BIJAY AGARWAL versus M/S MEDILINES

BIJAY AGARWAL versus M/S MEDILINES

Held that merely because an officer of a company is the authorised signatory of the cheque, that alone does not make such an officer the 'drawer' of the cheque for the purposes of Section 148 of the Negotiable Instruments Act, 1881; consequently an Appellate Court cannot direct such an authorised signatory to deposit any sum under Section 148(1) as a condition for suspension of sentence without considering whether exceptional circumstances exist; the High Court order imposing a 20% deposit was set aside and the orders suspending sentence restored subject to bond execution.

Parties
Appellant: Bijay Agarwal; Respondent: M/s Medilines
Jurisdiction
India
Judgment Date
21 October 2024
Procedural Posture
Criminal Appeal / Special Leave Appeal Against High Court Order Challenging Condition to Deposit Under Suspension of Sentence
Outcome
Appeals allowed
Legal Topics
Section 138 NI Act, Section 143 a NI Act, Section 148 NI Act, Authorized Signatory Vs Drawer, Suspension of Sentence, Interim Compensation
Criminal Law Negotiable Instruments Act, 1881 Section 138 NI Act Section 143 a NI Act Section 148 NI Act Authorized Signatory Vs Drawer Suspension of Sentence Interim Compensation

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Parties

Bijay Agarwal

Appellant

M/s Medilines

Respondent

Procedural Posture

Criminal Appeal / Special Leave Appeal Against High Court Order Challenging Condition to Deposit Under Suspension of Sentence

Legal Issues

  1. 1 Whether an authorised signatory of a company is the 'drawer' of the cheque for purposes of Sections 143A and 148 of the Negotiable Instruments Act, 1881
  2. 2 Whether an appellate court can direct an appellant to deposit a sum under Section 148(1) when the appellant is only an authorised signatory and not the drawer, as a condition for suspension of sentence

Ratio Decidendi

Held that merely because an officer of a company is the authorised signatory of the cheque, that alone does not make such an officer the 'drawer' of the cheque for the purposes of Section 148 of the Negotiable Instruments Act, 1881; consequently an Appellate Court cannot direct such an authorised signatory to deposit any sum under Section 148(1) as a condition for suspension of sentence without considering whether exceptional circumstances exist; the High Court order imposing a 20% deposit was set aside and the orders suspending sentence restored subject to bond execution.

Court Disposition

Appeals allowed

Orders

  • Impugned common order dated 09.01.2024 of the High Court of Karnataka at Bengaluru is set aside.
  • Orders dated 10.11.2023 passed by the Principal City Civil & Sessions Judge, Bangalore are quashed and set aside to the extent they put the condition to deposit 20% of the fine/compensation amount payable under orders in C.C. Nos.13937/2013 and 13938/2013.