MODERN DENIM LIMITED Vs. STATE OF GUJARAT

JUDGEMENT

(1.) BY the present application filed under section 482 of the Code of Criminal Procedure, 1973, ("the Code") the applicants have prayed to quash the complaint filed by the respondent No.2 for the offence under section 138 of the the Negotiable Instruments Act ("the Act") which is registered as Criminal Case No.654/2014.

(2.) LEARNED Advocate Mr. Hardik Dave appearing for the applicants submitted that in absence of valid notice of demand, the complaint under section 138 of the Act is not maintainable. Taking the Court through notice dated 18.1.2014, at annexure -B, Mr. Dave submitted that the demand for payment made in the notice is not for the cheque amount and, therefore, it is no demand notice in the eye of law. Mr. Dave submitted that no specific averments are made in the complaint as regards involvement of the applicants in day to day business of the company or to show that as Directors of the Company, the applicants are responsible for conduct of the business of the Company. Mr. Dave submitted that in absence of such averments in the complaint against the applicants, the complaint under section 138 of the Act against the applicants is not maintainable. Mr. Dave submitted that the applicants No.2 to 4 are residing beyond the territorial jurisdiction of the learned Metropolitan Magistrate, Ahmedabad and therefore no process could have been issued against them without following the mandate of holding inquiry at first stage as provided in section 202 of the Code. Mr. Dave submitted that the respondent No.2 complainant has not filed the affidavit of chief examination but has filed verification affidavit and such verification affidavit could not be considered by the learned Magistrate for the purpose of issuing process against the applicants as the law requires filing of separate affidavit of chief examination of the complainant with the complaint. Mr. Dave submitted that the order passed by the learned Magistrate issuing process on the complaint reflects non -application of mind by the learned Magistrate in as much as the learned Magistrate has not discussed whether the requirements of section 143 and 145 of the Act read with section 200 to 202 of the Code are satisfied. In support of his submissions, Mr. Dave has relied on the the decision in the case of K.R. Indra v. Dr. G. Adinarayan, 2003 AIR(SC) 4689Indra Kumar Patodia and Anr. Versus Reliance Industries Limited and Others, 2013 AIR(SC) 426Kamla Chaturvedi versus National Insurance Company and Others, 2009 1 SCC 487, National Bank of Oman versus Barakara Abdul Aziz and another, 2013 2 SCC 488.

(3.) LEARNED Advocate Mr. Shah appearing for respondent No.2 submitted that the demand in statutory notice issued by respondent No.2 is in respect of the amount covered by the dishonoured cheque and, therefore, the notice is legal and valid. Mr. Shah submitted that the respondent No.2 has clearly averred in the complaint that the applicants are involved in day to day business and the administration of the company and are responsible to the company for conduct of its business. Mr. Shah submitted that in view of such averments made in the complaint, the argument that the applicants were not responsible for conduct of the business of the company could be considered at this stage in absence of any concrete material before the Court. Mr. Shah submitted that the provisions of section 142 to 145 of the Act are held to have overriding effect over the provisions of the Code and the use of non -obstante clause in the said provisions of the Act would make it abundantly clear that the learned Magistrate is not to hold inquiry as per section 202 of the Code before issuing process for the offence under section138 of the Act. Mr. Shah submitted that separate affidavit of chief examination is filed with the complaint which has been rightly relied by the learned Magistrate for issuance of process against the applicants. Mr. Shah submitted that even if such separate affidavit is considered to be verification of the complaint on oath, then also, it was the discretion of the learned Magistrate to issue process on the basis of such verification of the complaint without calling for any further affidavit as evidence of the complainant. Mr. Shah submitted that the order passed by the learned Magistrate for issuance of process reveals application of mind by the learned Magistrate as it is clearly mentioned that the process is issued after considering the complaint, the affidavit of the complainant, and the other documentary evidence. Mr. Shah has relied on the judgments in the case of A.C. Narayanan versus State of Maharashtra and another, 2014 11 SCC 790, Shivjee Singh versus Nagendra Tiwary and others, 2010 7 SCC 578, Indian Bank Association and others versus Union of India and Others, 2014 5 SCC 590.