Section 138 of n.i.act

Querist : Anonymous (Querist) 07 December 2011 This query is : Resolved
A company borrowed money from another Company.
A borrower company gave a cheque towards payment of its dues, which got bounced. The borrower company did not give any reply to the notice sent by the lender company / complainant.
The lender company filed a complaint u/s. 138 N.I.Act.
The lender company has also filed a separate petition for winding up, on the ground that the borrower company is unable to pay its debts.
In the meanwhile, the Borrower Company has filed a suit against the complainant for recovery of money on appropriate facts, reasons and grounds. According to the Suit, the lender company (complainant) has to pay the borrower company after adjusting the amount due from the borrower.

In these circumstances:

(1) Whether the borrower company can take the same defence in the 138 case and ask the Magistrate to stay the proceedings?

OR

(2) Whether the borrower company has to file a petition before the High Court seeking stay of the proceedings in the complaint case u/s. 138 N.I. till such time the recovery suit filed by it gets finalised?

Experts may please guide and also cite Supporting Case laws if any.

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DEFENSE ADVOCATE.-firmaction@g (Expert) 07 December 2011
criminal case NI 138 will not be stayed. This you have to fight on technical grounds if you want to escape conviction.

civil suits will be entirely different matters.

K S GOSWAMI, Advocate (Expert) 07 December 2011
There is no law that only civil or criminal remedy should be exhausted at one and that these two proceedings can not simultaneously. So both these proceedings can run concurrently and the accused has no defence or remedy for getting stay on the criminal case.

Shonee Kapoor (Expert) 07 December 2011
No. 138 would proceed, civil case would take its own course.

Regards,

Shonee Kapoor
harassed.by.498a@gmail.com

Devajyoti Barman (Expert) 07 December 2011
Yes I agree.

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