THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Criminal Petition No.7345 of 2008 (Dated : 14-12-2011) Between: G.S.P.Veera Reddy ....Petitioner A n d M/s. Arvee Infra Tech and another ...Respondents THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Criminal Petition No.7345 of 2008 ORDER: This criminal petition has been taken out under Section 482 Cr.P.C., by A-2-G.S.P.Veera Reddy in C.C.No.152 of 2007 on the file of XIV Additional Chief Metropolitan Magistrate, City Criminal Courts, Nampally, Hyderabad to quash the proceedings therein. 2. Brief facts of the case are:- The 1st respondent filed a complaint under Section 200 Cr.P.C., before the Chief Metropolitan Magistrate, City Criminal Court, Hyderabad against the petitioner herein and M/s. GVPR Engineers Limited alleging that the accused had issued cheque bearing No.125721 dated 30-10-2006 drawn on S.B.I., Industrial Finance Branch, Hyderabad towards payment of the due amount of Rs.9,00,000/-. On presentation of the said cheque, it came to be dishonoured on 29-11-2006 on the ground that “payment stopped by the Drawer”. Thereupon, the complainant issued a notice dated 9-12- 2006 demanding the accused to make good the amount covered under the cheque in question. In spite of receipt of the notice, the accused failed to pay the amount and thereby, rendered themselves liable for punishment under Section 138 of the Negotiable Instruments Act. 3. The learned Magistrate took the complaint on file as C.C.No.152 of 2007. Hence this petition by A-2 –G.S.P.Veera Reddy seeking the prayer stated supra. 4. Heard Sri Vedula Venkata Ramana, learned Senior counsel appearing for the petitioner/A-2 and Sri K.Ashok Reddy, learned counsel appearing for the 1st respondent and learned Additional Public Prosecutor appearing for the 2nd respondent-State. 5. Learned senior counsel submits that under Section 141 of the N.I.Act , it is only the persons in charge of the affairs of the company liable to be prosecuted in case of bouncing of cheque issued on behalf of the company. A further submission has been made the complaint averments do not indicate that the petitioner herein issued cheque on behalf of the 1st respondent-company, in which case, continuation of proceedings in C.C.No.152 of 2007 against the petitioner amounts to abuse of process of Court. In support of his submissions, reliance has been placed on the judgment of Supreme Court i n Central Bank of India v. Asian Global Ltd.[1]. Much emphasis has been laid on paragraphs (15) and (16) of judgment, which read as hereunder:- “15. We have carefully considered the submissions made on behalf of the respective parties and we are unable to persuade ourselves to differ with the judgment and order of the High Court. The judgment in S.M.S.Pharmaceuticals Ltd. Case [ (2005) 8 SCC 89], which was relied upon by the High Court, while sinterpreting the provisions of sub-section (1) of section 141 of the 1881 Act, made it very clear that unless a specific averment was made in the complaint that at the time when the offence was committed, the person accused was in charge of and responsible for the conduct of the business of the company, the requirements of Section 141 would not be satisfied. 16. It was further held that while a Managing Director or a Joint Director of the company would be admittedly in charge of the company and responsible to the company for the conduct of its business, the same yardstick would not apply to a Director. The position of a signatory to a cheque would be different in terms of sub-section (2) of Section 141 of the 1881 act. That, of course, is not the fact in this case”. 6. Learned counsel appearing for the 1st respondent-complainant submits that the petitioner is the signatory to the cheque issued on behalf of the company and he being the signatory cannot avoid the prosecution for the offence under Section 138 of the N.I.Act. The photostat copy of the cheque issued by the A-1-M/s. Arvee Infra Tech in favour of the 1st respondent-complainant has been filed along with the material papers, which finds place at page No.9. The petitioner herein is the signatory to the cheque. In the complaint, the 1st respondent stated that the accused has issued cheque dated 30-10- 2006 drawn on State Bank of India towards part of payment of the due amount of Rs.9,00,000/-. The petitioner being a signatory to the said cheque cannot be permitted to contend that the prosecution against him for the offence under Section 138 of the N.I.Act cannot be initiated. The decision on which reliance has been placed by the learned counsel appearing for the petitioner is wholly inapplicable to the facts of the case on hand. What was held in the cited case is to fasten liability on a person other than the signatory to the cheque, specific averment is required to be made that he was in charge of the affairs of the company at the time when the offence was committed. That is not the case on hand. In the case on hand, the petitioner herein is signatory to the cheque in question. In that view of the matter, I find that the petitioner failed to make out any valid ground for quashing the proceedings against him in C.C.No.152 of 2007 on the file of XIV Additional Chief Metropolitan Magistrate, City Criminal Courts, Nampally. 7. Accordingly, the Criminal Petition is dismissed. _____________________ B.SESHASAYANA REDDY, J Dt.14-12-2011 RAR [1] (2010) 11 Supreme Court Cases 203