CAV:

1. As requested by Mr. Tejas P. Satta, learned advocate appearing on behalf of the applicant, leave to delete respondent no.5 from the cause title of the application is allowed.

2. The applicant-accused no.4 has preferred this application under Section 482 of the Code of Criminal Procedure, 1973 {"CrPC" for brevity} for quashing and setting aside the complaint, being Criminal Case No. 1244 of 2013 filed before the court of Learned Metropolitan Magistrate, Ahmedabad for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881, and all other consequential proceedings arising therefrom.

3. The facts leading to filing of the present application are as under;

3.1 That, the respondent no.3-Company I-Maritime Consultancy Pvt. Ltd. is a duly incorporated, established and registered as a Company under the provisions of the Companies Act, 1956. It is duly managed, operated and actively controlled by the accused Nos. 2, 3 and 4 and all of them are taking parts in the day-to-day affairs of the business of the Company. They all are individually and jointly responsible/liable for the said business of the Company. That, the said accused Nos. 2, 3 and 4 had, for and on behalf of the said Company, unanimously had taken a decision and contacted the complainant Company for requirement of Inter Corporate Deposit (ICD) of Rs. 1,00,00,000/-, vide its Inter Corporate Deposit letter dated 19.10.2012 and sent it to the complainant Company under the signature of accused No. 2, followed by letter of documents for ICD dated 19.10.2012. That, on receipt of said two letters, and in connection with the said ICD, the accused persons had purchased a Non Judicial Stamp Paper of Rs. 100/- and on a stamp paper, Memorandum of Understanding was executed under the signature of the accused No. 2; for and on behalf of accused no.1 Company, in pursuance to a duly taken decision of the accused Nos. 3 and 4 and on other side, under the signature of Mr. B. Ravi, Chief Financial Officer, Apsezl.

3.2 That, on execution of the said MOU, the complainant Company sent RTGS letter dated 22.10.2012 as applicant and in favour of the said accused as beneficiary for the amount of Rs. 1,00,00,000/- (Rupees one Crore only), through cheque no. 561404 dated 22.10.2012 in favour of Axis bank Ltd. Law Garden Branch, Ahmedabad, to be deposited in the said Bank. That, the accused persons received said amount on 22.10.2012 of Rs. 1,00,00,000/- @ 12% per annum for 180 days through Rtgs from the complainant Company, and in response to such payment, the said accused persons through their authorised person ie., the accused No. 2 issued a receipt dated 22.10.2012 in favour of the complainant Company.

3.3 The said accused persons had, through their authorised person ie., the accused no.2, also issued a Demand Promissory Note dated 22.10.2012 for Rs. 1,00,00,000/- @ 12% per annum, in favour of the said complainant Company, which was duly signed by the said accused no.2 for and on behalf of the other accused persons. That, the said complainant Company had enlarged Rs. 1,00,00,000/- as ICD to the said accused persons, and the said accused had received the said amount through RTGS, and hence, the said accused persons became responsible/liable for the repayment of the said amount to the complainant Company as on the day fixed and on demand.

3.4 That, the said accused persons, in response to fulfilment of their legally enforceable debt towards the complainant Company had issued two cheques in favour of the complainant -company, being (A) cheque No. 887218 dated 20.04.2013 for Rs. 1,00,00,000/- drawn on RBS-The Royal Bank of Scotland N. V. Sakhar Bhavan, Nariman Point, Mumbai duly signed by accused no.2 as an authorised person of bank account No. 446078, in favour of Adani Ports and Special Economic Zone Limited, and (B) cheque No. 887220 dated 20.04.2013 for Rs. 5,32,603/- drawn on RBS-The Royal Bank of Scotland N. V. Sakhar Bhavan, Nariman Point, Mumbai duly signed by accused No. 2 as an authorised person of the said accused persons of their bank account No. 446078, in favour of Adani Ports and Special Economic Zone Limited. That, the aforesaid two cheques were deposited under the specific intimation, instructions, assurance and promise of all the accused on or about 25.04.2013 in the said Axis Bank Limited, Ahmedabad for encashment/clearing, but due to "insufficient funds" in the said bank account, the said two cheques were not honoured and accordingly returned unpaid. That, complainant Company was duly informed/intimated by the said bank ie., AXIS Bank Ltd. as to dishonour of the said two cheques and therefore, the complainant served a notice to the accused persons and all the accused were, therefore, called upon, jointly as well as severally, by the said statutory notice of demand to make payments of the said two dishonoured cheques within 15 days from the date of receipt of the notice of demand, as provided under Section 138 of the Negotiable Instruments Act, 1881 and thereafter, a complainant, being Criminal Case No. 1244 of 2013 came to be filed before the court of Metropolitan Magistrate, Ahmedabad for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 against the accused persons.

