M/S SRI KRISHNA AGENCIESversusSTATE OF A.P. & ANR.

      SRI KRISHNA AGENCIES v. STATE OF A.P. & ANR.                21


       0. Bharathi Reddy and Shekhar G. Devasa (for Dinesh              A
    Kumar Garg) for the Respondents.

        The following Order of the Court was delivered :

                                 ORDER
                                                                        B
         1. Leave granted.

        2. This appeal is directed against the judgment and order
    dated 24th September, 2007, passed by the Andhra Pradesh
    High Court in Criminal Petition No. 4508 of 2007 quashing the
    proceedings, being C.C. No. 982 of 2005, on the file of the llnd
                                                                        c
    Additional Chief Metropolitan Magistrate, Hyderabad, under
    Section 138 of the Negotiable Instruments Act, 1981 (for short
    the Act) in exercise of powers under Section 482 of the Code
    of Criminal Procedure.
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        3. As would appear from the complaint, the same was filed
    on account of stop payment orders issued with regard to three
    cheques of Rs. 5 lakhs each.

         4. Before the High Court, it was sought to be contended        E
    on behalf of respondent No. 2 that since the appellant herein
    had already taken recourse to arbitration proceedings, the
    dispute was obviously of a civil nature and the criminal
    complaint could not be proceeded with. Accepting the
    statements made on behalf of respondent No. 2, the High Court
"   quashed the complaint as indicated hereinabove.                     F

           5. Mr. Adhyaru, learned senior counsel appearing in
     support of the appeal, submitted that the High Court has
     apparently confused the issue relating to the continuance of the
     afbitration proceedings as also the criminal proceedings, since    G
     when the cheques were dishonoured, a separate liability arose
    :1r\ terms of Section i 38 of the Act, whereas the arbitration
     proceedings were under the agreement signed between the
     parties. It was submitted by him that the commencement and
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    22       . SUPREME COURT REPORTS              [2008] 16 S.C.R.


A the continuance of the arbitration proceedings could in no way
  affect criminal proceedings taken separately.

       6. In support of his submissions, Mr. Adhyaru, referred to
  the decision of this Court in Trisuns Chemical Industry vs.
  Rajesh Agarwal and Ors., (1999) B sec 686, where the same
B                                                                              1·
  question arose in relation to arbitration proceedings taken
  during the continuance of a complaint filed under Sections 415
  and 420 of the Code of Criminal Procedure. In. the said
  decision, it was held that merely. because arbitration
  proceedings have been undertaken, the criminal proceedings
c could not be thwarted. :
       7. On behalf of respondent No. 2, the submissions which
  had been urged before the High Court, were reiterated, which,
  however, appears to be unacceptable having regard to the
                                                                           y
D decision cited by Mr. Adhyaru. We are also of the view that there
  can be no bar to the simultaneous continuance of a criminal
  proceeding ·and a civil proceeding if the two arise from separate
  causes of action. The decision in Trisuns Chemical/ndustry's ·.
  case (supra) appears to squarely cover this case as well.
E       8. We, accordingly, allow the appeal and set aside the order
    passed by the High Court and restore the complaint before the
    learned llnd Additio:nal Chief Metropolitan Magistrate,.·
    Hyderabad to be proceeded with in accordance with law.             f

F R.P.                                           Appeal allowed.