CHERUKU ENTERPRISES Vs. STATE BANK OF HYDERABAD

JUDGEMENT

(1.) The petitioner invokes the inherent powers of this court under Section482 Cr.P.C. for quashing of the proceedings in C.C. No. 333 of 1999 on the file of the V Metropolitan Magistrate, Nampalle, Hyderabad.

(2.) It is necessary to have a brief resume of the background of the facts of the case to appreciate the contentions canvassed. The petitioner deals with the sale of computers and is the distributor for Andhra Pradesh Region for Leo Computers. Sanchayani, Madras is the All India Distributors for Leo Computers. The Head Office of Leo Computers is Taipee Taivan. The petitioner in turn has appointed a few dealers in Andhra Pradesh region for supply of computers and always insists advanced post-dated cheques to supply computers to the dealers. The petitioner has opened cash credit account No. 50584 during September 1998 with the State Bank of Hyderabad, Sanjivareddi Nagar branch and since then it has been doing all transactions of the petitioner with the said first respondent. A loan of five lakh rupees sanctioned for running business. The petitioner has furnished 92 lakh worth properties as security to the bank. While the matters stood thus, one of the dealers of the petitioner at Vijayawada by name Someswar Rao had placed order for supply of 12 computers systems with the petitioner. The petitioner has collected post dated cheque bearing No. 337416 dated 23-10-1998 for a sum of six lakh rupees from the dealer. It was drawn on Punjab and Sindh bank, Vijayawada for a sum of Rs. 6 lakh by Someswar Rao. After collecting the cheques from the dealer, 12 computers systems were supplied. In order to pay to Sanchayani Leo Computers, Madras the petitioner has approached the bank for discounting the cheque. The petitioner has to pay the same to the said Sanchayani Leo Computers, Madras. On the strength of Field Officer's report the Branch Manager was pleased to credit the cheque in favour of the petitioner and the petitioner has discounted the cheque and paid money to Sanchayani for supply of 12 computers. The dealer at Vijayawada cancelled the order for purchase of 12 computers by which time the petitioner already purchased 12 computers systems by paying cash. Immediately it approached Sanchayani Leo Computers, Madras to take back the systems and pay back the amount collected. Hence the Sanchayani Leo Computers, Madras collected the computers from the petitioner but they did not return the money collected from the petitioner and later they cancelled the distributorship of its computers. The respondent bank deposited the cheque bearing No. 334717 dt. 23-10-1998 for clearance issued by Someswar Rao the dealer of the petitioner drawn in favour of the petitioner and the cheque was returned unpaid stating the reason as insufficient funds. The respondent bank immediately informed the petitioner regarding the dishonour of the cheque. It is represented by the petitioner to the bank about the cancellation of orders placed by its dealer Someswar Rao and by that time the bank has paid the discounted amount to Sanchayani Leo Computers, Madras and he has Sought time for settling the transaction. The petitioner requested the bank to clear the amounts towards the discounted cheque as securities of the petitioner worth of nearly Rs. 92 lakh are lying with the bank. Thereupon the first respondent bank issued notice on 12-3-1999 calling upon the petitioner to pay the cheque amount immediately. A detailed reply was given on 10-4-1999 and the petitioner has subsequently paid an amount of Rs. 50,000/- on 20-7-1999 and another sum of Rs. 50,000/- on 29-9-1999 towards the discounted cheque. The bank has filed criminal complaint in C.C. 333 of 1999 before the V Metropolitan Magistrate, Hyderabad invoking the provisions of Section 138 of Negotiable Instruments Act. Aggrieved by the same, the petitioner has presented this criminal petition.

(3.) The learned counsel for the petitioner contends that the bank has no right to present a complaint against him under Section 138 of N.I. Act. It is also further contended that G.P.A. holder has no right to present a complaint and hence the complaint is not maintainable.