Delhi High Court
S.G Wines & Anr vs Sab Miller India Ltd. on 16 December, 2024
IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on:16.12.2024
+ CRL.M.C. 5209/2019, CRL.M.A. 38043/2019 & CRL.M.A.
3221/2021
S.G WINES & ANR .....Petitioners
versus
SAB MILLER INDIA LTD. .....Respondent
+ CRL.M.C. 5220/2019, CRL.M.A. 38076/2019 & CRL.M.A.
3397/2021
S.G. WINES & ANR .....Petitioners
versus
SAB MILLER INDIA LTD. .....Respondent
+ CRL.M.C. 5221/2019, CRL.M.A. 38079/2019 & CRL.M.A.
3296/2021
S.G WINES & ANR .....Petitioners
versus
SAB MILLER INDIA LTD. .....Respondent
+ CRL.M.C. 5222/2019, CRL.M.A. 38081/2019 & CRL.M.A.
3399/2021
S.G WINES & ANR .....Petitioners
versus
SAB MILLER INDIA LTD. .....Respondent
+ CRL.M.C. 3396/2022 & CRL.M.A. 14241/2022
S.G. WINES A PARTNERSHIP FIRM THROUGH
ITS PARTNER R. SELVAM & ANR. .....Petitioners
versus
SAB MILLER INDIA LTD. .....Respondent
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Advocates who appeared in these cases:
For the Petitioners : Mr. Aseem Mehrotra & Ms. Deeksha
Mehrotra, Advs.
For the Respondent : Ms. Shivani Tayal & Mr. Sumit Panwar,
Advs.
CORAM
HON'BLE MR JUSTICE AMIT MAHAJAN
JUDGMENT
1. The present petitions are filed under Section 482 of the Code of
Criminal Procedure, 1973 (‘CrPC‘) essentially seeking quashing of
Criminal Complaint Nos. 10977/2018, 10966/2018, 10965/2018,
10967/2018 and 10963/2018 filed by the respondent against the
petitioners for the offence under Section 138 of the Negotiable
Instruments Act, 1881 (‘NI Act‘) read with Section 141 of the NI Act.
2. The petitioners have also challenged the respective summoning
orders in the aforesaid complaints.
3. The brief facts of the cases are that Respondent No.2 (the
complainant company), which is a manufacturer and distributor of
various brands of beer, had entered into a Distribution Agreement
dated 01.04.2016 with Petitioner No.1 (the accused firm) whereby
Petitioner No.1 was appointed as the exclusive distributor for
Respondent No.2 in Puducherry. It is alleged that a sum of
₹1,07,93,057.81/- was due to be paid by Petitioner No.1 against
purchase of beer. In furtherance of the same, multiple cheques were
issued on behalf of Petitioner No.1 to the complainant company which
were returned unpaid with remarks- “ACCOUNT CLOSED”.
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Petitioner No.2 is the partner of Petitioner No.1 firm and the
authorised signatory of the cheques in question.
4. Thereafter, the name of the complainant company was changed
from Sab Miller India Ltd. to M/s. Anheuser Busch Inbev India Ltd.
and fresh certificate of incorporation pursuant to change of name was
issued by the Office of the Registrar of Companies on 28.05.2018.
5. Subsequently, the subject complaints were filed in the month of
June, 2018 in the old name of the complainant company.
6. The learned counsel for the petitioners submitted that the
respective complaints are not maintainable in law as the respondent
company stood merged with Anheuser Bursch Inbev Ltd. before filing
of the complaint. He submitted that the merger took place in May,
2018, however, the complaints were subsequently filed on 08.06.2018
in the old name only.
7. He submitted that as per the Certificate of Incorporation issued
by the Ministry of Corporate Affairs on 28.05.2018, the respondent
ceased to exist in the eyes of law and therefore the complaints were ex
facie not maintainable and the proceedings were non-est in law.
8. He submitted that the respondent had not approached the Court
with clean hands and misled the learned Trial Court by not disclosing
the fact of its merger and the complaints were an abuse of the process
of law.
9. He placed reliance on the judgments in the cases of Munish
Kumar Gupta v. Mittal Trading Co. : 2024 SCC OnLine SC 1732
and S.R. Sukumar v. S. Sunaad Raghuram : (2015) 9 SCC 609. He
submitted that grave prejudice would be caused to the petitioners if the
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amendment of the complaints is allowed after six years as the same
would essentially permit a time barred complaint to be taken on record
as the complaint was filed by a non-existent entity.
