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TMI Blog2020 (11) TMI 835X X X X Extracts X X X X X X X X Extracts X X X X ..... o.2, a former director of accused no.1-company. Complaint resulted out of dishonour of two collateral security cheques dated 15.08.2017 and 26.07.2017, for an amount of Rs. 10,78,419/- and Rs. 5,00,000/-, respectively. Cheques were issued on behalf of accused company M/s Supreme Tex Mart Limited, in discharge of alleged outstanding of a term loan sanctioned by the bank. 3. The banker of the petitioner returned the cheques vide memo dated 24.08.2017on account of "payment stopped by the drawer" instructions. Despite legal notice dated 01.09.2017, no payment was made, leading to the filing of impugned complaint. The trial Court, on the basis of preliminary evidence, summoned the accused company and the petitioner vide an order dated 06.01.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ual capacity. 6. In the aforementioned context, learned counsel for the petitioner relies on a decision in case titled Rajeev Raj Kumar &Ors. Vs. State of Maharashtra &Anr, Criminal Application No. 02052 of 2018 wherein,per him, in somewhat similar situation, prosecution of 138 complaint against the Directors of accused Company was quashed. Continuation thereof was held valid only against the accused Company. He submits that prior to filing of impugned complaint, Allahabad Bank had already initiated insolvency proceedings against the Company. Moratorium had been declared. Company did not thereafter have the option to pay its debts and/or settle/pay the amount qua the cheques. All the moveable and immoveable assets of the Company have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the directors of accused no.01, who are in-charge and responsible for the conduct of the affairs of the company. The complainant has not given what is the nomenclature and how each one of accused nos.02 to 12 is in-charge. Admittedly, accused nos.02 to 12 are not the signatories to the disputed cheques. In fact, in para no.05 of the complaint, the complainant has stated that accused nos.01 to 12 issued a cheque ..... None of them i.e. accused nos.02 to 12 had issued that cheque but somebody else is the signatory to the cheque. This fact is also suppressed by the complainant. The learned Magistrate ought to have considered as to who is the signatory to the cheque and whether he is made an accused or not before proceeding to issue process aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is alleged against him. This will enable him to meet the case at the trial. " Further, taking into consideration the legal fiction that has been created in Section 141 of the N.I. Act, in para 19 of the judgment, it has been held thus:" 19. 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 anessential 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and demonstrate as to how each one of accused nos.02 to 12 were in charge and responsible for the conduct of the business of accused no.01. Therefore, the order of issuance of process passed by the learned Magistrate cannot be allowed to be sustained." 10. I am in respectful agreement with the above view taken above by the learned Judge, which in turn, is based on lucid principles enunciated by Supreme Court in S.M.S. Pharmaceuticals Ltd., ibid. Going by contents and the allegations contained in the impugned complaint, continuation of prosecution against the petitioner in his capacity as Director of accused No.1 Company in the instant case also is held to be bad in law. 11. Apart from above, even otherwise, it is not in dispute that befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C the Resolution Professional is under mandate to protect and preserve the assets of the 'corporate debtor company'. Subsequent thereto, the committee of creditor is required to submit a resolution plan for approval of the 'committee of creditors'. After such approval, the resolution plan is presented to the Adjudicating Authority. Resolution plan, if approved, is be binding on the corporate debtor and its employees, members, creditors, guarantors and other stakeholders involved in the resolution plan. 14. In the premise, due to insolvency proceedings against the accused company and imposition of moratorium, two consequences arise, namely, (a) option to compound a cheque bounce is not available to its directors (erstwhile) and; (b) claims ..... X X X X Extracts X X X X X X X X Extracts X X X X
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