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2015 (8) TMI 907 - SUPREME COURT

2015 (8) TMI 907 - SUPREME COURT - TMI - Dishonour of cheque - Liability of drawer of cheque - whether the respondent can be made liable in his personal capacity when the Company has not been made a party to the complaint - Held that:- Drawer of the cheque was the respondent, who had drawn the cheque, bearing No.075073 for ₹ 74,200/- on a bank account maintained by him towards the refund of the booking amount. Therefore, he was the drawer of the cheque. The case of the appellant, apart fro .....

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erson from out of that account for the discharge, in whole or in part of any debt or other liability. It is only such a cheque which is dishonoured which would attract the provisions of Section 138 of the above Act against the drawer of the cheque.

In the light of the position which the respondent in the present case held, we are of the view that the respondent be made liable under Section 138 of the NI Act, even though the Company had not been named in the notice or the complaint. Th .....

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ths for the offence under Section 138 of the NI Act. - Decided in favour of appellant. - Criminal Appeal No. 1472 of 2009 - Dated:- 6-7-2015 - Pinaki Chandra Ghose And Uday Umesh Lalit,JJ. For the Appellant : Mr. Jatin Zaveri,Adv. For the Respondent : Mr. Ugra Shankar Prasad,Adv. JUDGMENT Pinaki Chandra Ghose, J. 1. This appeal, by special leave, has been filed against the judgment and order dated 9.10.2007 passed by the High Court of Judicature at Bombay in Criminal Application No.646 of 2006, .....

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000/- and ₹ 14,200/-, respectively. By the year 2003, as alleged by the appellant, the aforesaid project of the respondent did not materialize. After much persuasion, the accused respondent drew cheque No.075073 for ₹ 74,200/- in favour of the appellant, of an account maintained by him with his banker towards refund of the aforesaid booking amount. The cheque was drawn by the respondent in his individual capacity and not in the capacity as a Director of M/s. Salvi Infrastructure Pvt. .....

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complaint under Section 138 of the N.I. Act. 3. The aforesaid complaint filed by the appellant was taken up by the Metropolitan Magistrate, 33rd Court, Ballard Pier, Mumbai, and vide his order dated 15.12.2005 passed in C.C. No.5194/2003, the Metropolitan Magistrate acquitted the respondent. The reasons given for the acquittal of the respondent were that the Company M/s. Salvi Infrastructure Pvt. Ltd. was not made the accused and instead the respondent was made accused in his personal capacity. .....

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.C., before the Bombay High Court. The High Court by the impugned order dismissed the said application on the ground that the reasoning set out by the Trial Court in its order did not call for reconsideration. 5. The appellant is thus before us. Learned counsel for the appellant has raised the following grounds in this appeal. Learned counsel submits that the Courts below have failed to appreciate that under Section 138 of the NI Act, it is the drawer of the cheque who is made punishable for off .....

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the appellant contended that such a conclusion was not supported by any evidence inasmuch as there was only one acknowledgment card on record, showing receipt of notice under Section 138(b) of the Act, by the respondent. The Courts below did not appreciate that the accused respondent in his statement under Section 313 Cr.P.C. had admitted that he was paid ₹ 74,200/- as earnest money and that he had issued receipt for the same and thus there is no substance in the argument of the respondent .....

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committed, was incharge of, and was responsible to the Company for the conduct of business of the Company as well the Company, shall be liable. In the complaint and the affidavit, M/s. Salvi Infrastructure Pvt. Ltd. was not made the accused. Further, it was argued that there was no averment that the accused was the person incharge of, and responsible for the affairs of the Company. In that case the accused was mentioned as the said person incharge. In the present case, the accused Vijay Salvi wa .....

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a liability under the Section. The first and foremost being that the person who is to be made liable should be the drawer of the cheque and should have drawn the cheque on an account maintained by him with a Banker for payment of any amount of money to another person from out of that account for discharge in whole or part, of any debt or other liability. We see that from the bare text of the Section it has been stated clearly that the person, who draws a cheque on an account maintained by him, .....

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Ors. Vs. Water Base Limited, (2010) 12 SCC 146 where this Court has dealt with the scope of Section 138 and held that it is very clear that in order to attract the provisions thereof a cheque which is dishonoured will have to be drawn by a person on an account maintained by him with the banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part of any debt or other liability. It is only such a cheque which is dishonoured which wou .....

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d its Directors were absolved of the liability. The logic applied was that the Section itself makes the drawer liable and no other person. This Court in P.J. Agro Tech Limited (supra) noted as under: "An action in respect of a criminal or a quasi-criminal provision has to be strictly construed in keeping with the provisions alleged to have been violated. The proceedings in such matters are in personam and cannot be used to foist an offence on some other person, who under the statute was not .....

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re Pvt. Ltd. and sole proprietor of M/s. Salvi Builders and Developers, there is no need of specific averment on the point. This Court has held in National Small Industries Corporation Ltd. Vs. Harmeet Singh Paintal and Anr., (2010) 3 SCC 330 as follows: Para 39 (v) "If the accused is a Managing Director or a Joint Managing Director then it is not necessary to make specific averment in the complaint and by virtue of their position they are liable to be proceeded with." 13. Thus, in the .....

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law laid down by this Court in R. Vijayan Vs. Baby and Anr., (2012) 1 SCC 260 was to the following effect: "As the provisions of Chapter XVII of the Act strongly lean towards grant of reimbursement of the loss by way of compensation, the courts should, unless there are special circumstances, in all cases of conviction, uniformly exercise the power to levy fine up to twice the cheque amount (keeping in view the cheque amount and the simple interest thereon at 9% per annum as the reasonable .....

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