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2024 (2) TMI 1295 - HC - Indian LawsDishonour of Cheque - Liability of a Director - principles of vicarious liability - petitioner had already resigned on 15.03.2014 as Director of the Company and was neither signatory of the cheques, nor Managing Director of the Company - Section 141 of NI Act - HELD THAT:- This Court is of the considered view that present petitions under Section 482 Cr.P.C. are not maintainable since the earlier petitions were withdrawn with liberty to urge all the pleas before the learned Trial Court at an appropriate stage and there has been no change of circumstances thereafter. However, in the interest of justice, present petitions have also been considered on merits since the clarificatory certificate issued by Chartered Accountant dated 07.08.2018 that petitioner was a Non-Executive Director is stated to have been filed with the concerned office on the date of withdrawal of earlier CRL.M.Cs. (i.e. 07.08.2018). The scope of proceedings under Section 141 of NI Act has been considered by the Hon’ble Apex Court in SMS PHARMACEUTICALS LTD. VERSUS NEETA BHALLA [2005 (9) TMI 304 - SUPREME COURT], wherein, it was observed that persons, who are sought to be made criminally liable under Section 141 of NI Act, should at the time of commission of offence be incharge of and responsible to the Company for the conduct of the business of the Company. Consequently, a Director, merely by holding a designation or office in a Company, would not be liable unless he was in-charge of and responsible for the conduct of the business of the Company. Thus, the liability depends upon role in the conduct of the affairs of the Company and not merely by the designation or status except in the case of Managing Director and Joint Managing Director. The existence of special circumstances or change of circumstances which is specific to the knowledge of accused needs to be established during the course of trial, if the same is not apparent from the record. Since the object of enactment of Section 138 and 141 of NI Act is to prevent bouncing of cheques and sustain credibility of commercial transactions, the proceedings can be quashed only if the ingredients of the offence are altogether lacking despite the foundational facts laid by the complainant. The principle of law, as referred in Siby Thomas v. Somany Ceramics Ltd., [2023 (10) TMI 487 - SUPREME COURT], is not disputed, but it may be noticed that in the aforesaid case, the appellant submitted that he had retired from the partnership firm on 28.05.2013, while the cheque in question was issued on 21.08.2015. It was further noticed that the complaint was devoid of mandatory averments required to be made in terms of sub-Section 1 of Section 141 of NI Act. All the petitions are dismissed with composite cost of Rs. 25,000/- to be paid to respondent No. 1. Pending applications in respective petitions, if any, also stand dismissed.
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