TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 807
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....ecords and proceedings of S.C.C. No.7222 of 2021 pending before the learned Judicial Magistrate, First Class, 7th Court, Akola and after examining the correctness, legality and validity of the said impugned judgment and order and the said impugned order be further pleased to examine the correctness, legality and validity thereof and be further pleased to issue an appropriate writ, order and direction to set them aside and quash them and also quash and set aside the impugned judgment and order of learned Sessions Judge, Akola passed in C.R.A. No. 94/2022 dated 12th April 2022 and the impugned order passed by the Judicial Magistrate First Class, 7th Court, Akola in S.C.C. No. 7222 of 2021 dated 20th January, 2022. (c) That pending and hearing final disposal of this petition further proceedings in Criminal Case SCC No.7222/2021 pending before learned Judicial Magistrate, First Class, 7th Court, Akola may kindly be stayed. (d) Ad-interim and interim reliefs in terms of prayer clauses 'b' and 'c' may kindly be granted. 3. Petitioner No. 1 is a Company duly incorporated under the Companies Act. The respondent No. 1 is the original complainant filed a complaint throug....
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....ordingly, the complainant presented the cheque through his account with the Axis Bank on 14.10.2021. However, the cheque has been dishonoured for the reason 'Account Closed'. Therefore, the respondent - complainant issued a notice to the petitioners through the Advocate on 20.10.2021 and called upon the petitioners to make payment of the cheque amount. Despite the notice duly served on petitioners on 23.10.2021, the petitioners failed to make payment of the cheque amount within a period of 15 days and therefore, the complainant was constrained to file the complaint. 5. The Magistrate has taken cognizance of the said complaint and passed an order of issuance of process on 20.01.2022. Being aggrieved and dissatisfied with the order of issuance of process, the petitioner along with its Directors challenged the order by preferring Criminal Revision Application No. 94/2022. The said revision application came to be dismissed and therefore, the petitioners approached to this Court for quashing and setting aside the order of issuance of process and quashing of the criminal proceeding. 6. The ground raised in the petition is that the petitioner No. 1 is a Company duly incorporated und....
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.... the prescribed period. The offence under Section 138 of the N. I. Act is triggered upon the failure to pay the amount of the cheque. The bank account upon which the cheque was drawn was closed on 03.10.2013. The phrase 'amount of money is insufficient' as it appears in Section 138 of the N.I. Act is broad category and dishonoured due to such reasons as the account closed falls within the category derived under Section 138 of the N.I. Act. All the individuals responsible for the conduct of the Company's business are potentially lack up to prosecution. The contention of the petitioners that the petitioner No.2 along with the respondent Nos. 2 and 3 are not parties to the agreement dated 06.04.2001 between the respondent No. 1 and his predecessor and there is no privity of contract between the petitioners and the respondent No. 1 is relevant. There was transfer of an actionable claim and transaction between the creditor and transferee, the debtor's participation in signing the agreement is not required. There need not be any privity of contract between the transferee and the debtor still the transfer is entitled to recover the amount from the debtor and against the said liability the....
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....e over to him under section 192, may, if he thinks fit, [and shall, in a case where the accused is residing at a place beyond the area in which he exercises his jurisdiction,] postpone the issue of process against the accused, and either inquire into the case himself or direct an investigation to be made by a police officer or by such other person as he thinks fit, for the purpose of deciding whether or not there is sufficient ground for proceeding: Provided that no such direction for investigation shall be made,- (a) where it appears to the Magistrate that the offence complained of is triable exclusively by the Court of Session; or (b) where the complaint has not been made by a Court, unless the complainant and the witnesses present (if any) have been examined on oath under section 200. (2) In an inquiry under sub-section (1), the Magistrate may, if he thinks fit, take evidence of witnesses on oath: Provided that if it appears to the Magistrate that the offence complained of is triable exclusively by the Court of Session, he shall call upon the complainant to produce all his witnesses and examine them on oath. (3) If an investi....
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....s exercise by the Magistrate, for the purpose of deciding whether or not there is sufficient ground for proceeding against the accused, is nothing but an inquiry envisaged under Section 202 of the Code." The amended provision casts an obligation on the Magistrate to apply his mind carefully and satisfy himself that the allegations in the complaint, when considered along with the statements recorded or the enquiry conducted thereon, would prima facie constitute the offence for which the complaint is filed. He also placed reliance on Vijay Dhanuka and others Vs. Najim Mamtaj and others referred supra, wherein also the Hon'ble Apex Court by referring Section 200 and 202 of the Cr.P.C. observes that "Section 202 of the Code, inter alia, contemplates postponement of the issue of the process "in a case where the accused is residing at a place beyond the area in which he exercises his jurisdiction" and thereafter to either inquire into the case by himself or direct an investigation to be made by a police officer or by such other person as he thinks fit. In the face of it, what needs our determination is as to whether in a case where the accused is residing at a place beyond the area in wh....
