Criminal Petition No. 845 of 2025 · The High Court · 2025

Order

This Criminal Petition is filed rvith the following relief: ".., to call for the rcc:ords ar-rd to set aside t.he order dated 24.09.2024 passed in Crl.M.P.No.37 I6 of 2023 in S.T.C.No.34-t of 2O2l on thc file of I{onble X Judicial Magistratc of First Class, Manoranjal Corlplex, Namp;rlly, Hyderabarl :rnd quash the procecdir.rgs agarir.rst pctitioner hercin i.e., accused No.3 in S.T.C.No.345 o[ 2O2l on tht: filc of Hon'ble X Judicial Magistrate of First Class, Manoranjan Complex, Nan.r1:all.i,, Hyderabad artcl pass such other order or orders as this HoIr'Lrle Court may deem fil :rt.td proper in the circum stanccs o[ thc case."

2. Heard Mr. N- Asu'it-t Kumar, iearned counsel representing M. Avinarsh Reddy, learned counscl for petitioner, Mr. S.Prashanth, learned Assistant Public Prosecutor for respondent No. 1 State and Mr. Katika Ravinder Reddy, learned counsel for respondent No.2. Perused the material on record

3. This case has a chequered history. It is pertinent to record only those facls which are relevant alld necessary lor this criminal petition. a JAK, J rL P-No a45 of2025 Petitioner hcrcin is accused No.3. lr t:onrpiaint rvas prescntcrl under Scction 190 r/w 200 Clr . l'].C., rcgistcrcd Ibr the olTcnccs unclcr Sections 138 and 1. .: ol \cgotiable InsLruments Act, 18il 1 (for short. 'the Act i lx rcspondent

No.2 -com plainant (Sri Kalyana Chakravartrr i ll<iucational ir,lemorial Trust) in this criminal petitior Complainant u,anted to cstablish a University in the Stirtc of Andhra Plzidesh irnd to start new educational rnsri:utions in Karnataka ancl Termilnadu. Accused Mr. L.t.Si. Ra.lasekhar, his lamill membcrs i.e., L. Ramesh, L. Surn:rnir rrnd others met thc complain:rnt in August, 20 12 rr i I , an offcr for acquirir-rg suitablc properties for establish irrg cclucational irtstitutions. Fzrm il-1, members of Lingatmar cni lamily are knor,,'n to complainant Trust Fourtr:r:r Chairman Dr.B.S.Rao. Accuscd Nos.2 and 4 and their lr'nih'members promised to procurc land ald constru(.t br_rildings for running educatiorral institutions. Conrplzrrnzrnt accepted tl-re offer. Or-r 27 .Oa.2O12, accused No.,i entered into Memorandum oI Ur-rderstanding (MOU) ivith :omplainanl in the capacitv of I)irector of M/ s.LEPL projects i,imitcd. t ,'- ) JAK, J Crl.P.No EaS of 2o25

1. It is averred in the complainl thaL the complainant Trust made payments on the instructiot-ts of accused Nos.2 and 4. Three cheques, each for an amount of Rs.S.OO crores, were issued, cheques bearing Nos.03394 I and O259O4 were issucd on 27.08.20 12, and third cheque bearing No.034O46 was issucd on 14.O9.2O I2. Accused Nos.2 and 4 approached the complainant in the month of ..luly, 20 [3 seeking an amourtt ol Rs.3O.OO crores. On

15.O7 .2O 13, accused No.4 executed another MOU in the capacity of Director oi M/s. Swarna Bhaskar Holdings Private Limited promising to acquire properties in the name of complainemt. The complainant Trust issued a cheque bearing No.034524, dated I 5.O7.2013 for an amount of Rs.30.00 crores in favour of M/s. Swarna Bhaskar Hoidings Private Limited and the said cheque was cncashcd. A total amount of Rs.45.00 crores was received from tl-re complainant Trust. BuL, accused No.4 and others neither delivered any properties nor returned the money to the complainant Trust. 4 JAK, J Ctl l'!\-o a15 of 2025

5. Pursuant to consistent elforts nrade by thc complair,.an'. Trust, a consolidated MOI.- u,as cxecnted on 24 .06.2O 16 , in r.r,hich .rll the crcrl 1 rrr inclivicluals and companies \\rere represented b1 ljri Srrcharan Veeramachineni as party A, and all the dc rtor indiviclr_rals and companies \\'ere represented by accusr:ri No.2 in u,hich comy>lainant's namc was incorporated as lr nt.h menrbcr of partl' 'A' and zrccused No.4 is tigured as lirst rrembcr of part.y' 'B'anrl aiccused No.I is ligured as seclrnd member ol part-y 'B'. As per the MOU, the total debt p,ri,ablc to partv 'A' was Rs.30O.00 crores, which includes l.,s.4g.ee c16r-s. shich r.r,as ltayablc to the complainant .l.rr_rst lt ri.as further averrccl that erll the accused r,r,cr.e joinLly ernd severirlll, liablc to pay a sum of Rs.45.00 crores to the complainant Trr-rst along u,ith interest @ 1Bt),,.J)cr annum as per the terms of MOU dated 24.06.2016.

6. The rcrms of MOU dated 24.06.,2A16 \verc not honoured, ltu t, on repeated requests and sr:r cral demar-rds by complainant Trust, accused came forwarr and accused No.4 issucd a cheque bearing NoggOgO2 lor zrn amount of 5 .IAK, J CrI-P-No.84s ol2o25 Rs.30.00 crores in thc capacity of Director of M/s.Swarna BhaskzLr Holdings Privatc Limited in lhe month of April, 20 19. Whiie issuing thc cheque, accuscd No.4 lilled in atl the det:rils, excepL the date on the cheque, as per the avcrmcnts in thc complaint. When thc complainant Trust requcsted to puL a spccilic datc o t-t thc chcque, accused No.4 promised that hc would intimate the date of presentalion of cheque after arranging t[-re requirecl funds in the bank account. The complainar-It Trusl- deposited the said cheque in Axis Bank, Hima.yatnagar Brallch, Hyderabad, on 23.11.2020, i.e., the cheque which was issucd ir-r April, 2019 by accused No.4 tou'ards partial disch:rrge of the debt due and payable to complainant Trust. But, the cheque was returned unpaid on 24.11 .2O2O vidc Mcmo dated 24.1L.2O2O with an endorscmcnt "payment stoppe d by Drawer". Hence, accused committed offences under Sections 138 and 142 of Act. 7 . lt is averre d that a demand noticc dated 19. l2.2O2O seeking payment of amount of Rs.3O.OO crores within 15 days was sent to accused No.4. Notice was served on 6 JAK. J Gl P No a45 ol20.ti

23.12.2020. It is lurther averred in the crrlplaint that a rcph' to the noticc was received by thi, ,:omplarnant or-r 08.0 11202 1 through e -mail and thro,Lgh post on 1O.O1.20'21 . The complaint specificurlt\, :ryers that lhe cause of action arosc on 08.01.2021 and t rr: complaint is filcd rvithin a pcrrocl of one month of da te of expir,r, ol statutory notice. Hcncc, the complair-rt. B. It is obsen,ecl lrom the complarnt that tr-r instructions of accuscci Nos.2 ancl 4, thrce cheques for. zrn amount of Rs..5.00 crores each were issued in fzivorr . of M/s. LEpL Prr-rjects Limitecl. Tu,o 61-l"0rl"" rverc issueci on 27.08.2O12 and orrc <:heque rvas issuccl on 14.09.2012. Thesc tl,rrcc cheqtrcs rvurc issucd in pursuancc of I\4L LI enterccl b\: arccrrsed No.zl on 27.OB.2O12.

