Kinfotech (P) Ltd. v. Redington (India) Ltd.

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The Tax Publishers 2018 TaxPub(CL) 0918 (Mad-HC) Kinfotech (P) Ltd. v. Redington (India) Ltd. NEGOTIABLE INSTRUMENTS ACT, 1881, --Dishonour of cheque due to insufficiency, etc., of funds in the account--Jurisdiction of courtDirectors in-charge of and responsible for conduct of business ----Where complaint for dishonour of cheque was filed within the jurisdiction of the court, where the bank of the complainant was situated, then, petition to quash the proceedings initiated against the accused was to be dismissed.--Complainant company filed complaint against the accused company and its directors for dishonour of cheques due to account closed. Accused company filed petition under section 482 to quash the proceedings against it on the ground that its directors resigned from their positions before the presentation of cheques for encashment, thus, they could not be held liable for the said offence. Further, an enquiry under section 202 was necessary before issuing process, as the accused were residing in Karnataka, whereas the complaint was filed before the Magistrate exercising his jurisdiction in Chennai. *Held:* Directors of accused company were in charge of and responsible for day-to-day affairs and conduct of the business and were actively involved in all the transactions between the parties, thus, a prima facie case was made out against the directors of accused company. Further, complaint under section 138 could be filed within the jurisdiction of the court, where the bank of the complainant was situated. The bank of the complainant company was situated in Chennai, therefore, the complaint was filed within the jurisdictional court. Hence, criminal original petition was dismissed. Negotiable Instruments Act, 1881, Section 138 Code of Criminal Procedure, 1973, Sections 202 & 482 *Relied:S.M.S. Pharmaceuticals Limited v. Neeta Bhalla & Anr. in (2007) 4 Supreme Court Cases 70 : 2007 TaxPub(CL) 0199 (SC), N.K. Wahi v. Shekhar Singh & Ors. in (2007) 9 Supreme Court Cases 481 : 2007 TaxPub(CL) 0217 (SC), National Small Industries Corporation Limited v. Harmeet Singh Paintal & Anr. in (2010) 3 Supreme Court Cases 330 and GHCL Employees Stock Option Trus v. Kranti Sinha in Supreme Court Cases (2013) 4 SCC 505 : 2013 TaxPub(CL) 0542 (SC) REFERRED :* Laxmi Dyechem v. State of Gujarat in (2012) 13 Supreme Court Cases 375 : 2013 TaxPub(CL) 0461 (SC) FAVOUR : Against the petitioners SUBSCRIBE FOR FULL CONTENT

The Tax Publishers 2018 TaxPub(CL) 0918 (Mad-HC)

Kinfotech (P) Ltd. v. Redington (India) Ltd.

NEGOTIABLE INSTRUMENTS ACT, 1881,

--Dishonour of cheque due to insufficiency, etc., of funds in the account--Jurisdiction of courtDirectors in-charge of and responsible for conduct of business ----Where complaint for dishonour of cheque was filed within the jurisdiction of the court, where the bank of the complainant was situated, then, petition to quash the proceedings initiated against the accused was to be dismissed.--Complainant company filed complaint against the accused company and its directors for dishonour of cheques due to account closed. Accused company filed petition under section 482 to quash the proceedings against it on the ground that its directors resigned from their positions before the presentation of cheques for encashment, thus, they could not be held liable for the said offence. Further, an enquiry under section 202 was necessary before issuing process, as the accused were residing in Karnataka, whereas the complaint was filed before the Magistrate exercising his jurisdiction in Chennai. Held: Directors of accused company were in charge of and responsible for day-to-day affairs and conduct of the business and were actively involved in all the transactions between the parties, thus, a prima facie case was made out against the directors of accused company. Further, complaint under section 138 could be filed within the jurisdiction of the court, where the bank of the complainant was situated. The bank of the complainant company was situated in Chennai, therefore, the complaint was filed within the jurisdictional court. Hence, criminal original petition was dismissed.

Negotiable Instruments Act, 1881, Section 138

Code of Criminal Procedure, 1973, Sections 202 & 482

Relied:S.M.S. Pharmaceuticals Limited v. Neeta Bhalla & Anr. in (2007) 4 Supreme Court Cases 70 : 2007 TaxPub(CL) 0199 (SC), N.K. Wahi v. Shekhar Singh & Ors. in (2007) 9 Supreme Court Cases 481 : 2007 TaxPub(CL) 0217 (SC), National Small Industries Corporation Limited v. Harmeet Singh Paintal & Anr. in (2010) 3 Supreme Court Cases 330 and GHCL Employees Stock Option Trus v. Kranti Sinha in Supreme Court Cases (2013) 4 SCC 505 : 2013 TaxPub(CL) 0542 (SC)

REFERRED : Laxmi Dyechem v. State of Gujarat in (2012) 13 Supreme Court Cases 375 : 2013 TaxPub(CL) 0461 (SC)

FAVOUR : Against the petitioners