating their involvement in the company's affairs. The court cited the Supreme Court decision in Anil Hada v. Indian Acrylic Ltd., which held that directors could be prosecuted even if the company was under winding up proceedings. 5. Validity of the Complaint: The petitioners argued that the cheques were for interest payments and not for discharge of any liability, and that they had resigned from the company. The court held that these are factual matters to be determined at trial. The court emphasized that the presumption under Section 139 of the NI Act is in favor of the holder of the cheque and that the accused can rebut this presumption during the trial. The court also noted that it could not consider unverified documents annexed to the revisional application, as these matters should be addressed during the trial. Conclusion: The court dismissed the revisional applications, finding no merit in the petitioners' arguments. The court directed the trial to proceed expeditiously and allowed the petitioners to be represented by their authorized advocate under Section 205 of Cr. PC, considering their residence in Mumbai. The court emphasized that its observations were limited to the revisional applications and that the trial court should decide the case based on evidence and law.
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