Criminal Law – Section 138 of the N.I. Act – Issuance of Security Cheques – Legal Enforceability:
Petitions filed to quash criminal proceedings under Section 138 of the Negotiable Instruments Act – Cheques issued by petitioners as security for employment contracts – Petitioners argued no legally enforceable debt existed at the time of issuance – Respondents contended cheques were dishonored due to breach of contract terms – High Court held the relevant date for determining enforceability is the date of presentation – Cheques issued as security can attract Section 138 if liability exists at the time of presentation [Paras 1-20].

Contractual Obligations and Security Cheques – Burden of Proof:
Petitioners argued cheques were not for discharge of debt but as indemnity against future losses – Court observed that legal liability on the date of presentation suffices for Section 138 – Burden on the drawer to rebut presumption of liability under the Act – Arguments about invalid contracts and lack of enforceability to be examined during trial, not at the quashing stage [Paras 10-12, 20].
Decision: Petitions dismissed – Criminal proceedings under Section 138 N.I. Act to continue – Trial court directed to expedite proceedings given the pendency since 2017 – Petitioners allowed to present evidence and challenge the enforceability of the alleged debt during trial [Paras 21-22].
 

Companies Act Offense Jurisdiction – Cognizance of offenses under Section 447 of the Companies Act, 2013, can only be taken based on a complaint made by the Director, Serious Fraud Investigation Office (SFIO), or an authorized Central Government officer, not on a private complaint – Complaint under Section 447 by a shareholder held not maintainable on jurisdictional grounds. [Paras 22-29]

Limitation Period Application – For offense under Section 185 of the Companies Act, punishable by up to six months or fine, the limitation period under Section 468(2)(b) Cr.P.C. is one year – Complaint filed in 2017 for alleged offenses during 2002-2008 deemed time-barred. [Paras 30-34]

Continuing Offense Consideration – Section 452 of the Companies Act treated as a continuing offense, where wrongful withholding of company property continues to be an offense as long as the act persists – Not barred by limitation as each day’s continuation of wrongful act resets the limitation period. [Paras 36-41]

Conspiracy and Joint Trial Impact on Limitation – Cognizance for offenses under Sections 185 and 452 along with Section 120B IPC is permissible, but separate consideration of limitation periods for each offense necessary – Conspiracy under Section 120B not independently chargeable from the corporate offenses without specific SFIO or authorized complaint. [Paras 42-53]

Decision: Orders summoning petitioners for offenses under Sections 185/447 of the Companies Act read with Section 120B of the IPC set aside due to lack of jurisdiction and lapse of limitation period.

Order under Section 452 of the Companies Act upheld as a continuing offense not barred by limitation.

Liberty granted to respondent no.2 to move an application under Section 473 of the Cr.P.C. before the trial court to seek an extension of the period of limitation for offense under Section 185, if permissible by law. [Paras 55-58]

Recognition of Bar Associations – Administrative Discretion – The petitioner challenged the Bar Council of Madhya Pradesh's refusal to recognize a separate Bar Association – The court noted the resolutions of the State Bar Council allowing only one recognized Bar Association at any given place where the High Court is located – Emphasized the intent to avoid multiplicity of associations for better administration and welfare schemes [Paras 1-7, 38-41].

Welfare and Administrative Consistency – The petitioner's claim was based on the need for separate recognition to access welfare benefits – The court observed that all members of the petitioner association were already members of the existing recognized associations, ensuring no deprivation of benefits – Highlighted the administrative convenience and unity in having a single recognized association per place [Paras 8-14].

Judicial Review and Procedural Propriety – The court applied the principles of judicial review, finding no illegality, irrationality, or procedural impropriety in the State Bar Council's decision – Referenced the doctrines of Wednesbury unreasonableness and proportionality – Found that the decision was within the discretion of the Bar Council and did not warrant interference [Paras 53-57].

Decision: The writ petition was dismissed – The court upheld the State Bar Council's decision not to grant separate recognition to the petitioner association – Emphasized the importance of a single recognized Bar Association for effective administration and welfare of advocates [Para 60].