4. Feeling aggrieved by the complaint filed by the respondent no.2, being Criminal Case No. 1244 of 2013 before the Metropolitan Magistrate, Ahmedabad, the applicant has preferred this application for quashment of the impugned complaint and while admitting this matter by issuing rule, this Court vide oral order dated 10th January, 2014 granted ad interim relief in terms of para 10(C) of the application.

5. Heard learned senior counsel Mr. Yogesh Lakhani appearing for the applicant, learned advocate Mr. Hardik A. Dave appearing for the respondent No. 2, learned advocate Mr. Pratik Barot appearing for the respondents No. 3 and 4 and learned APP Mr. KP Raval appearing for the respondent No. 1-State.

6. It was submitted by Mr. Yogesh Lakhani, learned senior counsel appearing on behalf of the applicant that the applicant joined the Company-respondent no.3 as Additional Director on 22nd July, 2009 and was an independent non-Executive Director uptill 31st December, 2012. On 31st December, 2012, he resigned as a Director from the respondent no.3-Company. That, he had informed the Registrar of Companies about his resignation under the provisions of the Companies Act, 1956 in Form No. 32. That, after his resignation, the respondent no.2 filed a complaint under Section 138 of the Negotiable Instruments Act, being Criminal Case No. 1244/2013 before the court of learned Metropolitan Magistrate, Ahmedabad. That, as the applicant had already resigned from the Company ie., the respondent no.3, and cease to be a Director of the Company, even at the time of so called commission of the crime, however, he has been arraigned as an accused in the complaint. That, the said complaint is nothing, but misuse of process of law and just to exert pressure on the applicant and to harass him. That, the respondent no.2, in its complaint, has not clearly alleged the specific role of the applicant in so called commission of crime. That, only those persons, who were in-charge of and responsible for the conduct of the business of the Company at the time of commission of offence, will be liable for criminal action. That, even as per the provisions of Section 141 of the Negotiable Instruments Act, a person can be made vicariously liable, only if, it is proved that, at the time of the commission of offence, he was in charge of and was responsible to the Company for the conduct of the business of the Company. That, the applicant had resigned much earlier then issuance of cheques and dishonour of the same. Therefore, he is not liable for any such crime, and therefore, the complaint against him is required to be quashed and set aside. It is further argued by learned senior counsel Mr. Yogesh Lakhani appearing for the applicant that applicant is not a signatory to the cheque nor has he committed any kind of offence as alleged in the complaint. That, facts of the case reveals mala fide intention on the part of the respondent no.2, and therefore, continuous of the complaint is nothing, but an abuse of the process of law. In support of his arguments, learned senior counsel for the applicant has relied upon decisions of Honble Supreme Court in cases of Saroj Kumar Poddar v. State (NCT of Delhi) & Anr., reported in (2007) 3 SCC 693 [LQ/SC/2007/58] ; Harshenda Kumar D. v. Rebatilata Koley & Ors. reported in (2011)3 SCC 351 [LQ/SC/1974/157] , Pooja Ravinder Devidasani v. State of Maharashtra & Ors., reported in (2014) 16 SCC 1 [LQ/SC/2014/1366] and N.K. Wahi v. Shekhar Singh & Ors., reported in 2007(9) Supreme Court Cases 481.

7. Learned senior counsel appearing on behalf of the applicant has drawn attention to this Court to the affidavit made by Shri Rameshkumar Abhimanyu Singhal, one of the Director of the respondent no.3-Company to urge that he has supported the contentions of the applicant saying that the applicant had tendered his resignation with the respondent no.3 on 31.12.2012 via email and hand delivery, which was accepted by way of a resolution passed in a Board meeting held on 15.01.2013. The applicant was never in-charge of or responsible for the affairs of the Company, etc. He has also drawn attention of this Court to the documents produced on record, such as resignation tendered by the applicant, e-mail forwarded by the applicant, minutes of the meeting resolving and accepting the resignation of the applicant as a Director from the Company, Form no.32 issued by Registrar of Companies, etc.