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.... power of the trial court under Section 322 CrPC to revisit the order of issue of process in case it is brought to the court's notice that it lacks jurisdiction to try the complaint. (vii) Section 258 CrPC is not applicable to complaints under Section 138 of the Act and findings to the contrary in Meters and Instruments, (2018) 1 SCC 560 do not lay down correct law. To conclusively deal with this aspect, amendment to the Act empowering the Trial Courts to reconsider/recall summons in respect of complaints under Section 138 shall be considered by the Committee constituted by an order of the Supreme Court dated 10.03.2021. (viii) All other points, which have been raised by the Amicus Curiae in their preliminary report and written submissions and not considered herein, shall be the subject matter of deliberation by the aforementioned Committee. Any other issue relating to expeditious disposal of complaints under Section 138 of the Act shall also be considered by the Committee. 16. He further placed reliance on the Criminal Application (APL) No.32/2024 referred supra, wherein the coordinate Bench has considered the aspect of Section 202 and observed that the presen....
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.... the Code is inapplicable to complaints under Section 138 in respect of examination of witnesses on oath. The evidence of witnesses on behalf of the complainant shall be permitted on affidavit. 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. 18. Thus, by referring the decisions in the case of Abhijit Pawar Vs. Hemant Madhukar Nimbalkar and another and Vijay Dhanuka and others Vs. Najim Mamtaj and others relied upon by the learned Senior Counsel for the petitioners. The Hon'ble Apex Court in Expeditious trial of cases under Section 138 of N.I. Act which is a Suo Motu Writ Petition (Crl.) No.2 of 2020 decided on 16.04.2021 held that Section 202 (2) of the Code is inapplicable to complaints under Section 138 in respect of examination of witnesses on oath. In view of that observations of the Hon'ble Apex Court herein the present case the ground raised by the learned Senior Counsel for the petitioners that no inquiry was held which is mandate of Section 202 is not sustainable. 19. The ground r....
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....ian Registration Act, 1908 (16 of 1908) and the rules made thereunder, (2) the instrument or memorandum has been duly entered or filed, as the case may be, in books kept under section 51 of that Act, and (3) the particulars regarding the transaction to which the instrument relates have been correctly entered in the indexes kept under section 55 of that Act. Explanation II.-Any person acquiring any immoveable property or any share or interest in any such property shall be deemed to have notice of the title, if any, of any person who is for the time being in actual possession thereof. Explanation III.-A person shall be deemed to have had notice of any fact if his agent acquires notice thereof whilst acting on his behalf in the course of business to which that fact is material: Provided that, if the agent fraudulently conceals the fact, the principal shall not be charged with notice thereof as against any person who was a party to or otherwise cognizant of the fraud. 21. Here the petitioner's claim is that they issued cheque against enforceable debt against the transaction of the year 2002 is unsustainable. The Limitation Act, 1963 typic....
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....efore, the complaint was filed. 22. As far as the submission of the learned Senior Counsel Mr. Mardikar that Section 25(3) of the Contract Act will not come for the help of the respondents, as already observed that in the year 2001 the said debt was transferred to the complainant and against the said debt the said cheque was in question was issued. This aspect is considered by the various decisions of the Hon'ble Aepx Court as well as by this Court. It is observed in Rajesh Jain Vs. Ajay Singh referred supra that the Court will necessarily presume that the cheque had been issued towards discharge of a legally enforceable debt/liability in two circumstances. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that cheque was issued/executed in his favour by the drawer. 23. In the case of K. Hymavathi vs. State of Andhra Pradesh reported in 2023 SCC OnLine SC 1128 wherein the Hon'ble Apex Court in para No. 10 observed that: "From a perusal of the legal position enunciated, it is crystal clear that this Court keeping in perspective the nature of the proceedings arising under the NI Act an....
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....he time barred debt becomes enforceable. The Sub-section (3) of Section 25 of the Contract Act does not apply to promise to pay all categories of debts which are not enforceable in law. It applies only to a debt which is not recoverable in law only on the ground of bar created by the law of limitation. Thus, the promise under Sub-section (3) of Section 25 of the Contract Act will not validate a debt which is not enforceable on a ground other than the ground of bar of limitation. For example, if there is a promise to pay an amount advanced for immoral purposes which is hit by Section 23 of the Contract Act, it will not attract Sub-section (3) of Section 25 of the Contract Act and the said provision will be attracted only when a promise is made in writing and signed by the promisor to pay a debt which is barred by limitation." 25. It is the case of the complainant that the petitioner No. 1 company had purchased pulses, edible oil and other goods from NavalkKishore Kothari Sons partnership firm having its office at Akola. The transaction between the petitioner No. 1 and Navalkishore Kothari Sons are prior to the year 2002. The amount due was Rs.35,26,102/-. It was agreed between th....