9. it is fr-rrther observed that on 1S.07.:1013. accused No.4 executecl another MOU in the capacitv of Director of M/s Swarna Bhzrskar Holdings private l_imited zrnd subsequent to entering ol MOU datecl I 5.O7 .2013, a cheque for an antoLlnt of Rs.30.00 crores was i:;suecl b1. the complainant Trust. Thus, a total amount of Rs.45.00 7 ,tAK. J Crl.P.No 843 oI2O25 crores was paid by the complainant Trust. A consolidated MOU was executed on 24.06.2016 in which all the creditor individuals of t[-re comparly were present and the-r' u ere incorporated in MOU as party 'A' and pzrrty 'B'. Accused No.2 was incorporated as I OLI' mcmbcr of party 'A' and accuscd No.4 is figured AS first member of party 'B' and accuscd No.1 is figured as second member of party 'B' and Lhe total debt payable to party 'A' was Rs.300.OO crores which ir-rcludes Rs.45.00 crores

10. It is pertinenL to take noLe that till the consolidated MOU rvas exccuted on 24.06.2016, there is no mention of the pe titioner hercin/ accuscd No.3 (i.e., Kakarla Vinay) in the prescnt criminal petition. Spccific overt acts have been attributed to accused Nos.1, 2 and 4. It is specifically averred in the compiaint that it is on the instructions of accused Nos.2 and 4, three cheques for an amount of Rs.5.00 crorcs each were issued, pursuant to MOU entered by accused No.4, a cheque for a sum of Rs-3O.00 u'as issued by the complainant Trust to accused No.4 subsequent to execution of MOU by accused No.4. Even 8 JAK, J 345 of2A25 t)t P ^'o aftcr thc consolidared MOU was exccuted ,n 2,1.06.2O16, the name oi petitioner herein/accuscd No.lt does not ligurc cithcr in partt' 'A' or partlr 'B' rvherein the tot,i; debt pa.yablc to the complainatrt Trust was running jnLo Rs.3OO.00 crorcs and thc amoLlnt payable by M/s_ Sr, arna Bhaskar Holdings Private Limitcd \\,as to an cxt( ! L ol Rs.45.00 crores. Thor-rgh it is averrcd in the compla rLt that it was Lhe ilccusecl Mr. LVS Rzrjasekhar, his famrlr tnembers zrnd others. u,ho met the complainant in Augnst, 20l2 for acqursitiorl of suitable properties lor establishing educational institutior-rs, nou.here thc nanr,r of petitioner hcrcin/accused No.3 is rcflected in the enlir.e complaint. Though it is contenclecl in rhe complaint thai a.legations zrre made agarnsr zrccLrscd No.4 and othcr lamirv mcmbers of Mr. LVS Rajashckar and others, nothing is madc out against petitioncr/ accu sed No.3 in the cn.ire complaint specilicall,l . I i. It is thc primary contention of learncd counsel for petition er/ accused No.3 that as per the larr laid down by the Hon'ble Apex Court, the complaint has to be specific 9 -t{K,.l CrI.P.No A45 ol 2425 with regard to the allegations with respecL to accused and thert no such allegatioll is made out in thc cntirc complaint Lcarned counsel for respondent No.2-complainzrnt matdc ellorts to impress upon the Court by relerring to ll-re contents of affidavit liled by the accused herein in W.P.No.3377O ol 2021 and batch, u,herein petitioner No.2 in the n rit pctition is nonc othe r than the petitior-rcr herein/accused No.3. A learned Single Judge ol this Court by common order dated 20.12.2O2O disposed of the said batch ol writ pctitions and in paragraph No.3 of the common order, it is stated as follows: "3. Scveral grounds are raised including Lhe grounds of there being no legally enforceable debt and/ or subsisting liability."

12. When a query \\ras put Lo learned counsel for petitioner/ accused No.3, learned counsel submitted that the law laid down by the Hon'ble Apex Court specifically rcquires that an zrllegation has to be made against the person and whether such a person was resPonsible for the conduct ol the business of company for commission of oflcnce to be roped in. It is submitted that such a l0 JAK, J Cn P.no aa5 ol2025 requlremenL is noL met \,",ith. It is furthcr Submittcd that a perusal o[ thc cntire complaint u.ould < rmonstratc thc absence of thr: requiremcnt rvhich needs to tt: met w,ith, the complaint cannot be sustained.

13. On thc other hand, learned counsel lor respondent No.2-complzrinant contended that a learne(l Stngle .Iudge of this Court bv common orcler dated 20.12.21)2(J in a bartch ol writ petitions (W.P.Nos.33376 of 2O2l and Lratch) held as follou,s: "Srncc all the writ pelitions arc fi1, rl by the petitioncrs for quashing proceedings initiirted under Section IlJS ol the Negotiable Instruntcnls /\ct, they are treirrg heard together.and disposerl oft lr.. way o[ this Cornmon Order. 2. Ilcirrri learned counsel lbr the ltetiti,rners and learnecl counscl for llrc 2"d responck,nl (te thcto complain an t.

3. ScvereLl grounrls are raiscd including tlr r grolrnds of therc being no legally enforceable <lt.l t anci/or subsistir.rg liability. 4. All these questiolls arc mixed qucsti()rr-. of lact ald larv which can only be agitated bcforr the trial Court drrring trial. If thc petitioners are sr ,lclviscd. they can file trn applicution seeking disc t:trge. in accordance with law laid down by the Horr'ltlc _{Lrpreme Court in the case of Bhushan Kumar and arrcrther v. State (NCT of Delhi) and anotherl. All ttrr 1l.ounds ' (2012) 5 scc 421 ,]AK, J crl.P.No.a45 of2O25 including the grounds raised rn the prcscnt wl it may be raised.

5. With the above observations, all the Petitions ar-e disposed off. No order as to costs. sequel thereto, misccllaneous applications, if shall stand closed." Writ As a arny,

14. The order of learned Single Judge was carried to the Hon'ble Apex Courl and the Hon'ble Apex Court by its order dated 21.O4.2023 held as follows: "Since by the impr-rgnr:d order the High Courl has gir<:n Iibertl,to the Ilctitior.rcr to Inove thc trial court for dischargc,,"r'c do not fincl:rtr1'rcason to intcrferc with thc impugned ordcr and hcncc, the special lcave petitions are dismisscd."

15. Pursuant to the directions of the Hon'bie Apex Courl-, Crl.M.P.No.3716 of 2O23 in CC.NI.No.345 of 2O2l came up bcfore X Judicial Magistratc of First CLass, Hyderabad. By order, dated 24.09.2024, t!;le Court zrfter extensively discussing on the petition filed seeking discharge of petitioner/ accused No.3 (to deletc the name of accused No.3 from the array of accuscd) hcld that the Magistrate is devoid of powers to discharge and/or drop the proceedings in summons cases instituted on a complaint including the proceedings ln cheque dishonor cases and dismissed the said petition. It is this order whic-! is under challenge in ) JAK, J t)rL P No 84s of2o2s this criminal petition. It is lurther prayc( to cluash the proceedings against the petitioner herein/-r:c.uscd No.3 in STC.No.3.15 of 2021 on thc filc of X Judicri I Magistrate of First Class, Hyderabad.

16. This Court requested both the counse sj to assist the Court by placing all the relevant judgments 17 . Learned counsel for petitioner/accus ,r I No.3 lairly conceded to the fact that Magistrate Cor-rr I is devoid of powers to discharge and/or drop the l-r.1)cecclings IN summons case instituted on a complaint

18. Learncd counsel for respondent Nci.2 cornplainant contended that second criminal pctition is no. tnaintainable in view of the fact that leerned Single.Judgt: iv his common order dated 2O.12.2O2O in W.P.Nos.33377 ol 2021 and batch specifically observed that the mixed qr_rc stions of fact and law can be agitated beforc the trial Cotr: t during trial. It was further contended that the Court spr:,:ificattl, held that several grounds are raised ,,including tlrc grounds of there being no legally enforceable debt anclT or slrbsisting d-4 l3 . /t l-, J C P No 445 ol2025 liability." lt was pointed out that therc was a spccific dircction b_r, thc lcarned Single .Judge in the batch of rvrit petitions that ar1 application secking discharge I11 accordance with lau, lard down in tl-re case of Bhushan Kumar (i supra), all thc grounds including the grounds raised in thc present writ petitions may bc raised