8. Per contra, learned advocate Mr. Hardik A. Dave appearing for the respondent no.2 has vehemently opposed the arguments advanced by the learned senior counsel Mr. Yogesh Lakhani appearing on behalf of the applicant and submitted that the essential ingredients for the purpose of committing offence under Section 138 of the Negotiable Instruments Act are prima facie made out, as alleged by the respondent no.2 in its complaint. That, criminal proceedings cannot be quashed at an initial stage if that complaint prima facie consists of the essential ingredients of alleged offence. That, there are several disputed questions of facts, which essentially requires leading of and appreciation of the evidence, and therefore, they cannot be decided in a petition under Section 482 CrPC by this Court. That, the subject cheques were issued to the respondent no.2 as post dated cheques towards security for the Inter Corporate Deposit received by accused Company, while the applicant was a Director and responsible for the affairs of the accused Company. That, tendering of so called resignation by the applicant also, requires leading of the evidence during the trial. That, the applicant has filed Form no. 32, which also creates doubt, because in the said form, no date of resignation of the applicant is cited, which requires trial. That, legal position of filing of the Form No. 32 would be relevant for deciding the liability of applicant and until it is decided, the complaint cannot be quashed. That, the question raised by the applicant would require proper adjudication as to his role in the Company, and therefore also, the complaint cannot be quashed or set aside. In support of his arguments, learned advocate Mr. Hardik A. Dave appearing for the respondent no.2 has relied upon a judgment delivered by this Court in Criminal Misc. Application No. 16198/2011 and the judgment of the Apex Court in case of Malwa Cotton and Spinning Mills Limited v. Virsa Singh Sidhu Ors. reported in AIR 2008 SC 3273. Ultimately, it was requested by him to dismiss the present petition.

9. Learned advocate Mr. Pratik B. Barot appearing for the respondents no. 3 to 4 has adopted the arguments advanced by learned senior counsel Mr. Yogesh Lakhani appearing for the applicant.

10. Learned APP Mr. KP Raval appearing for the respondent no.1 State has supported the arguments advanced by learned advocate Mr. Hardik A. Dave appearing for and on behalf of the respondent no.2. He submitted that it is a pure question of fact involved in the petition as well as in the complaint. Therefore, at this stage, no powers could be exercised by the High Court under Section 482 CrPC. That, this dispute can only be decided in the trial Court on leading of necessary evidence by both the parties. Ultimately, it was requested by learned APP to dismiss the petition.

11. Having heard learned advocates for the parties, it is not in dispute that applicant joined the Company ie., respondent no.3 as Additional Director on 22nd July, 2009 and officiating in the capacity of independent Non-Executive Director. From the documents produced on the record, it appears that he has tendered his resignation to the respondent no.3 on 31st December, 2012, resigning from the post of Director from the respondent no.3-Company. As per the record, resignation forwarded by the applicant declaring his intention to step down as Director was taken on record on the very same day ie., on 31st December, 2012. It is certified by the respondent no.3 that resignation of Mr. Deepak Shyamsunder Agrawal ie., the applicant herein from the Directorship of the Company with effect from 31st December, 2012 is accepted and he was duly relieved from his duty as a Director of the Company from that date. Mr. Rameshkumar Abhimanyu Singhal, Director of the Company was authorised on behalf of the Company to file Form No. 32 with the Registrar of Companies, Mumbai and all necessary formalities-procedures, as required to be done with respect to the resignation of the applicant were to be complied with. Thereafter, it appears that Form no. 32 was forwarded to the Registrar of Companies, which is produced on the record. Surprisingly both the parties have produced copies of Form No. 32 issued by the office of the Registrar of Companies, Mumbai (Maharashtra) at page no. 16 and page no. 53 on record. In both the forms, name of the applicant is shown along with the address, which includes date of birth. At page no. 16 in Form no. 32, it is written as hereby confirmed that the above mentioned Director is not associated with the Company with effect from 31.12.2012. At page no. 53, the respondent has produced a copy of Form no. 32 issued by the Registrar of Companies, Mumbai-Maharashtra, which also show name of the applicant, his address and date of birth. Surprisingly, at the bottom, in last column, no date is shown or inserted declaring that the applicant is not associated with the Company. Further details in the said Form no. 32 produced at page No.16 appears to be, as shown in Form no. 32 produced at page no.53.

