2021 (12) TMI 1003 - HC - Indian Laws

Dishonor of Cheque - cheque issued under duress or not - whether petitioner nos.2 and 3 are in no way related to the firm represented by the petitioner no.1 and are residents of Pune? - HELD THAT - In view of the decision of the Hon ble Supreme Court in SUNIL TODI ORS. VERSUS STATE OF GUJARAT ANR. 2021 (12) TMI 175 - SUPREME COURT it would not be mandatory on the part of the Magistrate to hold an enquiry under Section 202 (2) of the Criminal Procedure Code as specified in Section 145 of the N.I. Act. However, the petitioners have a legal right to assail a proceeding initiated against them in the form of complaint before the Court of a Magistrate. The matter be listed on 20.01.2022 for filing affidavit of service and affidavit in opposition, if any.

Summary

Issues:
1. Quashing of criminal proceedings under Sections 138 and 141 of the Negotiable Instruments Act.
2. Impleading of unrelated individuals as accused in the complaint case.
3. Requirement of holding an enquiry under Section 202(2) of the Criminal Procedure Code before issuing summons.

Analysis:
The petitioners sought the quashing of criminal proceedings initiated against them under Sections 138 and 141 of the Negotiable Instruments Act. The main contention was that the petitioner no.1, a proprietor of a firm, issued a cheque in favor of the opposite party, but the other petitioners, unrelated to the business, were wrongly implicated. It was argued that since the petitioners were residents of Pune, an enquiry under Section 202(2) of the Criminal Procedure Code should have been conducted before issuing summons. The court noted that the issue of whether the cheque was issued under duress was a matter for trial and prima facie observed that a cheque had indeed been issued by petitioner no.1.

The court referred to the case of Sunil Todi & Ors. Vs. State of Gujarat & Anr., where the Supreme Court held that evidence of the complainant under Section 138 can be given on affidavit, eliminating the need for witness examination on oath. The court emphasized that it is not mandatory for the Magistrate to hold an enquiry under Section 202(2) of the Criminal Procedure Code as specified in Section 145 of the N.I. Act. However, the petitioners retained the legal right to challenge the proceedings initiated against them before the Magistrate.

Consequently, the court admitted the criminal revision application and issued notice to the opposite party to present reasons against quashing the complaint. The case was scheduled for further proceedings on a specified date for filing necessary affidavits. The judgment highlighted the importance of legal rights for the petitioners to challenge proceedings and clarified the procedure regarding evidence presentation in cases under Section 138 of the Negotiable Instruments Act.