19. Bc that as it may, by order datcd 21.04.2023, thc Hon'ble Apex Court held that as the High Court has given liberty to the petitioner to move the trizrl Court for discharge, the Hon'ble Apex Court did not find any reasorl to interlere with the impugned order. It is only pursuant to the directions ol the Hon'ble Apex Court, Crl.M.P.No.3716 of 2023 came up before X .Judicial Magistrate of First Class, Hyderabad, and by order dated 24.09.2024, the Court, after extensively discussing on the petition filed seeking discharge of petitioncr/ accused No.3, held that the Magistrate is devoid of porvers to discharge and/or drop the proceedings in summons case instituted on a complaint including the proceedings 1n cheque dishonor cases. Ultimately relying on thc mandate of the judgment of the 1,+ JAK, J <)L P lo 545 oI2023 Constitutional Bench of the Hon'ble Ap :;< Oourl, the petition l-ras to be dismissed

20. Thc Lrial Court in its detailed ordcr darrrd 24.O9.'2024 in Crl.M.P.No.37 16 of 2023 in CC.NI.No.lt,:lr of :202 I held as follou,s: "24. In fact, the I lon'ble Apex Court in this : r'11i,ird has cilutioned that while exercising its jtrris li::tion ol' dischzrrge, "court cannot act merelv:rs a Pc,sL l)lllcc or a mouthpiece of the prosecr-rtion, but ltas t, ) :onstdcr the broad probabrlities o[ the case, the torl I elTe,;t ol tl-re eviclence and the documents procluced rt iore thc Court, ar-ry basic infirmities appearing in thr i:ise and so on. At the same time it has bccn rnanrl; tr:d, 'this however does not mean that the jrrdge shoLL ri rnakc a roving enquiry into the pros and cons ol' I tr. mir[ter turd r"veigh the evidcnce as if hc wzrs coit {rLcting ir trial."

25. Clearly, the recent mandate by the Consrit:utional bench of the Apex Court in Re: Expeditious Trial of Cases Under Section 138 of the Nellotiable Instruments Act,2O2l case seems to prerrii;ccl on arr rrge old adage, 'Qtrando aliquid prohibetur i r clirecto, prohibetur et per obliquum" to thc cfti.i r that a magistrate cannot exercise its power inrlrrcctlv l;r, discharging an accused or discontrnuin[j iL.rnmons proceedings, in the atrsence of conferrnent ,,i cxplicit power of recalling or reviewing its order (of su;nmons) under the Code. However, considering thrr ground rea-lities regarding the huge pendency of cas(.: , ,.le lay. in adjudlcation, etc., even in summon: cascs, reasonableness of the approach adopteii b1, the I [on'ble Apex Court appears to be lriri e and purposeless. In fact, awareness of these dill1,.Ltlties. rs the likely reason why that, though, the Hon rl: Court refrained to diverge from the statlltory 1} ovisio;.rs, 15 Crl.P,No,A45 o12025 howcvcr, dodged the responsibility on thc legislature to considcr amcndment in thc statutory provisiofrs, empowcring tlic Trial Court to reconsider/ recall the order of summons. Nevertheless, till the time any initiative is takt:n by legislaturc in thc s:ud direction, law scems to bc rnore or less scttled thaL a tnagistrate is devoid of pouers to discharge and,/or drop proceed.ings in summons case/summons cases instituted on a complaint, includ.ing the proceedings in cheque dishonour cases.

26. ln the judgment of the Supreme Court in M/s Metcrs and Instruments Private Limited and Anothcr vs. Karnch:ur Mehta (supra). The Supreme Court highlighterl thc fact tllat thc maLters under Section 138 of the Negotiablc Instrumeltts Act are essclrtially civil wrongs and thc case has to be normzrlly tried in a summary manncr as prescribccl rn Cr.P,C.

27. The Apex Court obsened in Para 18 of the judgmcnt as bck;w-"i) Offencc under Section 138 t-rf t]re Act is primarily a civil wrong. l3urden of proof is on accused in view prcsumptior.r under Section 139 but the stardard of such proof is "preponderzurce of probabitities". The samc has to bc trormally trit:d summarily as per provisions o[ summary tria] undcr the Cr.P.C. but with such variation as may be appropriate to procecdings under Chapter XVII of ttle Act. Thus rcad, principlc of Scclion 258 Cr.P.C. will apply and thc Court can close the proceedings and discharge thc accuscd on satislaction that the cheque amount with assessed costs arrd interest is paid ald ii there is no reason to procced u'ith the punitivc aspect i) The object of the provision being primarily compensatory, punitive element being mainly with the object o[ enforcing the conpensatory element, compounding at thc initial stage has to be encouraged but is not debarred at later stage subject to appropriate compensation as may be found acceptable to thc parties or the Court. ii) Though compounding requires consent of both parties, even iu absence o[ such consent, the @.2- 16 JAK, J C P No a4; of2025 Court, in the interests ofjustice, on being satir;lled lhal the complainant has been duly compeI,s.,ted, can in rts discretion close the proceedinl; incl ( Lis( ltirrgc thc lccused."

28. 'l'lrc SC on April 16, 2O2I (ln Re: EXI ElllTl()US ,IRIAI, OI. CASES UNDER SECTION 138 ():I N I, ACT 188 I ) held that tltere is no inherent powL.r o[ .l.rial Cou rts to review or recall the issue of sumnrons Howcvcr, it was held that this does not affect ilre pou.cr of tlrc Trial Collrt under Section 322 of thc Cr p.C. to rcvisit the order of issue of process in case it is brotrghl to thc courl's notice that it lacks jurisdiction tl trv thc com 1;li rr rr t.

29. It wzrs :tlso held by the Constitutir n Bench, c:omprisir.rg of that section 2S8 oi the Cr.. f C . is not rrpplicatrlc to complaints under Section l3g .rt tt-re Acr irnrl finrlings to the contrary in Meters in srrLrmt:nts Privatc l,imited and Another V. Kanchan Mehr a (20l g) I SCC 5(r0 do not lay down correct law. 3O. ]'he ,luclge's duty is to interpret and appi, thc [aw., not to change it to meet the judge,s idea of r,.,l,at justicc rcrluires. 'lhe court cannot add words lo :r rlttute or rczrd worrls into it which are not there. 31. 'l'[rc 'lrierl Court cannot be conferred wit I inherenr power cither review or recall the order of is ;r-. ance of proccss.

32. 'l'hc Ilon'ble High Court in Awind KeJriutc:t !. Amit Sibal wcnt a step ahead, mandating, ,,in ttrt cvent ol the lt:arncd Magistrate not finding a prima i ar:ie t:ase against the accused, the Magistrar I clischargc/drop the proceedings against the ilccr-t secl these dircctions are being issued in exercisc oI porver under Scction 482 read with Section 4g3 Cr p C. and Articlc 227 of the Constitution to secure tht :nds ot .lustice ; to avoid needless multiplicity of pr,)cedlrres, unne(:essary delay in trial/protraction of procecdings, to kcep thc path ofjustice clear of obstructions arLd to give effect to the principles laid down by the Supr_ n,_ Coprt in Ilhuslran Kumar case..,, pertinentty, though the s:rid t7 JAK, J Ctt ? No aa5 of2a25 decision of the Hon'ble I ligh Court of Delhi was set aside ir.r an appeal, howevcr, while passing its decision, thc llon'ble Apex Court did not dcliberate and dclvc deep into the recoursc arlopted by the Hor.r'lrlc ]{igir Court. In fact, the Hon l;lc Supreme Cotrrt mcrr:ly recordcd that thc parties to thc said casc h:rcl :rcccclcd beforc it that the, "order permltting the respor.rclcnts to raise such contentions at thc stage of framing o[ notice and dirccting the Metropolitan Magistrate to consrclcr the same and pass appropriate ordcr is contr.rry to law." Accordingly, while acccpting the said view and bzrscd on the suggested proposal, the Hon'ble Supreme Court refcrrcd the matter b:rck to High Cou rt reconsideration.

