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TMI Blog2020 (8) TMI 215X X X X Extracts X X X X X X X X Extracts X X X X ..... before the lower Court against respondent No.1 and 2 to prosecute them under section 138 of the Negotiable Instruments Act (hereinafter, the parties are mentioned in accordance to their rank before the trial Court). 2. The case of the complainant in brief is as follows:- The complainant is engaged in the business of transporting containers and hiring trailer lorries for transporting. According to the complainant, the accused issued a cheque drawn on M/s.Federal Bank Ltd. dated 26.06.1999 for Rs. 1,96,000/- in favour of the complainant for discharging the liability incurred in the business. The cheque was presented for encashment, it was dishonored with an endorsement 'fund insufficient'. When a statutory notice was issued, the acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of the business of the company, as well as the company. According to the counsel, there is no such averment in the complaint and hence the benefit of the decision of the S.M.S.Pharmaceuticals Ltd. Vs. Neetha Bhalla (Supra) is actually in support of his contention. The learned counsel also cited the decision of the Division Bench of this Court in Mymoonath Beevi Vs. State of Kerala (2005(4) KLT)174. The counsel submitted that, the Division Bench of this Court observed in para 12 of the decision that,the complaint should contain the necessary facts constituting the offence as against the person arranged as the accused. If there is no such averments, according to the counsel, the prosecution is not possible against a partner, even if he is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or conduct of its business could be proceeded against. 7. After considering the entire facts and the law on the subject the larger bench of the Supreme Court answered the point in the following manner. (a) It is necessary to specifically aver in a complaint under S.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 S.141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of S.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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Managing Director or Joint Managing Director would be admittedly in charge of the company and responsible to the company for conduct of its business. When that is so, holders of such position in a company become liable under Section 141 of the Act. By virtue of their portion, they hold as Manging Director or Joint Managing Director. These persons are in charge of and responsible for the conduct of business of the company. Therefore, the larger Bench of the Supreme Court held that, they get covered under section 141 of the Negotiable Instruments Act. It is also mentioned in the decision that, signatory of a cheque which is dishonoured is concerned, he is clearly responsible for the incriminating Act and will be covered under sub section ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se is M/s. Sea Wings Shipping & Others, Willingdon Island represented by its Managing Partner Mr. Varghese Philip. Mr. Varghese Philip is the 2nd accused. He is arrayed as the 2nd accused, because he is the Managing Partner. The 1st accused firm was convicted by the Trial Court under Section 138 of the Negotiable Instruments Act. Since 1st accused is a firm, only fine was imposed. The conviction and sentence imposed on the 1st accused is not challenged by the 1st accused. 1St accused is represented by the 2nd accused. The conviction and sentence imposed on the 1St accused became final. In such circumstances, the 2nd accused, who is actually representing the 1st accused cannot contend in an appeal against acquittal of the 2nd accused to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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