Varinder Kumar Khullar vs M/S Mahadev Traders And Others

Rajnesh Oswal, J

1). This petition has been filed by the petitioner under Section 482 Cr. P.C. for quashing the order dated 06.12.2021 passed by the court of learned City Judge, JMIC, Jammu (hereinafter to be referred as “the trial court”), whereby the learned trial court has issued the process against the petitioner alongwith other accused for commission of offence under Section 138 of the Negotiable Instruments Act, 1881 (for short, the N.I. Act) in a complaint, titled “M/s Mahadev Traders and Anr. vs. Arun Kumar and others”.

2). The petitioner has impugned the order dated 06.12.2021 on the ground that the learned trial court has issued the process against the petitioner in a routine manner that too without there being any basis or ground to form an opinion about prima facie evidence of commission of offence by the petitioner. It is further stated that the impugned order does not disclose either examination of or reliance upon any evidence to connect the petitioner with the affairs of M/s Joginder Nath Varinder Kumar, as there was no material or specific allegation in the complaint in respect of the role played by the petitioner in the transactions. It is also stated that as the petitioner was the resident of Rajouri, a District beyond the territorial jurisdiction of the trial court, the trial court could not have issued the process against the petitioner without resorting to the inquiry under Section 202 Cr. P.C.

3). Respondent Nos. 1 & 2 have filed their response, thereby stating that while adjudicating the petition under Section 482 Cr. PC, mini trial cannot be conducted by this Court and further that the respondent Nos. 1 & 2 have specifically documented the role of the petitioner, respondent No. 3 and accused No. 3 in the complaint during the business transactions with the respondent Nos. 1 & 2. They have denied that the Magistrate is required to proceed under Section 202 Cr. P.C. in complaint filed under Section 138 of the N.I. Act and the exercise of power under Section 202 Cr. P.C. is discretionary in nature, which cannot be exercised as a matter of course in ordinary manner.

4) Learned counsel for the petitioner vehemently argued that the petitioner was not the partner of M/s Joginder Nath Varinder Kumar, as the same is proprietorship concern of the respondent No. 3, which is substantiated by the objections filed by the J&K Bank in WP(C) No. 153/2021, titled, “Varinder Kumar Khullar vs. UT of J&K and others”. He further argued that without resorting to Section 202 Cr. P.C., process could not have been issued against the petitioner, when the petitioner was not residing at a place within the territorial jurisdiction of the trial court. He placed reliance upon the decision of the Hon’ble Apex Court in “Lalankumar Singh and ors. Vs. State of Maharashtra” 2022 Legal Eagle (SC) 1168.

5) Mr. Pranv Jain, learned counsel for the respondent Nos. 1 & 2 vehemently argued that the respondent Nos. 1 & 2 have specifically mentioned in their complaint in respect of the role attributed to the petitioner. He further submitted that the disputed questions of facts have been raised by the petitioner, which cannot be decided by this Court while adjudicating the petition under Section 482 Cr.PC. In support of his contentions, he has placed reliance upon the judgment of the Supreme Court in “S.P. Mani and Mohan Dairy vs. Dr. Snehalatha Elagovan” 2022 SCC OnLine SC 1238.

6) Heard learned counsel for the parties and perused the record.

7) A perusal of the record reveals that respondent Nos. 1 & 2 had filed a complaint against the petitioner, respondent No. 3 and partnership firm, namely, M/s Joginder Nath Varinder Kumar i.e. the accused No.3 in the complaint, thereby pleading that M/s Joginder Nath Varinder Kumar is a partnership firm and petitioner and respondent No. 3 were the partners of the firm and further that they were actively managing the affairs of the firm. It has also been stated that the petitioner and respondent No. 3 being the partners of the accused No. 3 in the complaint, on their behalf and also on behalf of the partnership firm from time to time had business transaction with the respondent No. 1 & 2 and used to purchase liquor of different brands from the respondent Nos. 1 & 2 for its retail sale in their liquor vend run by them under the firm name, “M/s Joginder Nath Varinder Kumar” at Rajouri as per the license No. 20/JKEL-2 issued by the Excise Department J&K Government. It is further stated that two cheques were issued by the accused in order to discharge part of their legal liability accruing from the business transactions, which were subsequently dishonoured vide memo dated 07.10.2021 having endorsement as “Account Inactive”. The respondent Nos. 1 & 2 have also placed on record the legal notice sent to the petitioner, respondent No. 3 and accused No. 3 in the complaint, whereby the demand of amount in lieu the of dishonoured cheques was made from them.