33. Therefore, a cursory rcading of scction 258 Cr.l'.C. revca.ls that the e said statutory provisions ar-c applicable in a summon triable case which is inst.rlLltod otherwise than upon a compla.int i.e., a case institutecl upon police popularly knowr.r :rs State Casc'. 'l'he sa icl provisions specifrcally excludes a prlvatc criminal complaint like the case in hand (iu a summon triablc case) from its purview.

34. Before adverLing to thc poillt involved il l.tas trl be stated here that the prcsct-rt cornplaint pctition htrs l-lcdtr liled by the respondent/ complarnt conseclucnt Ltp()r.) dishonour of cheque for a sum ol Rs.3O crores whilc lhc matter is at the stage of commenr:ement of trial, thc counsel for accused no.3 filed the present application to discharge petitioner/A3 U/Sec.258 Cr.P C. [or t]rc offence u/sec. 138 of NI Act stating that thc complainant company has not hled single document to show that the petitioner/ accuscd no-3 is dircctlv or Indirectly involved in the alleged transaction and thcre the complaint that tl-rc is no averment in petitioner/ accused involved in day to day lrat-rsactiotr o[ A[ company and in-spite of abscnce of prima facic material against the accused no.3, A3 is added as al accused and further accused no,3 is neither partner of thc accused company nor signatory of the subjcct cheque and prays to reconsider the issua-nce o[ I8 JAK, J (''t P No 345 of2025 summons ln order to stop the proceedrng,s irgirinst petitioncr/accnsed.

35. On the other hand thc counsel for complainanr irss:rrlt'rl the said contentions and interalia st.tc(1 that aftcr complction ol 251 Cr.P.C. examini ri )n. the petitioner/A3 has come r.rp with present i 1> rlit.irtion .rnd initrall_\' ttrc compounding of offence u/s,r. 147 oi NI Act has been consiclcrcd by the Hon'ltJr lirrprt:rnc Courl in thc case of .Jk Industries Ltd. And )tl]crs Vs. AmarrliLl V. Jumani and another (2012) t3 !iuprcme Court Cirses 255 where in the Hon'ble Suprr rrrc Court has insistecl for consent of the complirintLrrt lbr cornpounding the olfence and later on in rlc casc of I{ctcrs irntl insLruments l\'t. Ltd Vs. Kancir,rri Me htrr tlrr' llon'ble Supreme Court has dirt.r tcrl that compoundrng of the offence can be taken plac' ,rt initial slagc and even at later stage a,lso the comprrrrtdinll of the oflcnce is acceptable and that without th 1' (.()nscnt ol- thr: complainalt in case the accused pav. :lcposits itrnount as assessed by the court having :egrtr<l to chccltrc iLmorrnt interest /costs etc with in ;t 1tr-rl:ttcd pc rio rl 36. 'fhc Involvcment of the petitioner/A3 in ( av to clzry lransa('tion AI Company can be decided rfler frrll flcclged tri:rl and at this stage, it is not possib) . lo comc to concltrsion that the petitioner/A3 neitLcl. taken :rctivc rolt' nor a partner of the Al company. Frirthcr, the pctitioncr Al to Al have not deposited subjc( t Chc(lLle amoLlnt of together with approximate cost bv r,,rry ol DJ) ancl also A2 not expressed willingness to [)it-v the adcqlrate interest and prayed the court to discrirrgc the accuserl tr/sec. 258 Cr.P.C by following the ir:tio laid dorvn irr the case of Mcters and instruments r( l), )11cd in 20 I 8 ( I ) SCC 560 is not applicable to present c rsx:. 37. It is not necessaS/ to reproduce the l:u gu:rgt: ol' Scction l4l ver batim in the complaint sirLr;e the complair.rt is required to be read as a wholc. If thc sLrbstance of the allegations made in the comltJlint firlfill the requirements of Scction 14 1, the complaint has to procccd and is required to be tried with. t9 JAI', J Ctl.P.No a45 ol2025

38. From the complarnt, it would be evidcnt that thcrc is no avcrment regarding the involvement ol the accused in day to day transactions of the accused company. It is contended by the complainart counsel that it would bc evidcnt from the MOUS executed by thc accusr:d in favour o[ the complainant and the checluc in cprcstion was not signed by thc pclitioner but thc sarrrc \\:as issucd in pursuztnce of Mcmorandum of Underst.ancling betwccn thc complainant and accuscd company. 39. As per complainant dcspite traving bcctr wititecl morc thar-r 10 years accused firiled to deliver any propcrtics as promiscd in rnemoratrdum o[ understanding held between complainant and accused as pcr the Memorandum of Ur.rderstanding, 6 months time was stipulated but subsequentiy entcrcd into anothcr Mcmorandum of Under-the accused compaly ald the complainant. lt is also contended by the complainalt cou Ir sel 40. that the accused compared chcque in question wrth the consent and knowledge of the abovc petrLioncr to discharge its liability to the complainant. The lcgal notice was also issued the petitioner after drshonor ol the chcque in question wl-tich was rcplied by thc petitioner. The petitioner has not challengcd thc summoning order and tl.rere is no provision turclcr which ttre petitioner can be discharged for thc offcnce under section 138 of the NI Act. 4L. Several grounds were rarscd by the accused including there is no subsisting liability and the Hon ble High Court gave finding that all the questions wcre mr,xed question of fact and law which cen bc agitatecl before the trial Court during trial. 42. The accused was an independent nott-executive Director in the accused company ard was ncvcr itr charge and responsible for the day to day affarrs ol the accused company can be decided after full-fledged trial but not at this stage.lt is settled law that a magistrate is devoid of powers to discharge and/ or drop procecdings in summons case/summons cascs instituted on a complaint, including the proceeding in q !.- - 2 J )K, J Cll P.No 845 ol 2025 chcclrrc dishonor circurnstances of clismisse d. cases. In the casc, view of the the petition lar:1s zrnd rs Ircr-cby lrr r('slrlr. Lhe petrtion is clismissed. No cos s ''

21. On ir perusal ol the order of the triirt Court, iL is apparcrlL that tl-re issues raised before thc Court were considercd bv it. This Court is now called r pon to clecide \\rhether t hc criminal petition is maintainaL lr: or not and other isst-rt:s raised

22. Primrrr-r, contention of respondent No..2-complainant is that no second criminal petition can be mitintainable on the samc sct ol lacts and'hcnce, the crimitrarl petitior-r is liablc to bt: dismissed. Learned counsel placec reliance on the judgmcnt of the Hon'blc Apex Court n S.p, Mani and. Mohan Dairy a. Dr. Snehalatha ,gtangouatr 2 . At paragraph Nos.58.1 to 58.4, the Hon,ble Apex Court held as follorvs: "58.1.'l'he prirnary responsibility o compl:rinant is to make specifrc averments in the complaint so as to make the accused vicariouslv liable. For lirstcning the criminal liability. there is n,r legaJ requirement for the complainalt to show rhat the accuserl partner of the hrm was aware about t ach and ' i:oz:1 rr scr: cts 21 JAK, l Crt.P No 845 oJ 2025 every lr:msaction. On the other hand, the hrst proviso to sub-section (l) of Section 141 of the Act clearly lays down that if the accused is able to prove to the satisfaction of the Court that tl-re offence was committed witliout his/l-rer knowledge or he/she had cxcrciscd duc diligence to prevent the commission of such oflcncc, he/she will not be liable of punishment.

58.2. The complainant is supposed to know only genererlly as to who were in charge of the affairs o[ the company or firm, as thc case may be. The other aclministrativc matters would be within thc special kr.rowledge o[ the company or the frrm and those who :rre in charge of it. In such circumstances, the complainant is cxpccted to allege that thc pcrsons namccl in the complarnt are in charge of thc zr.ffarrs of thc company/firm. It is only the Directors of the company or the partners of the firm, as the case may bc, who have the special knowledge about the role they l'rad playcd in the company or the partners in a ltrm to show belore Lhc Court that at the relevanl- point of timc tl-rey wcrc not in chargc of the allarrs of the company- Advcrtencc to Sections 138 and Section 141, respectively, of the NI Act shows that on the other clemcr.rts o[ an offence under Section 138 being satisfied, the burden is rin the Board of Dilectors or thc olficers in chargc of the a{Tarrs of the compa.ny/ partncrs of a firm to show that thel' were rlot liable to be convicted. The existence of any spcciz:-l circumstancc that makes them not liable is somcthing that is pcculitrrly within their knowledge and it is lor them to establish at the trial to show that at the rclevant time they were not in charge of the affairs of thc company or thc firm.

