LexMAHINDRA AND MAHINDRA FINANCIAL SERVICES LTD. AND ANR. versus RAJIV DUBEY
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[2008] 16 S.C.R. 1186 A MAHINDRA AND MAHINDRA FINANCIAL SERVICES LTD. .. AND ANR. II. RAJIV DUBEY (Criminal Appeal No. 1966 of 2008) B DECEMBER 4, 2008 [DR. ARIJIT PASAYAT AND DR. MUKUNDAKAM _., SHARMA, JJ.] I \ c Code of Cfiminal Procedure, 1973 - s. 482 - Cheques towards instalment issued to accused company against hire- purchase finance - Cheques on presentation dishonoured - Accused initiating proceedings u/s 138 of Negotiable Instruments Act - Complaint by guarantor of the ioan that D presentation of chequf1 amounted to breach of trust as they were presented despite the FJntire money having been paid through demand draft as agreed between the parties - Initiation of proceedings uls 406 and 420 /PC - Quashing of the proceedings - Sought - RejeGted by High Court - On E appeal, held: In the facts of the case, the offences complained are not made out - The complaint apparently shows that it was with ulterior motive and thus amounted to abuse of the process of law- Penal Code, 1860 - ss.406 and 420. F The respondent filed a complaint as the Managing Director of a Finance Company u/ss.406, 420, 294, 506/ 34 IPC. He alleged hat respondent availed hire-purchase r finance from the appellant No.1 - accused company in respect of a vehicle. Tough he had· given cheques for payment of instalments in favour of the appellant - G company, but an agreement was executed between the parties that appellant company shall not present the ;._ cheque, and the payment shall be made through demand drafts. Despite the entire amount; having paid by demand drafts, ctppellant-company did not return the cheques and H 1186 ; MAHINDRA AND MAHINDRA FINANCIAL SERVICES LTD. ~187 AND ANR. v. RAJIV DUBEY presented the same with the bank. Judicial Magistrate A took cognizance of the offence punishable u/ss.406 and 420 IPC. Petition u/s 482 Cr.P.C. by the appellant-accused was dismissed by High Court. In appeal to this Court appellant-accused stated that 8 several tripartite loan agreements were signed and loans were disbursed to the customers directly by the appellant to which the respondent was a guarantor. As per1the agreement the respondent was required to open a separate bank account and deposit all post dated instalment cheques received from the customers. It was C also required to reimburse the default in payment by the customer. Appellants when presented the cheques. the same were dishonoured. Hence, proceedings u/s 13B of Negotiable Instruments Act, 1881 was initiated. Appellant contended that the complaint was as a counter blast to D the proceedings u/s 138 of Negotiable Instruments Act. Allowing the appeal, the Court HELD: It is not in dispute that the proceedings under . E Section 138 are pending. That being so, the question of proceeding for alleged breach of trust does not arise. The respondent does not dispute issuance of cheques. Even a casual reading of the complaint does not show tha' the F . ingredients of Section 406 IPC are in any event made 'out It is also not understandable as to how Section 294 has any application to the facts of the case much less Section 506 IPC. In addition to this, perusal of the complaint apparently shows the ulterior motive. It is clear that the proceeding initiated by the respondent clearly amounted to abuse of the process of law. The criminal proceeding G is manifestly attended with ma/a fide 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 gru~ge. [Para 16 and 17] (1192-E, F, G; 1194-D-E] H A B 1188 SUPREME COURT REPORTS [2008] 16 S.C.R. State of Haryana v. Bhajan Lal AIR 1992 SC 604, relied on. Case Law Reference: AIR 1992 SC 604 Relied on. Para 17 CRIMINAL APPElLA TE JURISDICTION : Criminal Appeal No.1966 of 2008. From the final Judgment and Order dated 20.6.2006 of the High Court of Orissa at Cuttack in Crl. M.C. No. 6246 of 2001. c Mukul Rohtagi, Prashant Kumar, Triveni Potekar, Manoj, Vandana and Chander Shekhar Ashri for the Appellants. V. Shekhar, Manoj Aparna Sinha and Abhijat P. Medh for 0 the Respondent. E The Judgment of the Court was delivered by DR. ARIJIT PASAYAT, J. 1. Leave granted. 2. ChaHenge in this appeal is to the judgment of a learned Single Judge of the Orissa High Court declining to interfere with the order passed by learned SDJM, Bhubaneshwar in ICC 21
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