1. By way of this petition under Article 226 of the Constitution of India r/w section 482 of the Code of Criminal Procedure, 1973, the petitioner has prayed to quash and set aside the proceedings of Criminal Case No.87 of 2015 pending before the Id. Metropolitan Magistrate Court, Ahmedabad.

2. Brief facts of the case are as under:-

During this period, 3 drill machines were spoiled and send to Page 1 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined respondent no.2 on 18.10.2014 for repairing and on that day, petitioner gave cheque of Rs.1,33,500/- to respondent no.2. On 06.11.2014, respondent no.2 has returned all the machines to applicant. The respondent no.2 gave deliver of machines amounting to Rs.1,78,000/- + 24,531/- for maintenance. Respondent no.2 deposited advance dheque dated 30.01.2014 of Rs.1,78,000/- bearing No.684447. Respondent no.2 deposited the said cheque.

2.2 The complainant had deposited the cheque given for security purpose and the same came to be dishonoured. The complainant had therefore lodged a complaint under section 138 of the Negotiable Instruments Act. The said complaint came to be registered as Criminal Complaint No.87 of 2015.

2.3. The Learned Metropolitan Magistrate, Ahmedabad was pleased to issue process against the accused no.1 i.e. present petitioner vide its order dated 13.04.2015. The said order was passed despite the fact that no complaint under section 138 is maintainable in the present facts and circumstances of the case.

2.4. Hence, present petition.

3. Learned advocate Ms. Joshi for the petitioner in her submission argued that the cheque in question is not handed over to the complainant for any subsisting or legally enforceable liability, which subsists on the date of the cheque. She would further submit that the documents on record produced by the complainant itself indicates that the cheque in question was given towards guarantee as per the payment terms. Therefore, Page 2 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined she would submit that it could be treated that the cheque in question was granted towards security for liability which may arose on subsequent date. She would submit that goods which were sold to petitioner were defective goods. Cheque was given to payment of goods purchased but since goods were defective no liability arise upon the petitioner to pay bill amount. In premises of this fact no subsisting liability exist on day of cheque presented for encashment. She would further submit that the learned trial Court committed serious error in issuing process without referring any documents on record.

3.1 In nutshell, learned advocate for the petitioner submits that since the essential ingredients of offence u/s 138 of the NI Act are not satisfied, issuance of process against the petitioner by the learned trial Court is gross error.

3.2 In support of her submissions, learned advocate Ms.Joshi has relied on judgment of Hon'ble Supreme Court in the case of M/s. Indus Airways Pvt. Ltd. v/s. M/s. Magnum Aviation Pvt. Ltd. [2014 (12) SCC 539] and judgment of this Court in the case of Nikhil P.Gandhi v/s. State of Gujarat [Criminal Misc. Application No.968 of 2014].

3.3 Upon above submissions, learned advocate Ms. Joshi submits to allow the petition and to quash and set aside order of issuance of process in criminal case as well as to quash and set aside proceedings of criminal case.

4. Per contra, learned advocate Mr. Modi appearing for the respondent No.2 referring to judgment in case of Sunil Todi and Page 3 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined others Vs. State of Gujarat , 2022(16) SCC 762, more particularly, para 30 to 34 and in case of Rathish Babu Unnikrishnan v. State (Govt. of NCT of Delhi) and Another , 2022 SCC OnLine SC 513, more particularly, para 8.13 and 16 to 19 would submit that whether the cheque in question is issued towards security, whether there is subsisting liability and the cheque in question was issued towards subsisting liability, whether there is any violation of the terms and conditions of the purchase order, all are the questions of fact and cannot be a reason to quash criminal complaint without weighing them in evidence. He would further submit that the Court should slow in quashing the complaint where disputed questions of facts are to be weighed under the scale of the Evidence Act . He would further submit that section 139 of the NI Act operates presumption against accused that the cheque in question has been given towards legally enforceable liability. The accused however got chance to rebut the presumption by leading evidence, but not by adjudicating the case u/s 482 of the Code of Criminal Procedure, 1973. Therefore, he would submit that since the signature of the petitioner is admitted on the disputed cheque and the petitioner has also accepted that the cheque is returned unpaid as payment was stopped, prima facie, ingredients of section 138 of the NI Act are attracted and therefore, the learned trial Court has rightly issued process to the petitioners.

