VMC Systems Ltd. and Others vs State and Others

Sunil Gaur, J—In the above-captioned two petitions, quashing of complaint under Section 138 of the Negotiable Instruments Act, 1881 and the Notice framed under Section 251 of Cr.P.C. is sought on identical grounds and so, both these petitions were heard together and by this common judgment, they are being disposed of.

At the hearing, it was vehemently contended that the proceedings arising out of the complaint in question ought not to continue on three counts. Firstly, on the ground that respondent-complainant is foreign firm and is not a legal entity recognized under the Indian law; secondly, on the ground that respondent-complainant is not holder of the cheque in question in due course; and thirdly, on the ground that the complaint in question is barred by time. It was submitted by learned counsel for petitioners that the dishonoured cheque in question as in the name of Punjab Communications Limited and not in the name of respondent- complainant herein.

On the limitation aspect, it was submitted that the dishonoured cheque in question was not presented during the period of limitation. Reliance was placed by learned counsel for petitioners upon decisions in Sadanandan Bhadran Vs. Madhavan Sunil Kumar, (1998) 6 AD 357 : AIR 1998 SC 3043 : (1998) 94 CompCas 812 : (1998) 4 CompLJ 228 : (1998) CriLJ 4066 : (1998) 3 Crimes 217 : (1998) 2 CTC 462 : (1998) 6 JT 48 : (1998) 120 PLR 318 : (1998) 4 SCALE 708 : (1998) 6 SCC 514 : (1998) 1 SCR 178 Supp : (1998) AIRSCW 2902 : (1998) 7 Supreme 20 , Milind Shripad Chandurkar Vs. Kalim M. Khan and Another, AIR 2011 SC 1588 : (2011) 2 BC 542 : (2011) 102 CLA 128 : (2011) CriLJ 1912 : (2011) 3 CTC 234 : (2011) 3 JT 138 : (2011) 2 RCR(Civil) 687 : (2011) 2 RCR(Criminal) 568 : (2011) 3 SCALE 285 : (2011) 4 SCC 275 : (2011) 2 SCC(Cri) 208 : (2011) AIRSCW 1773 and P.K. Koya Moideen Vs. G. Hariharan, (1996) 86 CompCas 399 : (1996) CriLJ 3153 : (1996) 2 ILR (Ker) 645 in support of above submissions.

On behalf of respondent-complainant, reliance was placed upon decisions in State of Haryana and others Vs. Ch. Bhajan Lal and others, AIR 1992 SC 604 : (1992) CriLJ 527 : (1990) 4 JT 650 : (1990) 2 SCALE 1066 : (1992) 1 SCC 335 Supp : (1990) 3 SCR 259 Supp , Rajesh Agarwal Vs. State and Another, (2010) 7 AD 57 : (2010) 159 CompCas 13 : (2011) 2 Crimes 711 : (2010) 171 DLT 51 : (2010) 6 ILR Delhi 610 , Punjab and Sindh Bank vs. Vinkar Sahakari Bank Ltd., 2001 (3) ACR 2774 (SC) , Bank of India Vs. State and Others, (2010) 119 DRJ 401 , K.R. Indira Vs. Dr. G. Adinarayana, AIR 2003 SC 4689 : (2005) 3 BC 384 : (2003) 117 CompCas 407 : (2004) CriLJ 5 : (2003) 4 CTC 252 : (2003) 8 JT 71 : (2004) 136 PLR 63 : (2003) 8 SCALE 730 : (2003) 8 SCC 300 : (2003) 48 SCL 109 : (2003) 4 SCR 535 Supp : (2003) AIRSCW 5501 : (2003) 7 Supreme 741 , M/s. U. Ponnappa Moothan Sons, Palghat Vs. Catholic Syrian Bank Ltd. and others, AIR 1991 SC 441 : (1991) 70 CompCas 1 : (1990) 4 JT 94 : (1991) 1 SCC 113 : (1990) 1 SCR 542 Supp , Sada Vijay Kumar v. State of Maharashtra in Crl. Appln. No. 638/2012 rendered on 18th December, 2012, India Saree Museum v. P. Kapurchand and Anr. rendered on 4th April, 1989 and Anil Kumar Jaiswal v. State and Anr. rendered on 23rd August, 2006 to submit that an endorsement has been made on the cheque in question by virtue of which respondent- complainant becomes holder of the cheque in question in due course and in this regard, attention of this Court is drawn to petitioners'' Communication of 29th November, 2012 to respondent-complainant.

It is submitted that the statutory notice was given on 6th February, 2013 in respect of the dishonoured cheque of 30th November, 2012 and thus, complaint in question is within the period of limitation. As regards respondent-complainant being a legal entity, attention of this Court was drawn to Section 11 of the Indian Penal Code. Lastly, it was submitted that the grounds on which quashing of the complaint in question is sought, essentially relate to facts, which are required to be established during the proceedings, which are of summary nature and so, no case for quashing the complaint in question is made out.

Upon considering the submissions advanced by both the sides and on perusal of the impugned Notice under Section 251 of Cr.P.C., the Escrow Account Agreement of 26th December, 2007, petitioners'' Communication of 29th November, 2012 addressed to respondent- complainant, the material on record and the decisions cited, I find that respondent-complainant is a legal entity within the meaning of Section 11 of the Indian Penal Code. In view of Clause 6.7 Escrow Account Agreement of 26th December, 2007 coupled with petitioners'' Communication of 29th November, 2012, I find that the question of respondent-complainant being the holder of the cheque in question or not, is of fact, which is required to be established before the trial court after respondent-complainant is duly cross-examined.

Regarding the question of limitation, I find that it is a mixed question of law and fact, which cannot be pre-judged in proceedings under Section 482 of Cr.P.C.. Infact, the decisions relied upon by petitioners are of no avail at this stage. However, the evidence on record needs to be scrutinized by trial court at the final hearing in the light of the decision cited.

In view of aforesaid, without commenting upon merits of this case, the above captioned two petitions and the applications are disposed of with liberty to petitioners to urge the pleas taken herein before the trial court at the final stage.