12. Mr. Jay Amin, who has filed his affidavit and which is produced on record, has stated that Form no. 32 filed by the applicant and produced on record before this Court, is creating doubt. He further stated that the respondent no.2 has also obtained a certified copy of Form no. 32 filed by the applicant from the office of the Registrar of the Companies. He added that Form no. 32 would be relevant for deciding the liability of the applicant and until the same is decided by the trial Court, the complaint cannot be quashed. None mentioning of the date of relieving the applicant from the liability of the post of Directorship of the respondent no.3 with effect from 31st March, 2012 would be a factual aspect, which needs to be adjudged as in one Form date of submititng the same is mentioned, and whereas in another it is not. Shri Rakeshkumar A. Singhal has filed his affidavit supporting the contents of the petition saying that the resignation was tendered by the applicant on 31st December, 2012 via email and hand delivered letter and in a Board meeting held on 15.01.2013, his resignation was accepted. In the complaint, it is specific case of the respondent no.2 that the accused Company [ie., the respondent no.3] is duly managed/operated and actively controlled by the accused nos. 2, 3 and 4. It is further averred that the accused Company is doing its business in Maritime infrastructure consultancy etc,. through its Directors viz., the accused nos. 2, 3 and 4. As per the averments made in the complaint, the applicant is a Director of accused Company and is actively taking part in day to day affairs of the Company. Further, it is averred in the complaint that since the accused nos. 2, 3 and 4 are managing the day to day affairs of the business of the Company, they all are individually and jointly responsible and liable for their joint business activities, as they all are jointly and severally, deeply involved in the said business of the accused Company. As per the averments made in the complaint, the said accused person nos. 2, 3 and 4 had, for and on behalf of the Company, unanimously taken a decision and contacted the complainant Company for requirement of Inter Corporate Deposit (ICD) of Rs. 1 Crore (Rupees One Crore only) vide its Inter Corporate Deposit letter dated 19.10.2012, etc.

13. In the affidavit filed by Mr. Jay Amin, on behalf of the complainant-respondent no.2, it is stated that two post dated cheques were issued towards security for the Inter Corporate Deposit by the accused company, when the applicant was a Director. It appears that on filing of the complaint by the respondent no.2 against the present applicant and other co-accused, learned Metropolitan Magistrate, Ahmedabad on 25th September, 2013 was satisfied, considering the averments made in the complaint, affidavit, documentary evidence, to issue summons against the accused for the offence punishable under Section 138 of the Negotiable Instruments Act.

14. Before arriving at any conclusion, a brief analysis of the law on the subject matter needs a brief reference.

14.1 In case of Sarojkumar Poddar v. State (NCT of Delhi) & Anr., reported in (2007) 3 SCC 693 [LQ/SC/2007/58] , it is held by the Apex Court that for fixing vicarious liability of a person, requisite averments in the complaint is a statutory requirement. Here, in the complaint, to attract the provisions of Section 138 of the Negotiable Instruments Act, requisite averments are clearly made by the complainant, and therefore, at this stage, it cannot be said that requisite averments are not made by the respondent no.2 in its complaint.

14.2 In case of Harshendra Kumar D. v. Rebatilata Koley & Ors. reported in (2011) 3 SCC 351 [LQ/SC/2011/217] , it is held by the Supreme Court that an ex- Director cannot be made accountable and fastened with liability for anything done by Company after acceptance of his resignation. In the case on hand, on facts resignation of the Director of Company was accepted and notified to the Registrar of Companies in a prescribed form (ie., Form 32). Here, as discussed above, there is a difference in the form produced by either side showing date in one form as 31st December, 2012 and no date of relieving the applicant from the responsibility as a Director of the accused Company, in another. This would be a pure question of fact, which requires adjudication upon leading evidence, because date of relieving the applicant from Company is material to hold be liable.

14.3 In case of Pooja Ravinder Devidasani v. State of Maharashtra & Anr., reported in (2014) 16 SCC 1 [LQ/SC/2014/1366] , it is held by the Apex Cort that for making a Director liable, there must be specific averments against him showing as to how and in what manner he/she was responsible for the conduct of business of the Company. It was further held that mere verbatim reproduction of words of section without a clear statement of fact duly supported by proper evidence would not be enough to make accused vicariously liable for the Company and conduct of its business was in charge of and was responsible to the Company. The question of post dated cheques towards security for ICD received by the accused Company was also a bare question of fact, which would not be decided by this Court in a petition preferred under Section 482 CrPC.

14.4 In case of N.K. Wahi v. Shekhar Singh & Ors., reported in (2007) 9 SCC 48, it is held that under Section 141 of Negotiable Instruments Act, if any offence is committed by the Company then every person, who is a Director/employee would not liable. It is further held that liability lies only on such person(s), who at the time of commission of offence, were in charge and were responsible to the Company for conduct of the business of the Company as well as the Company. Merely, being a Director of the Company would not make such person liable. As per the respondent no.2, the applicant was a Director and responsible for the affairs of the accused Company, when the subject cheques were issued to the present respondent. As all the questions, which are in dispute are based on factual aspect, fixing liability of the applicant with the accused Company and whether the cheques in dispute were issued while the applicant was a Director and was responsible for the affairs of the accused Company or not.