4.1 Upon such submissions, learned advocate Mr. Modi prays to dismiss the petition.

5. Regard being had to the rival submissions of learned Page 4 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined advocates for both the sides and giving anxious thoughts and consideration in context to the averments and documents on record, at the outset, let refer judgment of the Hon'ble Apex Court in case of State Of Orissa Versus Pratima Mohanty Etc.,2022 (16) SCC 706 observed as under:-

6. At initial stage, where cognizable offence is disclosed in FIR, whether investigation can be thwart by exercising inherent power under section 482 of Cr.P.C., the Hon'ble Apex Court in the case of Skoda Auto Volkswagen India Private Ltd. v/ s. State of Uttar Pradesh [2020 SCC Online SC 958], in para 41 has held as under :-

7. In the case of State of Haryana Vs. Bhajanlal & ors., AIR 1992 SC 604, the Hon'ble Apex Court has opined that power of quashing can be exercised very sparingly and that too in rarest of rare case. Relevant observations reads as under:-

8. After considering ratio laid down as aforesaid, let examine pleadings of the petition. The pleadings are indicative of the fact that the petitioners, who is accused in the trial under the NI Act did not deny issuance of the cheque nor signature thereof or the complainant being holder in due course. It is also undeniable Page 6 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined aspect that the cheque was deposited by the complainant. The cheque in question was presented by the complainant for clearance on 15.9.2015 and it was returned unpaid with the endorsement "stop payment". The statutory notice issued on 25.02.2015 demanding cheque amount of Rs.1,78,000/- being unpaid, which admittedly was not paid within the stipulated time period, leading to the complainant to file complaint u/s 138 of the NI Act before the jurisdictional Court. It is equally indubitable that learned Metropolitan Magistrate, after considering the averments made in the complaint and also documents annexed with it and after applying its mind, issued process to the petitioners In background of above aspects, the contention of the petitioners if noticed it is that the cheque in question was not given towards discharging existing or subsisting liability, but it is given towards security and hence, the cheque in question does not fall within the purview to call the criminal proceedings u/s 138 of the NI Act.

9. At this juncture, let refer section 139 of the NI Act, which reads as under:-

10. In Lakshmi Dyechem v State of Gujarat 2012(12) JT 65, the Hon Apex Court has held that presumption under Section 139 of the Act is a rebuttal presumption and the accused issuing the cheque is at liberty to prove to the contrary.

NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined

11. In Mandvi Cooperative Bank Vs. Nimesh B. Thakore reported in 2010(3) SCC 83, it is held by the Hon Apex Court that a rebuttal presumption is created under Section 139 of the NI Act that cheque was issued by the drawer in discharge of any debt or liability owned by him or its holder. Therefore, the presumption available under Section 139 of the NI Act in favour of the holder in cheque can be rebutted by the accused by adducing evidence. The burden of proof is on the accused and the evidence which is available on record will have to be tested bearing in mind the facts regarding the burden of proof. The rebuttal burden envisaged under Section 139 of the NI Act can be discharged by placing a photocopy of the account maintained by the petitioners accused in a proceedings under Section 482 of the Criminal Procedural Code.

12. This Court in case of M/s Jalaram Jyot Sales Agency & Anr. Vs. State of Gujarat, Special Criminal Application No.2125 of 2018, in para 6.5 held as under:-

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13. It is apposite to refer to the judgment of the Hon'ble Supreme Court in Rohitbhai Jivanlal Patel v. State of Gujarat, AIR 2019 SC 1876, wherein the Hon'ble Court, in paragraph 7 and 7.1, extracted and examined the findings of the High Court as under:

14. Therefore, applying the ratio laid down in the aforesaid judgments to the facts of the present case, the petitioner accused cannot contend at this juncture that the cheque in question is issued towards security and hence, the case u/s 138 of the NI Act is not made out or cannot contend that the cheque in question is not issued towards discharge of any legally enforceable or subsisting liability. These contentions are disputed facts and can be addressed and weighed during trial. To be noted that once the process is issued, presumption u/s 139 of the NI Act starts operating in favour of the complainant. The accused can discharge rebuttal burden by leading evidence. The complaint cannot be quashed until the accused discharges burden envisaged upon.

15. In case of Sampelly Satyanarayana Rao v/s. Indian Page 12 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined Renewable and Energy Development Agency Ltd. [AIR 2016 SC 4363], Hon'ble Apex Court held in Paras 14, 13, and 16 as under:-

as per defence of the accused. Negativing the contention, this Court held :-

12. In Rallis India Ltd. v. Poduru Vidya Bhushan [(2011) 13 SCC 88], this Court expressed its views on this point as under: (SCC p. 93, para 12) "12. At the threshold, the High Court should not have interfered with the cognizance of the complaints having been taken by the trial court. The High Court could not have discharged the respondents of the said liability at the threshold. Unless the parties are given opportunity to lead evidence, it is not possible to come to a definite conclusion as to what was the date when the earlier partnership was dissolved and since what date the respondents ceased to be the partners of the firm."