Public Interest Litigation (PIL) – Allotment of Premises in High Court Campus – Challenge to Allotment Procedure – High Court's Decision on Lack of Transparency and Legal Entity Recognition – Examination of Procedural Compliance and Discretionary Power

Public Interest Litigation – Maintainability – Writ Petition filed by Advocate challenging allotment of premises to unrecognized Bar Association – High Court held petition maintainable as PIL – Found absence of transparent and objective criteria in allotment process – Consideration of discrimination and violation of Article 14 [Paras 1, 113].

Administrative Discretion – Allotment of Public Property – Chief Justice's Prerogative – Examination of Discretionary Power in Absence of Policy or Procedure – High Court held lack of transparency and fairness in allotment to Madhya Pradesh High Court Advocates Bar Association – Cancellation of Allotment – Requirement of adherence to principles of justice and equity in administrative decisions [Paras 13, 63, 83, 107, 112].

Recognition of Bar Associations – Legal Entity Status under Advocates Act, 1961 – High Court upheld State Bar Council's decision to deny recognition to Madhya Pradesh High Court Advocates Bar Association – No entitlement to claim facilities without recognition – Affirmation of the principle 'One Bar One Vote' – Implications on legal status and entitlements of Bar Associations [Paras 2, 6, 11, 61, 112].

Judicial Review – Examination of Administrative Decisions – Application of Wednesbury Test – High Court found absence of objective criteria, transparency, and fairness in decision-making process – Emphasized the need for rules and procedures in allotment of public property to ensure non-arbitrariness and equality [Paras 66, 92, 106, 111].

Decision – Revocation of Allotment – Held – Allotment of space to Madhya Pradesh High Court Advocates Bar Association was arbitrary, lacked transparency and violated principles of natural justice – Allotment cancelled and premises directed to be made available to recognized Bar Associations in compliance with established procedures and equitable principles [Paras 112-114].

Criminal Procedure - Petition to quash proceedings under Sections 3 to 5 of the Immoral Traffic (Prevention) Act and Section 370(A)(2) of IPC - Petitioner, accused as a customer in a brothel raid, seeks relief citing non-applicability of charges - Analysis hinges on distinctions between customers and traffickers/exploiters in law - Court distinguishes roles based on previous judgments and specifics of the legislative intent behind cited laws - Proceedings under Sections 3 to 5 of the Immoral Traffic (Prevention) Act quashed, but those under Section 370(A)(2) of IPC to continue [Paras 1-17].

Criminal Law – Dishonor of Cheque – Cheques issued as security under employment contracts – Petitioners sought quashing of criminal proceedings under Section 138 of the Negotiable Instruments Act, arguing no subsisting legal debt or liability at the time of the cheque issuance – High Court held proceedings should continue as the question of the validity of contracts and enforceability of debt on the date of cheque presentation to be determined at trial – Petitions dismissed. [Paras 1-22]

Contract Law – Security Cheques and Legally Enforceable Liabilities – Analysis focused on whether the cheques issued as security without a specific date could establish a legally enforceable debt under Section 138 when no such debt existed at the time of contract formation. The court referenced Supreme Court judgments clarifying the need for a legally enforceable debt or liability at the time of the cheque's presentation, not just at issuance, to sustain a criminal complaint under Section 138 [Paras 10-19].

Judicial Procedure – Role of Trial Court in Determining Contract Validity and Enforcement – The High Court emphasized that the validity of contracts and the existence of enforceable liabilities should be adjudicated at the trial level where evidence can be fully examined. The decision highlighted the trial court's responsibility to assess whether the terms of the employment contracts and the subsequent issuance and dishonour of cheques constituted a breach under the stipulated conditions [Paras 11-12, 20].

Decision – Dismissal of Petitions to Quash Proceedings – The High Court dismissed the petitions, ruling that issues concerning the enforcement of contracts and the applicability of Section 138 N.I. Act are matters for trial consideration. The court instructed the trial court to expedite proceedings given the long duration since the filing of the original complaints [Paras 21-22].

