TMI Blog2021 (10) TMI 1067X X X X Extracts X X X X X X X X Extracts X X X X ..... ereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. The Magistrate has to carefully scrutinise the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused. In the present case, the Trial Court has failed to pose to himself the correct question viz. as to whether the complaint, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The Bank is a body corporate. Vicarious liability of the Chairman/Managing Director and Branch Manager would arise provided any provision exists in that behalf in the statute. The Statutes indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... repay, so petitioner no. 1, in order to secure interests of bank, asked revenue authorities to put a lien on property of complainant. He has averred that complainant in her complaint has not named the accused at all and this fact is evident form complaint itself. It is contended that petitioner no. 2 has been sued as Chairman of the Bank. According to him Chairman of the Bank cannot be sued as he has no role and it lies within jurisdiction and powers of the Branch Managers and even in the matter of sanction of ₹ 2.00 Crores, the story is that her husband had already applied through another branch (J K Bank Branch Office B.B. Cantt.) for providing loan of ₹ 2.00 Crores. It is stated that at no stage petitioner no. 2 had anything to do with complainant or her husband. He also contends that no criminal case is made out taking into account all the circumstances that have been set out by Trial Court in the order or in the statement of complainant inasmuch as putting lien in the revenue extract to secure interests of the bank is not an act which is prohibited by law nor does it constitute any criminal offence and that Trial Court has assumed jurisdiction, which is not vest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient evidence of his active role coupled with criminal intent. Second situation in which he can be implicated is in those cases where the statutory regime itself attracts the doctrine of vicarious liability, by specifically incorporating such a provision. When the company is the offender, vicarious liability of the Directors cannot be imputed automatically, in the absence of any statutory provision to this effect. One such example is Section 141 of the Negotiable Instruments Act, 1881. In Aneeta Hada (supra), the Court noted that if a group of persons that guide the business of the company have the criminal intent, that would be imputed to the body corporate and it is in this backdrop, Section 141 of the Negotiable Instruments Act has to be understood. Such a position is, therefore, because of statutory intendment making it a deeming fiction. Here also, the principle of alter ego , was applied only in one direction namely where a group of persons that guide the business had criminal intent, that is to be imputed to the body corporate and not the vice versa. Otherwise, there has to be a specific act attributed to the Director or any other person allegedly in control ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irect or circumstantial to show that apart from approving the purchase of fertilisers he knew that the firms from which the fertilisers were purchased did not exist. Similar is the case with the other two items. Indeed, if the Chairman was to be made liable then all members of the Committee viz. Tehsildar and other nominated members, would be equally liable because all of them participated in the deliberations of the meetings of the Committee, a conclusion which has not even been suggested by the prosecution. As Chairman of the Sangh the appellant had to deal with a large variety of matters and it would not be humanly possible for him to analyse and go into the details of every small matter in order to find out whether there has been any criminal breach of trust. In fact, the hero of the entire show seems to be A-3 who had so stage-managed the drama as to shield his guilt and bring the appellant in the forefront. But that by itself would not be conclusive evidence against the appellant. There is nothing to show that A-3 had either directly or indirectly informed the appellant regarding the illegal purchase of fertilisers or the missing of the five oil engines which came to lig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned in the FIR are for commission of offences under a general statute. A vicarious liability can be fastened only by reason of a provision of a statute and not otherwise. For the said purpose, a legal fiction has to be created. Even under a special statute when the vicarious criminal liability is fastened on a person on the premise that he was in charge of the affairs of the company and responsible to it, all the ingredients laid down under the statute must be fulfilled. A legal fiction must be confined to the object and purport for which it has been created. 6. Sharon Michael v. State of T.N. (2009) 3 SCC 373: 16. The first information report contains details of the terms of contract entered into by and between the parties as also the mode and manner in which they were implemented. Allegations have been made against the appellants in relation to execution of the contract. No case of criminal misconduct on their part has been made out before the formation of the contract. There is nothing to show that the appellants herein who hold different positions in the appellant Company made any representation in their personal capacities and, thus, they cannot be made vicariously ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused. 9. As can be seen in Pepsi Foods Ltd. v. Special Judicial Magistrate (1998) 5 SCC 749, summoning of an accused in a criminal case is a serious matter as criminal law cannot be set into motion as a matter of course. It is not that complainant has to bring only two witnesses to support his allegations in a complaint to have criminal law set into motion. The order of the Magistrate summoning accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. The Magistrate has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. The Magistrate has to carefully scrutinise the evidence brought on record and may eve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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