14.5 This Court has taken a similar view in Criminal Misc. Application No. 16198/2011 holding that this Court cannot enter into facts of the case in dispute, while deciding application under Section 482 CrPC, relying upon the judgment of Malwa Cotton and Spinning Mills Limited v. Virsa Singh Sidhu Ors. reported in AIR 2008 SC 3273 [LQ/SC/2008/1655 ;] ">AIR 2008 SC 3273 [LQ/SC/2008/1655 ;] [LQ/SC/2008/1655 ;] ">AIR 2008 SC 3273 [LQ/SC/2008/1655 ;] ">AIR 2008 SC 3273 [LQ/SC/2008/1655 ;] [LQ/SC/2008/1655 ;] [LQ/SC/2008/1655 ;] .

14.6 In case of Suryalakshmi Cotton Mills Limited v. Rajvir Industries Limited & Ors., reported in 2008(13) SCC 678, Honble Supreme Court has made following observations explaining parameters of jurisdiction of the High Court in exercising jurisdiction under Section 482 CrPC:

"17. The parameters of jurisdiction of the High Court in exercising its jurisdiction under Section 482 of the Code of Criminal Procedure is now well settled. Although it is of wide amplitude, a great deal of caution is also required in its exercise. What is required is application of well known legal principles involved in the matter.

22. Ordinarily, a defence of an accused although appears to be plausible should not be taken into consideration for exercise of the said jurisdiction. Yet again, the High Court at that stage would not ordinarily enter into a disputed question of fact. It, however, does not mean that documents of unimpeachable character should not be taken into consideration at any cost for the purpose of finding out as to whether continuance of the criminal proceedings would amount to an abuse of the process of Court or that the complaint petition is filed for causing mere harassment to the accused. While we are not oblivious of the fact that although a large number of disputes should ordinarily be determined only by the civil courts, but criminal cases are filed only for achieving the ultimate goal namely to force the accused to pay the amount due to the complainant immediately. The Courts on the one hand should not encourage such a practise; but, on the other, cannot also travel beyond its jurisdiction to interfere with the proceeding which is otherwise genuine. The Courts cannot also lose sight of the fact that in certain matters, both civil proceedings and criminal proceedings would be maintainable."

14.7 In case Rallis India Limited v. Poduru Vidya Bhushan, reported in 2011(13) SCC Page No. 88, the Honble Supreme Court has expressed its view on this point, as under:

"12. At the threshold, the High Court should not have interfered with the cognizance of the complaints having been taken by the trial court. The High Court could not have discharged the respondents of the said liability at the threshold. Unless parties are given opportunity to lead evidence, it is not possible to come to definite conclusion as to what was the date when the earlier partnership was dissolved and since what date the Respondents ceased to be the partners of the firm."

14.8 On a similar issue, Honble Supreme Court, in the case of Sampelly Satyanarayana Rao v. Indian Renewable Energy Development Agency Limited, reported in (2016) 10 Supreme Court Cases 458, [LQ/SC/2016/1224] has held whether cheque was given as security or there existed outstanding liability or not is question of fact. Under such conditions, the High Court cannot entertain disputed question of fact under Section 482 CrPC. The High Court needs to exercise power under Section 482 CrPC with great deal of caution. Even though, defence of accused appears to be plausible, but it should not be considered, while exercising power under Section 482 CrPC. In the said case, post dated cheques were issued; as observed by Honble Apex Court, postdated cheques is a well-recognised mode of payment and it depends on each case.

15. Considering the above stated legal settled principles of law, while dealing with a quashing petition, the Court has ordinarily to proceed with all the averments in the complaint, defence of the accused cannot be considered at this stage. The Court considering the prayer for quashing, does not adjudicate upon the disputed questions of fact. Therefore, the question has to be answered in favour of the respondent no.2 and against the applicant. Accordingly, this Court did not find any merits in this petition, therefore, the same is dismissed. Ad interim relief stands vacated. Rule nisi discharged with no order as to costs.

16. As a parting note, it needs a mention here that this Court has not gone into the merits of the matter and has only gone into the aspect of its entertain-ability for quashing the impugned complaint qua the applicant herein, and therefore, the applicant will at liberty to raise all the available contentions before the trial Court, which shall be gone into and dealt with by the concerned Court, on merits and in accordance with law.