10. He submitted that unlike the Companies Act, 1956, the
Companies Act, 2013 has no provision stipulating that the change of
name shall not affect the rights or obligations of the company and that
the legal proceedings which might have been continued or
commenced by or against the company in its former name may be
continued in its new name.
11. He further submitted that the cheques in dispute were issued as
surety and the assertion is corroborated by the Distribution Agreement
between the parties. He submitted that the payments were being made
to the respondent through RTGS.
12. The learned counsel for the respondent submitted that the
application for change in name of the complainant company had
already been preferred by the respondent.
13. He submitted that it is not a case of merger or amalgamation
and only the name of the complainant company had been changed. He
submitted that there are no other legal impediments or consequences
and the present petitions have been filed with the mere purpose of
delaying the trial.
14. He submitted that Section 23(3) of the Companies Act, 1956
clearly provides that the legal proceedings commenced by the
company in its former name may be continued by its new name. He
submitted that in the absence of any new provision to the contrary in
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Companies Act, 2013, the same rationale ought to apply in the present
case as well.
15. He submitted that even otherwise, no prejudice would be caused
by a mere change of name to the petitioners.
ANALYSIS
16. At the outset, it is relevant to note that the inherent jurisdiction
of the Court under Section 482 of the CrPC ought to be exercised
sparingly especially when the matter is at the stage of issuance of
summons as the same has the effect of scuttling the proceedings
without the parties having an opportunity to adduce the relevant
evidence. The Hon’ble Apex Court, in the case of Rathish Babu
Unnikrishnan v. State (NCT of Delhi) : 2022 SCC OnLine SC 513,
adverting to a catena of judgments, had underscored the parameters
for exercising inherent jurisdiction to quash the proceedings at the
stage of the summoning order. The relevant portion of the impugned
order is reproduced hereunder:
“14. The parameters for invoking the inherent jurisdiction of the
Court to quash the criminal proceedings under S.482 CrPC, have
been spelled out by Justice S. Ratnavel Pandian for the two judges’
bench in State of Haryana v. Bhajan Lal [1992 Supp (1) SCC
335 : AIR 1992 SC 604], and the suggested precautionary
principles serve as good law even today, for invocation of power
under Section 482 of the Cr.P.C.
‘103. We also give a note of caution to the effect that the
power of quashing a criminal proceeding should be
exercised very sparingly and with circumspection and
that too in the rarest of rare cases; that the court will not
be justified in embarking upon an enquiry as to the
reliability or genuineness or otherwise of the allegations
made in the FIR or the complaint and that the
extraordinary or inherent powers do not confer an
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arbitrary jurisdiction on the court to act according to its
whim or caprice.’
15. In the impugned judgment, the learned Judge had rightly relied
upon the opinion of Justice J.S. Khehar for a Division Bench
in Rajiv Thapar (supra), which succinctly express the following
relevant parameters to be considered by the quashing Court, at the
stage of issuing process, committal, or framing of charges,
’28. The High Court, in exercise of its jurisdiction under
Section 482 CrPC, must make a just and rightful choice.
This is not a stage of evaluating the truthfulness or
otherwise of the allegations levelled by the
prosecution/complainant against the accused. Likewise, it
is not a stage for determining how weighty the defences
raised on behalf of the accused are. Even if the accused is
successful in showing some suspicion or doubt, in the
allegations levelled by the prosecution/complainant, it
would be impermissible to discharge the accused before
trial. This is so because it would result in giving finality
to the accusations levelled by the
prosecution/complainant, without allowing the
prosecution or the complainant to adduce evidence to
substantiate the same.’
16. The proposition of law as set out above makes it abundantly
clear that the Court should be slow to grant the relief of quashing a
complaint at a pre-trial stage, when the factual controversy is in
the realm of possibility particularly because of the legal
presumption, as in this matter. What is also of note is that the
factual defence without having to adduce any evidence need to be
of an unimpeachable quality, so as to altogether disprove the
allegations made in the complaint.
17. The consequences of scuttling the criminal process at a pre-
trial stage can be grave and irreparable. Quashing proceedings at
preliminary stages will result in finality without the parties
having had an opportunity to adduce evidence and the
consequence then is that the proper forum i.e., the trial Court is
ousted from weighing the material evidence. If this is allowed, the
accused may be given an un-merited advantage in the criminal
process. Also because of the legal presumption, when the cheque
and the signature are not disputed by the appellant, the balance
of convenience at this stage is in favour of the
complainant/prosecution, as the accused will have due
opportunity to adduce defence evidence during the trial, to rebut
the presumption.
