TaxTMI 
TaxTMI 
TaxTMI 
2025 (8) TMI 1546
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....t of the aforesaid FIR qua the petitioner herein. 3. Brief facts of the case are as under:- 3.1 The petitioner No.1 was the Executive Vice Chairman and Managing Director of Pipavav Defence and Offshore Engineering Company the Limited and the Applicant No.2 was Director of the said Company (which is now known as Reliance Naval and Engineering Limited after the management is changed in the year 2016). The said Company was incorporated under the provisions of the Companies Act, 1956. 3.2 The said Company had entered into a Loan Agreement with the HUDCO dated 12.09.2005 for obtaining loan of Rs. 271/- crores against mortgage, hypothecation, pledge, personal guarantee and corporate guarantee etc. on the terms and conditions mentioned in the Loan Agreement. According to the Loan Agreement, HUDCO had sanctioned and disbursed Term Loan of Rs. 271 crores on the terms and conditions mentioned in the Loan Agreement. The repayment schedule of the said loan amount is also mentioned in the Loan Agreement. The Company has already repaid approximately 69% of the Loan amount out of Rs. 271 crores to HUDCO and only about Rs.84 crores remains outstanding. 3.3 The Company had regularly pai....
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....052/- to HUDCO through State Bank of Hyderabad, Backbay Reclamation Branch, Mumbai. 3.9 The Company through RTGS had made further payment of Rs.10,54,00,056/- to HUDCO through State Bank of India, Overseas Branch, Mumbai. 3.10 Again the Company through RTGS had made further payment of Rs.3,80,81,143/- to HUDCO through State Bank of India, Overseas Branch, Mumbai. 3.11 Thus, the Company had made a total payment of Rs. 18,68,95,251/- to HUDCO through RTGS in which Rs.10.54 crores was Principal amount and the remaining amount i.e. Rs.8.15 crores was paid towards interest by the Company to HUDCO. HUDCO had duly received the aforesaid payment. 3.12 HUDCO having received the first payment of Rs.4,34,14,052/- from the Company 29.01.2014 through RTGS, still HUDCO had issued Notice dated 13/14.02.2014 under Section 138 of the Negotiable Instruments Act, 1881 to the Company. The Company had paid further amount of Rs. 10,54,00,056/- to HUDCO through RTGS immediately on next day of filing of Criminal Complaint. In fact, the Company had no knowledge about the filing of Criminal Complaint by HUDCO under the provisions of the Negotiable Instruments Act, 1881. Lastly, on 26.05.2014, th....
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....RTTGS. He would further submit that in the present case, the complainant never informed the accused about encashment of the cheques, and therefore, there is a breach of terms and conditions. He would submit that the cheques, which were essentially issued towards the security to pay the outstanding amount or interest and principal due and returned thereof cannot constitute the offence under section 138 of the NI Act. Subsequently, referring to the case of Meters and Instruments Private Ltd and another Vs. Kanchan Mehta, (2018) 1 SCC 560, learned senior advocate would submit that during the pendency of the trial, the amount of cheques are already paid, and therefore proceedings under section 138 of the NI Act need to be closed by the learned trial Court. 4.1 Upon above submissions, learned senior advocate requests to allow this petition by quashing and setting aside the proceedings of the Criminal Cases as stated herein above. 5. On the other hand, learned advocate Mr. Vas appearing for the private respondent would submit that whether the cheques in question are issued towards the security, whether any existing cheques were substituted or not, whether they were issued towards s....
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....ction 138 of the Act. He referred to a judgment of this Court in Meters andnstruments Private Limited and Another v. Kanchan Mehta 11 which reads as follows:- "While it is true that in Subramanium Sethuraman v. State of Maharashtra this Court observed that once the plea of the accused is recorded under Section 252 CrPC, the procedure contemplated under Chapter XX CrPC has to be followed to take the trial to its logical conclusion, the said judgment was rendered as per statutory provisions prior to the 2002 Amendment. The statutory scheme post-2002 Amendment as considered in Mandvi Coop. Bank and J.V. Baharuni has brought about a change in law and it needs to be recognised. After the 2002 Amendment, Section 143 of the Act confers implied power on the Magistrate to discharge the accused if the complainant is compensated to the satisfaction of the court, where the accused tenders the cheque amount with interest and reasonable cost of litigation as assessed by the court. Such an interpretation was consistent with the intention of legislature. The Court has to balance the rights of the complainant and the accused and also to enhance access to justice. Basic object of the law is....
