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Quashing of 'Cheque Bounce' Complaint Against Director Of Company

In CRIMINAL APPEAL Nos.403­405 OF 2019, A.R. RADHA KRISHNA vs DASARI DEEPTHI, the High Court at Hyderabad had quashed a complaint filed by one AR Radha Krishna 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 were drawn on different dates by the authorised signatory, i.e., M.D. of M/s Dhruti Infra Projects Limited, were returned dishonored.

In the appeal filed by the complainant, the Apex court bench observed that the High Court was not justified in allowing the quashing petitions by invoking its power under S.482, Cr.P.C. The Court decided that 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 that 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 a quashing petition under S. 482, Cr.P.C., 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. The court further observed that, 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, Cr.P.C. only when it is convinced, from the material on record, that allowing the proceedings to continue would be an abuse of process of the Court. Allowing the appeal, the court said:

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