Ajit Kerkar, managing director of Tulip Star Hotels, will have to face trial in a Rs9.79 crore cheque bounce case.
Ajit Kerkar, managing director of Tulip Star Hotels, will have to face trial in a Rs9.79 crore cheque bounce case. Bombay High Court on Monday rejected Kerkar’s plea to quash a criminal complaint filed against him and his company, ABK Enterprise Private Ltd, by the Mumbai-based Trade Wings Hotel Ltd (TWHL).
The maximum punishment in a cheque bounce case is two years’ imprisonment and a fine double the amount of the cheque.
According to the criminal complaint filed by TWHL, it had entered a memorandum of understanding (MoU) with Kerkar and his company in 2000 for a joint venture to manage a resort in Goa. Kerkar had agreed to buy 50 per cent of the resort’s equity capital. Subsequently, he issued a cheque, dated November 1, 2006, of Rs9.79 crore to TWHL. But, when deposited, it returned as dishonoured because of insufficient funds.
TWHL issued a legal notice to Kerkar and subsequently, filed a criminal complaint. In December 2006, a magistrate issued process against Kerkar and his company and summoned them to stand trial.
Kerkar, former chairman and managing director of Taj Hotels, challenged the magistrate’s order in a Sessions Court, stating that the shares were not transferred to him and, therefore, there was no liability. He pointed out that the MoU was terminated and the matter was being heard by a Goa court.
However, in August 2007, Additional Sessions Judge Chitra Bhedi refused to quash the magistrate’s order and the criminal complaint, stating, “Prima facie I find that liability of payment was there. Learned magistrate has not committed any illegality in issuing process. The question of fraud can be decided only on trial.”
Kerkar challenged the sessions court order in the HC. Hearing the appeal, Justice AP Deshpande once again rejected Kerkar’s plea.
TWHL has also filed a criminal complaint against Kerkar and five others, alleging embezzlement of Rs300 crore, unauthorisedly selling a timeshare scheme for the Goa resort and misappropriating the funds.
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