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....ode and the summary procedure to be followed for trials under Chapter XVII. Conferring power on the court by reading certain words into provisions is impermissible. A judge must not rewrite a statute, neither to enlarge nor to contract it. Whatever temptations the statesmanship of policy-making might wisely suggest, construction must eschew interpolation and evisceration. He must not read in by way of creation12. The Judge's duty is to interpret and apply the law, not to change it to meet the Judge's idea of what justice requires13. The court cannot add words to a statute or read words into it which are not there14. 21. A close scrutiny of the judgments of this Court in Adalat Prasad (supra) and Subramanium Sethuraman (supra) would show that they do not warrant any reconsideration. The Trial Court cannot be conferred with inherent power either to review or recall the order of issuance of process. As held above, this Court, in its anxiety to cut down delays in the disposal of complaints under Section 138, has applied Section 258 to hold that the Trial Court has the power to discharge the accused even for reasons other than payment of compensation. However, amendment to the ....
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....f discharging the subsisting liability or debt. There is, thus, no similarity in the facts of that case simply because in that case also loan was advanced. It was noticed specifically therein - as was the admitted case of the parties - that the cheque was issued as "security" for the advance and was not intended to be in discharge of the liability, as in the present case. 14. In HMT Watches Ltd. versus M.A. Abida[8], relied upon on behalf of the respondent, this Court dealt with the contention that the proceedings under Section 138 were liable to be quashed as the cheques were given as "security" as per defence of the accused. Negativing the contention, this Court held :- "10. Having heard the learned counsel for the parties, we are of the view that the accused (Respondent 1) challenged the proceedings of criminal complaint cases before the High Court, taking factual defences. Whether the cheques were given as security or not, or whether there was outstanding liability or not is a question of fact which could have been determined only by the trial court after recording evidence of the parties. In our opinion, the High Court should not have expressed its view on th....
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.... other, cannot also travel beyond its jurisdiction to interfere with the proceeding which is otherwise genuine. The courts cannot also lose sight of the fact that in certain matters, both civil proceedings and criminal proceedings would be maintainable." 12. In Rallis India Ltd. v. Poduru Vidya Bhushan [(2011) 13 SCC 88], this Court expressed its views on this point as under: (SCC p. 93, para 12) "12. At the threshold, the High Court should not have interfered with the cognizance of the complaints having been taken by the trial court. The High Court could not have discharged the respondents of the said liability at the threshold. Unless the parties are given opportunity to lead evidence, it is not possible to come to a definite conclusion as to what was the date when the earlier partnership was dissolved and since what date the respondents ceased to be the partners of the firm." 13. In case of Rathish Babu Unnikrishnan v. State (Govt. of NCT of Delhi) and Another, 2022 SCC OnLine SC 513, the Hon'ble Supreme Court, while referring to the ratio laid down in Rajeshbhai Muljibhai Patel v. State of Gujarat, (2020) 3 SCC 794, has categorically held that disputed ques....
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....the inherent jurisdiction of the Court to quash the criminal proceedings under S.482 CrPC, have been spelled out by Justice S. Ratnavel Pandian for the two judges' bench in State of Haryana v. Bhajan Lal6, and the suggested precautionary principles serve as good law even today, for invocation of power under Section 482 of the Cr.P.C. "103. We also give a note of caution to the effect that the power of quashing a criminal proceeding should be exercised very sparingly and with circumspection and that too in the rarest of rare cases; that the court will not be justified in embarking upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR or the complaint and that the extraordinary or inherent powers do not confer an arbitrary jurisdiction on the court to act according to its whim or caprice." 15. In the impugned judgment, the learned Judge had rightly relied upon the opinion of Justice J.S.Khehar for a Division Bench in Rajiv Thapar (supra), which succinctly express the following relevant parameters to be considered by the quashing Court, at the stage of issuing process, committal, or framing of charges, "28. The ....
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...., when the proceedings are at a nascent stage, scuttling of the criminal process is not merited." 14. Applying the aforesaid ratio to the facts of the present case, the contention raised by learned Senior counsel that the cheques in question issued towards security is also answered in negative. 15. The Hon'ble Apex Court in case of State Of Orissa Versus Pratima Mohanty Etc.,2022 (16) SCC 706 observed as under:- "9. While quashing the criminal proceedings the High Court has not at all adverted to itself the aforesaid aspects and has embarked upon an enquiry as to the reliability and genuineness of the evidence collected during the investigation as if the High Court was conducting the minitrial. Therefore, as such the impugned judgment and order passed by the High Court quashing the criminal proceedings against the respondents herein - original accused Nos. 4, 5 and 3 - Smt. Pratima Mohanty, Shri Prakash Chandra Patra and Shri Rajendra Kumar Samal is unsustainable, both, in law and/or facts and the same deserves to be quashed and set aside." 16. At initial stage, where cognizable offence is disclosed in FIR, whether investigation can be thwart by exercising inheren....