DYNAMIC AURA LLP & ORS. vs THE STATE/GOVT. OF NCT OF DELHI) & ANR.

* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on : 14.09.2023
% Pronounced on : 29.11.2023

+ CRL.M.C. 4993/2023
DYNAMIC AURA LLP & ORS. ….. Petitioners
Through: Mr. Brahma Nand Prasad, Adv.

versus

THE STATE/GOVT. OF NCT OF DELHI) & ANR.
….. Respondents
Through: Mr. Raghuinder Varma, APP for the State.
Mr. Nitin Mittal, Adv. for R-2.
CORAM:
HON’BLE MR. JUSTICE RAJNISH BHATNAGAR
JUDGMENT
RAJNISH BHATNAGAR, J.
CRL.M.A. 19003/2023 (exemption)
Exemption allowed, subject to all just exceptions.
The application stands disposed of.
CRL.M.A. 19004/2023 (delay of 15 days in refiling the petition)
For the reasons mentioned in the application, delay of 15 days in re-filing the petition is condoned.
The application stands disposed of.
CRL.M.C. 4993/2023 & CRL.M.A. 19002/2023 (stay)
1. The present petition under Section 482 Cr.P.C has been filed by the petitioners seeking the following reliefs: –
“It is therefore, prayed this Hon’ble Court may kindly quash the proceedings/complaint/order of Cognizance/Order of summoning dated16.03.2023 against the petitioners (the alleged accused of the main complaint) from the Complaint Case No. C.C. N1 ACT-6887/2022, case titled Strabag Engineers Private Limited Vs. Dynamic Aura LLP in the interest of justice.”

2. The complainant (respondent no. 2 herein) had instituted a complaint under Section 138 read with Section 142 of Negotiable Instruments Act, 1881 against the present petitioners in respect of non-payment against one dishonoured cheque for the amount of Rs.50,00,000/- issued by petitioners in favour of the respondent no. 2.

3. The Metropolitan Magistrate vide Order dated 16.03.2023 issued summons under Section 138 of Negotiable Instruments Act, 1881 requiring the petitioners to attend the Court.

4. The petitioners feeling aggrieved, filed the present petition invoking jurisdiction of this Court U/s 482 Cr.P.C.

5. It has been mainly argued by the Ld. Counsel for the petitioners that the Ld. Trial Court failed to appreciate that no complaint is made out on the basis of a technically defective legal demand notice as no cause of action arises against the said drawers of cheques. He further submitted that the order of cognizance against the petitioners dated 16.03.2023 is illegal and improper and the same deserves to be quashed owing to non-compliance of statutory provision mentioned under Section l38 (b) read with Section 142 of N.I. Act. Ld. Counsel for the petitioners, in support of his contentions has placed reliance on Pawan Kr. Goel vs. State of UP & Anr. [Criminal Appeal No. 1999 of 2022(arising out of Special Leave Petition (Crl.) No. 1697 of 2020)], Dashrathbhai Trikambhai Patel vs. Hitesh Mahendrabhai Patel &Anr. [Criminal Appeal No. 1497 of 2022] and Mohamad Irfan vs Velukannan [Crl.A.No.94 of 2014].