8) The contention raised by the learned counsel for the petitioner that M/s Joginder Nath Varinder Kumar is not a partnership firm but the proprietorship concern of the respondent No. 3 and the petitioner has nothing to do with the said concern, are the disputed questions of facts in view of the specific averment made in the complaint, therefore, the same are required to be adjudicated during the course of the trial and not while adjudicating a petition under Section 482 Cr. P.C. In S.P. Mani & Mohan Dairy v. Snehalatha Elangovan, 2022 SCC OnLine SC 1238, the Hon’ble Supreme Court of India has held as under:

“40. The principles discernible from the aforesaid decision of this Court in the case of Ashutosh Ashok Parasrampuriya (supra) is that the High Court should not interfere under Section 482 of the Code at the instance of an accused unless it comes across some unimpeachable and incontrovertible evidence to indicate that the Director/partner of a firm could not have been concerned with the issuance of cheques. This Court clarified that in a given case despite the presence of basic averments, the High Court may conclude that no case is made out against the particular Director/partner provided the Director/partner is able to adduce some unimpeachable and incontrovertible evidence beyond suspicion and doubt.

(emphasis added)

9) The other contention raised by the learned counsel for the petitioner is that the petitioner was admittedly residing beyond the territorial jurisdiction of the trial court as the respondent Nos. 1 & 2 have themselves shown that the petitioner is the resident of Rajouri, whereas the complaint was filed before the Chief Judicial Magistrate, Jammu and transferred to the learned trial court. In this context, it is appropriate to note that in terms of Section 202 Cr. P.C. when a complaint is filed before any Magistrate in respect of an offence of which he is authorized to take cognizance and where the accused is residing at a place beyond the area in which he exercises his jurisdiction, the Magistrate has to postpone the issue of process against the accused and either inquire into the case himself or direct an investigation to be made by a police officer or by such other person as he thinks fit for the purpose of deciding whether or not there is sufficient ground for proceeding.

10) In the present case, admittedly not only the petitioner, but the respondent No. 3 and accused No. 3 in the complaint are residing/having their place of their business beyond the territorial jurisdiction of learned trial court. In such a situation, the learned trial court ought to have postponed the issue of process against the accused and conduct an inquiry in terms of Section 202 Cr. P.C. A perusal of the order impugned would reveal that the complaint was instituted before the trial court on 06.12.2021 and on the same day without resorting to the provisions contained in Section 202 Cr. P.C., the learned trial court issued the process against the petitioner, respondent No. 3 and the accused No. 3 in the complaint.

11) In an identical situation, the Hon’ble Supreme Court in Vishwakalyan Multistate Credit Co Op Society ltd. vs. Oneup Entertainment Private Limited 2023 Legal Eagle 839 , directed the Magistrate to proceed with inquiry under Section 202 Cr.P.C, when the Magistrate had issued the process against the accused for commission of offence under section 138 NI Act without proceeding in terms of section 202 Cr.P.C, who was not residing with in the territorial jurisdiction of the Magistrate. Relevant portion is extracted as under:

“We may note here that as far as complaints under Section 138 of the NI Act are concerned, this Court in Suo Motu Writ Petition (Criminal)No.2 of 2020 in the case of "In Re : Expeditious Trial of Cases Under Section 138 of N.I.Act, 1881" has laid down the guidelines. In clause (3) of paragraph 24 of the said decision, the Constitution Bench has directed as under:

"3) For the conduct of inquiry under Section 202 of the Code, evidence of witnesses on behalf of the complainant shall be permitted to be taken on affidavit. In suitable cases, the Magistrate can restrict the inquiry to examination of documents without insisting for examination of witnesses."

We, therefore, modify the impugned judgment and direct the Trial Court to proceed from the stage of Section 202 of the CRPC. While doing so, the learned Magistrate will be guided by the direction issued by the Constitution Bench which is reproduced above.”

(emphasis added)

12). Thus, the course adopted by the learned trial court while issuing process against the petitioner and other accused is in utter disregard to the provisions contained under Section 202 Cr. P.C. and the same cannot be countenanced.

13) Though the respondent No. 3 in the present petition and accused No. 3 in the complaint have not assailed the order impugned dated 06.12.2021 but keeping in view the fact that the same is illegal, as such, this Court deems it proper to quash the order dated 06.12.2021 in its entirety. The same is, accordingly, quashed. The learned trial court before proceeding further shall resort to the provisions contained under Section 202 Cr. P.C in terms of directions issued by the Supreme Court in Re: Expeditious trial of cases under Section 138 of N.I. Act, 1881. Needless to say that the accused has no right of audience before the process is issued by the Magistrate.

The respondent Nos. 1 & 2 are directed to appear before the trial court on 30.12.2023.