2023 (2) TMI 1 - HC - Indian Laws

Court upholds Section 138 proceedings, dismisses revisional application challenging Director's implication.

M/s. Bell Finvest (India) Limited & Ors. Versus The State of West Bengal & Anr.

The Court dismissed the revisional application challenging the continuance of proceedings under Section 138 of the Negotiable Instruments Act. It upheld ... Dishonor of Cheque - particular phrase relating to ‘enquiry being conducted under Section 202 of the Code of Criminal Procedure’ is missing in the order dated 13.03.2020 or not - Section 202 of the Code of Criminal Procedure - HELD THAT:- In paragraph 12 of the Larger Bench judgement of the Hon’ble Supreme Court [ [2021 (12) TMI 175 - SUPREME COURT] ], it has been held “If the Magistrate holds an inquiry himself, it is not compulsory that he should examine witnesses. In suitable cases, the Magistrate can examine documents for satisfaction as to the sufficiency of grounds for proceeding under Section 202” - In Sunil Todi’s case [ [2021 (12) TMI 175 - SUPREME COURT] ], the Hon’ble Supreme Court in paragraph 47 has approved the manner in which the Magistrate proceeds to issue process after adverting to the complaint, the affidavit filed by the complainant, the evidence as per evidence list and the submissions of the complainant. By way of the present revisional application, the petitioners have not been able to show that the non-application of mind so contended in respect of the order issuing process has resulted in failure of justice because of false implication of any of the petitioners. The contention of the petitioners is definitely correct that the particular phrase relating to ‘enquiry being conducted under Section 202 of the Code of Criminal Procedure’ is missing in the order dated 13.03.2020, however, the whole of the process is undertaken do satisfy such enquiry which has been undergone by the learned Magistrate, prior to issuance of process - there are no grounds to interfere with the order issuing process which has been challenged by the petitioners so far as the non-compliance of Section 202 of the Code of Criminal Procedure is concerned. Thus, no case for interference has been made out in the present revisional application - revision application dismissed. Issues:Challenging continuance of proceedings under Section 138 read with Section 141 of the Negotiable Instruments Act. Compliance with Section 202 of the Code of Criminal Procedure. Implication of all persons in the complaint. Vicarious liability of a Director in a company.Analysis:Continuance of Proceedings:The petitioners challenged the continuation of proceedings under Section 138 of the Negotiable Instruments Act. The petitioners argued insufficiency in implicating all accused persons in the complaint. The Court examined the order issuing process and emphasized compliance with Section 202 of the Code of Criminal Procedure. Reference was made to the Supreme Court's decision on expeditious trial of cases under Section 138 and the necessity of conducting an inquiry under Section 202. The petitioners contended that the proceedings should be quashed for petitioner no.3 due to incomplete averments. However, the Court found no grounds for interference based on the submissions made.Compliance with Section 202 of CrPC:The Court analyzed the compliance with Section 202 of the Code of Criminal Procedure. It noted the Magistrate's actions in perusing materials, affidavits, and documents before issuing process. Reference was made to the Supreme Court's decision in Sunil Todi's case regarding the examination of witnesses on affidavit and the sufficiency of grounds for proceeding under Section 202. The Court compared findings from various judgments and concluded that the process undertaken by the Magistrate satisfied the requirements of Section 202, despite the specific phrase missing in the order dated 13.03.2020.Implication of Director in Company:Regarding the vicarious liability of a Director in a company, the Court referred to a Supreme Court judgment on vicarious liability as a question of fact. The petitioners argued that the Director was implicated without proper justification. However, the Court found no unimpeachable evidence to support the claim of false implication, thus dismissing the need for invoking jurisdiction under Section 482 of the Code of Criminal Procedure.Conclusion:The Court dismissed the revisional application, stating no grounds for interference were established. It upheld the continuation of proceedings and found no basis for quashing the process for petitioner no.3. The Court emphasized compliance with Section 202 of the Code of Criminal Procedure and the lack of evidence supporting false implication. All connected applications were disposed of, and parties were instructed to act upon the official copy of the order.