TMI Blog2007 (7) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... Anil Kumar Tandale for the Appellant. JUDGMENT S.B. Sinha, J. - Leave granted. 2. Appellant has been proceeded against for alleged commission of an offence under section 138 of the Negotiable Instruments Act. First respondent filed a complaint in the Court of 3rd Additional Chief Metropolitan Magistrate, Hyderabad. In regard to the liability of the appellant, which is vicarious in nature, the following statement has been made in paragraph 2 of the complaint petition which reads as under : "2. That the accused is a Company doing their business in the name and style of M/s. Rishab Alchem India Ltd., having its Registered Office at E2, Shantinivas Apartments, Mettuguda, Secunderabad and represented by accused No. 2 in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is nothing but abuse of process of court and so he prayed to quash the same. 4. The allegation in the complaint is that the present Petitioner is one of the directors of A.1 Company. Simply because he is a Director, he cannot be prosecuted for the offence under section 138 of the Negotiable Instruments Act, 1881 unless his case falls under the provisions of section 141 of the Act. Under section 141 of the Act, it must be shown that every person, who at the time of the offence, is responsible to the company for conduct of its business and day-to-day affairs. It is alleged that all the accused persons after negotiations with the Complainant firm agreed to take financial assistance from the Complainant and after executing comprehensive loan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not give rise to an inference that the appellant was responsible for day-to-day affairs of the Company. An offence envisaged under section 138 of the Negotiable Instruments Act contains several ingredients as has been held by a Three-Judge Bench of this Court in S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla [2005] 8 SCC 89 1 , in the following terms : "What is required is that the persons who are sought to be made criminally liable under section 141 should be, at the time the offence was committed, in charge of and responsible to the company for the conduct of the business of the company. Every person connected with the company shall not fall within the ambit of the provision. It is only those persons who were in charge of and respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on behalf of the Company by its Directors itself is not an ingredient for the purpose of constituting an offence under section 138 of the Negotiable Instruments Act. Furthermore, a vicarious liability on the part of a person must be pleaded and proved. It cannot be a subject-matter of mere inference. 6. In Sabitha Ramamurthy v. R.B.S. Channabasavaradhya [2006] 10 SCC 581, this Court opined : "7. A bare perusal of the complaint petitions demonstrates that the statutory requirements contained in section 141 of the Negotiable Instruments Act had not been complied with. It may be true that it is not necessary for the complainant to specifically reproduce the wordings of the section but what is required is a clear statement of fact so ..... X X X X Extracts X X X X X X X X Extracts X X X X
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