TMI Blog2020 (6) TMI 589X X X X Extracts X X X X X X X X Extracts X X X X ..... against the company. In the present case, although, the respondent stated that the petitioner borrowed money from him on account of personal need of his business but looking to the fact that the respondent has accepted his business relation with the petitioner and the disputed cheque was given by the petitioner on behalf of the Company. A demand notice was served only on the petitioner/accused, there was no demand notice against company, therefore, without arraying the company as an accused in complaint case, the petitioner can not be prosecuted for the offence of Section 138 N.I. Act. Petition allowed. - M.Cr.C No.735/2020 - - - Dated:- 9-6-2020 - HON BLE SHRI JUSTICE RAJENDRA KUMAR SRIVASTAVA Shri Ankit Saxena, learned counsel for the petitioner. Ms. Sonali Paroche, learned counsel for the respondent. ORDER This petition under Section 482 Cr.P.C. has been filed by the petitioner being aggrieved by the order dated 20.05.2019 in case No. SC NIA 158/2018 passed by learned JMFC Narsinghpur whereby the learned JMFC has framed the charge under Section 138 N.I. Act against the petitioner. 2. According to case, respondent is a trade firm and filed a compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he judgment of Hon ble Apex Court in the case of Saroj Kumar Poddar Vs. State NCT of Delhi and another passed in Appeal (Crl.) 70/2007. 5. Heard both the parties and perused the case. 6. On perusal of case, it appears that the petitioner is a chairman of company namely Well Built Industry India Ltd. Kalyanpur, Astha which is registered under the companies Act, 2013. It is an admitted fact that the disputed cheque has been issued on behalf of the company. Therefore, before examining the facts of the case, it would be appropriate to consider the legal aspect first. 7. Section 138 of N.I Act speaks about the offence for dishonouring of cheques, which is quoted 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 person 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 standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thstanding anything contained in sub-section (1), where any offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation .- For the purposes of this section,- (a) company means any body corporate and includes a firm or other association of individuals; and (b) director , in relation to a firm, means a partner in the firm.] 9. On reading of the above said provisions, it is apparent that Section 141 of N.I. Act deals with the offences committed by the companies and say that if an offence is committed by a company under Section 138 of the Act, every person, at the time, the offence was committed, was in-charge and responsible to the company in the conduct of the business of the company, is liable along with the company to be proceeded against and punished accordingly. Further, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uncements to settle the issues. In one of the landmark case, S.M.S. Pharmaceuticals Lts. Vs. Neeta Bhalla and Another, reported in (2005) 8 SCC 89, the Hon'ble Apex Court has observed as under: - 9. 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 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)........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 fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). No further averment would be necessary in the complaint, though some particulars will be desirable. They can also be made liable under Section 141(2) by making necessary averments relating to consent and connivance or negligence, in the complaint, to bring the matter under that sub-section. (iv) Other Officers of a company can not be made liable under sub-section (1) of Section 141. Other officers of a company can be made liable only under sub-section (2) of Section 141, be averring in the complaint their position and duties in the company and their role in regard to the issue and dishonour of the cheque, disclosing consent, connivance or negligence. 13. Further, in the case of National Small Industries Corpn. Ltd. Vs Harmeed Singh Paintal reported in (2010) 3 SCC 330 , the Hon'ble Apex Court has explained its earlier judgment passed in the case of K.K. Ahuja (Supra) and settled the principle of vicarious liability of the Director/Managing Director/Joint Director of company as well as principle regarding necessity of specific averment in the complaint. 14. Therefore, from the above discussion, it is clear that the person (Director/Managing Director/Joint Dire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Cri) 458], this Court held thus: (SCC p. 188, para 12) 12. The proviso to Section 138, however, is all important and stipulates three distinct conditions precedent, which must be satisfied before the dishonour of a cheque can constitute an offence and become punishable. The first condition is that the cheque ought to have been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier. The second condition is that the payee or the holder in due course of the cheque, as the case may be, ought to make a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid. The third condition is that the drawer of such a cheque should have failed to make payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice. It is only upon the satisfaction of all the three conditions mentioned above and enumerated under the proviso to Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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