58.3. Needless to say, the final judgment and ordcr would depend on the evidence adduced. Criminal liabrlity is attracted only on those, who at the time of commission of the offence, were in charge of arld q'erc responsible for the conduct o[ t]te business o[ the hrm. But vicarious criminal liability can be inferred against the partllers o[ a frrm when it is specifically averred in the complarnt about the status of the partners "qua" the firm. This would make them liable to face the prosecuLion but it does not lead to automatic conviction. Hence, they are not adversely prejudiced if they are eventually found to be not guilty, as a neccssary consequencc thereof would be acquittal. '- )1 ,,nh, J C.t P.No.gas oi 2o2s

58.4. Ii ixry Director lvants the proc(rss to be clr.r:rshcci bv filing a petition under Section 4311 of the Codc on thc grrtttnd that only a bald averment ls made rn thc cornplairtt and that he/she is r rally t-tot conccrn,-rl uith the issuance of the cheqtrt. he/she mrrst in orclcr to persuade the High Court to iluash the I)roc(:ss r:rthcr litrnislt some sterling incont rc'r'ertible mirtCriirl or itcccptitlllc circumstances to'srll)stantiate his/her colrtelltion. lle/she must make out a c'rse lllat rnaking hrm/her stancl the trial would be all:'buse of procc ss o[ Cou rt. "

23. Learncd counsel for respondent No.2 ltLrther placed reliancc ()r1 thc judgment ol Honble A lt:x Court in Bhisham Lal Verma vs. State of Uttar Pradesh and another 3 lor the proposition that it is not open to an zrggricvcd palrt,\' to raisc one plea after the :l.her invoking jurisdiction o[ thc Horl'ble High Court unclt:r Section 482 Cr.P.C., ra,hcn all such pleas were availablc at the first instance, u'hen the cause of action arose, lnd lnvoking jr-rriscliction repezrtedly rvould amount to ablrr;e of process of Court

21. Lcarnccl counsel for rcspondent No 2 invited the elttentiorl o[ this Court to the legal notice an(l the reply and contended that in the complaint and from lhe contents of record, it is apparent that, petitioner/ accuse'l No.3 was a '2021 sc(l onl,irc s(' ll99 23 JAK, J Crt P No 84s of 2025 part and pa-rccl of the team i.e., accused Nos. I to 4, who \\rerc part of the private limited compemy as Directors reflected from thc affidavit filed in W.P.No.3377O of 2O2I and batcl-r atnd that Lhis Court cannot turn a blind eye to thc specific avermcnt made stating that he was a Director in thc year 202 I q'hen the afhdavit was filcd in the High Co urt

25. No doubt, it is true and not denied by learned counscl for petitioner/ accused No.3 that petitioner/ accused No.3 \ ras never a Director. Primary contention of learned counsel for peLitioner/ accused No.3 is that whenever a complaint is made unde r the Negotiablc Instruments Act, there must be a specific averment with regard to the ingredients to make out ollences to attract Sections 138 and 142 of the Act. It is also the case of the petitioner/ accused No.3, that nowhere in the complaint, except a bald allegation, neither there are any specific allegations nor any overt acts attributed to petitioner/ accused No.3.

26. Learned counsel for petitioner/ accused No.3 relied on the judgment of the Hon'ble Apex Court in Muskan 21 JAK. J Ctt.P.No.84s ol2o2s Enterprises and Another us. State oJ Punjab and Anothera for- the proposition that thc petitror-r filed under Scctior-r.182 Cr.P.C., is indccd maintainablc rnd invitcd thc attention oi this Court to pzrrzrgraph Nos. I 4, I 5, 18 to 2 I and 28, u,hich arc as [ollovr.s "14.'l'he 1;roccdural laws governirrq criminal procecclings anci crvil ltrocecdings in our cr rLntry eue qrritc rlissimilirr, tholrgh thc ruie ol aurli aharant prtderrr antl a proccdurc tltat is both llrtr irnrl rcasonirblc to lroth/all partics ft)r rendering I ir;Licc are at the hcart oI lrot]r thc Cr. P.C. an<l :he (livii Proceclrrrc Coclc, 1908. 'lhc principlc of rt:. -,udir ctta, trtrcr:ablc in Ser:tion ll of thc CPC, does ncirh..r irpply to criminz l;roceedings nor is thcre any pr x isiotr in the Cr. P.C. akin to Orcler XXIII Rule I (3), C ,(1. While Section I l4 of the C[,C rcacl with Order XL\ ll thercot empo\vers the civil courts to excrcise tht: ltower of revit.w, Section 362, Cr. P.C. ban-s a revir:rv A close reading o[ Sections 48'2, Cr. P.C. and I 15, ( P- u,oulcl also rcflc.ct that thc pLlrposcs soLlgltt to bc iic Ir t.r'crl by exercising thc high courts' inherent pou,ers;, r,lrich the respcctive Procerltrr-al ltrws savc, arc also aI r,,rriitrrce. Prudcnce irnd proltrictl, in thc decisron mal<ing process, thr:s, make it imperativc for thc high coLtrts to not conlusc the procedurirl laws governing r.riminal and civii proceecl ings.

15.'l'hc legal position as to whether a second petition under Section 482, Cr. P.C. rv,l ld be maintair.rable or no[ rs no longer res inteqnt. \Vc rnay notice a feu,decisions of this Court on thc p()i rt.

18. Rcccntly, this Court in Bhisl rr.n Lal Vemutv. State oJ U.P, has again hetd that tl cr: is no blanket rule against liling ol successive petition under section 482, Cr. P.C. l;eforc the high court. It v,as irlso held that iI such a petition is filed, it musr l)e seen 4 2024 SCC Ont-ine SC 4107 25 .IAK, J Ctl.P.No-84s of 2o2s whether there was any change in lacts or circumsteurces, necessitating the ltling of such petition. 19, Section 482 Cr-P.C., on its own terms, saves Lhe inhcrent powers of the high court to make such orders as may bc ncccssary (i) to glve effcct to any order ur.rder the Cr. P.C., or (ii) to prevent abuse of the process of any court, or (iii) to sccure the ends of justrce. Change of law cafl legitimately be regarded as a vital chalge in circumstar-rce clothing the high court with the power, competence and jurisdiction to entertain the subsequent petition notwithstanding the fact tl.rat t1-rc carlier petition was withdrawn without obtarning arly leave, subject to the satisfaction rccorded by thc trigh court that the order prayed for in Lhe subsequent petition ought to be made, inter alia, eiLhcr to prevent abuse of the process of arty court or to secure thc ends oljustice.

20.'l'hus, in our considered opinron, the constricted vicw taken by High Court to hold that the appellants were requircd to obtain thc leave of the .Juclgc u,ho had dismissed thc earlier petition prior to filing the subsequent petition is clearly untenable and not warranted in law. It is noted that the appellants had applied a second (ime bcfore the High Court only when the law on interpretation of Section 148, N.I. Act was laid down somervhat differently in Jamboo ]3handa.ri (supra) and not on any other ground. It was not a review.in disguise that thc appellants attempted bul thcir endeavour was to impress the High Court to havc the law, currently governing the hetd, to be applied in thcir case. In terms of the authorities rcferred to above, the subsequent petition was well- nigh maintainable.

21. That the decisions irt Suinder Singh Deswctl (supra) and Jamboo Bhandai (stpral have been rendered by benches of coequal strength have not escaped our notice. However, notlrithstanding the legal position that a cleavage of opinion is discermble owing to JcLmboo Bhandai (supra) seeking to explain the law by reading a limited discretion that an Appellate Court has been conferred with by sub-section (1) of Section l4a, which the decision in Suinder Singh Desual(supra) did not read, the latter bench while deciding the matter before it having considered the 26 JAK, J {:,1-P No.845 ol2A25 decrsion of the former bench, it is the decirion of the latter bench which is now the larv.