6. As far as the judgments relied upon by the Ld. Counsel of the petitioners are concerned, there is no dispute with regard to the proposition of law laid down in the said judgments, but with due regard, the same are not applicable to the facts of the present case as perusal of the records of the case shows that all the statutory requirements have been complied with as the cheque in question was presented within its validity period, the cheque got dishonored vide return memo dated 20.08.2022 and subsequently, when the petitioners still failed to make any payments, the legal notice was issued on 25.08.2022. Moreover, as far as the contention of learned counsel for the petitioner that no cause of action arises as a defective legal notice has been issued has no force in it as the petitioner has failed to give any explanation whatsoever as to how the said legal notice was defective and merely stating the same by the petitioner is of no consequence.
7. Now coming to the legal position in this case and taking into consideration the various provisions of Cr.PC which have been discussed in various judgments time and again demonstrate that the Negotiable Instruments Act, provides sufficient opportunity to a person who issues the cheque. Once a cheque is issued by a person, it must be honoured and if it is not honoured, the person is given an opportunity to pay the cheque amount by issuance of a notice and if he still does not pay, he is bound to face the criminal trial and consequences. It is seen in many cases that the petitioners with malafide intention and to prolong the litigation raise false and frivolous pleas and in some cases, the petitioners do have genuine defence, but instead of following due procedure of law, as provided under the NI Act and the Cr.PC, and further, by misreading of the provisions, such parties consider that the only option available to them is to approach the High Court and on this, the High Court is made to step into the shoes of the Metropolitan Magistrate and examine their defence first and exonerate them. The High Court cannot usurp the powers of the Metropolitan Magistrate and entertain a plea of accused, as to why he should not be tried under Section 138 of the NI Act. This plea, as to why he should not be tried under Section 138 of the NI Act is to be raised by the accused before the Court of the Metropolitan Magistrate under Section 251 of the Cr.PC & under Section 263(g) of the Cr.PC. Along with this plea, he can file necessary documents and also make an application, if he is so advised, under Section 145(2) of the NI Act to recall the complainant to cross-examine him on his plea of defence. However, only after disclosing his plea of defence, he can make an application that the case should not be tried summarily but as a summons trial case.
8. An offence under Section 138 of the NI Act is technical in nature and defences, which an accused can take, are inbuilt; for instance, the cheque was given without consideration, the accused was not a Director at that time, accused was a sleeping partner or a sleeping Director, cheque was given as a security etc. etc., the onus of proving these defences is on the accused alone, in view of Section 106 of the Indian Evidence Act, 1872. Since the mandate of the legislature is the trial of such cases in a summary manner, the evidence already given by the complainant by way of affidavit is sufficient proof of the offence and this evidence is not required to be given again in terms of section 145(1) of the NI Act and has to be read during the trial. The witnesses i.e. the complainant or other witnesses can be recalled only when the accused makes such an application and this application must disclose the reason why the accused wants to recall the witnesses and on what point the witnesses are to be cross examined.

9. The offence under Section 138 of the NI Act is an offence in the personal nature of the complainant and since it is within the special knowledge of the accused as to why he is not to face trial under section 138 N.I. Act, he alone has to take the plea of defence and the burden cannot be shifted to complainant. There is no presumption that even if an accused fails to bring out his defence, he is still to be considered innocent. If an accused has a defence against dishonour of the cheque in question, it is he alone who knows the defence and responsibility of spelling out this defence to the Court and then proving this defence is on the accused. Once the complainant has brought forward his case by giving his affidavit about the issuance of cheque, dishonour of cheque, issuance of demand notice etc., he can be cross-examined only if the accused makes an application to the Court as to, on what point he wants to cross examine the witness(es) and then only the Court shall recall the witness by recording reasons thereto.

10. Sections 143 and 145 of the NI Act were enacted by the Parliament with the aim of expediting trial in such cases. The provisions of summary trial enable the respondent to lead defence evidence by way of affidavits and documents. Thus, an accused who considers that he has a tenable defence and the case against him was not maintainable, he can enter his plea on the very first day of his appearance and file an affidavit in his defence evidence and if he is so advised, he can also file an application for recalling any of the witnesses for cross-examination on the defence taken by him.

