Law: Criminal Procedure Code (V of 1898)

Section: 22-A,22-B

Law: Penal Code (XLV of 1860)

Section: 489-F

Criminal Procedure Code (V of 1898)--- ----Ss. 22-A & 22-B---Penal Code (XLV of 1860), S. 489-F---Cheques issued as security---Ex-officio Justice of Peace, powers of---Scope---Petitioner-Company assailed the order passed by Justice of Peace whereby he had declined the request for issuance of direction for registration of FIR---Contention of petitioner was that the accused persons had provided three cheques for payment of outstanding amount which were dishonoured when presented---Ex-officio Justice of Peace dismissed the petitioner's application under S. 22-A, Cr.P.C. holding that respondent gave the cheque by way of security, thus S. 489-F, P.P.C., did not apply to such cheques---Validity---In its application under S. 22-A, Cr.P.C., before the Ex-officio Justice of Peace, the petitioner stated that it did business with a company and Rs.15.00 million became outstanding against it over time---Said company's directors, i.e. respondents Nos.1 and 2, issued three cheques for Rs.5.00 million each to settle the liability, but these were dishonoured on presentation---However the petitioner's pleadings before the High Court, indicated that it received the said cheques as security under a distribution agreement---Respondents Nos.1 and 2 had submitted documents proving that reality---Most importantly, the petitioner admitted them---Since the petitioner's plea, which it took in the application under S. 22-A, Cr.P.C., was negated, present petition was liable to be dismissed on that short ground---Admittedly, the petitioner and the company of which the respondents were directors, never settled their accounts---However, there was a dispute between the two and the latter had a claim against it for Rs.100,439,515/-, which was currently under litigation---As per record, respondent No.1 issued one of the cheques on 13.5.2019, while respondent No.2 issued the other two cheques on 25.1.2020 and 2.7.2020, respectively, and there was no final liability of the respondents' company on those dates or when the petitioner presented them---Said cheques were also not the outcome of any specific transaction---True, that one of the clauses of the distribution agreement allowed the…

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