TMI Blog2009 (4) TMI 900X X X X Extracts X X X X X X X X Extracts X X X X ..... AND P. SATHASIVAM, JJ JUDGMENT 1. Challenge in this appeal is to the judgment of a learned Single Judge of the Madhya Pradesh High Court, Indore Bench, dismissing the revision application filed by the appellant questioning his conviction for an offence relating to Section 138 of the Negotiable Instruments Act, 1881 (in short the Act ). 2. Respondent No.2-complainant was dealing in the business of transportation. The appellant was the General Manager of J.K. Utility Division of J.K. Synthetics Ltd. whereas the absconding accused Anup Chaturvedi was the Finance Manager. Both were working under the Managing Director Manoj Kumar Mathur. The non-applicant and the coaccused Anup Chaturvedi placed order No.U/QMR/Coal 96028 dated 7.8.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant guilty and the appeal was dismissed by learned Additional Sessions Judge, Indore. Both the courts found the appellant guilty. The appellant s stand was that he was not in charge and responsible for the conduct of the business of the company and, therefore, he should not have been held guilty. The cheques were not signed by him and a notice under Section 138 proviso (b) of the Act was not given in his name. The High Court did not accept the stand and dismissed the revision application. 6. Learned counsel for the appellant submitted that there is no evidence that the appellant was in charge and responsible for the conduct of the business of the company. A notice was not given to him. There was no specific role attributed to him in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vicariously liable for commission of the offence of the Company both was in charge of and was responsible for the conduct of the business of the Company. Requirements laid down therein must be read conjointly and not disjunctively. When a legal fiction is raised, the ingredients therefor must be satisfied. 10. In N.K. Wahi v. Shekhar Singh and Ors. (2007 (9) SCC 481) it was observed as follows: 6. Chapter XVII has been incorporated under the Act with effect from 1.4.1989. In certain contingencies referred to under Section 138 of the Act on the cheques being dishonored a new offence as such had been created. But to take care of the offences purported to have been committed provisions of subsection (1) to Section 141 of the Act come i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The description should be clear. It is true that precise words from the provisions of the Act need not be reproduced and the court can always come to a conclusion in facts of each case. But still in the absence of any averment or specific evidence the net result would be that complaint would not be entertainable. 9. Section 138 of the Act reads as under:- 138. Dishonour of cheque for insufficiency, etc., of funds in the account Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another persons from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money stan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a company, the principal accused being the company itself. It is a departure from the rule in criminal law against vicarious liability. A clear case should be spelled out in the complaint against the person sought to be made liable. Section 141of the Act contains the requirements for making a person liable under the said provision. That the respondent falls within the parameters of Section 141 has to be spelled out. A complaint has to be examined by the Magistrate in the first instance on the basis of averments contained therein. If the Magistrate is satisfied that there are averments which bring the case within Section 141, he would issue the process. We have seen that merely being described as a director in a company is not sufficient to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative. The question notes that the managing director or joint managing director would be admittedly in charge of the company and responsible to the company for the conduct of its business. When that is so, holders of such positions in a company become liable under Section 141 of the Act. By virtue of the office they hold as managing director or joint managing director, these persons are in charge of and responsible for the conduct of business of the company. Therefore, they get covered under Section 141. So far as the signatory of a cheque which is dishonoured is concerned, he is clearly responsible for the incriminating act and will be covered under sub-section (2) of Section 141 . 14. The matter was again considered in Sabitha Ramamurt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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