TMI Blog2015 (12) TMI 779X X X X Extracts X X X X X X X X Extracts X X X X ..... (accused No.l) stated that there was financial crunch in the Company, however, assured that the cheque would be honoured at any cost and the balance principal amount alongwith interest shall also be paid very soon by them. Thus, specific allegations against the present petitioners, accused No. 4 to 6, have been made in the complaint. Therefore, in my opinion, the Metropolitan Magistrate was right in summoning the petitioners keeping in view the allegations made in the complaint. The petitioners can prove their innocence by taking recourse to proviso to sub-Section (1) of Section 141 NI Act. No merit in this petition. This petition amounts to gross abuse and misuse of process of law. The petitioners have succeeded in delaying the complaint before the Metropolitan Magistrate for more than four years. - CRL.M.C. 3074/2011 and Crl.M.A.No.10878/2011 - - - Dated:- 29-10-2015 - MR. SURESH KAIT, J. For The Petitioner : Mr.Nishit Kush, Advocate. For The Respondent : Mr.Sudershan Joon, Mr.Bharat Gupta, Mr.Varun Tyagi, and Ms.Surbhi Mehta, Advocates SURESH KAIT, J. CRL.M.C. 3074/2011 1. By way of the present petition filed under Section 482 of the Code of Crimin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Urad, aforesaid invoices amounting to ₹ 53,54,449.67 were issued by the complainant. As a part-payment of the said invoices, the Company in question under the signature of Mr.Sushil Jindal and on directions and instructions of the petitioners and Mr. Anil Jindal issued a cheque bearing No.361540 dated 23.11.2010 for a sum of ₹ 53,50,000/- drawn on State Bank of Bikaner and Jaipur, Khari Baoli Branch, Delhi. Rest of the principal amount and the interest as per the rules of the Delhi Grain Merchant Association (Regd.) was also agreed to be paid by the petitioners on behalf of the Company. As instructed, the Complainant presented the aforesaid cheque with its banker the State Bank of Mysore, Naya Bazar Branch for encashment, however, the same was returned dishonoured by the banker of the accused with the endorsement Exceeds arrangement . Accordingly, the information regarding the same was received by the Complainant by way of cheque return memo dated 25.11.2010. On dishonour of the said cheque, the Complainant, while protesting asked the accused that even after having received and consumed the goods, they have dishonoured the cheque. Moreover, neither the balance princ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve on the part of all the accused and that they had dishonest intention right from the very beginning to cheat the Complainant. On receiving the information of dishonour of the cheque in question, the respondent No.2 got served a legal notice dated 11.06.2011 upon the accused through Speed Post as well as Registered A.D. Cover, however, the said notice was received back. Registered A.D. Covers and Speed Posts sent to the accused at C-47, Lawrence Road Industrial Area, Delhi-110035 were received back on 15.06.2011 with the endorsement dated 13.06.2011 stating that No such person/firm exists or resides at the given address. The Speed Posts sent to the accused at House No.164, Vaishali, Pitampura, Delhi-110034, were received back on 17.06.2011 with the endorsement dated 13.06.2011, 14.06.2011 and 15.06.2011 stating that from regular visits it is known that the addressee has gone out of Delhi . The Registered A.D. Covers sent to the accused at House No.164, Vaishali, Pitampura, Delhi-110034, were received back on 22.06.2011 with endorsement dated 14.06.2011, 15.06.2011 and 16.06.2011 stating HC , which supposedly means House Closed . 7. As alleged all the accused have got false ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors of the accused No.1/Company. The respondent No.2 is allegedly a partnership firm and the above mentioned false and frivolous complaint has been filed by one of the alleged partner of the firm. The petitioners are not involved in the day-to-day functioning of the Company, they are also not signatories to the Cheque in question and that they have no involvement in daily affairs of the Company. 12. Learned counsel further submitted that some of the Cheques have been missing from the office of the Company and only on receiving of the summons of the present case it has come to the knowledge of the active directors of the Company that the said Cheques have been misused by the respondent herein in the case in question. Immediately, after noticing the same, a complaint dated 01.09.2011 with Police Station Maurya Enclave was lodged by mentioning the true facts. 13. Mr. Kush submitted that perusal of the subject Complaint discloses that no offence is made out against the petitioners as the same had been lodged with intent to unnecessarily persecute the petitioners as they have no involvement with the business of the Company, being serving only in titular capacities. 14. The pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the petitioners were not incharge of the day-to-day affairs of the Company at the relevant time is concerned, petitioners No. 1 to 3 are the only directors as on date in the Company in question. Petitioners No. 1 and 3 are wife and son of Mr.Sushil Jindal, accused No.2, who in turn is son of Mr.Anil Jindal, accused No.3. The dishonoured cheque is of substantial sum of ₹ 53,50,000/- and the petitioners and other accused, being members of one family, are residing together and managing and controlling the Company in question. 18. Mr. Gupta further submitted that so far as the contention raised by the petitioners that accused No.2 being the only authorized signatory of the Company signed the cheque in question and the petitioners have no concern therewith is concerned, it needs to be established during trial. 