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18. Situated thus, to non-suit the complainant, at the stage of the
summoning order, when the factual controversy is yet to be
canvassed and considered by the trial court will not in our opinion
be judicious. Based upon a prima facie impression, an element of
criminality cannot entirely be ruled out here subject to the
determination by the trial Court. Therefore, when the proceedings
are at a nascent stage, scuttling of the criminal process is not
merited.”
(emphasis supplied)
17. In the present case, apart from raising an argument in relation to
the cheques in dispute being given as security, the petitioners have
sought to challenge the complaints essentially on the ground that the
same are not maintainable by virtue of the same being filed in the old
name of the complainant company.
18. It is argued that even though the name of the complainant
company was changed on 28.05.2018, however, the complaints were
subsequently filed in the erstwhile name in June, 2018.
19. The petitioners have placed reliance on the judgments in the
cases of Munish Kumar Gupta v. Mittal Trading Co. (supra) and
S.R. Sukumar v. S. Sunaad Raghuram (supra). This Court considers
it apposite to discuss the said judgments before proceeding further.
20. In the case of Munish Kumar Gupta v. Mittal Trading Co.
(supra), the Hon’ble Apex Court had set aside the order whereby the
concerned High Court had permitted the complainant to amend the
date in the complaint by observing that if such amendment was not
permitted, the same will be fatal to the case of the complainant. In the
said case, the complainant therein had claimed that the error in the
date of the cheque in dispute in the evidence as well as the complaint
was merely typographical in nature. The Hon’ble Apex Court
observed that the date of the cheque is a relevant aspect as the same
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was instrumental in determining whether the issue of notice was
within the time frame as provided under the NI Act and as to whether
there was sufficient balance in the account of the issuer on the date. In
view of the same, it was held that the amendment as sought for was
not justified.
21. In the case of S.R. Sukumar v. S. Sunaad Raghuram (supra),
the Hon’ble Apex Court inter alia considered whether the amendment
to a complaint filed under Section 200 of the CrPC was allowed and if
the order by way of which the amendment was allowed suffered from
any infirmities. The relied upon paragraph of the said judgment is
reproduced hereunder:
“20. In the instant case, the amendment application was filed on
24-5-2007 to carry out the amendment by adding Paras 11(a) and
11(b). Though, the proposed amendment was not a formal
amendment, but a substantial one, the Magistrate allowed the
amendment application mainly on the ground that no cognizance
was taken of the complaint before the disposal of amendment
application. Firstly, the Magistrate was yet to apply the judicial
mind to the contents of the complaint and had not taken
cognizance of the matter. Secondly, since summons was yet to be
ordered to be issued to the accused, no prejudice would be caused
to the accused. Thirdly, the amendment did not change the original
nature of the complaint being one for defamation. Fourthly, the
publication of poem Khalnayakaru being in the nature of
subsequent event created a new cause of action in favour of the
respondent which could have been prosecuted by the respondent by
filing a separate complaint and therefore, to avoid multiplicity of
proceedings, the trial court allowed the amendment application.
Considering these factors which weighed in the mind of the courts
below, in our view, the High Court rightly declined to interfere
with the order passed by the Magistrate allowing the amendment
application and the impugned order does not suffer from any
serious infirmity warranting interference in exercise of jurisdiction
under Article 136 of the Constitution.”
(emphasis supplied)
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22. The petitioners have highlighted that it was held in the said case
that amendment cannot be permitted once cognizance is taken unless
the amendment is of a curable legal infirmity which causes no
prejudice to the other side. In the opinion of this Court, the same will
be an erroneous reading of the aforesaid judgment. While the Hon’ble
Apex Court was weighed by the fact that the Magistrate was yet to
apply its mind on the facts of the case and take cognizance of the
matter, however, the principle enunciated is that proposed amendment
was not a formal one and the same was substantial in nature.
23. In the said case, the Hon’ble Apex Court placed reliance on the
judgment of U.P. Pollution Control Board v. Modi Distillery :(1987)
3 SCC 684 where the amendment of the name of the company was
sought to be made and it was observed that the same was merely a
technical flaw that could be easily cured by calling upon the appellant
therein to make formal amendments. In view of the same, it was noted
that an easily curable infirmity could be cured by means of a formal
application even in absence of any specific provision in the Code. The
relevant portion of the judgment is reproduced hereunder:
“18. Insofar as merits of the contention regarding allowing of
amendment application is concerned, it is true that there is no
specific provision in the Code to amend either a complaint or a
petition filed under the provisions of the Code, but the courts
have held that the petitions seeking such amendment to correct
curable infirmities can be allowed even in respect of complaints.
