2006 (1) TMI 667 - HC - Indian Laws

Court expedites trial proceedings, dismisses petition under Section 482, emphasizing timely resolution.

Constellation Enterprises Pvt. Ltd. and Ors. Versus P.E.C. Limited

The court dismissed the petition under Section 482 of the Code of Criminal Procedure, directing the trial court to expedite the proceedings within four ... - Issues:Petition under Section 482 of the Code of Criminal Procedure for quashing the summoning order dated 14.2.2003 in Criminal Complaint case No. 478/1/2002 under Section 138 read with Section 142 of the Negotiable Instruments Act.Analysis:1. The complaint alleged that the accused company, through its authorized Directors, approached the complainant for import contracts, giving post-dated cheques as security. The first contract was completed, and the unused cheque was to be treated as security for the second contract. The accused failed to honor the payment obligations under the second contract, causing losses to the complainant.2. The court noted that the complainant did not conceal any facts, and the parties had a successful prior contract. The accused's request to treat the unused cheque as security for the second contract was plausible, given the continuity in dealings and mutual agreement. The court found merit in the complainant's contention regarding the cheque usage for the second transaction.3. Referring to a precedent, the court emphasized that when a post-dated cheque is given as security and payment is not made as promised, the cheque becomes payable per the agreement. In this case, the earlier cheque became part of the second transaction by mutual agreement, and as no payment was made in the new transaction, the liability on the cheque remained.4. The court addressed the contention regarding the accused's responsibility for running the company at the time of issuing the cheque. It found substantial compliance in the pleadings and disregarded the petitioner's resignation post the second contract, as the Director status was valid during the contract initiation.5. Despite the delay in proceedings, the court stressed the need for expeditious disposal of matters under the Negotiable Instruments Act. It highlighted the limitations of interference under Section 482 of the Code of Criminal Procedure, emphasizing that such intervention is warranted only in exceptional circumstances of manifest injustice.6. Ultimately, the court dismissed the petition, directing the trial court to expedite the proceedings within four months. The judgment clarified that the dismissal does not indicate any opinion on the case's merits, underscoring the importance of timely resolution under the Act.