19. To support his case, learned counsel has relied upon the case of Gunmala Sales Private Ltd. Vs. Anu Mehta, AIR 2015 SC 1072, wherein the Supreme Court held as under:- 33. We may summarize our conclusions as follows: a) Once in a complaint filed Under Section 138 read with Section 141 of the NI Act the basic averment is made that the Director was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt at that stage does not conduct a mini trial or roving inquiry, but, nothing prevents it from taking unimpeachable evidence or totally acceptable circumstances into account which may lead it to conclude that no trial is necessary qua a particular Director. 20. Also relied upon the case bearing Nos. Crl.M.C. 3937/2012 and Crl. MC 3935/2012, titled as Krishna Muraril Lal Vs, IFCI Factors Ltd., decided on 27.11.2012, wherein a Coordinate Bench of this Court held as under:- 5. This Court upon a perusal of the complaint filed by the respondent/complainant finds that there are specific allegations against the present petitioners. The relevant portion of the complaint filed under Section 138 read with Section 141 of the Negotiable Instruments Act is reproduced hereinbelow:- 2. The accused no.1 is a company incorporated under the Companies Act, 1956 with its registered office at West Bengal. Accused Nos. 2 and 6 are directors on the board of the accused no.1 concern, and are in charge of an responsible for the conduct of the day to day business and financial decision making of the accused No.1 Company. xxxxxx 9. The accused nos. 2 to 6, being the directors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted by the company, on the very same analogy notice served on the company amounts to serving of notice on all the persons as found in Section 141of N.I. Act. A person who was in charge of the company and was responsible to the company for the conduct of the business of the company alone can be prosecuted, while so, such a person cannot deny knowledge about the service of notice to the company. Only in that view of the matter vicarious liability is cast upon those persons and that is why no notice to them is contemplated. 22. Also relied upon the cases of Paresh P. Rajda Vs. State of Maharashtra Anr. 2008 (7) SCC 422, Rebby Varghese Vs. Haier Appliances P. Ltd. (2010) 175 DLT 424 and Vipul Kumar Mittal Vs. M/s Varishtha Leasing (I) Ltd. 124 (2005) DLT 206. 23. I have heard the learned counsel for the parties. 24. The moot question which now arises for consideration is whether a person simply being a Director of a Company is liable to be prosecuted by virtue of the provisions of Section 141 NI Act or the person who at the time of offence was in charge of and was responsible to the company for the conduct of the business of the Company would be prosecuted? 25. Be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charge of the company and responsible to the company for conduct of its business could be proceeded against. 27. In SMS Pharmaceuticals Ltd (supra) the above questions were answered by the Apex Court in the following terms:- 16. ... ... .... (a) It is necessary to specifically aver in a complaint under Section 141 that at the time the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential requirement of Section 141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of Section 141 cannot be said to be satisfied. (b) The answer to question posed in sub-para (b) has to be in negative. 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 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness and its memorandum or articles of association. Other than that, he may not be aware of the arrangements within the Company in regard to its management, daily routine, etc. Therefore, when a cheque issued to him by the Company is dishonoured, he is expected only to be aware generally of who are in charge of affairs of the Company. It is not reasonable to expect him to know whether the person who signed the cheque was instructed to do so or whether he has been deprived of his authority to do so when he actually signed the cheque. Those are matters peculiarly within the knowledge of the Company and those in charge of it. So, all that a payee of a cheque that is dishonoured can be expected to allege is that the persons named in the complaint are in charge of its affairs. The Directors are prima facie in that position. .... ..... ..... 19........In fact, an advertence to Sections 138 and 141 of the Negotiable Instruments Act shows that on the other elements of an offence under Section 138 being satisfied, the burden is on the Board of Directors or Officers in charge of affairs of the Company to show that they are not liable to be convicted. Any restriction on their powe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Company and its decisions. That the complainant has not elaborated the exact role of the petitioners No.2 and 3 while stating that they are responsible for the day-to-day operations and decision making of the company, is not sufficient ground to throw out the complaint qua the petitioners, at this premature stage. 32. It is pertinent to mention here that in a case bearing Crl.M.C. No.1996/2010, entitled Rajesh Agarrwal Vs. State Anr., decided on 28.07.2010, a Coordinate Bench of this Court has observed that quashing of summoning order cannot be sought on the ground that the complaint and the evidence before the learned Metropolitan Magistrate does not disclose commission of offence by the petitioner/accused. If the petitioner has other defences available to him, including the fact that he was not a Director of the company at the relevant time or that he was not responsible for the conduct of the affairs of the company or only a sleeping partner in a partnership firm etc., he is entitled to appear before the learned Metropolitan Magistrate and take such pleas. The proceedings under Section 138 NI Act being summary proceedings, the petitioner can make his submissions bef ..... X X X X Extracts X X X X X X X X Extracts X X X X
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