TMI Blog2006 (9) TMI 490X X X X Extracts X X X X X X X X Extracts X X X X ..... be said to be satisfied. Merely being a director of a company is not sufficient to make the person liable under Section 141 of the Act. A director in a company cannot be deemed to be in charge of and responsible to the company for the conduct of its business. The requirement of Section 141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as there is no deemed liability of a director in such cases - - Appeal (crl.) 950 of 2006 - - - Dated:- 13-9-2006 - S.B. Sinha Dalveer Bhandari, JJ. JUDGMENT Leave granted in SLPs. Two cheques dated 23.6.2001 and 30.6.2001 for a sum of Rs. 1,24,406/- each w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the loan, issued a cheque in favour of the complainant. The M.D. signed and issued the cheque dated 23.6.2001 for Rs.1,24,406/- on the account maintained by the company. On presentation of the said cheque to the Bank for collection, the same was returned on 30.6.2001 as insufficient funds. Notice dated 12.7.2001 was issued through Advocate to the accused was served on 13.7.2001. The case was filed on 27.8.2001\005" Processes were directed to be issued on the said statement for alleged commission of an offence under Section 138 of the Negotiable Instruments Act. Appellants herein filed an application under Section 482 of the Code of Criminal Procedure praying for quashing of the processes issued against them in the said proceedings. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt the commission of such offence. Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for-prosecution under this Chapter." 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 as to enable the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration of case against the complainant for mala fide prosecution of the accused. The accused would also be entitled to file a suit for damages. The relevant provisions of the Code of Criminal Procedure are required to be construed from the aforementioned point of view. This Court in Monaben Ketanbhai Shah and Another v. State of Gujarat and Others [(2004) 7 SCC 15] held as under: "From the above, it is evident that in the complaint there are no averments against the appellants except stating in the title that they are partners of the firm. Learned counsel for the respondent complainants contended that a copy of the partnership deed was also filed which would show that the appellants were active in the business. No such document was file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that she was in charge of the business and was responsible for the conduct of the business of the firm in terms of Section 141 of the Act nor was there any other allegation made against the appellant that she had connived with any other partner in the matter of issue of cheque\005" [See also K.P.G. Nair v. Jindal Menthol India Ltd., (2001) 10 SCC 218] The question has been set at rest by a Three-Judge Bench of this Court in S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla and Another [(2005) 8 SCC 89] wherein the law has been laid down in the following terms: "In view of the above discussion, our answers to the questions posed in the reference are as under: (a) It is necessary to specifically aver in a complaint under Section 141 that a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