28. L'r such view of the matter an:1 lor the foregoing reasons, rve are unhcsitatingly o' the view thar the impugned orcler of the High Court d:c:lining to enlertain subsequent petition under Section 482, Cr. P.C. of the appellents is unsustainable in l:rw. I lor,l,ever, we do not cr:nsider the neeil to remit the mattcr to the I ligir Colrrt for considcration of the subsequent pctitior nnder Section 482, Cr. P.C.; instead, in our r.ie,v, justice would be sufficiently served if the Sessions (lourL re- examines thc issue of deposit being rcquirerl to be macle bv the appcllants in thc light of tl- e larv taid dou.r'r in .lamboo Bhandan (supra) i rrd obsr:rvatiorrs made hereinabove."

27. Learned counsel for pe titior-ier/ accusc d No.3 further relied on the judgment of thc Hon'ble Apex Oourt in Rqui Dhingra vs. Std.te of NCT oJ Dethi a-nd Anothers for the proposition that there must be a specific av,)tmeht against the person concerned that he \vas in-cltlrrge of, and responsible for the company concerned in the mattcr of conduct of its business. This Court is conscious of the '"l,ell settied proposition that to bring home the cltarges under Sections 138 and 142 ol the Negotiable In:;trurnents Act, there must be a spccific averment(s) againsrt the accused that he was not only the Director but was alsc responsible for the day-to-day affairs of the company in r-he matter of '2024 SCC Onl.ine sc 3802 z'\ C) 27 JAK, J Crl P.No.A45 of 2025 conduct of its business. The said proposition of law is enunciated in several judgments, and relied upon the Iearncd counsel for thc pctitioner/ accused No. 3

28. Reliance is also placed the judgment 1n Special Lcave Petition (Criminal) No. 12390- 12391 of 2022, u'herein the Hon'ble Apex Court held as follorvs: " 10. It u,as hcld that mcrcly because a person is a director of a company, it is not lrecessary that he is .rware about thc clay-lo-clay fur.rctioning of the company. This Court helcl that there is no universal rule that a director o[ a compaly is in cherrge of its everyday affairs. It was, thcrcfore, rlecessary, to aver as to how the director o[ thr: comparty was iu cha-rge of day-to-day affairs of the company or responsible to the affairs of thc compeury. 'l'his Court, l-rowever, clarihed that the position of :r managing director or a joint managir.rg dircctor in zr compary may be differcnt. This Court furthcr held lhat these persons, as the designation of their office suggests, arc in cl.rarge of a company a:rd are responsible for the conduct of the business of thc company.'l'o escape liability, they will have [o provc that whcn the offence was committcd, they h:rd no l<nowlcclgc of the offence or that they cxercised atl due diligence to prevcnt the comrnission of the offence."

29. It is held by the Hon'ble Apex Court that it is necessary to aver as to how the Director of a company was in charge o[ the day-to-day affairs of the company or responsible for its affairs. That there being no universal rule thaL merely because an individual is a Director, he is 28 JAK, J an.P.No.a45 ol2025 in charge ol thc day to-day alfairs of the con rJ)an_r, In other \\'ords, the I ar.r, is that rhcre must be a s1;,:r.ific averment in ordcr to ltring home thc charge under t rc \e gotialtle Instruments Act, that the said person u,as ii [)irc,:tor of the companlr ;rncl was in-charge of the day-to-dirr affairs of thc compan], or responsible lor its affairs altd t,I-r,: offenccs have occurrcd :tt that timc.

30. On iL perusal of the entire complaint, rt is observed that accuscd Nos. l, 2 and 4 were activcly ini.olve<l eithcr in issuing chcqucs or instructions or entering into MOUs, spccificalll, it was accused Nos.2 and 4 who I hve instructcd to issure r:lreques, cheques were issued o r- N4OUs rve re cntitlcd into. Accused No. l's involvement is rlso reflected in thc contpl:rint. In the complaint, it is rr.f ect,:d that it \\,Lis thc ferntily' of Mr. LVS Rajasekhar'r; anrl others including tr ct>uple of names, but nowhere in tire complaint, there is a relerence of petitioner herein/accu;t:d No.3 as to an-y allcgations or averments of any overt acts attributcd against him. In the absence of such specific irve rments and also thc spccific requiremcnts that petitioner,,rLccr-Lsed No.3 )() JAK, J CrLP.No.8a5 of2o25 must have been in-charge ol the day-to-day aflairs bcing a Director of the company are also not made out. The only coursc left out for this Court is to drau' an inferencc from the complaint that rlo case is made out against the petitioncr hcrein/accused No.3, as rcquircd under lau' as Iaid down by the judgmcnts of thc Hon'ble Apex Court' This Court is not inclincd to accedc to the contentions made on behalf of respotldent No.2-complainant' Though several points and issues have been raised, including the contcnts of [he orders passcd bt' thc lcarned Single Judge and the marntainability of a second crimir-ral. petition, this Court is not inclined to delvc into tl-rose aspects, as at no point of time, the quesLion, u'l-rether Lhe pelitior-rer/ accused No.3 was a Director involvcd in the day-to-day affairs of the company was ever considered or adjudicated' 3 1 . It is trite to take note of the taw laid down by the Hon'ble Apex Court in Susetc Padmavathg Amma Vs' M/s. Bharti Airtel Limited6, the relevant portion 15 AS follows: u lzoz+1 rz scc r:r 30 JAK, J t-1 lr No 315 nJ2025

16. Lr Stzrte oI l]aryzura v. Brrj Lal Mittzrl rrrcl otlr,rrs, tllis Corr rt ol;scned thrrs: "8. Nonetheless, wc finrl tliat tho impr.rgnt'rl .jrrrlgnrerrt o[ t he I ligh Court has got to l)c uplr,,',rl tirr irn altoijcthcr dillcrent rcasorr. Aclrnitterlly, lrr t rr('( rcsPon(lcl)ts wcre being pr<lsecutccl as I)irccr() s ol thc mant-ilirctrrrcrs with the arirl of Section l|4(l I ol thc Act rvtriclr rc.acls as undcr: '34. Offences by compirnics i i) Wherc an offence under this Act has lcr-'n commlttecl by a company, evcry pcrsorr u lro irt the timc the offcnce lvas commrttc(l. v. irs in ch:irgc of, and rvas responsible tr, :lrr' company for thc conduct of the brrsir-rc,;s o[ thc company, as well as the companl ,ilurll bc deemed to be guilty ol the ofl'enc -' I nd shall be liablc to be proceedc<l against lrrrl pu nished nccordingly: Provided tl.rat nothing containt'l in this str b-sectror.r shall render anr, ;L clt person liable to any punishmenl pr ()\ i(lc(l irt this Act if he proves that thc ,rll . n, r' wzrs committcd without his knowlr'<l1,e or that he exercised all due diligenc: to prevent the commission of such offcn,'c ' It is thr,rs sccn that the vicarious Iiabilrtl' ol I pr,r son Ii;r lrcing prosccuted for al ofience cornrnitrt. I urrilcr thc ,\ct by a cornpany arises i[ at thc rnatcri, r] trrnt. Itc rvirs in chargc of and was also responsilrl(' 1o ihc comr)any [or the condr.rct o[ its br.rsin<:r;: Sinrpll. bccause :l Jlerson is a Director of the cornltirtr it rl,tcs not ncccssarllY mean that he iulfils l)otlr ,lI' itlr0r,c rcquirernents so as to make him liablc. (l,rr.r't rst:Ir,, u,ithout being a Director a person can l:e rrr crrargc of and resporrsiblc to the compaly for the conr u(.t oi its lrusirross. From the complaint in questior.r u,r:. l orvercr, find that exccpt a bald statement that the r-cs l)r)rr(l(.nts were l)irectors ol the malufacturers, there rs no ollrcr allegation to indicate, even prima facie, that h<'1, s.'g1" in clrtrrgc of thc company and also responsil;1.. to rhe coml)any for thc conduct of its busincss."

