- 1 - NC: 2025:KHC:1145 WP No. 7155 of 2021 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 13TH DAY OF JANUARY, 2025 BEFORE THE HON'BLE MRS JUSTICE M G UMA WRIT PETITION NO. 7155 OF 2021 (GM-RES) BETWEEN: MRS. THEKKEYIL AYROOKKARAN POULOSE, AND ALSO CALLED KAVITHA AYYKARETH, AND KAVITHA ANIL THOMAS AND KAVITHA ANIL AYYKKARETH HOUSE, EDAKKUNNU, PADAVUPURAM P O, ERNAKULAM, KERALA, INDIA-683 572. …PETITIONER (BY SMT. RAJITHA T O, ADVOCATE [V/C]) AND: 1. MR. ABHINAV MITTAL, AGED ABOUT 33 YEARS, S/O ANILKUMAR MITTAL, R/A NO.17, 4TH CROSS, NAVYA NAGAR, JAKKUR, BENGALURU-560 064. REP. BY HIS SPA HOLDER, SMT. SHOUNA MITTAL, AGED ABOUT 33 YEARS, W/O MR ABHINAV MITTAL. 2. M/S. BIGBORE ENGINEERING PVT. LTD., NO.9/325, PADAVUPURAM P.O., REP. BY MANAGING DIRECTOR ANIL THOMAS, KARAKUTTY, ANGAMALY, KOCHI, KERALA, INDIA-683 576. 3. MR. ANIL AYKKARETH THOMAS, AND ALSO CALLED ANIL THOMAS, Digitally signed by SWAPNA V Location: high court of karnataka - 2 - NC: 2025:KHC:1145 WP No. 7155 of 2021 AND ANIL KUMAR, MANAGING DIRECTOR, M/S BIGBORE ENGINEERING PVT. LTD., NO.9/235, PADAVUPURAM P.O, KARAKUTTY, ANGAMALY, KOCHI, KERALA, INDIA-683 576. ALSO AT: AYKKARETH HOUSE, EDAKKUNNU, PADAVUPURAM P.O., ERNAKULAM, KERALA, INDIA-683572. AND B-21, US VILLA, BAROI ROAD, MUNDRA, KUTTCH, GUJARAT, INDIA-370 421. …RESPONDENTS (BY SRI NAGARAJA REDDY D, ADVOCATE FOR R-1; V/O DATED 16.06.2021 R-2 & R-3 IS DISPENSED WITH) THIS W.P. IS FILED UNDER ARTICLE 226 AND 227 OF CONSTITUTION OF INDIA R/W SECTION 482 OF THE CRIMINAL PROCEDURE CODE, 1973 PRAYING TO CALL FOR RECORDS OF MATTER BEARING PCR NO.12062/2020 RENUMBERED AS C.C.NO.15417/2020 ON THE FILE OF THE XVIII ADDL. CHIEF METROPOLITAN MAGISTRATE COURT AT BANGALORE ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MRS JUSTICE M G UMA ORAL ORDER The petitioner being accused No.3 is seeking to quash the criminal proceedings initiated against her by respondent No.1, pending in C.C. No.15417/2020 on the file of the learned 18th Additional Chief Metropolitan Magistrate, Bengaluru (arising out of PCR - 3 - NC: 2025:KHC:1145 WP No. 7155 of 2021 No.12062/2020), for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 [for short, 'NI Act']. 2. The brief facts of the case are that, respondent No.1 being the complainant filed the private complaint in PCR No.12062/2020 against accused Nos.1 to 3 alleging commission of the offence punishable under Section 138 of the NI Act. It is alleged that accused No.1 is the Company, accused Nos.2 and 3 are the Directors representing accused No.1- Company. It is further alleged that the complainant was working with M/s.Heliopolis Contracting Company as a Project Manager since April, 2018. During third quarter of 2019, he completed all the projects and the Management decided to demobilize the existing set up and buy a new one for the company once new project is awarded. During October 2019, a meeting was held with accused No.2 with other members at Bahrain. The complainant attended the meeting and presented the equipments on behalf of the Company with all details. It - 4 - NC: 2025:KHC:1145 WP No. 7155 of 2021 was decided in the meeting that equipments will have to be sold for 680,000 USD. Subsequently, since terms of payment was unacceptable the complainant refused to sell the equipments. However, at the request of the accused, complainant visited India for investigation and confirmed whether the equipments were fit for the purpose of their project. On the complainant confirming the fitness and design, a final agreement of sale was entered into between the company of the complainant and Smart Building Solution on 08.11.2019. As per the terms of the agreement, the complainant was working under the accused at various locations. 3. On nearing the completion of the period of agreement, the complainant received a confirmation call from the management of M/s. Heliopolis Contracting Company to relieve from the site on completing the period of work and join back to the Company head office. When it was communicated to the accused and when the complainant was making preparation to hand over, and getting ready to leave the site, accused No.2 requested - 5 - NC: 2025:KHC:1145 WP No. 7155 of 2021 the complainant to continue to work till accused No.2 would come and finalize the future course of action. 