Civil Procedure – Filing of Written Statements – Order 8, Rule 1 CPC – Mandatory Time Limit – Petition challenging trial court orders accepting late filed written statements – Defendants filed written statements beyond the prescribed 120 days from the date of service of summons – Plaintiff argued that such acceptance violates mandatory provisions of Order 8, Rule 1 CPC.

Exclusion of Limitation Period – Supreme Court’s Directions – Covid-19 Pandemic – Applicability – Defendant No.1’s written statement accepted within extended period due to Covid-19 directions issued by Supreme Court in Cognizance for Extension of Limitation – Directions excluded period from 15.03.2020 to 28.02.2022 – Defendant No.1’s written statement filed on 28.05.2022 held within time – Held – Trial court correctly applied Supreme Court’s directions. [Paras 8-14]

Waiver of Right – Concession by Plaintiff’s Counsel – Defendant No.2’s written statement – Plaintiff’s counsel conceded no objection to late filing – Concession held as waiver of right accrued to plaintiff due to default by Defendant No.2 – Held – Statutory right under Order 8, Rule 1 CPC can be waived by conduct – Plaintiff’s subsequent challenge to acceptance of written statement rejected. [Paras 17-19]

Costs – Non-Payment of Costs – Acceptance of Written Statements – Defendant No.2 offered costs as directed by trial court – Plaintiff’s refusal to accept costs not attributed to default by Defendant No.2 – Held – No ground to reject written statement for non-payment of costs – Costs offer compliant with court’s directive. [Para 20]

Decision – Dismissal of Petition – Court found no perversity or illegality in trial court’s orders – Petition dismissed – Interim directions vacated. [Paras 21]

Constitutional Law – Challenge to Telangana State Judicial Services Rules, 2023 – High Court upholds constitutionality of Rule (5.2) (A) prescribing age and marks criteria for selection of judicial officers – Challenge to maximum age limit of 26 years and marks criteria for open category (60%) and reserved categories (55%) – Court follows previous decisions and Supreme Court precedents to uphold rules [Paras 1-13].

Age and Marks Criteria – Petitioners challenged maximum age limit of 26 years and marks criteria for judicial service recruitment – Court held age and marks criteria valid, finding them consistent with objectives of ensuring quality in judicial appointments – Court referred to previous judgments and Supreme Court rulings supporting such criteria to maintain high standards in judicial services [Paras 3-10].

Provincialism and Bar Association Certificate – Rule restricting eligibility to advocates practicing in Telangana and requiring Bar Association Certificate – Challenge on grounds of provincialism and procedural unfairness – Court upheld rules, citing administrative policies and objectives of maintaining local relevance and ensuring proper certification of candidates [Paras 4-5].

Evidence from Previous Judgments – Court heavily relied on principles and precedents set in earlier judgments, including Devanch Kaushik v. State of Madhya Pradesh and All India Judges’ Association v. Union of India – Emphasized judicial discretion in setting eligibility criteria and maintaining high standards for judicial appointments [Paras 10-11].

Decision – Dismissal of Petitions – Held – The writ petitions are dismissed – Court affirmed validity of Telangana State Judicial Services Rules, 2023, upholding the age and marks criteria, and eligibility conditions for judicial appointments in Telangana [Para 13].

Bail – Criminal Law – Bail Jurisprudence – Petitioners accused of offences under Sections 420, 406, and 120-B IPC, sought bail under Section 439 Cr.P.C. Contended that offences are triable by a Court of Magistrate, no case made out against them, and their incarceration is unwarranted. Argued that co-accused had already been granted bail and petitioners' cases are not distinguishable.

Grant of Bail – Judicial Discretion – Court reiterated bail jurisprudence, emphasizing discretion vested in Magistrates for offences triable by them. Highlighted that prolonged detention without trial completion infringes on rights and goes against reformative justice principles. Court found no legal impediment to grant bail to petitioners, given no significant adverse factors against them. [Paras 1-28]

Decision – Bail Granted – Petitions allowed. Petitioners ordered to be enlarged on bail on furnishing personal bonds and sureties as stipulated. Court underscored parity with co-accused and judicial consistency as grounds for decision. [Paras 5-6]