In U.P. Pollution Control Board v. Modi Distillery [(1987) 3 SCC
684 : 1987 SCC (Cri) 632] wherein the name of the company was
wrongly mentioned in the complaint, that is, instead of Modi
Industries Ltd. the name of the company was mentioned as Modi
Distillery and the name was sought to be amended. In such factual
background, this Court has held as follows: (SCC pp. 659-60, para
6)
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‘6. …The learned Single Judge has focussed his
attention only on the technical flaw in the complaint and
has failed to comprehend that the flaw had occurred due
to the recalcitrant attitude of Modi Distillery and
furthermore the infirmity is one which could be easily
removed by having the matter remitted to the Chief
Judicial Magistrate with a direction to call upon the
appellant to make the formal amendments to the
averments contained in Para 2 of the complaint so as to
make the controlling company of the industrial unit
figure as the accused concerned in the complaint. All that
has to be done is the making of a formal application for
amendment by the appellant for leave to amend by
substituting the name of Modi Industries Limited, the
company owning the industrial unit, in place of Modi
Distillery. … Furthermore, the legal infirmity is of such
a nature which could be easily cured.’
19. What is discernible from U.P. Pollution Control Board
case [(1987) 3 SCC 684 : 1987 SCC (Cri) 632] is that an easily
curable legal infirmity could be cured by means of a formal
application for amendment. If the amendment sought to be made
relates to a simple infirmity which is curable by means of a
formal amendment and by allowing such amendment, no
prejudice could be caused to the other side, notwithstanding the
fact that there is no enabling provision in the Code for
entertaining such amendment, the court may permit such an
amendment to be made. On the contrary, if the amendment sought
to be made in the complaint does not relate either to a curable
infirmity or the same cannot be corrected by a formal amendment
or if there is likelihood of prejudice to the other side, then the court
shall not allow such amendment in the complaint.”
(emphasis supplied)
24. While a bald averment is made that grave prejudice would be
caused to the petitioners if the substitution of the new name of the
complainant company is allowed, however, in the opinion of this
Court, mere use of the old name of the complainant company is not a
relevant aspect as the same is not likely to have any effect on the
merits of the case. No cogent argument is made in relation to how the
change in name will affect the case against the petitioners or as to how
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their defence would be hampered by such a change. It is not the case
of the petitioners that they have established their case in ignorance of
the change in name of the complainant company as the said objection
was raised at a very nascent stage. It is also relevant to note that the
mere change in name does not alter or affect the rights of the
company. Furthermore, the agreement between the complainant
company and the accused company is not disputed. The change of the
name of the complainant company is merely formal in nature and the
same can be easily cured. The same also has no effect on the original
nature of the complaint.
25. It is not disputed that the name ‘Sab Miller India Ltd.’ of the
complainant company was changed to ‘Anheuser Bursch Inbev Ltd.’.
The mere filing of the complaint in the old name appears to be an
oversight for which a party cannot be non-suited and left remediless.
26. The judgment in Munish Kumar Gupta v. Mittal Trading Co.
(supra) is also not applicable to the facts of the present case as the
change sought to be made is not substantial in nature.
27. It is stated that applications have been preferred for substitution
of the authorised representative and change in the name of the
complainant company. The same is seen to have also been allowed in
Criminal Complaint No.10977/2018. The respondent company has
evidently taken appropriate steps to cure the defects in the complaints.
28. It is incumbent on this Court to exercise its inherent jurisdiction
to ensure substantial justice. In light of the same, considering that the
petitioners have failed to show as to how they will be gravely
prejudiced by a mere correction in the name of the company, quashing
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of the criminal proceedings merely on account of a technical error at
this junction, when the signatures on the cheques in dispute have not
been disputed and the claim of the complainant company has not been
adjudicated on merits, would be unmerited and it will frustrate the
ends of justice.
29. However, considering that the complaints have been pending
since the year 2018, this Court considers it apposite to request the
learned Trial Court to expedite the proceedings.
30. In view of the aforesaid discussion, the present petitions are
dismissed in the aforesaid terms.
31. Pending applications also stand disposed of.
32. A copy of this judgment be placed in all the matters.
AMIT MAHAJAN, J
DECEMBER 16, 2024
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