- 1 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF MARCH, 2026 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ CRIMINAL PETITION NO. 5886 OF 2023 BETWEEN: 1. M/S HOTEL AMAR INTERNATIONAL INDI STATION ROAD, INDI, VIJAYAPURA DISTRICT-586209 REPRESENTED BY SRI MOHAMMED HANEEF S/O ABDUL REHAMAN SOUDAGAR AGE ABOUT 38 YEARS 2. SRI. ISMAIL S/O ABDUL REHAMAN SOUDAGAR AGE: 35 YEARS M/S HOTEL AMAR INTERNATIONAL, INDI STATION ROAD, INDI VIJAYAPURA DISTRICT-586209 3. SRI. ABDUL JABBAR S/O ABDUL REHAMAN SOUDAGAR AGE" 33 YEARS M/S HOTEL AMAR INTERNATIONAL INDI STATION ROAD, INDI VIJAYAPURA DISTRICT-586209 4. SRI. MUSA S/O CHANDASABA SOUDAGAR AGE: 55 YEARS STATION ROAD, INDI VIJAYAPURA DISTRICT-586209 …PETITIONERS (BY SRI. SRINATH KULKARNI, ADVOCATE) AND: M/S DURGA HOTEL AND HOSPITALITY SERVICES STATION ROAD, INDI Digitally signed by HEMALATHA J Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 VIJAYAPURA DISTRICT-586209 REPRESENTED BY ITS PARTNERS 1 MR. RAJAGOPAL SHETTY S/O SHIVARAMA SHETTY AGE ABOUT 54 YEARS 2 MR. BALAKRISHNA SHETTY S/O SADANANDA SHETTY MAJOR, AGE 43 YEARS 3 MAHENDRA SHETTY S/O JAGANNATHA SHETTY MAJOR AGE 36 YEARS …RESPONDENTS (BY SRI. K. SHRIHARI, ADVOCATE) THIS CRL.P IS FILED UNDER SECTION 482 OF THE CODE OF CRIMINAL PROCEDURE, 1973 PRAYING TO QUASH THE COMPLAINT IN PCR NO.37/2023 DATED 16.02.2023 FILED BY THE RESPONDENT AND THE ORDER OF COGNIZANCE, ISSUANCE OF SUMMONS AND REGISTRATION OF A CRIMINAL CASE AND ENTIRE PROCEEDINGS IN C.C.NO.360/2023 PENDING ON THE FILE OF THE ADDL. CIVIL JUDGE AND JMFC, KUNDAPURA, FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF THE N.I. ACT, AGAINST THE PETITIONERS AT THE INSTANCE OF THE RESPONDENTS. THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE R. NATARAJ ORAL ORDER The petitioners have challenged the prosecution launched against them by the respondent in C.C.No.778/2023 pending before the Principal Civil Judge and JMFC, Kundapura (henceforth referred to as 'Trial Court') for the offence - 3 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 punishable under Section 138 of the Negotiable Instruments Act, 1881 (henceforth referred to as 'N.I. Act'). 2. The respondent initiated prosecution of the petitioners for an offence punishable under Section 138 of the N.I. Act. After recording the sworn statement of the respondent, the Trial Court took cognizance and issued process to the petitioners. The petitioners have therefore, challenged the registration of C.C.No.778/2023 and also to quash the private complaint lodged by the respondent. 3. Learned counsel for the petitioners submitted that the respondent has not mentioned the role of petitioner Nos.2 to 4 in the conduct of business of the petitioner No.1 and therefore, all the petitioners are not liable for an offence under Section 138 of the N.I. Act. In support of this contention, he relied upon Section 141 of the N.I. Act and contended that when a juristic person is sought to be prosecuted, it is incumbent upon the complainant to disclose as to who are the persons responsible for the conduct of business of such juristic person and how they are responsible. He submits that perusal of the complaint shows that there is not even a whisper about - 4 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 the role of the petitioners in the alleged commission of the crime. He therefore, submits that the impugned prosecution of the petitioners is liable to be set at nought. 4. Per contra, the learned counsel for the respondent submits that petitioner Nos.2 and 4 are the ones who have signed the cheque in question and therefore, they are liable to be prosecuted for an offence under Section 138 of the N.I. Act. In so far as one Mr. Mohammed Haneef is concerned, he contends that petitioner No.1 is represented by him and therefore, he is in charge of the business of petitioner No.1 and hence, he is also liable to be prosecuted. 5. I have considered the submissions of the learned counsel for the petitioners as well as the learned counsel for the respondent. 6. For the sake of convenience, Section 141 of the N.I. Act is extracted below:- "141. Offences by companies.—(1) If the person committing an offence under section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was - 5 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 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 and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub- section shall render any person liable to punishment if he proves that the offence was committed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence: Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for prosecution under this Chapter. (2) Notwithstanding anything contained in sub- section (1), where any offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be - 6 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation.—For the purposes of this section, — (a) “company” means any body corporate and includes a firm or other association of individuals; and (b) “director”, in relation to a firm, means a partner in the firm. 7. A perusal of the above would show that it is incumbent upon the complainant to plead that the accused persons are in charge and responsible for the conduct of business of the company or the juristic person. A perusal of the private complaint lodged by the respondent would show that there is no whisper about the role of each of the petitioners in the alleged commission of the crime. However, as rightly contended by the learned counsel for the respondent, the petitioner Nos.2 and 4 are the ones who have signed the cheque in question and therefore, criminality can be attributed to the said petitioner Nos.2 and 4 and that it can be construed that they were in charge of the business of the petitioner No.1. Likewise, one Mr. Mohammed Haneef, who claims to represent - 7 - HC-KAR NC: 2026:KHC:16442 CRL.P No. 5886 of 2023 the petitioner No.1 also is liable to be proceeded against as he represents the petitioner No.1. 8. In so far as petitioner No.3 is concerned, there is nothing to show that he was responsible for the day-to-day conduct of the business of the petitioner No.1 and/or that he was responsible for the affairs of the petitioner No.1. In that view of the matter, the prosecution of the petitioner No.3 for an offence punishable under Section 138 of N.I. Act was wholly unwarranted. 9. Consequently, petition is allowed-in-part. The prosecution initiated against the petitioner No.3 by the respondent in C.C.No.778/2023 pending consideration before the Principal Civil Judge and JMFC, Kundapura, for the offence punishable under Section 138 of Negotiable Instruments Act, 1881, is quashed. It is made clear that the proceedings against the other petitioners shall continue. Sd/- (R. NATARAJ) JUDGE PMR List No.: 2 Sl No.: 42