Wednesday 18 March 2015

Whether single complaint for dishonour of several cheques is maintainable?


 This Court after referring to Section 219 Cr.P.C. and
judgment of Madras High Court in K.Govindaraj V. Aswhin Barat
held that though the different cheques issued by the accused were
dishonoured, one notice was issued to the accused which was 
replied by the  accused through only one reply notice.  As there
was only one demand made by the first respondent/complainant  
and one reply from the accused company and all the cheques were 
returned on only one day, the Court held that the case falls under
Section 220 Cr.P.C.  In view of the above, the learned single Judge
rejected the argument of the learned counsel for the petitioners
therein as to the maintainability of one complaint.
          Similar question came for consideration before this Court in
E.Madhu and others Vs. State of Andhra Pradesh and another . 
This Court dealt with the situation where a single complaint was
filed in respect of dishonour of 20 cheques.  The argument of the
learned counsel for the petitioner therein was that separate
complaints ought to have been filed in respect of 20 dishonoured
cheques. This Court held that it is desirable as per the
requirements of Sections 218 and 219 of  Cr.P.C. to file separate
complaints but it is not a mandatory requirement under law in
view of the Judgment of the Apex Court in Ranchood Lal Vs. State
of Madhya Pradesh . 
ANDHRA PRADESH HIGH COURT

CRIMINAL PETITION No.6355 OF 2013     

DATED;28-01-2014 

M/s. Vasundhara Projects Pvt. Ltd., Rep. by its Chairman and Managing Director
Vs    
                
The State of A.P. 

HONBLE SRI JUSTICE C.PRAVEEN KUMAR          
CRIMINAL PETITION No.6355 OF 2013     
Citation: 2014(2)ALD(Cri)883, 2015ALLMR(Cri)100, 2014 (3) ALT (Crl.) 193 (A.P.)


