Quashing of cheque dishonour complaint refused where security cheque and disputed liability raised factual issues for trial.

A criminal complaint under Section 138 of the Negotiable Instruments Act was not liable to be quashed under Section 482 CrPC where the accused contended that the cheque was issued only as security and that the underlying liability was disputed. The Court held that questions about the compromise memo, alleged coercion, the character of the cheque, and the existence of a legally enforceable debt involved contested facts requiring evidence. Because such defences could not be conclusively decided at the quashing stage, the complaint was allowed to proceed to trial, leaving the petitioner to raise all factual and legal defences before the trial court.

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Issues: Whether the criminal complaint under Section 138 of the Negotiable Instruments Act, 1881 was liable to be quashed in exercise of inherent jurisdiction under Section 482 of the Code of Criminal Procedure, 1973 on the ground that the cheque was issued as security and that the underlying liability was disputed.

Analysis: The petitioner's challenge turned on factual disputes regarding the manner in which the compromise memo was executed, the alleged coercion, the nature of the cheque as a security instrument, and the existence of any legally enforceable debt. Those objections required examination of evidence and could not be conclusively determined in proceedings for quashing. The compromise memo and the rival claims as to liability disclosed matters that were fit for trial rather than summary interference. Inherent jurisdiction is not meant for resolving contested facts or assessing the defence version at the threshold.

Conclusion: The complaint was not liable to be quashed and the petition was rejected as against the petitioner.

Final Conclusion: The prosecution was permitted to proceed before the trial court, with the petitioner left to establish all factual and legal defences in the course of trial.

Ratio Decidendi: Factual defences concerning the nature of the cheque and the existence of liability cannot be adjudicated in a petition to quash criminal proceedings, and such matters must ordinarily be tested at trial.

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