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of <h1>High Court rules for petitioner in loan default and cheque case under Section 138</h1> <h3>ONEUP ENTERTAINMENT PVT. LTD. THROUGH ITS AUTHORIZED SIGNATORY MR. NITIN DARA Versus VISHWAKALYAN MULTISTATE CREDIT CO-OP SOCIETY LTD GULMANDI, AURANGABAD</h3> ONEUP ENTERTAINMENT PVT. LTD. THROUGH ITS AUTHORIZED SIGNATORY MR. NITIN DARA Versus VISHWAKALYAN MULTISTATE CREDIT CO-OP SOCIETY LTD GULMANDI, AURANGABAD ... Issues:- Non-compliance with the procedure under Section 202 of the Code of Criminal Procedure- Absence of necessary averment under Section 141 of the Negotiable Instruments Act in the complaintAnalysis:1. The petitioner, a company, sought a loan from the respondent Credit Cooperative Society for film production. A loan was advanced, but a default occurred. The petitioner issued a cheque to discharge its liability, which was returned due to insufficient funds. The respondent filed a complaint under Section 138 of the Negotiable Instruments Act. The petitioner challenged the process issuance, citing non-compliance with Section 202 and absence of Section 141 averments.2. The learned Additional Sessions Judge upheld the trial court's decision, stating that the trial court followed due process under Section 202. The court noted a variance in the loan amount and cheque value but deemed it triable. The petitioner's locus to file a revision was questioned since the director was served summons. The court dismissed the revision based on non-consideration of Section 141 requirements.3. The petitioner appealed to the High Court, arguing the absence of Section 141 averments and the excess cheque amount. The petitioner emphasized the need for Section 202 inquiry due to residing beyond the court's jurisdiction. The petitioner also clarified the director's resignation. Legal judgments were cited to support the arguments.4. The respondent contended that the director's involvement justified suing the company. The respondent defended the cheque amount variance, attributing it to added interest. The respondent supported the trial court's and sessions court's decisions regarding due inquiry under Section 202.5. The High Court analyzed relevant judgments on Section 141 requirements and Section 202 inquiries. It found the absence of Section 141 averments and excess cheque amount rendered the complaint unsustainable. The court criticized the mechanical process issuance without proper inquiry under Section 202, especially considering the petitioner's location. The court ruled in favor of the petitioner, quashing the process issuance and the complaint.6. The High Court concluded that the petitioner had the authority to file the revision and writ petition, highlighting errors in the lower courts' judgments. The court allowed the criminal writ petition, emphasizing the necessity of complying with Section 202 and Section 141 requirements for a valid complaint under the Negotiable Instruments Act.
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