ANNAM ASSOCIATES Vs. STATE OF A P

JUDGEMENT

(1.) Heard the learned counsel appearing for the petitioners, the learned counsel appearing for respondent No. 2 and the learned Additional Public Prosecutor representing the State. This Criminal Petition is filed under Section 482 of Cr.P.C, to quash the proceedings in C.C. No.502 of 2009 on the file of the II-Additional Judicial First Class Magistrate, Bhimavaram, West Godavari District.

(2.) The petitioners are the accused in the aforesaid case filed under Sections 138 and 141 of Negotiable Instruments Act. It is alleged in the complaint that the petitioners borrowed personal loan of Rs. 30,00,000/- (Rupees thirty lakhs only) from the second respondent company, agreeing to pay the same in 36 monthly installments at the rate' of Rs. 1,20,210/- (Rupees one lakh, twenty thousand, two hundred and ten only) commencing from September, 2006. The petitioners paid only seven installments and thereafter they committed default. Subsequently, on demand, the petitioners issued cheques for repayment of the debt and they were dishonoured. The Complainant after issuing notice/filed the aforesaid criminal case under Sections 138 and 141 of the Negotiable Instruments Act.

(3.) It is contended on behalf of the petitioners that there is an arbitration clause in the agreement between the parties and in fact, the complainant initiated arbitration proceedings, wherein an ex parte award was passed, which is now the subject matter of challenge in an appeal filed by the petitioners.