Supreme Court Sets Aside Quashing Order in Negotiable Instruments Act Case.
19 December 2024
Negotiable Instruments Act >> Criminal Law
The Supreme Court, in the present case, addressed five appeals arising from a common judgment passed by the High Court of Delhi. The appellant, Ravi Dhingra, challenged the High Court's dismissal of his petitions seeking to quash the summoning orders and discharge applications in five complaint cases filed under Sections 138 and 142 of the Negotiable Instruments Act, 1881 (NI Act). These complaints arose from dishonoured cheques issued in a loan transaction between M/s Silverstar Fashions Private Limited (the appellant's company) and M/s Pinnacle Capital Solution Pvt. Ltd. (the respondent).
The crux of the appellant's argument was that the complaints lacked the necessary statutory averments required to sustain a charge under Section 138 of the NI Act, as established by the Supreme Court in the case of Ashok Shewakramani & Ors. v. State of Andhra Pradesh & Anr.. The appellant contended that the complaints did not properly allege that he was in charge of and responsible for the company's business operations, a mandatory requirement to pursue a case under Section 138 of the NI Act.
Upon reviewing the complaints, the Supreme Court agreed with the appellant's contention, finding that the complaints lacked the necessary averments to establish the charge under Section 138. As a result, the Court held that continuing the proceedings would constitute an abuse of the judicial process. The Court quashed the High Court's order and the complaints, as well as all related proceedings, including the summoning orders, were set aside.
Section 138, Negotiable Instruments Act - 1881
Section 142, Negotiable Instruments Act - 1881
Negotiable Instruments Act, 1881