S K PHARMACEUTICALS LTD Vs. VED PRAKASH GUPTA

JUDGEMENT

(1.) BY the impugned order dated 11. 9. 2001, Judicial Magistrate, First Class, Gwalior, in his Criminal Case No. 679/2001 (Vedprakash Gupta v. S. K. Pharmaceutical Ltd.) on complaint of Vedprakash Gupta, the respondent, registered an offence under Section 138 of the Negotiable Instruments Act (to be called as Act only ). The Magistrate first issued a notice and on petitioner's remaining absent despite service of notice, he issued coerceive process. Ultimately non-bailable warrant was also issued.

(2.) IN this petition under Section 482 of the Code of Criminal Procedure (Code for short), the petitioners have sought quashment of the proceedings first on the ground that the Board for Industrial and Financial Reconstruction (BIFR for short) has declared the petitioner-Company a sick company and under Section 22-A of Sick Industrial Companies (Special Povisions) Act, 1985, has directed not to dispose of its assets; secondly that against registration of a criminal case under Section 406 of the Indian Penal Code, another Misc. Cri. Case No. 3838/2001 has been filed, which is pending with a direction of stay of further proceedings of that case; and thirdly, Baroda Court has issued a stay order against enforcement of the agreement dated 28. 3. 1998.

(3.) THE Hon. Apex Court in Kusum Ingots and Alloys Ltd. v. Pennar Peterson Securities Ltd. : II (2000) SLT 375=i (2000) CCR 260 (SC)=i (2000) BC 300= (2000) 2 SCC 745 and B. S. I. Ltd. v. Gift Holidays Pvt. Ltd. : II (2000) SLT 184=i (2000) CCR 226=i (2000) BC 292 (SC)= (2000) 2 SCC 737 has held that merely because a Company is declared a sick unit, prosecution under Sections 138, 141 and 142 of the Negotiable Instruments Act and pro tanto for any other offence is not barred. A. P. High Court in B. Mohan Krishnan v. Union of India, 1995 (2) Crimes 795, has held that no permission of the B. I. F. R. is necessary. The only condition when aprosecution can be barred, can well be understood from the following passage in the Kusum Ingots andalloys Ltd. (cited supra) at page 755 of SCC :