17. [t cor-rld thus be seen that this Court had hcld rhat simply bccause a person is a Director ol the rcmpiuty, it does not necessarily mean that he fulfils thc twin requirements of Section 34(1) of thc saicl n ()r rio ,ls to make l-rim liablc. It has been held that A perli(,n (:annot 31 JAK, J CtL P-No.84s oJ 2o2s be made liable unless, at thc material time, he was in charge of ald was irlso responsible to the compaly for lhe conduct of its business. 18. In S.M.S. Pharmaceuticals Ltd.. this Court was considering the question as Lo whether it was sufhcient to make the person liable for being a Dircctor of a company under Section 14I of the Negotiable lnstruments Act. 1881. This Court considered the dehnition of [he word "Director" as dehncd in Section 2(13) of the Compar-rics Act, 1956. This Court obscr-vcd thus: "8. ... There is nothing which suggests that simply by being a Dircctor in a compimy, one is supposed to discharge particular functior-rs on behalf of a compaly. It happens that a person may be a Director it'r a company but he may not know anything about the day-to-day functionir.rg ol the company. As a Director he may bc attending mcctings of the Board of Directors of the company where usually thcy dccrde policy matters and guide the course o[ business of a company. It may be that a Board of Directors may appoint sub-committees consisting of one or two Directors out of the Board of the company who may bc made responsible for the day-to-day funct.ions of the cornpany. These are matters which form part o[ resolutions of tl-rc Board of Dircctors of a company. Nothing rs oral. What emerges from this is that the role of a Director in a company is a question of fact depending on the peculiar facts in each case. There is no universal rule that a Director of a company is in charge of its everydery affairs. We have discussed about the position of a Director in a company in order to iilustrate the point that there is no magic as such in a partrcular word, be it Director, Malager or Secretary. tt all depends upon the respective roles assigned to the off-rcers in a company." 19. It was held that merely because a person is a Director of a company, it is not necessary that he is aware about the day-to-day functioning of the company. This Court held that there is no universal rule that a Director of a company is in charge of its everyday affairs. It was, therefore, necessary, to aver as JAK, J Ctl.P.No-845 ol2A25 to hor.v the Director of the company was in cJ-rarge of day-to-day affairs of the company or respo'r;ible for the alfairs of the compzrny. This Court, however, clarifiecl that the position of a Managing Dir,:ctor :r a Jomt lr4anaging Director in a comp:1n1, rrtav l:e dillerent.'l'his Court further held that these ])ersons, as the designation o[ their ofhce suggesti, are in charge of a cornpany and are responsiblc for the conrluct of the business of the compary. i'o escape Iiability, they will have to prove that when tlre offcnce was committccl, they had no knowledge o[ tl rc offt:rrcc or th.rt they exercised all due diligence to pre,.,ent the commission ol the offence. 20. In Pooja Ravinder Devidasani v. Statc of Maharashtra [Pooja Ravinder Devidasani \... ]Statt: of Mahirrashtra. this Court observed thus: " 17 Evcry person connected \r,ith thc Cornparv u,r1l not fall into the ambr t o I the pror.,isron. Time and again, it has been a;serteC b,v this Court that only those persons who 'vcre in chargc of alcl responsible for the condllot ol the business of the Company at the Li:n e oi cc,mmission of an offence will be lialrlr for criminal action. A Director, who was n(Jt i'r clr:rrge of and was not responsible for the c rnducl o[ the bu siness of the Company at the r,]l,lvan t tirne, will not be liabie for an offencr: lLnder Sr:ction 141 of the NI Act. [n National limnl] Industrres Corpn. [National Small [ndurstries Corpn. Ltcl. \,. Harmeet Singh Paintal, (23 t0) 3 SCC s30:(2010) 1 SCC (Civ) 677 : (2010) 2 SCC (Cri) 1l 13 : (2010) 154 Comp Cas 3l3l tliis (lourt observed: (SCC p.336, paras 13-14) '13. Section 141 is a penal provision c -eating vicarious hability, and which, as per setthcl la\\'. must be strictly construed. It is therefole, not sttfficient to make a bald cursory stateme tt in a complaint that the Director (arrayed al; an accused) is in charge of and responsible to the compa-ny for the conduct of the business of thc compimy wrthout anything more as to the role of the Director- But the complarnt should spell out as to how and in what manner Responderl 1 was in charge of or was responsible to the a:cused Compatry for the conduct of its business. lhis is in consonalce with strict interpretation ot 1renal 33 JAK, J Clt.P.No.84s of2o2s statutes, especially, where such statutes crcate vicarious liability. 14. A company may have a number of Directors and to make any or all the Directors as accused in a complaint merely on the basis of a statement tl-rat thcy are in charge of ald responsible lor the conduct of the busir-ress of the company wrthou t anything more is not a sufllcient or adequatc fulfilmcnt of the requirements under Section t4t.' 18. In Girdhari La1 Gupta r'. D.H- Mehta [Girdhari La1 Gupta v. D.H. Mehta, (197 l) 3 SCC 189 : 197 I SCC (Crr) 2791, this Court observed that a person "in charge of a business" meals that thc person sl-rould bc in overall control of the day to- day business of thc ComPanY. 19. A Director of a company is liable to bc convicted for an offencc cotnmittecl by the company if he/ she was in chalge of ancl rv:rs responsible to the company for the conduct of ils business or if it is proved that the offencc rvas commilted with the consent or connivalce o[' or was attributablc to a-r-ry negligencc on the part of the Director concerned (sce State of Kamathka v' Pratap Chand [State of Karnataka v. Pratap Chanrl, (198I) 2 SCC 335 : 1981 SCC (Cri) 453 : (lq8 i) 5 l Comp Cas l98l ). 20. In other words, the law laid down by this Court is that for making a Director of a company liable for the offences committed by the company under Section 141 of the NI Act, there rnust be specific averments against the Director showing as to how and in what mallner the Direclor was responsiblc for the conduct o[ the business of the company. In Sabitha Ramamurthy v' R B S' 2I. Charnabasavaradhya [Sabitha Ramatmurthy v ' R.B.S. Channabasavaradhya, (2006) 10 SCC 581 : (2007) 1 SCC (Cri) 621 : 12006) 133 Comp Cas 680l , it was held by this Court that: (SCC pp' 584-85, para 7) '7 . .. . iL is not necessary for the complarnant to specihcally reproduce the wordings of the section but what is required is a clear statement of fact so as to enable t.Ile court to arrive at a prima facie 34 JA]<, J C.L P-No-84s oJ 202s opinion that the accused are vicariouslv liablc. Section 141 raises a legal frction. By reasorr tf tht: said provision, a pcrson although s not personally li:rble lor commission of sr cl an olTence u.ould be vicariously liable therefor. Sucl-r vicanorts liability can be inlerred so fa- as zL company registered or incorporated unr er thc Compzrnies Act, 1956 is concerned only if the requisite statements, which are requirerl :o be averre d in the complaint petition, are macl: so as to m.rke the accused therein vicariously lir.ble for the oll-cnce committcd by the company_' By ,,'erbatim reproducing the words of thc st,ction u,lthollt a cleif statement of fact suppot tcd by proper cvidence, so as to make the a]clrsed ','icariously liable, is a ground for qu:rshing proceedings uritjatcd against such person rrncler St:ction l4I ol the NI Act." (emphasis in o -il3inal)

21. It coulc.l thus cle:ulv be seen that this ()ourt has held that merell reproducing the words of th e seclion withrut a clear statement of fact .rs to how un:l in u'hat manner a Director of the company was respo:r,;ible lor the conduct of the business of the company, r.,ould trot ipso facto makc the Dircctor vicariously liable 22. A similar vicw has previously been take-r by this Court in K.K. Ahuja v. V.K. Vora [K.K. Ahula v. V.K. Vora, 12OO9) 10 SCC.18 : (2OO9) a SCC (Civ) : (2010) 2 SCC (Cri) I i81 : (2009) 152 Comp Cas 5201 . 23. ln Stare (NCT ot Delhi) v. Rajiv Khura ra fState (NC'l ol Delhi) v. Rajiv Khurana, (2OlO) t 1 Sll 469 : (201 l) I SCC (Cn) 195 : (20 1O) 158 Comp Car; lS ll , this Court reiterated the position thus: "17. 'lhe ratio of all these cases 1s thlt the complainant is required to state in the conrplaint how a l)irector who is sought to be made an accnsed, was in charge of the business oi the compar-ry or responsible for the conduct ol- the compzrny s business. Every Director need 'rot be and is not in charge of the business rf the company. If that is the position with regerrd to a Director, it is needless to cmphasise that irL the case of non-Director officers, it is all the more necessary to state what were his dutie; ancl responsibilities in the conduct of business ol the 35 ,rAK,,l Crl.P.No.845 of2o25 company and how and in what marner he is responsible or liable."