        The petitioners, who are accused Nos.1 to 4 filed the present
Criminal Petition under Section 482 of Criminal Procedure Code,
1973 (for short the code), seeking quashing of all further
proceedings in C.C.No.425 of 2013 on the file of the XIII Special
Magistrate, Erramanzil, Hyderabad.   A private complaint was filed
by the second respondent against the petitioners for an offence
punishable under Section 138  of the  Negotiable Instruments Act,
1881 (for short the Act).
           The allegations in the complaint are as under:
           Accused No.1 is the company engaged in Real Estate
business rep. by its Chairman and Managing Director, who is shown 
as accused No.2.  Accused Nos.3 and 4 are the directors of accused 
No.1 company.  It is alleged in the complaint that when one
Mr.T.Sateesh Kumar was unable to lend the required amount in 
cash, accused No.2 requested Sateesh Kumar to arrange the funds  
through any of his friends.  As such, both of them approached the
complainant, who is known to Mr.Sateesh Kumar, seeking loan of 
Rs.1.5 crores.   The complainant is said to have verified cash
balance and informed accused No.2 that he would lend an amount  
of Rs.1,02,50,000/- only.  Accused No.2 accepted the offer and
promised to repay the same before August, 2012.  A promissory 
note was executed by accused No.2 agreeing to repay the said 
amount with interest at 24% p.a.  Accused Nos.3 and 4 also assured 
the complainant that they being active directors of accused No.1
company would take personal responsibility for ensuring repayment
of the debt.  As the accused failed to repay the same within the
time prescribed, the complainant started demanding the accused 
for repayment of the amount.  Thereupon, accused No.2 gave pre-
dated cheques bearing Nos.709926, 709927, 709928, 709929 and   
709930 dated 25.06.2012 for Rs.5,00,000/- each drawn on A/c 
No.30745446921 maintained by accused No.1 company with the    
State Bank of India, New Nagole Branch, Alkapuri Cross Road, 
Hyderabad towards part payment of the loan with an
understanding to present the said cheques in the first week of
September, 2012. 
          On 10.09.2012 the said cheques when presented at Bank of
Baorda, Abids Branch were returned on 11.09.2012 with the remark 
payment stopped by drawyer.  The complainant got issued a 
notice, dated 09.10.2012 intimating the accused about the
dishonour of cheques and also demanding payment of the cheque  
amounts within 15 days from the  date of receipt of the notice.
Though the accused received the notice they failed to make
payment of the cheque amount but however got issued a reply on 
25.10.2012 making frivolous and baseless allegations against the
complainant.  Accused Nos.3 and 4 failed to give any reply.
Thereafter, the present complaint came to be filed.
          Heard the learned counsel for the petitioners and learned
counsel for the second respondent.
           The first ground raised by the learned counsel for the
petitioners is that the learned Magistrate erred in taking
cognizance of the matter basing on the affidavit of the
complainant instead of recording the sworn statement of the
complainant as contemplated under Section 200 Cr.P.C. 
           The said issue raised by the learned counsel for the
petitioners is no more res integra  in view of the judgment of the
Apex Court in A.C.Narayanan Vs. State of Maharashtra and  
another  wherein the Apex Court has categorically held that it is
open to the Magistrate to rely upon the verification in the form of
affidavit filed by the complainant in support of the complaint
under Section 138 of the Act  and the Magistrate is neither
mandatorily obliged to call upon the complainant to remain
present before the Court, nor to examine the complainant on his
witness upon oath for taking the decision as to whether or not to
issue process on the complaint under Section 138 of the Negotiable
Instruments Act, 1881.
      In Mandvi Co-operative Bank Limited Vs. M/s. V.Nimesh
B.Thakore  the Apex Court after considering Sections 143 to 147 of
the Negotiable Instruments Act, 1881 held that there is nothing
illegal or wrong in accepting the affidavits filed by the
complainant.  The Court held that it is always open to the accused
to summon the person who gave the affidavit for cross
examination.
           However, the learned counsel for the second respondent
strenuously contends that the Magistrate has recorded the sworn
statement before issuing summons to the petitioners.
                   Viewed from any angle there is no merit in the said
argument of the learned counsel for the second respondent and
the same is accordingly rejected.
           The second ground raised by the learned counsel for the
petitioners is that the Court of XIII Special Magistrate at Erramanzil
has no jurisdiction to take cognizance of the matter as the offence
took place within the jurisdiction of Cyberabad Court at L.B.Nagar.
           The said issue is squarely covered by the recent judgments
of the Apex Court in Nishant Aggarwal Vs. Kailash Kumar Sharma  
and M/s. Escorts Limited Vs. Rama Mukherjee .  The above two  
judgments have reaffirmed the law declared by the Apex Court in
K.Bhaskaran Vs. Shankaran Vaidhyan Balan and Another .   The   
Apex Court held that the offence under Section 138 of the  Act can
be completed only with the concatenation of a number of acts.
The following are the acts which are components of the said
offence.
i)      drawing of the cheque
ii)     presentation of the cheque to the bank
iii)    returning the cheque unpaid by the draweee bank
iv)     giving notice in writing to the drawer of the cheque
demanding payment of the cheque amount   
v)      failure of the drawer to make payment within
15 days of the receipt of the notice
           Therefore, the Apex Court held that if five different acts
were done in five different localities, any one of the Courts
