Court: Petition Maintainable, Proceedings Quashed. Impugned Orders Set Aside.

The Court held that the petition was maintainable and quashed the proceedings against the petitioner. The impugned orders were set aside, and the proceedings in the case were quashed as against the petitioner.

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Issues Involved:
1. Maintainability of the petition under Article 227 of the Constitution and Section 482 of the Cr.P.C. after recording the plea.
2. Liability of the petitioner under Section 138 read with 141 of the Negotiable Instruments Act, 1881.
3. Validity and effect of the petitioner’s resignation from the directorship of the accused company.

Issue-wise Analysis:

1. Maintainability of the petition under Article 227 of the Constitution and Section 482 of the Cr.P.C. after recording the plea:

The primary contention was whether the petition could be maintained after the plea had been recorded. The respondent argued that once the plea is recorded, the trial must proceed to its logical conclusion, as per the Supreme Court's decision in *Subramanium Sethuraman Vs. State of Maharashtra and Anr.* The Court observed that while the High Court should not ordinarily interfere after the plea is recorded, the inherent powers under Section 482 of the Cr.P.C. are still available to challenge the proceedings at an interlocutory stage. The Court emphasized that the powers under Section 482 can be invoked to prevent abuse of process or to meet the ends of justice, as supported by the Supreme Court's decision in *Adalat Prasad Vs. Rooplal Jindal*.

2. Liability of the petitioner under Section 138 read with 141 of the Negotiable Instruments Act, 1881:

The petitioner argued that he was an independent professional director and had resigned before the issuance and dishonor of the cheque in question. The respondent contended that the complaint contained sufficient averments indicating that the petitioner was in charge and responsible for the day-to-day affairs of the accused company, making him liable under Section 138 read with 141 of the Negotiable Instruments Act. The Court noted that the petitioner’s role and responsibility were disputed and required examination at trial. However, the petitioner provided Form 32, showing his resignation was effective from 01.07.2013, which was before the issuance and dishonor of the cheque dated 11.09.2013.

3. Validity and effect of the petitioner’s resignation from the directorship of the accused company:

The petitioner provided evidence, including Form 32 and a resignation letter, indicating his resignation was effective from 01.07.2013. The Court found no reason to doubt the genuineness of these documents. The Court referred to the Supreme Court's decision in *Harshendra Kumar D. Vs. Rebatilata Koley and Ors.*, which held that criminal prosecution should not proceed against a director who had resigned before the issuance of the cheques. The Court concluded that prosecuting the petitioner would result in gross injustice and abuse of process, as he had resigned before the cheque issuance and dishonor.

Conclusion:

The Court held that the petition was maintainable and quashed the proceedings against the petitioner. The impugned orders dated 20.01.2017 by the Sessions Court and 01.04.2015 by the Metropolitan Magistrate, along with the proceedings in C.C. No.304/SS/2015, were set aside as against the petitioner.

Order:

(i) The impugned order dated 20.01.2017 passed by the Sessions Court in Criminal Revision Application No.1178 of 2016, the order dated 01.04.2015 passed by the Metropolitan Magistrate, 23rd Court, Esplanade, Mumbai, and the proceedings in C.C. No.304/SS/2015 pending in the Court of Metropolitan Magistrate, 23rd Court, Esplanade, Mumbai are quashed and set aside as against the petitioner.

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