24. In Ashoke Mal Bafna [Ashoke Ma] Bafna v. Upper India Steel Mfg. & Engg. Co- Ltd., l2O 18) 14 SCC 2O2 : (20 19) I SCC (Cri) 568 : (2018) 4 SCC (Civ) 5151 , this Court obserwed thus: "9. To fasten vicarious liability under Scction 141 ol the Act on a person, the l:rw is well scttlcd by this Court in a catena of cases that the complaina-nt should specilically show as to horv and in what manner the accused was rcsponsiblc. Simply because a person is a Dircctor of a defaulter Company, does not rnake him liable under the Act. Time :rnd again, it has been assertcd by this Court that only the person who was at the helm of alfairs of thc Compar-ry and in charge of and responsible for the conducL of the business at the t ime o[ commission of al offence wrll be liablc for criminal action. (See Pooja Ravinder Devidasani v. Slate of Maharashtra IPooja Ravinder Devidasani v. State of Maharashtra, (2o 14) 16 SCC 1 : (2015) 3 SCC (Civ) 384 : (2015) 3 SCC (Cri) 378:(2O15) 190 Comp Cas r06l .)

10. ln ottrer words, the [aw laid down by this Court is that for making a Director of a Company liable for the offences committed by the Compar-ry undcr Section 141 of the Act, there must be speciiic ave rments agarnst the Director showing as to how and in what manner the Director was responsib.le for the conduct of the business of the Compaly."

25. A similar view has been taken by this Court in Lalankumarr Singh v. State of Maharashtra [Lalarrkumar Singh v. State of Maharashtra, 2022 SCC Online SC 13831 to which one of us (B.R. Gavai, J.) was a party. 26. In the light of this settled legal position, let us examine the averments made in the complaints. 27. lt :llitll be relevant to refer to Para 16 of the complaint bearing No. CC 3151 of 2O 17 filed by the respondent before the Court of XVIII Metropolitan Magistrate, Saidapet, Chennai dated 30-1I-2O16, which reads thus: 36 JAK, J Clt P.No.84s of2o25 " 16. 'l'he complainant states that the accr sed tras an intention of cheating the complain rnt. l'he 2r'rd and 3rd accused herein has lo inlention to pay the dues that they or,ve to rhe r ornplainant. lnstearl, making t he lomplainant l:elieve that the siune wor.llr. bc paid and through u.hich trying to pusll l:re Labilit-y to future. It is also pertinent to rrc,te that the 2nd and 3rd of the accused hc:cin arc the Dircctors, promoters of the lst accu sed being the Compar-ry. The 2nd of t re :rccused hcrein is the authorised signat:ry, rvho is in chargc of anrl responsible lor t.re day-to clay alfairs of the Company, the lst accuserl."

28. [. can t]rus be seen that the only allegatio ) against thc pps5s61 appell:rnt is that the present appellirnt irnd Acctrsed 2 had no intention to pay the clues hat they owe to the complainant. It is statecl th:il tlre 2nd accuscd and the 3rd accused (appellant hereirr) are thc Direc:tors, promoters of the lst accused being the Comp:urv. lt is lurther ar,erred that the 2nd ,.ir:cr-rsed is the au Lhorised signatory, rvho is in chargr of and resportsiblc for the day-to day affairs of the ()ompany i.c. thc lst acclrscd- 29. It can thus be clearly scen that the:-e is no avcrrncnt Lo the elfect that the present appclla:-rt is in charge o[ and responsible for t]re day-to da1 tflairs of thc Company. lt is also not the casc of the respondent that the appellalt is either the Managing Dire ctor or the .Joint Mar-raging Director of the Compar-r1,- 30. It can thus clearly be sccn that the rt.,crments made are not suffrcient to invoke the prov sions of Section I4 I ot the NI Act qua the appellant."

32. As observed from the record, no :1/orments are forthcomins suflicient to invoke the provisiorrs lf the NI Act as contended. The ratio laid down in the H onble Apex Court judgment is that the complainant is recuired to state in the complaint as to how a director sought to be made an 31 JAK, J C.I.P-No-845 of2O25 accused was in-charge of the affairs of the company. Every director need not be in-charge of the affairs of the company. In the absence of the complaint specific:rlly showing as [o holv the accused was . responsible, the peti tioner/ accuscd No.3 herein cannot be mulcted for the olfences as canvasscd

33. In the absence of any adjudication, on the issue canvassed, that criminal petition is not maintainable by petitior-rer/ accused No.3, contentions are liabie for rejection and are rejected. Attentron of this Court was invitcd to the observations made by learned Single Judge, this Court is r-rot ir-rclined Lo accede to these contentions as the question of requircment of Lhe specific averment in the complaint was ncvcr adjudicated or was never considered by arry of [he Courts. With regard to the maintainability of the second criminal petition, this Court draws support from the order rn Muskan Enterprises (4 supra), where the Hon'ble Apex Court held Lhat a criminal petition under Section 482 Cr.P.C., is indeed maintainable. The Court indeed considered the law laid down in Bhisham Lq.l Verma 38 JAK, J Ctl P.No.845 of2025 (3 supra) relied on by learned counsel lor respondent No.2- complainant

34. Having perused the record, this cr:,1trt is ol the considered oprnion that the contention raist-'rl on behalf ol respondent No.2 that the second criminal ; etition is not maintainable rs on a sandy loundation as th : verl' subjcct matter that the petitioner l-rerein/ accused Nr.ll who was a Director of thc Company and rvas in charge o the alfairs of the Company has never fallen for considcrirlion. In the absence of such consideration, this Court dr cs ot see any merit in the contention that the second crirniaal pctition is not maintainable

35. In view ol the settled law witl regard to maintainability of criminal petition, as helrl in Muskan Enterprises (4 supra), this Court is of tlre considered opinion that the contents of the complaint c o not make out any offences under the Ncgotiable Instrurrr:nLs Act and AS such, the proceedings against tf e ltetitioner herein/accused No.3 are liable to be quashcd and are accordingly quashed i9 ,]AK, J C.l P-No.84s of2o25 36 . Accordingly, Lhe Criminal Pctition is allou'ed and the proceedings against the petitioner/ accused No.3 in S.T.C.No.345 of 2021 on t1-tc file of X.Judicial Magistratc ol First Class, Hyclerabad, are hereby quashed. Miscellancous application s pending, if any, shall st:rnd closed. //TRUE COPY// SD/- C.DEEPIKA ASSISTANT REGISTRAR a SECTION OFFICER To, 1 The X Judicial Magistrate of First Class Manoranjan Complex Nampally, Hyderabad.

2. The Station House Officer, Narayanaguda police Station, Hyderabad. 3 Two ccs to the Pubric prosecutor, High court for the state of rerangana at Hyderabad IOUT]

4. One CC to SRt MAMtDt AVTNASH REDDY Advocate IOPUC] 5. One CC to SRI KATTKA RAVTNDER REDDY, Advocate tOpUCl 6. Two CD Copies NYB Nr\/p /pq rYY HIGH COURT DATED:1710312025 ORDER CRLP.No.845 of 2025 a ,4 ,/'//,,, ,rt a 14- J J LJ t+i-, 2 li t{olt ma { € \ So41r;UEO r ALLOWING THE CRIMINAL PETITION 6\ cd'^ tr-,