4. it is contended that, the accused failed to pay salary and expenses and finally accused No.2 issued two cheques bearing Nos.100045 dated 20.07.2020 for a sum of Rs.1,50,000/- and No.100046 dated 20.08.2020 for a sum of Rs.6,44,000/- as part payment and agreed to finalize remaining payments on future dates. When cheques were presented for encashment, the same were dishonoured as there was insufficient funds in the account. Legal notice was issued calling upon the accused to make payment and an untenable reply was received after receipt of the notice, but the cheque amount was not paid. Therefore, it is contended that the accused have committed the offence punishable under Section 138 of the NI Act. The petitioner being accused No.3 is before this Court seeking to quash the criminal proceedings initiated against her. - 6 - NC: 2025:KHC:1145 WP No. 7155 of 2021 5. Heard Smt. Rajitha T.O., learned counsel for the petitioner and Sri. Nagaraja Reddy D, learned counsel for respondent No.1. Perused the materials on records 6. Learned counsel for the petitioner submits that the petitioner is arrayed as accused No.3. Even though accused No.3 is the Director of accused No.1 - Company, she never managed the affairs of the company nor did she issue the cheques in favour of the complainant. She submits that there is no averment in the complaint that the petitioner was managing the affairs of the company or that she was in any way concerned to the functioning of the company. Under such circumstances, petitioner is not a necessary party even as per Section 141 of the NI Act. Under such circumstances, she prays for allowing the petition by quashing the criminal proceedings. 7. Per contra, learned counsel for respondent No.1 submits that specific allegations are made which would constitute the offence punishable under Section 138 of the NI Act. Admittedly, the petitioner is one of the Directors of - 7 - NC: 2025:KHC:1145 WP No. 7155 of 2021 the Company representing the same. Accused No.2 had issued two cheques in question. Both the cheques were dishonoured. Legal notice was issued and in spite of that, cheque amounts were not paid. Thereby in view of Section 141 of NI Act accused No.1 being the company, accused No.2 being the drawer of the cheques and accused No.3 being the Director of the Company are liable for prosecution under Section 138 of the NI Act. No grounds are made out to quash the criminal proceedings. 8. The learned counsel submitted that the only ground made out by the petitioner for quashing of the criminal proceedings is on the ground that she had resigned from Directorship on 26.02.2021. The said event is much after issuance of the cheques which were dishonoured, issuance of legal notice and filing of the private complaint. The learned counsel further submits that at the time of commission of the offence, the petitioner was one of the Directors and she was responsible for the affairs of the company and she is liable - 8 - NC: 2025:KHC:1145 WP No. 7155 of 2021 for prosecution. Under these circumstances, commission of the offence was complete as on the date of the resignation and therefore, the petitioner is not entitled for any relief. Accordingly, he prays for disposal of the petition. 9. In view of the rival contentions urged by the learned counsel for both the parties, the point that would arise for my consideration is: “Whether the petitioner has made out any grounds to allow the petition and to quash the criminal proceedings initiated against her?" My answer to the above point is in ‘Affirmative’ for the following: R E A S O N S 10. It is the specific contention of the complainant before the trial Court that accused No.1 is the Company and accused No.2 being the Director issued 2 cheques towards discharge of legally enforceable debt. Both the cheques were dishonoured. Legal notice was issued and inspite of that, the cheque amounts were not paid. On - 9 - NC: 2025:KHC:1145 WP No. 7155 of 2021 going through the complaint, no specific averments are made against the petitioner who has been arrayed as accused No.3 except saying she is also the Director of the company. 11. As per Section 141 of the NI Act, if the person committing an offence under Section 138 of the NI Act is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence. On going through the copy of complaint, no such allegations are made against the present petitioner. Under such circumstances, I am of the opinion that arraying the petitioner as one of the accused was only unnecessary even as per Section 141 of the NI Act. Since accused No.1 is the Company, and accused No.2 is the Director who issued the cheques in question, prima facie case is made against them and not against the present petitioner. Under these circumstance, I am of the opinion - 10 - NC: 2025:KHC:1145 WP No. 7155 of 2021 that there are no reasons to permit the criminal proceedings to continue against the petitioner as it would amount to infringement of the right of the petitioner and also abuse of the process of the Court. Therefore, I am of the opinion that the criminal proceeding is liable to be quashed. 12. Accordingly, I answer the above point in the Affirmative and proceed to pass the following: ORDER (i) The petition is allowed. (ii) The Criminal proceedings initiated against the petitioner - accused No.3 in C.C. No.15417/2020 pending on the file of the 18th Additional Chief Metropolitan Magistrate, Bengaluru (arising out of PCR No.12062/2020) for the offence punishable under Section 138 of the NI Act, is hereby quashed. Sd/- (M G UMA) JUDGE SA/VP