16. In the recent judgment rendered in the case of Rathish Babu Unnikrishnan (supra), the Hon'ble Supreme Court, while referring to the ratio laid down in Rajeshbhai Muljibhai Patel v. State of Gujarat , (2020) 3 SCC 794, has categorically held that disputed questions of fact are not required to be adjudicated at the threshold stage. Instead, such issues ought to be considered and decided only after the parties lead evidence. The relevant paragraphs of the judgment are reproduced hereinbelow:-

13. Bearing in mind the principles for exercise of jurisdiction in a proceeding for quashing, let us now turn to the materials in this case. On careful reading of the complaint and the order passed by the Magistrate, what is discernible is that a possible view is taken that the cheques drawn were, in discharge of a debt for purchase of shares. In any case, when there is legal presumption, it would not be judicious for the quashing Court to carry out a detailed enquiry on the facts alleged, without first permitting the trial Court to evaluate the evidence of the parties. The quashing Court should not take upon itself, the burden of separating the wheat from the chaff where facts are contested. To say it differently, the quashing proceedings must not become an expedition into the merits of factual dispute, so as to conclusively vindicate either the complainant or the defence.

14. The parameters for invoking the inherent jurisdiction of the Court to quash the criminal proceedings under S.482 CrPC, have been spelled out by Justice S. Ratnavel Pandian for the two judges' bench in State of Haryana v. Bhajan Lal6 , and the suggested precautionary principles serve as good law even today, for invocation of power under Section 482 of the Cr.P.C.

15. In the impugned judgment, the learned Judge had rightly relied upon the opinion of Justice J.S.Khehar for a Division Bench in Rajiv Thapar (supra), which succinctly express the following relevant parameters to be considered by the quashing Court, at the stage of issuing process, committal, or framing of charges, "28. The High Court, in exercise of its jurisdiction under Section 482 CrPC, must make a just and rightful choice. This is not a stage of evaluating the truthfulness or otherwise of the allegations levelled by the prosecution/ complainant against the accused. Likewise, it is not a stage for determining how weighty the defences raised on behalf of the accused are. Even if the accused is successful in showing some suspicion or doubt, in the allegations levelled by the prosecution/ complainant, it would be impermissible to discharge the accused before trial. This is so because it would result in giving finality to the accusations levelled by the prosecution/complainant, without allowing the prosecution or the complainant to adduce evidence to substantiate the same."

16. The proposition of law as set out above makes it abundantly clear that the Court should be slow to grant the relief of quashing a complaint at a pre-trial stage, when the factual controversy is in the realm of possibility particularly because of the legal presumption, as in this matter. What is also of note is that the factual defence without having to adduce any evidence need to be of an unimpeachable quality, so as to altogether disprove the allegations made in the complaint.

17. The consequences of scuttling the criminal process at a pre-trial stage can be grave and irreparable. Quashing proceedings at preliminary stages will result in finality without the parties having had an opportunity to adduce evidence and the consequence then is that the proper forum i.e., the trial Court is ousted from weighing the Page 17 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025 NEUTRAL CITATION R/SCR.A/4391/2015 ORDER DATED: 15/07/2025 undefined material evidence. If this is allowed, the accused may be given an un-merited advantage in the criminal process. Also because of the legal presumption, when the cheque and the signature are not disputed by the appellant, the balance of convenience at this stage is in favour of the complainant/prosecution, as the accused will have due opportunity to adduce defence evidence during the trial, to rebut the presumption.

18. Situated thus, to non-suit the complainant, at the stage of the summoning order, when the factual controversy is yet to be canvassed and considered by the trial court will not in our opinion be judicious. Based upon a prima facie impression, an element of criminality cannot entirely be ruled out here subject to the determination by the trial Court. Therefore, when the proceedings are at a nascent stage, scuttling of the criminal process is not merited."

17. Considering the application of ratio of above judgments, the judgment cited by learned advocate for the petitioners renders no help to his case.

18. In view of above and for the foregoing reasons, the contention of the petitioners to quash the complaint does not hold the field and the same can at the most be a good defence and can be raised during trial, but upon such finding, the Court cannot quash the complaint.

19. Resultantly, the petition fails and stands dismissed. Rule discharged. Interim relief granted earlier stands vacated.

(J. C. DOSHI,J) SATISH Page 18 of 18 Uploaded by SATISH C. VEMULLA(HC00206) on Fri Jul 18 2025 Downloaded on : Fri Jul 18 23:45:05 IST 2025