KALYANI REFINERIES LIMITED Vs. BANARAS STATE BANK LIMITED

JUDGEMENT

(1.) These two criminal petitions have been filed under Section 482 of Cr.PC for quashing the relative proceedings in CC Nos.727 and 729 of 1998 on the file of the XVII Metropolitan Magistrate, Hyderabad in which the petitioners are the accused and respondent No.1 is the complainant. Accused No.1 is a company and accused No.2 is its Managing Director. Accused No.3 is the sole proprietary firm represented by accused Nos.4 and 5. The complaint has been filed by the Banaras State Bank Limited, a Scheduled Bank.

(2.) The allegations as stated in the complaint briefly are as follows: Accused No.2 is the Managing Director of accused No.2 company (petitioners herein) accused No.1 Company was sanctioned by the complainant Bank credit facilities like cash credit to the bills discounted, cheques discounted etc., in a limit of Rs.280 lakhs. The accused No.1 has withdrawn the said amount and failed to update the accounts. Inspite of demands for payment, the accused did not regularise the accounts. When the complainant was about to take steps for recovery of outstandings, accused No.2 as Managing Director of accused No.1 deposited with the complainant Bank at their Branch Office situated at Narayanaguda three cheques amounting to Rs.9,31,140/- in Crl. P No.4461 of 1999 and four cheques amounting to Rs.30,41,219/ in Crl. P No.4462 of 1999. The said cheques were issued by accused No.3 as sole proprietor of his firm towards outstanding to adjust the overdrafts in the account of accursed No. 1. The complainant bank bonafidely believing the representation of accused Nos.1 and 2 had discounted the aforementioned cheques on 31-3-1998 and the same was credited to the account of accused No.1 and adjusted towards overdue of liabilities of accused No.1 with the complainant bank in bill discounted accounts in anticipation that the said cheques will be honoured, on the said representation.

(3.) The said cheques were returned unpaid on 9-4-1998. This was brought to the notice of accused Nos.1 and 2. Subsequently, the said cheques were represented on 25-5-1998 in State Bank of Hyderabad, Bhavanipuram Branch, Vijayawada with the Bankers of accused No.3. The said cheques were again returned unpaid with endorsement 'funds insufficient'. The complainant received intimation of dishonour of said cheques through memorandum dated 3-6-1998. It is stated that accused Nos.l, 2 and 3 had conspired together and issued the cheques in question with a dishonest intention and to cheat the complainant Bank.