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2019 (9) TMI 418 - HC - Indian LawsDishonor of Cheque - section 138 of NI Act - case of petitioner is that they are neither a party to the agreement nor is an authorised signatory - petitioner was prosecuted in the capacity of the director of the company - subsisting debt or liability or not - section 141 of NI Act. Whether the petitioner, being the director of the company, which issued the cheque in question, could be deemed guilty of the offence punishable under section 138 of the Act? HELD THAT:- When the managing director or joint managing director is sought to be prosecuted for the offence under section 138 of the Negotiable Instruments Act, there need not be any specific averment in the complaint that the managing director was in charge and responsible for the conduct of the business of the company. It stands to reason that the affairs of the company being managed by the managing director, he is answerable to the acts of commission or omission by the company without further proof of the fact that at the time of the commission of the offence he was in charge of the affairs of the company. In a case as in the instant case, when the managing director and also a director of the company are sought to be prosecuted, it cannot be presumed that the director was also running the affairs of the company and was in charge and management of the company. The IDEB Projects P. Ltd., did not owe any debt or liability to the complainant. According to the complainant, the cheque in question was issued to satisfy the liabilities or the debt incurred by M/s. IDEB Parkway Holdings P. Ltd., and M/s. IDEB PSB Estates P. Ltd. Under the said circumstances, without there being any further material to show that as on the date of occurrence of the liability, the petitioner being one of the directors of the company was fully aware of the affairs of the company and with her knowledge and consent, the cheque in question was issued through IDEB Projects P. Ltd., merely by reproducing the ingredients of section 141(2) of the "Act", the criminal liability cannot be fastened on her. The petitioner cannot be prosecuted in her capacity solely on the ground that she was director of the said company as on the date of the issuance of the said cheque. The prosecution of the petitioner for the alleged offence under section 138 of the "Act" is bad in law and cannot be sustained. - the prosecution of the petitioner has turned out to be an abuse of the process of court and is liable to be quashed - application disposed off.
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