MARLECHA SECURITIES (P) LTD., STOCK AND SHARE BROKERS REPRESENTED BY ITS DIRECTOR SRI VINOD G. JAIN Vs. MR. P.C. SINGHVI S/O SRI PARASMAL SINGHVI

JUDGEMENT

(1.) AS parties to these two petitions are one and the same and since it relates to one and the same proceedings initiated in C.C. No. 7997/2003 on the file of XV Additional C.M.M., Bangalore, and since common questions of fact and law arises for consideration in these two petitions, they were heard together and are being disposed of by this common order.

(2.) FACTS leading to the presentation to these two petitions under Section 482 of Cr.P.C. are as under: There were certain transactions relating to stocks and shares between M/s. Marlecha Securities (P) Ltd., and Sri. P.C. Singhvi, son of Sri. Parasmal Singhvi. As certain dispute arose between them, the said dispute was referred to an Arbitral Tribunal. After enquiry, the Arbitral Tribunal passed an award dated 17.5.2002 holding that P.C. Singhvi, the respondent in the arbitration case is liable to pay a sum of Rs. 2,00,000/ -with interest at 12% per annum from 6.9.2001 up to the date of payment. As the said award had the force of a decree of the civil court as per the provisions of Arbitration and Conciliation Act, 1996 (for short the Act), on 12.8.2002, the decree holder filed Execution Case No. 1762/2002 on the file of the City Civil Judge at Bangalore to execute the award claiming Rs. 2,23,000/ -inclusive of interest On 17.8.2002, the executing court directed issue of warrant for attachment of movables belonging to the Judgment Debtor P.C. Singhvi, by dispensing with issue of cause notice, since the Execution Petition had been filed within the period of two years from the date of the award. In the meanwhile, the Judgment Debtor P.C. Singhvi filed Petition under Section 34 of the Act, seeking to set aside the award dated 17.5.2002, which came to be registered as Arbitration Suit No. 52/2002. It appears on 8.10.2002, the warrant of attachment was sought to be executed, and at that time, the Judgment Debtor. P.C. Singhvi, issued post dated cheque dated 17.10.2002 for Rs. 2,23,000/ - in favour of the Decree Holder. In the light of the issuance of the said cheque, warrant was returned unexecuted. After coming to know of the issuance of warrant in the Execution Petition, the judgment Debtor P.C. Singhvi, filed application in the Execution Petition on 9.10.2002, seeking, to advance the said case and bringing to the notice of the executing court about the filing of petition under Section 34 of the Act. On 10.10.2002, in Arbitration Suit No. 52/2002 order of interim stay came to be passed by the VI Additional City Civil Judge, Bangalore, staying the operation of the award dated 17.5.2002, subject to the condition that the petitioner therein namely, P.C. Singhvi, should deposit 50% of the award amount. On 11.10.2002, the executing court after hearing the learned Counsel appealing for the Decree Holder and the Judgment Debtor, passed an order directing the Decree Holder, not to encash the cheque issued by the Judgment Debtor till 19.10.2002. There was no further order with regard to the encashment of the said cheque. Therefore, since there was no prohibition for the Decree Holder to get the cheque encashed, the cheque was presented for encashment on 18.3.2003. However, the said cheque came to be dishonoured with a banker's endorsement 'insufficient funds'. Thereafter, the Decree Holder M/s. Marlecha Securities (P) Ltd., caused a legal notice served on P.C. Singhvi, informing him about the dishonour of the cheque and called upon him to pay the amount covered under the cheque. However, in spite of service of notice, there was no compliance of the demands made therein within the statutory period allowed under law. Therefore, M/s. Marlecha Securities (P) Ltd., filed private complaint under Section 200 of Cr.P.C. r/w 142 of the Negotiable Instruments Act, 1881 (for short the N.I. Act) in P.C.R. No. 6486/2003 alleging offence punishable under Section 138 of the N.I. Act.

(3.) IN the meanwhile, he presented Petition under Section 482 of Cr.P.C. in Criminal Petition No. 922/2006, seeking to quash the criminal proceedings initiated against him on the basis of the private complaint for offence punishable under Section 138 of the N.I. Act inter alia contending that the learned Magistrate was not justified in taking cognizance of the offence alleged, in view of the fact that the cheque in question had not been issued for discharge of legally enforceable debt as on the date of the cheque and therefore, no offence under Section 138 of the N.I. Act has been committed by him. In the Criminal Petition No. 922/2006, this Court by order dated 24.2.2006 stayed further proceedings before the Criminal Court for a period of four weeks and the said interim order was subsequently extended from time to time. Though, the further proceedings in the criminal case had been stayed by this Court, the learned Magistrate, proceeded to dismiss the complaint for non -prosecution on 29.4.2006 on the ground that the complainant has failed to lead evidence in the case.