exercising jurisdiction in one of the five local areas can become
the place of trial for an offence under Section 138 of the Act.
           A perusal of the averments in the complaint and the
material filed along with the complaint would clearly indicate that
more than one act fell within the jurisdiction of the Court at
Erramanzil.  The said aspect, though agitated, was not seriously
contested by the learned counsel for the petitioners.
          The third ground raised by the learned counsel for the
petitioners is that filing of a single complaint in respect of
dishonour of five cheques is barred under Section 219 Cr.P.C.
Since bouncing of each cheque amount to one offence and as all
the five cheques are said to have been returned within a period of
one year, he submits that a single complaint could not have been
filed in respect of dishonour of five cheques in view of Section 219
Cr.P.C.
          The said aspect came up for consideration before this Court
in N.Laxman and others Vs. Sri Shanukha Cotton Traders .  It was
a case where accused No.1 company, which fell due to the 
respondent therein, issued eight cheques towards part payment of
the amount, which were presented on different dates.  All the
cheques were returned un-paid.  Thereafter, the complainant
therein got issued a notice on 15.03.1997 demanding accused No.1 
company to pay the due amount.  A reply came to be issued  
seeking time for payment of money.  As no amount was paid a 
single complaint was filed in respect of the dishonour of all the
cheques. 
          This Court after referring to Section 219 Cr.P.C. and
judgment of Madras High Court in K.Govindaraj V. Aswhin Barat
held that though the different cheques issued by the accused were
dishonoured, one notice was issued to the accused which was 
replied by the  accused through only one reply notice.  As there
was only one demand made by the first respondent/complainant  
and one reply from the accused company and all the cheques were  
returned on only one day, the Court held that the case falls under
Section 220 Cr.P.C.  In view of the above, the learned single Judge
rejected the argument of the learned counsel for the petitioners
therein as to the maintainability of one complaint.
          Similar question came for consideration before this Court in
E.Madhu and others Vs. State of Andhra Pradesh and another . 
This Court dealt with the situation where a single complaint was
filed in respect of dishonour of 20 cheques.  The argument of the
learned counsel for the petitioner therein was that separate
complaints ought to have been filed in respect of 20 dishonoured
cheques. This Court held that it is desirable as per the
requirements of Sections 218 and 219 of  Cr.P.C. to file separate
complaints but it is not a mandatory requirement under law in
view of the Judgment of the Apex Court in Ranchood Lal Vs. State
of Madhya Pradesh . 
          In an identical case this Court in City Automobiles and
another Vs. J.K.Industries Limited and another (Criminal
Petition No.2666 of 2001 and Batch) held that issuing cheques in
discharge of a separate debts constitutes a separate offence
although they are all offences of the same kind.  Since the facts do
not warrant to conclude that series of offences have been
committed in the course of same transaction one complaint can be
filed adverting to the provisions of Sections 218, 219 and 220 of
Cr.P.C., inasmuch as those provisions incorporate a general rule
and are not mandatory.  The Court held that there is nothing
illegal in filing a single complaint nor the trial would be vitiated on
account of the same.
          In view of the judgments of this Court and that of the
Madras High Court, the argument of the learned counsel for the
petitioners that a single complaint is not maintainable cannot be
accepted, since all the cheques were dishonoured on one day ie.
10.09.2012, a single notice was issued demanding the petitioners
to repay the due amount and a single reply was given on
25.10.2012.
           The fourth ground raised by the learned counsel for the
petitioners is with regard to lending loan without having any
licence to do business under the Andhra Pradesh (Telangana Area) 
Money Lenders Act, 1349 F.  Placing reliance on a judgment of this
Court reported in Mrs. K.Sudersanam V. S.Venkata Rao  and as  
there was no licence to do money lending business, he submits that
a complaint under Section 138 of the Act is not maintainable. Since
the complainant is a company established for a business other than
money lending, he submits that the second respondent could not 
have lent money without obtaining licence under the provisions of
the Act.  He thus contends that any default in payment of money is
not enforceable under law and the present complaint under
Section 138 of the Act is not maintainable.  As stated above, the
petitioners are strangers to the second respondent and they came
into contact with the complainant only through one T.Sateesh
Kumar, who is the friend of accused No.2.
           Keeping in view the facts in issue, the said argument of the
learned counsel for the petitioners needs to be tested with the
judgment relied upon by him.
                  A reading of the judgment of this Court referred to above
(K.Sudersanam (10 Supra) would disclose that in order to fall
within the definition of money lender it is not enough merely to
show that a man had on several occasions lent money at 
remunerative rates of interest but that there must be a certain
degree of system and continuity about the transactions and that
the definition of money lender in the Act does not include those
who advanced money casually.   In case on hand, there is no
material to show that there was a certain degree of system and
continuity in doing money lending business.  On the other hand,
the complaint refers to only one transaction.
