IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF MAY 2019 BEFORE THE HON’BLE MR. JUSTICE JOHN MICHAEL CUNHA CRIMINAL PETITION NO.2401 OF 2016 BETWEEN:
SRI.VENKATARAMANA BHAT S/O GANAPATHI BHAT AGED ABOUT 49 YEARS, OCC: MANAGING DIRECTOR, M/S NIKHARA MOTORS PVT LTD R/AT NO 140 VINAYAKA LAYOUT ULLALA MAIN ROAD JNANABHARATHI POST BANGALORE – 560056. ... PETITIONER (BY SRI:M.R. BALAKRISHNA, ADVOCATE) AND THE KARNATAKA STATE CO-OPERATIVE APEX BANK LTD NO 1, UTHUNGA, PAMPA MAHAKAVI ROAD, CHAMRAJPET BENGALURU - 560018 ... RESPONDENT (RESPONDENT SERVED AND UNREPRESENTED) THIS CRL.P IS FILED U/S.482 CR.P.C PRAYING TO SET ASIDE THE ORDER OF TAKING COGNIZANCE AND ISSUE OF PROCESS DATED 05.03.2014 IN PCR NO.23286/2013 (NOW IN C.C.NO.5299/2014) PASSED BY THE XII A.C.M.M., BANGALORE NOW PENDING ON THE FILE OF THE XXXVIII A.C.M.M., BANGALORE FOR THE OFFENCES PUNISHABLE UNDER SECTIONS 138 OF N.I. ACT.
THIS CRL.P COMING ON FOR ADMISSION THIS DAY, THE COURT MADE THE FOLLOWING:-
O R D E R Petitioner has sought to quash the order dated 05.03.2014 passed by the XII ACMM, Bengaluru in PCR No.23286/2013(C.C.No.5299/2014) now pending on the file of XXXVIII Addl. Chief Metropolitan Magistrate, Bengaluru, whereby the learned magistrate has taken cognizance of the offence under Section 138 of N.I. Act and has issued process to the petitioner.
Heard learned counsel for the petitioner. Respondent is duly served and unrepresented.
2. The main contention urged by the learned counsel for petitioner is that the cheque in question was issued by the petitioner towards repayment of the loan borrowed by M/s. Nikhara Motors Pvt. Ltd., The averments made in the complaint indicate that M/s. Nikhara Motors Pvt. Ltd., was the borrower and the petitioner herein was representing said concern as its Managing Director. Under the said circumstances, without making the company a party to the proceedings, learned Magistrate ought not to have taken cognizance of the alleged offence and issued summons to the petitioner.
3. In support of his submission, learned counsel has placed reliance on the proposition of law laid down by the Hon’ble Supreme Court in the case of ANEETHA HADA vs. GOD FATHER TRAVELS AND TOURS PVT. LTD., reported in (2012) 5 SCC 661. Further, learned counsel submitted that entire dues payable to the respondent are repaid by the petitioner company and ‘no due certificate’ has been issued by the respondent, copy of which is produced before this Court alongwith the memo. Hence, the liability arising out of the dishonoured cheque having been discharged, continuation of the proceedings against the petitioners has resulted in abuse of the process of Court.
Considered submissions and perused the records.
4. The averments made in the complaint clearly indicate that the loan in question was availed by M/s Nikhara Motors Pvt. Ltd.,. The dishonoured cheque is said to have been issued on behalf of the company by the petitioner in his capacity as the Managing Director of the company. Under the said circumstances, in view of proposition of law laid down in the above decision, the prosecution of the petitioner without making the company as accused cannot be sustained. In the absence of company, the petitioner cannot be made vicariously liable for the offences committed by the company. In that view of the matter, the proceedings initiated against the petitioner being illegal and abuse of process of Court are liable to be quashed.
5. Accordingly, the petition is allowed. The proceedings initiated against the petitioner in C.C.No.5299/2014 on the file of XXXVIII Addl. Chief Metropolitan Magistrate, Bengaluru is quashed.
Sd/- JUDGE *mn/-