11. In view of the procedure prescribed under the Cr.PC, if the accused appears after service of summons, the learned Metropolitan Magistrate shall ask him to furnish bail bond to ensure his appearance during trial and ask him to take notice under Section 251 Cr.PC and enter his plea of defence and fix the case for defence evidence, unless an application is made by an accused under Section 145(2) of NI Act for recalling a witness for cross-examination on plea of defence. If there is an application u/s 145(2) of N.I. Act for recalling a witness of complainant, the court shall decide the same, otherwise, it shall proceed to take defence evidence on record and allow cross examination of defence witnesses by complainant. Once the summoning orders in all these cases have been issued, it is now the obligation of the accused to take notice under Section 251 of Cr. PC., if not already taken, and enter his/her plea of defence before the concerned Metropolitan Magistrate’s Court and make an application, if they want to recall any witness. If they intend to prove their defence without recalling any complainant witness or any other witnesses, they should do so before the Court of Metropolitan Magistrate.

12. Upon analyzing the provisions of the NI Act, it is clear that Section 138 of the Act spells out the ingredients of the offence as well as the conditions required to be fulfilled before initiating the prosecution.

13. These ingredients and conditions are to be satisfied mainly on the basis of documentary evidence, keeping in mind the presumptions under Sections 118 and 139 of the NI Act and Section 27 of the General Clauses Act, 1897 as well as the provisions of Section 146 of the Act.

14. The parameters of the jurisdiction of the High Court, in exercising jurisdiction under Section 482 Cr.PC, are now almost well-settled. Although it has wide amplitude, but a great deal of caution is also required in its exercise. The requirement is, the application of well known legal principles involved in each and every matter. Adverting back to the facts of the present case, this Court does not find any material on record which can be stated to be of sterling and impeccable quality warranting invocation of the jurisdiction of this Court under Section 482 Cr.PC at this stage. More so, the defence as raised by the petitioners in the petition requires evidence, which cannot be appreciated, evaluated or adjudged in the proceedings under Section 482 of Cr.PC and the same can only be proved in the Court of law.

15. As far as the contention of the Ld. Counsel for the petitioners that that the order of cognizance against the petitioners dated 16.03.2023 is without any basis, does not cut much ice as the Ld. MM while summoning the petitioners vide Summoning Order dated 16.03.2023, has duly observed as follows:

“…In the light of section 141 of Negotiable Instruments Act 1881, the partners of the partnership firm are vicariously liable for the acts of the partnership firm if they were incharge of, and responsible for the conduct of the business of the partnership firm at the time of commission of the offence. Perusal of the record shows that accused no. 1 is a partnership firm and accused no. 2 & 3 are the partners in the accused no. 1 partnership firm. Further, the agreement dated03.06.2022 has been signed by accused No.3 on behalf of accused No.1 firm. Thus, from the material on record and oral submissions advanced by Ld. Counsel for complainant, the court is of prima facie opinion that accused No.2 and 3 were responsible for day to day affairs and management of the accused No.1 at the relevant time period. Fm1her, the court has examined the documents filed by the complainant and is satisfied with regard to sufficiency of grounds to proceed against the accused as prescribed u/s 202 Cr.P.C. All the statutory requirements under the N.I. Act are complied with.
Following the law laid down in A.C. Narayanan Vs. State of Maharashtra (2014) 11 SCC 809, complaint, affidavit of evidence and other annexed documents considered. Accordingly, the formal recording of pre-summoning evidence stands dispensed with. After perusal of the entire record, the court is of the considered opinion that prima facie a case punishable u/s 138 N.I. Act, 1881 is made out against accused No.1 M/s. Dyanamic Aura LLP, accused No. 2 Navneet Maheshwari and accused No.3 Sudhir Mandal.”

16. Accordingly, no ground for quashing of the proceedings/complaint/order of cognizance/order of summoning dated 16.03.2023 against the petitioners from the Complaint Case No. C.C. N1 ACT 6887/2022 is made out and I also find no flaw or infirmity in the proceedings pending before the Trial Court. However, the Trial Court shall certainly consider and deal with the contentions and the defence of the petitioners in accordance with law.
17. The prayers are untenable in law. Hence, this Court does not deem it appropriate to issue notice to the respondents. Accordingly, the petition along with pending application is dismissed.

RAJNISH BHATNAGAR, J
NOVEMBER 29, 2023/ib

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