          Apart from that the word money lender is defined in
Section 2 (7) of the Andhra Pradesh (Telangana Area) Money 
Lenders Act, 1349 F which reads as under. 
 Money lender means a person including a pawn broker, 
who, within the meaning of this Act, only advances loan in
the ordinary course of his business or does so along with
other business, and shall also include the legal
representative of such person, and the person claiming to
be his representative on the ground of succession or
assignment or otherwise.
         The word loan mentioned in Section 2 (7) of the Andhra
Pradesh (Telangana Area) Money Lenders Act, 1349 F is defined in 
Section 2 (4)  of the Act which is as under: -
 loan means a loan secured or unsecured, advanced on interest in
cash or in kind, and shall include every transaction which is in
substance a loan, but shall not include the following.
Section 2 (4) (d) of the Act reads as under:
a loan advanced by a bank, a co-operative society or a company
         A conjoint reading  of Section 2 (4) (d) and 2 (7) of the
Andhra Pradesh (Telangana Area) Money Lenders Act, 1349 F would   
clearly indicate that the money advanced by a company in the
form of loan is excluded from the purview of the Andhra Pradesh
(Telangana Area) Money Lenders Act, 1349 F.   Viewed from any  
angle, the argument of the learned counsel for the petitioners does
not stand to merit.
          The next point urged by the learned counsel for the
petitioners is that since the loan was obtained by accused No.2 in
his individual capacity and as the cheque was issued on an account
maintained by the company, none of the accused are liable for
prosecution under Section 138 of the Negotiable Instruments Act,
1881.
        A reading of the complaint and the sworn statement would
clearly show that accused No.2 along with one T.Sateesh Kumar 
approached the complainant seeking loan as he was in urgent need 
of money.   After verification of the amounts, the complainant lent
a sum of Rs.1,02,50,000/- to accused No.2.  After receiving money,
accused No.2 executed promissory notes infavour of the
complainant promising to repay the same with interest @ 24% p.a.
on or before August, 2012.  The averments in the complaint and
the sworn statement of the complainant also show that accused 
No.2 gave cheques bearing Nos.709926, 709927, 709928, 709929   
and 709930 dated 25.06.2012 each for Rs.5,00,000/- drawn on 
account No.30745446921 maintained by accused No.1 company     
with the State Bank of India, New Nagole Branch, Alkapuri Cross
Road, Hyderabad, towards part payment of the debt.  In view of
the above, the learned counsel for the petitioner mainly contends
that accused No.1 company and accused Nos.3 and 4, who are   
directors of accused No.1 company are no way liable for the loan
taken by accused No.2 in his individual capacity.  He further
submits that issuing of cheques on an account maintained by
accused No.1 company does not, in any way, fasten the company   
and all its directors with any liability as the transaction was never
between accused No.1 company and the complainant company.  In    
support of his argument he relied upon a judgment of this Court
reported in Othiappan V. State of Andhra Pradesh and another .
              On the otherhand, the learned counsel for the second
respondent submits that since the cheques were issued by a 
company, every person who is incharge of the day today affairs of
the company are liable under the provisions of Sections 138 and
141 of the Act.  In view of the averments in the complaint and
sworn statement, he submits that issue involves disputed question
of fact which needs to be agitated only during trial and cannot be
decided in an application under Section 482 Cr.P.C.
             As seen from the averments in the complaint, sworn
statement and the rival arguments advanced by both the learned
counsel, it was accused No.2 alone, who took loan from the
complainant as he was in urgent need of money and it was he who 
issued the cheque belongs to accused No.1 company.  The  
averments in the complaint does not any where indicate that
accused No.2 took the amount for the business of accused No.1 
company.  
          Before proceeding further, it would be relevant to refer
Sections 138 and 141 of the Act  which are as under:
138. Dishonour of cheque for insufficiency, etc., of funds in the
account.
Where any cheque drawn by a person on an account maintained by   
him with a banker for payment of any amount of money to another
person from out of that account for the discharge, in whole or in
part, of any debt or other liability, is returned by the bank unpaid,
either because of the amount of money standing to the credit of
that account is insufficient to honour the cheque or that it exceeds
the amount arranged to be paid from that account by an
agreement made with that bank, such person shall be deemed to  
have committed an offence and shall, without prejudice to any
other provisions of this Act, be punished with imprisonment for (a
term which may be extended to two years), or with fine which may
extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this Section shall apply unless:-
(a) the cheque has been presented to the bank within a period of
six months from the date on which it is drawn or within the period
of its validity, whichever is earlier;
7(b) the payee or the holder in due course of the cheque, as the
case may be, makes a demand for the payment of the said amount   
of money by giving a notice in writing, to the drawer of the
cheque, (within thirty days) of the receipt of information by him
from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the
said amount of money to the payee or, as the case may be, to the
holder in due course of the cheque, within fifteen days of the
receipt of the said notice
Section 141(1) in The Negotiable Instruments Act, 1881

