[Malafide Litigation] Madras HC | Proceedings under S. 420 IPC quashed for being counterblast to complaint instituted under S. 138 NI Act

Madras High Court: G.K. Ilanthiraiyan, J., allowed a criminal original petition and quashed the proceedings in a criminal case filed against the petitioner.

Instant petition was filed to quash the proceedings pending on the file of Judicial Magistrate having been taken cognizance for the offences under Section 420 of Penal Code, 1860.

Respondent lodged a private complaint alleging that the complainant was running a proprietorship concern in the name and style of M/s RSR Egg Centre along with poultry farms at Namakkal District.

Respondent approached the petitioners for the supply of animal feeds and the same was agreed and animal feeds were supplied to the respondent. In the normal course of business transaction between the petitioners and the respondent, for the purpose of holding out security as against the feeds supplied by the petitioners, the respondent issued two cheques for security purpose.

Further, in the year 2017, feeds supplied by the petitioners were not standard one and therefore the respondent issued stop payment in respect of the cheques issued to the petitioners.

In order to take further action as against the petitioners, the respondent lodged complaint before the District Crime Branch, Namakkal and after the direction issued by the Judicial Magistrate under Section 156(3) CrPC, the case was registered for the offences under Sections 23, 409, 415 and 420 IPC as against the petitioners.

Towards liability of purchase, the respondent issued cheques for the said sum. Thereafter, the respondent stopped payment and as such both the cheques were returned dishonoured. After issuance of statutory notice, the petitioners initiated proceedings for the offences punishable under Section 138 NI Act.

Bench stated that the private complaint lodged by the respondent was nothing but counter blast to the proceedings initiated by the petitioners.

“…impugned complaint is manifestly attended with malafides and / or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.”

Hence while allowing the present petition, Court held that  “the continuance of the impugned proceedings will be nothing but abuse of process of law and as such the petitioners need not go for the ordeal of the trial since the complaint itself cannot be sustained as against the petitioners.” [M. Chandrasekar v. R. Rajamani, 2020 SCC OnLine Mad 4777, decided on 24-08-2020]

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