{"id":222807,"date":"2019-12-04T09:30:46","date_gmt":"2019-12-04T04:00:46","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=222807"},"modified":"2019-12-09T16:34:22","modified_gmt":"2019-12-09T11:04:22","slug":"del-hc-s-138-ni-act-epf-society-facilitating-purchase-of-houses-on-behalf-of-its-members-held-not-liable-for-dishonour-of-cheques-issued-to-the-builder","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2019\/12\/04\/del-hc-s-138-ni-act-epf-society-facilitating-purchase-of-houses-on-behalf-of-its-members-held-not-liable-for-dishonour-of-cheques-issued-to-the-builder\/","title":{"rendered":"Del HC | S. 138 NI Act; EPF society facilitating purchase of houses on behalf of its members held not liable for dishonour of cheques issued to the builder"},"content":{"rendered":"

Delhi High Court:\u00a0<\/strong>Suresh Kumar Kait, J., allowed a petition wherein directions were sought for quashing the complaint case filed against the petitioner under Section 138\u00a0(dishonour of cheque)\u00a0<\/em>read with Sections 141\u00a0(offences by companies)\u00a0<\/em>and 142\u00a0(cognizance of offence)\u00a0<\/em>of the Negotiable Instruments Act, 1881.<\/p>\n

The petitioner- Society, Employees Welfare Fund of the employees of Hindustan Aeronautics Ltd., had issued four cheques for a total sum of Rs 4.1 Crores in favour of the respondent-complainant. According to the complainant, the petitioner had drawn to said cheques in the discharge of legally recoverable debt pursuant to the terms of the MoU\/ Agreement to Sell concerned, however, on presentation of encashment, the subject cheques got dishonoured. The complainant-builder was represented by Nimesh Chib and Siddharth Chaturvedi, Advocates.<\/p>\n

Per contra, Vikas Gupta and Ieshaan Gupta, Advocates, submitted on behalf of the petitioner that the proceeding initiated by the complainant was an abuse of the process of law, and the complaint does not satisfy ingredients of the offence punishable under Section 138 NI Act.<\/p>\n

The High Court noted that the subject cheques were issued by the petitioner-Society on behalf of its individual members to facilitate the transaction in getting their houses constructed by the respondent. Since the individual members of the Society immediately doubted whether the respondent would be able to complete the flats, they did not deposit the amount with the Society and, thus, the cheques issued by the Society got dishonoured.<\/p>\n

Being of the opinion that the petitioner-Society was not liable under Section 138, the High Court observed:\u00a0“It is not disputed that the society was constituted for the welfare of its members who were interested in getting their houses constructed by the respondent. Therefore, the society played a role only to facilitate its members in getting their houses constructed and the society had no liability as per Section 138 NI Act on the date of signing of the MoU.”<\/strong><\/p>\n

It was further opined that even if it is presumed that the said was paid to the respondent as advance money, even then there appeared to be no criminal liability or any liability which was recoverable under provisions of Section 18.<\/p>\n

In such view of the matter, the court allowed the instant petition and quashed the complaint case filed against the petitioner as also all proceedings emanating therefrom. [Employees Welfare Fund v. KRA Infrastructure Developer (P) Ltd., 2019 SCC OnLine Del 11245<\/b><\/a>, decided on 19-11-2019]<\/p>\n","protected":false},"excerpt":{"rendered":"

Delhi High Court:\u00a0Suresh Kumar Kait, J., allowed a petition wherein directions were sought for quashing the complaint case filed against the petitioner <\/p>\n","protected":false},"author":8808,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[33522,2862,38655,38654,23584,37813],"class_list":["post-222807","post","type-post","status-publish","format-standard","hentry","category-casebriefs","category-highcourts","tag-agreement-to-sell","tag-dishonour_of_cheque","tag-employee-welfare-fund","tag-offences-by-companies","tag-section-138-ni-act","tag-section-141-of-ni-act"],"yoast_head":"\nDel HC | S. 138 NI Act; EPF society facilitating purchase of houses on behalf of its members held not liable for dishonour of cheques issued to the builder | SCC Times<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scconline.com\/blog\/post\/2019\/12\/04\/del-hc-s-138-ni-act-epf-society-facilitating-purchase-of-houses-on-behalf-of-its-members-held-not-liable-for-dishonour-of-cheques-issued-to-the-builder\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Del HC | S. 138 NI Act; 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Explained by Tis Hazari Courts","author":"Bhumika Indulia","date":"May 12, 2022","format":false,"excerpt":"Tis Hazari Courts, New Delhi: While addressing a decision revolving around Section 138 of Negotiable Instruments Act, 1881, Sanjay Sharma-II, Additional Sessions Judge-03, upheld the decision of the Trial Court and held that all the ingredients of Section 138 NI Act were fulfilled by the complainant. A criminal appeal under\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Tis-hazari","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":261806,"url":"https:\/\/www.scconline.com\/blog\/post\/2022\/02\/16\/dishonour-of-cheque-8\/","url_meta":{"origin":222807,"position":5},"title":"Can only a sole proprietor be held liable under S. 138 NI Act for dishonour of cheque drawn on account of sole proprietorship concern? Tis Hazari Court decodes","author":"Bhumika Indulia","date":"February 16, 2022","format":false,"excerpt":"Tis Hazari Courts, New Delhi: While deciding a matter under Section 138 of the negotiable Instruments Act, 1881, Devanshu Sajlan, MM-05 (NI Act) reiterated the settled position of law that there is no concept of vicarious liability in case of a sole proprietorship concern since a sole proprietorship concern does\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Tis-hazari","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2018\/08\/Tis-hazari.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]}],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts\/222807","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/users\/8808"}],"replies":[{"embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/comments?post=222807"}],"version-history":[{"count":0,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/posts\/222807\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/media?parent=222807"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/categories?post=222807"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.scconline.com\/blog\/wp-json\/wp\/v2\/tags?post=222807"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}