(1) Offences by companies. 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 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
Section 141(2) in The Negotiable Instruments Act, 1881
(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 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

                  From a reading of Section 138 of the Negotiable Instruments
Act, it is very clear that in order to attract the provisions thereof,
a cheque which is dishonoured will have to be drawn by a person
on an account maintained by him with the banker for payment of
any amount of money to another person from out of that account
for the discharge, in whole or in part of any debt or other liability.
It is only such a cheque which is dishonoured, would attract the
provisions of Section 138 of the above Act against the drawer of
the cheque.

          Section 141 of the Act refers to an offence committed by a
company.  A reading of Section 141 of the Act  would show that
when a person committing an offence under Section 138 of Act is a
company, every person, who at the time of committing the offence
was incharge of and responsible for the affairs of the company
shall be deemed to be guilty of the offence.
           A perusal of the averments in all the five complaints would
show that the amount involved in each of the complaint is
Rs.1,02,50,000/-.  Two complaints were filed making accused No.2
alone liable and three complaints were filed making the company
as well as other directors of the company including accused No.2
liable for the offence.
            As stated above, the averments in the complaint does not
any where indicate amount being borrowed by the company.  
            The question is  whether the company and its directors can
be made liable for the cheques issued by its Managing Director,
who took loan in his individual capacity but issued cheques of
accused No.1 company.   
            In Anil Sachar and another Vs. Shree Nath Spinners
Private Limited and others , the Apex Court dealt with a
situation where one Munish Jain, a Director of M/s. AT Overseas
Limited, a sister concern of M/s. Shree Nath Spinners (P) Limited,
issued four cheques to M/s Rati Woollen Mills towards
consideration for supply of goods to M/s. Shree Nath Spinners (P)
Limited.  The trial Court as well as the appellate Court held that
M/s. AT Overseas Limited has no reason to give cheques to the
complainant.  The Apex Court reversed the said finding after
referring Section 138 of the Act and taking into consideration the
understanding arrived at among the complainant and accused, held
that the cheques signed by Munish Jain has been issued by M/s. AT 
Overseas Limited to the complainant in discharge of a debt or
liability which had been incurred by M/s. Shree Nath Spinners (P)
Limited.
         In P.J.Agro Tech. Ltd. And others Vs. Water Base Limited
the Apex Court dealt with a situation where an employee of a
company gave a cheque discharging the dues of the company and   
its directors.  The said cheque was returned due to insufficiency of
funds.  The question before the Apex Court was whether the
company and its directors can be made liable for dishonour of
cheque issued by an employee in discharge of a debt of a company 
and its directors.  After referring to the provisions of the Act, the
Apex Court held as under:
The cheque which had been dishonoured may have been   
issued by the respondent No.1 for discharging the dues of
the Appellant No.1 company and its Directors to the
respondent No.1 Company and the respondent company    
may have a good case against the appellant No.1 company  
for recovery of its dues before other for a, but it would not
be sufficient to attract the provisions of Section 138 of the
Act.  The appellant company and its Directors cannot be
made liable under Section 138 of the Act for a default
committed by the respondent No.11.  An action in respect
of a criminal or a quasi-criminal provision has to be strictly
construed in keeping with the provisions alleged to have
been violated.  The proceedings in such matters are in
personam and cannot be used to foist an offence on some 
other person, who under the statute was not liable for the
commission of such offence.
           In Gummadi Industries Limited and another Vs. Khushroo
F. Engineer  a learned single Judge of Madras High Court dealt
with a situation where the cheques in question were issued by the
second petitioner therein from his personal account and not from
the account of the first petitioner company and those cheques
have been signed by the second petitioner in his individual
capacity and not as an authorized signatory of the first petitioner.
In the circumstances, an application was filed seeking quashing of
proceedings against the first petitioner.  The Madras High Court
held that the liability or debt though legally enforceable against
the first accused company but the cheques were issued by the 
second petitioner in his individual capacity and as such, he alone is
the drawer.   Accordingly, the proceedings against the first
petitioner therein were quashed while rejecting the plea of the
second petitioner therein holding that he alone can be held liable
for the offence.
           In I.C.D.S. Ltd. Vs. Beema Shabeer and another   the
Apex Court considered the fact as to the maintainability of the
proceedings under Section 138 of the Act vis--vis a guarantor.  It
may be relevant to refer the relevant paragraphs in the said
