TARA CHAND Vs. STATE GOVT OF NCT DELHI

JUDGEMENT

(1.) THE present petition has been filed under section 482 Crpc. for quashing of the complaint case filed under Section 138 of the Negotiable Instruments Act and orders dated 29th November, 2003 and 18th march, 2006 and also the subsequent proceedings relating thereto.

(2.) THE brief facts, as alleged in the petition, are that a Hire Purchase Agreement dated 19th September, 2001 was executed between the respondent no. 3 and respondent no. 4 and petitioner acted as the guarantor for the said loan. Thirty six (36) cheques were handed to the representative of respondent no. 2. Later on the petitioner detected the fraud in the agreement and issued legal notice to respondent no. 2 not to present any cheque for encashment. The respondent no. 2 terminated the agreement dated 19th september, 2001 and also invoked the arbitration clause and filed the application under the Arbitration and Conciliation Act in the civil suit and prayed to the Court to refer all the disputes for adjudication before the Arbitrator which was allowed by the civil judge. Later on 9th September, 2003, respondent no. 2 filed the complaint under section 138 of the Negotiable Instruments, act before the Magistrate and the Magistrate passed the summoning order against the petitioner and other persons. Thereafter, respondent no. 2 repossessed the vehicle from respondent no. 4 and sold the vehicle. On 29th July, 2005 the respondent no. 2 gave a statement before the Magistrate and sought the permission to withdraw the case against the other persons except the petitioner and the learned Magistrate granted' the permission and accordingly the proceedings were dropped against the other persons. Vide impugned order dated 8th march, 2006 notice under Section 251 Crpc was framed against the petitioner.

(3.) IT has been contended by the learned counsel for the petitioner that admittedly the petitioner has issued notice not to present the cheques in. question and the said cheques have not been dishonoured subsequent to such notice and as such the proceedings under Section 138 of the negotiable Instruments Act, 1881 are not maintainable against the petitioner. Further the cheques were not dishonoured on account of any dishonest intention on the part of the petitioner but on account of genuine dispute between the parties and the matter having been referred to the arbitration, the present complaint is clear abuse of the process of the Court.