Loan by NBFCs and Cheque Dishonour under Negotiable Instruments Act, 1881

Loan by NBFCs and Cheque Dishonour under Negotiable Instruments Act, 1881 - Inherent Powers of High Court and Scope of S.482 in cases under S.138 of NI Act - Quashing of Complaint in Respect of Offence under S.138 of NI Act, 1881 - Resignation of accused Director of Company - In case of Ravi Dhingra v. State of NCTD [2024] GCtR 3190 (SC) dealing with a case of Negotiable Instruments Act, 1881 and validity of summoning orders, the accused was successful in obtaining relief. The total loan amount in this case was of Rs. 11.75 crores and multiple cheques were issued. In this case, accused company was in garment business and the authorized signatory of the company was made accused. The complainant in this case was an NBFC. When summons were issued, the authorized signatory of accused company filed petition under S.482 of Code of Criminal Procedure before HC but the petition was dismissed. When matter reached Apex Court, Apex Court had quashed the complaint itself. It was held that to maintain a complaint and to frame a charge under Section 138 of the NI Act, 1881 there must be a specific averment against the person concerned that he was in-charge of, and responsible for the company concerned in the matter of conduct of its business. This position is now well settled and is being followed with alacrity. To make a person to stand the trial, in such circumstances, would be nothing but abuse of the process of the Court. Apex Court found the conclusions drawn by Hon'ble Judge Swarana Kanta Sharma in Ravi Dhingra v. State [2023] GCtR 2506 (Delhi) to be unsustainable in law. The argument made before HC in this case was that the accused had resigned from the Company on the date of issuance of cheque.