Hari Vinayak was the Director (Finance) of Engineers Techno India Limited, a BSE Listed Company. After completing 4 years in the company, he resigned from the post of Director (Finance) w.e.f. 20.12.2020 citing some pers

CS Professional · Multidisciplinary Case Studies · PYQS · December 2021
Hari Vinayak was the Director (Finance) of Engineers Techno India Limited, a BSE Listed Company. After completing 4 years in the company, he resigned from the post of Director (Finance) w.e.f. 20.12.2020 citing some personal reasons. His resignation was accepted in the ensuing meeting of Board of directors held on 20.01.2021. Form DIR 12 was also filed in Registrar of Companies. Godawari Construction Pvt. Ltd. filed a complaint against Hari Vinayak. It was alleged that the accused had issued cheques dated 15.02.2021 and 28.02.2021, which were dishonoured upon presentation. There was, however, no allegation that the cheques were post-dated. Accordingly, summons were issued against Hari Vinayak. On the other hand, Hari Vinayak preferred a miscellaneous writ petition for quashing the same. He took the defence that he had already resigned from the Company on 20.12.2020, which was accepted by the Board of directors on 20.01.2021. The High Court dismissed the petition without considering his contention that he had resigned from the Director of the company prior to the issuance of the cheques. Hari Vinayak then preferred a fresh application under section 482 Cr.P.C. to quash the summons. It was dismissed by the High Court opining that since the earlier miscellaneous application for the same relief had already been dismissed, the second application was not maintainable. Hari Vinayak intends to file a special leave petition against the order of the High Court. Will he succeed? Give reasons in support of your answer and refer to case law, if any.

Answer & Explanation:

The given case is similar to a case decided by Supreme Court in Anil Khadkiwala vs. The State Govt. of NCT of Delhi. Facts of the case Anil Khadkiwala vs. The State Govt. of NCT of Delhi are that the application preferred by the appellant under Section 482 of the Code of Criminal Procedure, 1973 to quash the summons issued in complaint case no.3403/1/2015 was dismissed by the High Court opining that since the earlier Crl. M.C. No.877 of 2005 for the same relief had already been dismissed, the second application was not maintainable. Respondent no.2 filed a complaint against the appellant who was the Director of M/s. ETI Projects Ltd., the Company in question. It was alleged that the accused person had issued cheques dated 15.02.2001 and 28.02.2001, which were dishonoured upon presentation. The appellant had preferred Crl.M.P. No.1459 of 2005 for quashing the same. He took the defence, without any proof that he had already resigned from the Company on 20.12.2000, which was accepted by the Board of Directors on 20.01.2001. The application was dismissed on 18.09.2007 after noticing the plea of resignation, solely on the ground that the cheques were issued under the signature of the appellant. The appellant then preferred a fresh application under Section 482 giving rise to the present proceedings. The High Court noticing the reliance on Form 32 issued by the Registrar of Companies, under the Companies Act, 1956, in proof of resignation by the appellant prior to the issuance of the cheques, issued notice, leading to the impugned order of dismissal subsequently. In the said case, Hon'ble Supreme Court allowed the Petition. Learned counsel for the appellant submitted that there was no bar to the maintainability of a second application under Section 482 of the Code of Criminal Procedure, 1973 in the peculiar facts and circumstances of the case, relying on Superintendent and Remembrancer of Legal Affairs, West Bengal vs. Mohan Singh and Ors., AIR 1975 SC 1002. Learned counsel for respondent no.2 relied upon order dated 06.05.2019 of this Court in Atul Shukla vs. The State of Madhya Pradesh and another (Criminal Appeal No.837 of 2019) to contend that such an application was not maintainable. The cheques being post-dated, the appellant cannot escape its answerability. We have considered the respective submissions on behalf of the parties and are of the opinion that the appeal deserves to be allowed for the reasons enumerated hereinafter. The complaint filed by respondent no.2 alleges issuance of the cheques by the appellant as Director on 15.02.2001 and 28.02.2001. The appellant in his reply dated 31.08.2001, to the statutory notice, had denied answerability in view of his resignation on 20.01.2001. This fact does not find mention in the complaint. There is no allegation in the complaint that the cheques were post-dated. Even otherwise, the appellant had taken a specific objection in his earlier application under Section 482 of the Code of Criminal Procedure, 1973 that he had resigned from the Company on 20.01.2001 and it had been accepted. From the tenor of the order of the High Court on the earlier occasion it does not appear that Form 32 issued to the Registrar of Companies was brought on record in support of the resignation. The High Court dismissed the quashing application without considering the contention of the appellant that he had resigned from the post of the Director of the Company prior to the issuance of the cheques. The High Court in the fresh application under Section 482 of the Code of Criminal Procedure, 1973, initially was therefore satisfied to issue notice in the matter after noticing the Form 32 certificate. Naturally there was a difference between the earlier application and the subsequent one, inasmuch as the statutory Form 32 did not fall for consideration by the Court earlier. The factum of resignation is not in dispute between the parties. The subsequent application, strictly speaking, therefore cannot be said to a repeat application squarely on the same facts and circumstances. The Company, of which the appellant was a Director, is a party respondent in the complaint. The interests of the complainant are therefore adequately protected. In the entirety of the facts and circumstances of the case, we are unable to hold that the second application for quashing of the complaint was not maintainable merely because of the dismissal of the earlier application. The impugned order of the High Court is set aside. The appeal is allowed and the proceeding. In view of the above mentioned case, Hari Vinayak may succeed in a special leave petition against the order of the High Court.

Topics: Negotiable Instruments Act / Criminal Procedure Code

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