# In the matter of Ashish Verma vs. Parmod Kumar

> HC judgment dated 2024-08-02. Citation: TCN-2024-HC-00054. The case involves a petition filed by Ashish Verma under Section 482 of the Code of Criminal…

- **Court:** HC
- **Order date:** 2 Aug 2024
- **Citation:** TCN-2024-HC-00054
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/ashish-verma-vs-parmod-kumar-49309f44

## Summary

### Background

The case involves a petition filed by Ashish Verma under Section 482 of the Code of Criminal Procedure, 1973, seeking to quash Complaint Case No. 12041/2016 under Section 138 of the Negotiable Instruments Act, titled 'Parmod Kumar vs. Ashish Verma'. The complaint was filed by Parmod Kumar alleging that Ashish Verma took Rs. 1 lac for the purpose of getting Parmod Kumar's son admitted to school. When Ashish Verma failed to secure the admission, he issued a cheque of Rs. 1 lac, which was dishonored with remarks 'Funds Insufficient'. A legal notice was issued on behalf of Parmod Kumar.

## Facts

Parmod Kumar (respondent/complainant) alleged that Ashish Verma (petitioner/accused) took Rs. 1 lac from him to get his son admitted to school. Ashish Verma failed to secure the admission. Consequently, Ashish Verma issued a cheque of Rs. 1 lac to Parmod Kumar. The cheque was dishonored due to 'Funds Insufficient' on 03.08.2016. A legal notice was issued on 11.08.2016. Parmod Kumar filed a complaint under Section 138 of the NI Act. Ashish Verma was summoned on 01.10.2016. Ashish Verma was declared an 'absconder' on 02.09.2021. The High Court stayed the proceedings under Section 82 Cr.P.C. on 28.09.2021, subject to conditions. Ashish Verma filed a petition to quash the complaint, arguing that the cheque was issued by his proprietorship firm, 'Verma Computers', which was

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## Issues and analysis

### Issue 1: Whether the proceedings against the petitioner are maintainable when the cheque was issued by his …

**Ratio:** A proprietary concern is not a separate legal entity from its proprietor. The proprietor

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**Reasoning:** The court reasoned that a suit by or against a proprietary concern is essentially a suit

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**Interpretation:** The court interpreted the legal position to mean that the liability incurred by

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**Application:** The court applied the ratio to the facts, stating that the petitioner cannot be

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## Parties

- **Judges:** ANOOP KUMAR…
- **Appellants:** ASHISH…
- **Respondents:** PARMOD…
- **Other parties:** Kohi…

## Timeline

- **2016-08-03 — Cheque Dish…**: The cheque of Rs. 1 lac issued by Ashish Verma was dishonored with remarks 'Funds…
- **2016-08-11 — Legal Notice…**: A legal notice was issued on behalf…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 138 — Discharge order](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-138)

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