Quashing of Cheque Bounce Complaints against Director
Introduction To Quashing Of Check Bounce
The Apex court of India said that the complaint of cheque bounce can be quashed against the director of the company provided that court is satisfied that the director was not in-charge of the company when the matter came into question. The above-said pre-requisites are necessary in order to file a complaint of the cheque bounce against the director of the company. But only when he has been responsible for the act or he has been in charge of the company during the happening of the event.
Facts of the Case:-
The Supreme Court looked into the matter which came during the appeal. The appeal was of the judgment of the Telangana High Court and the State of Andhra Pradesh where HC in its order quashed the complaint against the director of the company. They were accused of the dishonouring of the cheque. The Apex Court was of the view that in order to quash the complaint against the director of the company the court must have the knowledge that the director was not responsible for the check bounce.
The High Court had quashed a complaint which was filed against the directors of the company. The complaint was filed after six cheques for Rs.25, 00,000 each and one cheque for Rs.30, 00,000 was drawn on different dates by the authorised signatory. It was signed by M.D. of M/s Dhruti Infra Projects Limited and were returned dishonoured. In the appeal filed by the complainant, the Apex court has said that the High Court was not justified in allowing the quashing petitions by invoking its power under S.482, CrPC.
Views of the Court
The bench in this case of A.R. Radha Krishna v. Dasari Deepthi consisted of Justice NV Ramana, Justice Mohan M. Shantanagoudar and Justice Indira Banerjee has said that we are of the considered opinion that the High Court was not justified in allowing the quashing petitions. It invoked its power under S.482, CrPC. In a case pertaining to an offence under S. 138 and S. 141 of the Act. The law requires that the complaint must contain a specific averment the Director was in charge of, and responsible for, the conduct of the company’s business at the time when the offence was committed.
The High Court, in deciding to quash a petition under S. 482, CrPC. must be careful. It must consider whether the averment made in the complaint is sufficient or if some unimpeachable evidence has been brought on record which leads to the conclusion that the Director could never have been in charge of and responsible for the conduct of the business of the company at the relevant time. While the role of a Director in a company is ultimately a question of fact, and no fixed formula can be fixed for the same, the High Court must exercise its power under S. 482, CrPC. when it is convinced, from the material on record, that allowing the proceedings to continue would be an abuse of process of the Court. The court also referred the case of Gunamala Sales Private Limited v. Anu Mehta and Ors.”
Observations of the Court
Court also pointed out that the complaint specifies that all the accused, in active connivance, mischievously and intentionally issued the cheques in favour of the appellant and later issued instructions to the Bank to “Stop Payment”. No evidence of unimpeachable quality has been brought on record by the respondents to indicate that allowing the proceedings to continue would be an abuse of process of the court.
In conclusion, the court said that the instant appeals are allowed. The High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh passed the impugned order in Criminal Petition that is set aside and order of the trial court is restored. The court also said that they make it clear that they have not expressed any opinion on the merits of the case. The case is pending before the trial court. The trial court will adjudicate the matter on its own merits uninfluenced by any of the observations made herein.
 CRIMINAL APPEAL Nos.403405 OF 2019.
 (2015) 1 SCC 103.