NDLI: Rathish Babu Unnikrishnan Vs. The State (govt. of Nct of Delhi) & Anr.

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Code of Criminal Procedure 1973: s.482 – Scope of – Summoning order passed against appellant u/s.138 of NI Act – Petition u/s.438 for quashing summoning order
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Case(s) Referred	Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 Referred Case 4 Referred Case 5
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Dismissed
Headnote	Code of Criminal Procedure, 1973: s.482 – Scope of – Summoning order passed against appellant u/s.138 of NI Act – Petition u/s.438 for quashing summoning order – High Court opined that the grounds agitated by the appellant are “factual defences” which should not be considered within the parameters of limited enquiry permissible in petition u/s.482 – According to the appellant, the concerned post-dated cheques drawn by him in favour of the complainant were contingent/security cheques for buyback of shares of appellant’s company held by the complainant, and therefore the cheques could not have been prematurely presented to the bank and should have been presented for encashment only after transfer of the complainant’s shareholding in the appellant’s company – In other words, as the complainant was still holding the shares of the appellant’s company when the cheques were presented, the complainant is not entitled to receive any payment at that stage, through encashment of the cheques, made available to him – Held: The burden of proving that there is no existing debt or liability, is to be discharged in the trial – The transactional arrangement between the complainant and the accused reveals the nature of obligations that both had undertaken – The cheques in question were accepted by the complainant for an agreed price consideration, for the shares in the appellant’s company – According to the complainant, the appellant is to first pay and then as per the usual practice in the trade, the shares would be transferred to the appellant in due course within the time permitted by law – A bare perusal of s.56(1) of the Companies Act, 2013 indicates that a transfer of securities of a company can take place only when a proper instrument of transfer is effectuated – In shares transactions, there is a time lag between money going out from the buyer and shares reaching to the seller – A careful reading of the complaint and order passed by Magistrate showed that a possible view is taken that the cheques drawn were, in discharge of a debt for purchase of shares – In any case, when there is legal presumption, it would not be judicious for the quashing Court to carry out a detailed enquiry on the facts alleged, without first permitting the trial Court to evaluate the evidence of the parties – The quashing proceedings must not become an expedition into the merits of factual dispute, so as to conclusively vindicate either the complainant or the defence. Code of Criminal Procedure, 1973: s.482 – Quashing of proceedings at preliminary stage – Propriety of – Held: The Court should be slow to grant the relief of quashing a complaint at a pretrial stage, when the factual controversy is in the realm of possibility particularly because of the legal presumption, as in this matter – The factual defence without having to adduce any evidence need to be of an unimpeachable quality, so as to altogether disprove the allegations made in the complaint– The consequences of scuttling the criminal process at a pre-trial stage can be grave and irreparable – Quashing proceedings at preliminary stages will result in finality without the parties having had an opportunity to adduce evidence and the consequence then is that the proper forum i.e., the trial Court is ousted from weighing the material evidence – If this is allowed, the accused may be given an un-merited advantage in the criminal process – Also because of the legal presumption, when the cheque and the signature are not disputed by the appellant, the balance of convenience at this stage is in favour of the complainant/ prosecution, as the accused will have due opportunity to adduce defence evidence during the trial, to rebut the presumption– Situated thus, to non-suit the complainant, at the stage of the summoning order, when the factual controversy is yet to be canvassed and considered by the trial court will not be judicious– Based upon a prima facie impression, an element of criminality cannot entirely be ruled out here subject to the determination by the trial Court– Therefore, when the proceedings are at a nascent stage, scuttling of the criminal process is not merited.
Judge	Hon'ble Mr. Justice Hrishikesh Roy
Neutral Citation	2022 INSC 480
Petitioner	Rathish Babu Unnikrishnan
Respondent	The State (govt. Of Nct Of Delhi) & Anr.
SCR	[2022] 4 S.C.R. 989
Judgement Date	2022-04-26
Case Number	694-695

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Rathish Babu Unnikrishnan Vs. The State (govt. of Nct of Delhi) & Anr.

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