a)The appellant, vice-Chairman and managing director of the company under a scheme of investment had collected various amounts from various persons in the form of loans and, in consideration thereof, issued post-dated cheques either in his personal capacity or as the signatory of the company which later on got dishonoured.
b)Respondent No. 2, the power of attorney holder of six complainants, filed complaint against the appellant u/s 138 and 142 before the Metropolitan Magistrate.
c)The Additional Chief Metropolitan Magistrate issued summons against the appellant u/s 204 of the CrPC for the offences punishable u/s 138 and 142 of the NI Act.
d)The appellant, aggrieved by issue of summon, moved an application for discharge/recall of process in each of the complaints. The application filed by the appellant was dismissed.
e)The appellant preferred applications before the High Court for quashing of the complaints. However, the said applications were dismissed by the High Court.
On appeal, the Supreme Court held as under:
1)The Magistrate had taken cognizance of complaint without prima facie establishing fact as to whether power of attorney existed in first place and whether it was in order? Magistrate wrongly took cognizance in matter
2)From the bare perusal of the complaint it could be seen that except mentioning in the cause title there was no mention of or a reference to the Power of Attorney in the body of the said complaint nor was it exhibited as part of the said complaint.
3)Since aforesaid fact had been overlooked by High Court while passing impugned judgment, order passed by Magistrate and impugned judgment passed by High Court were to be set aside - A.C. NARAYANAN V. STATE OF MAHARASHTRA  55 TAXMANN.COM 118 (SC)