EVEREST ADVERTISING PVT. LTD. versus STATE, GOVT. OF NCT OF DELHI AND ORS.

Citation: [2007] 4 S.C.R. 1055 · Decided: 10-04-2007 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

EVEREST ADVERTISING PVT. LTD. 
A 
v. 
STA TE, GOVT. OF NCT OF DELHI AND ORS. 
APRIL I 0, 2007 
[S.B. SINHA AND MARKANDEY KA TJU, JJ.] 
B 
Code of Criminal Procedure, 1973-Recal/ing of erroneous order of 
issuance of summons-Jurisdiction of Magistrate-Held: Magistrate has no 
jurisdiction to recall such order-Magistrate does not have inherent C 
jurisdiction. 
Negotiable Instruments Act, 1881-s.141-Dishonour of cheque issued 
by Company---Gomp/aint against the Company as well as Chairman and 
Managing Director thereof-Payment of the amount through cheque made 
after meetings in which the Chairman and Managing Director participated- D 
They also participated in negotiations as a result of failure to niake payment-
Jssuance of summons to the Chairman & Managing Director-Recalled on 
the ground that complaint did not satisfy requirements of s.141-Held: 
Recalling of order issuing summons not correct as in the facts of the case 
ingredient of the provisions of s.141 stand satisfied-Code of Criminal 
Procedure, 1973-s.204. 
E 
Appellant-Company filed a complaint under Negotiable Instruments Act 
against a company (accused company) and its Chairman and Managing 
Director (respondent nos. 2 and 3 respectively), as the cheques issued by the 
Company were dishonoured. The Magistrate issued summons against the 
accused persons in terms of s.204 Cr.PC. On application, Magistrate recalled F 
order issuing summons against respondent nos. 2 and 3. High Court 
confirmed the order of Magistrate. Hence the present appeal. 
Allowing the appeal, the Court 
HELD: 1. Summons were issued by the Magistrate by way of an order. G 
He recalled the said order. He did not have any jurisdiction in that behalf. A 
Magistrate does not have and, thus, cannot exercise any inherent jurisdiction. 
[Para 10) [1059-E-F) 
1055 
H 
1056 
SUPREME COURT REPORTS 
(2007] 4 S.C.R. 
A 
Ada/at Prasad v. Roop/al Jindal and Ors., (2004) 7 SCC 338; 
Subramanium Sethuraman v. State of Maharashtra and Anr., JT (2004) 8 SC 
220 and N. K. Sharma v. Abhimanyu, [2005) 13 SCC 213, reljed on. 
2. Not only cheques were issued having regard to the huge amount 
payable by Accused No. 6 to the Company but also as a result of fall out of 
B non-payment thereof, negotiations were held between the parties wherein 
Respondent Nos. 2 and 3 took part, and, thus, there cannot be any doubt that 
the ingredients of the provisions of Section 141 of Negotiable Instruments 
Act stand satisfied. [Para 25) (1065-G) 
C 
S.MS. Pharmaceuticals Ltd v. Neeta Bhalla and Anr., [2005) 8 SC 89 
and Saro) Kumar Poddar v. State (NCT of Delhi) and Anr., (2007) 2 SCALE 
36, relied on. 
D 
Pepsi Foods Ltd And Anr. v. Special Judicial Magistrate and Ors., 
(1998) 5 sec 749, distinguished. 
S.MS. Pharmaceuticals Ltd v. Neeta Bhalla and Anr., (2007) 3 SCALE 
245 and N.K Wahi v. Shekhar Singh and Ors., [2007) 4 SCALE 188, referred 
to. 
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 520 of 
E 2001. 
From the Judgment and Order dated 13.07.2005 of the High Court of 
Delhi in Criminal M.C. Nos. 3690 and 3691 of2001. 
Aloke Kumar Sengupta, Suraj Prakash and Dr. Kailash Chand for the 
F Appellant. 
G 
H 
K.T.S. Tulsi, Aman Leekha, Umesh Kumar Khaitan, Ashu Kansai, Samir 
Ali Khan and Anil Katiyar for the Respondent. 
The Judgment of the Court was delivered by 
S.B. SINHA, J. l. Leave granted. 
2. This appeal is directed against a judgment and order dated 13.07.2005 · 
passed by a learned Single Judge of the Delhi High Court in Criminal M.C. 
Nos. 3690 and 3691 of2001. 
) ' 
EVEREST ADVERTISING PVT.LID. 1•. STATE,GOVT.OFNCTOFDELlil[S.B.SINHA,J.] 1057 
3. Respondent Nos. 2 and 3 herein are Chainnan and Managing Director A 
of a Company known as 'Dalmia Industries Ltd.', (The Company) which is 
registered and incorporated under the Companies Act, 1956. It was arrayed 
as Accused No. 6 in the complaint petition. 
4. The Company is engaged in the business of advertising and publicity. 
By an agreement dated 17.07.1995, the Company as also Accused No. 6 B 
entered into an agreement in tenns whereof the Company was appointed as 
advertising and publicity agents of Accused No. 6 in respect of their various 
products on the tenns and conditions contain~d therein. Allegedly, the 
Company carried out various jobs and releases between the period July, 1997 
and December, 1997. It raised bills to the extent of Rs. 2,59,21,053.37 for the C 
work executed by it. On 14.11.1997, Accused No. 6 issued various post dated 
che
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