2019 (8) TMI 1882 - HC - Indian Laws

Dishonour of Cheque - discharge of legally recoverable debt or cheque given as security - transfer of shares - factual defences - HELD THAT - It is clear that the grounds agitated by the petition at hand relate to factual defences , which cannot be considered by this court by the limited inquiry permissible on a petition under section 482 Cr.P.C. The observations of the Supreme Court in RAJIV THAPAR ORS. VERSUS MADAN LAL KAPOOR 2013 (1) TMI 932 - SUPREME COURT needs to be borne in mind where it was held that the judicial conscience of the High Court would persuade it to exercise its power under Section 482 CrPC to quash such criminal proceedings, for that would prevent abuse of process of the court, and secure the ends of justice. The petitioner is at liberty to raise such defences as are available to him before the court which has summoned him in the above case. Petition dismissed.

Summary

Issues:
1. Quashing of criminal proceedings under section 138 of the Negotiable Instruments Act, 1881.
2. Legal validity of the cheque issued in discharge of a legally recoverable debt.
3. Consideration of factual defenses in a petition under section 482 Cr.P.C.

Analysis:
1. The petitioner sought quashing of the criminal proceedings initiated against him under section 138 of the Negotiable Instruments Act, 1881. The case stemmed from a dispute between the parties over certain transactions, leading to the issuance of four cheques. The first cheque was dishonored due to insufficient funds, prompting the complainant to file a criminal complaint under section 138. The petitioner contended that the cheque was not issued in discharge of a legally recoverable debt, and also raised concerns regarding the transfer of shares. However, the court noted that such factual defenses could not be considered in a petition under section 482 Cr.P.C.

2. The petitioner argued that the cheque in question was given as security and raised other defenses in response to the notice under section 251 Cr.P.C. The court emphasized that the jurisdiction under section 482 Cr.P.C. should be exercised cautiously, especially when considering the quashing of criminal proceedings at early stages like issuing process or framing of charges. The court highlighted the need for the defense to be based on sound, reasonable, and indubitable facts that clearly refute the allegations leveled by the prosecution.

3. Referring to the Supreme Court's observations in Rajiv Thapar and Ors. Vs. Madan Lal Kapoor, the court emphasized the importance of ensuring that the material produced by the accused is of impeccable quality and persuades a reasonable person to dismiss the accusations as false. The court concluded that the petitioner could raise his defenses before the court where he was summoned. Ultimately, the petition seeking quashing of the criminal proceedings was dismissed, with the court emphasizing the need for caution and circumspection in exercising jurisdiction under section 482 Cr.P.C.