judgment, which are as under:
 Para No.9: As noticed hereinabove, the principal reason
for quashing of the proceeding as also the complaint by the
High Court was by reason of the fact that Section 138 of
the Act provides for issuance of a cheque to another person
towards the discharge in whole or in part of any debt or
liability and on the factual context, the High Court came to
a conclusion that issuance of the cheque cannot be co-
related for the purpose of discharging any debt or liability
and as such complaint under Section 138 cannot be 
maintainable.
Para No.10: The language, however, has been rather
specific as regards the intent of the legislature.  The
commencement of the Section stands with the words  
where any cheque.  The above noted three words are of
extreme significance, in particular, by reason of the use of
the word any the first three words suggest that in fact
for whatever reason if a cheque is drawn on an account
maintained by him with a banker in favour of another
person for the discharge of any of debt or other liability,
the highlighted words if read with the first three words at
the commencement of Section 138, leave no manner of  
doubt that for whatever reason it may be, the liability
under this provision cannot be avoided in the event the
same stands returned by the banker unpaid.  The
legislature has been careful enough to record not only
discharge in whole or in part of any debt but the same
includes other liability  as well.  This aspect of the matter
has not been appreciated by the High Court, neither been
dealt with or even referred to in the impugned judgment.
Para No.11: The issue as regard the co-extensive liability of
the guarantor and the principal debtor, in our view, is
totally out of the purview of Section 138 of the Act, neither
the same calls for any discussion therein.  The language of
the statute depicts the intent of the law-makers to the
effect that wherever there is a default on the part of one
in favour of another and in the event a cheque is issued in
discharge of any debt or other liability there cannot be any
restriction or embargo in the matter of application of the
provisions of Section 138 of the Act.  Any Cheque and
other liability are the two key expressions which stands
as clarifying the legislative intent so as to bring the factual
context with the ambit of the provisions of the Statute.
Any contra interpretation would defeat the intent of the
legislature.
          The judgments of the Apex Court as well as of this Court and
Madras Court referred to above dealt with various situations.  In
P.J.Agro Tech. Ltd. Case (13 supra) the Apex Court held that the
company and its directors cannot be made liable in respect of the
cheque issued by its employee in discharge of the debt of the
company.  In Anil Sachars case (12 supra) the cheque issued by a
Director of a sister concern of the accused company was
dishonoured. After referring to ICDS Ltd. Case  (15 supra), the Apex
Court held that the accused is still liable for prosecution under
Section 138 of the Act.  In ICDS Ltd. Case, the Apex Court, after
considering the opening words of Section 138 of the Act namely
wherever any cheque and the words debt or other liability,
held that for whatever purpose the cheque is issued, the drawer is
held liable for an offence under Section 138 of the Act.
                  Applying the principles of law enunciated in the judgments
referred to above, the argument of the learned counsel for the
petitioners that the complaint against all the accused is not
maintainable cannot be accepted.  At the same time the argument 
of the learned counsel for the second respondent that since the
cheque of accused No.1 company was issued by accused No.2 in    
discharge of a debt incurred in his personal capacity, the company
as well as its directors are liable for prosecution cannot also be
accepted. The cheque which was issued was not on a account  
maintained in his individual capacity of accused No.2 but that of a
company of which he is the Managing Director and also an
authorized signatory to the cheques.  Therefore, the circumstances
under which the cheques signed by accused No.2 was issued to the  
complainant needs to be examined during the course of trial.
Whether the cheque was issued pursuant to an agreement between   
the Directors or with a knowledge or understanding amongst its
Directors or with the consent of all the Directors are disputed
questions of facts,  which needs to be established during trial.  The
complainant cannot be faulted with for having presented the
cheque signed and issued by accused No.2 at this stage of the case.
Therefore, it is to be held that accused No.2 alone is liable for
prosecution as it was he, who took money for himself, signed the
promissory notes and also issued the cheques belonging to the
company in discharge of the said debt.
                   For the aforesaid reasons, the Criminal Petition is liable to
be rejected against accused No.2.
         Accordingly,  the Criminal Petition  insofar as accused No.2 is
dismissed while the Criminal Petition insofar as accused
No.1/company and accused Nos.3 and 4, who are the directors of 
accused No.1 company is allowed.  
            As a sequel to it, miscellaneous petitions, if any pending in
this Criminal Petition, shall stand closed.
____________________   
C.PRAVEEN KUMAR, J      
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