TMI Blog2022 (3) TMI 926X X X X Extracts X X X X X X X X Extracts X X X X ..... Court and thirdly, to secure ends of justice, Court can always take note of any miscarriage of justice and prevent the same by exercising its powers under Section 482 of Cr.P.C. These powers are neither limited nor curtailed by any other provisions of the Code. To fasten a liability under Section 141 of the N.I. Act, a clear case should be spelled out in the complaint against the person sought to be made liable is what the Hon ble Supreme Court has held in the case of SMS PHARMACEUTICALS LTD. VERSUS NEETA BHALLA [ 2005 (9) TMI 304 - SUPREME COURT] . A bald and vague averment made in the complaint would not suffice to compel a person to subject him or herself to criminal prosecution particularly, in cases under Sections 138, 141 142 N.I. Act - Even if the fact is admitted that the petitioner Mr. Mark Alexander Davidson is a partner in the said Firm and also even if the so called Retirement Deed is not taken into account, that is, that the legal provisions of Section 72 of the Partnership Act was not complied with, as far as the issue of notice is concerned, yet the fact remains that his role in the partnership firm has not been specifically spelt out and saying that he was als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein. Again, in all the complaint petitions the same set of accused persons were arrayed viz; i) M/s Twelve Baskets (Registered Firm); ii) Mr. Sachhidanand Kanchan; iii) Mr. Mark Alexander Davidson; and iv) Mrs. Sarita Harish Kanchan. 2. The complaint was made under Section 138 read with Sections 141 and 142 of the Negotiable Instruments Act, 1881 and also read with Sections 420, 418, 417, 403, 409 and 406 IPC. The offences alleged is with regard to dishonour of cheques drawn on HDFC Bank, Kalapahar, Guwahati Branch by the respondent No. 2 Firm. 3. According to Annexure P-2 of criminal petition No. 38 of 2021 which is a copy of the order sheet reflecting the order dated 05.02.2020 passed by the learned Judicial Magistrate First Class, Shillong, it is seen that the learned Magistrate had perused the statement of the complainant/respondent No. 1 which was filed by way of an affidavit, whereupon the learned JMFC has taken cognizance of the case and had issued process to the said accused persons, including the petitioner herein. 4. Being highly aggrieved and dissatisfied with the proceedings of the said complaint case, the petitioners has accordingly approac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Act. Therefore, no vicarious liability can be fastened upon the petitioner. 12. In support of this contention, the learned counsel for the petitioner has cited the following cases: - i) Pooja Ravinder Devidasani v. State of Maharashtra Anr: (2014) 16 SCC 1, paragraphs 15, 17, 18, 22, 27; ii) K.K. Ahuja v. V.K. Vora Anr: (2009) 10 SCC 48, paragraphs 9, 15, 18-25, 27; iii) Maksud Saiyed v. State of Gujarat Ors: (2008) 5 SCC 668, paragraphs 11, 12, 13; iv) S.M.S. Pharmaceuticals Ltd v. Neeta Bhalla Anr: (2005) 8 SCC 89, paragraphs 18 19. 13. Mr. Jebaraj has also submitted that in an application under Section 482 Cr. P.C, the guidelines set out in the case of State of Haryana Ors v. Bhajan Lal Ors: 1992 Supp (1) SCC 335, more particularly at paragraph 102 can be used as the standard as the grounds set out therein would apply to a quashing petition as the present one. Grounds 1, 3 and 5 of the said paragraph 102 has been referred to by the learned counsel to submit that no offence can be made out against the petitioner as those which are cited in the complaint petition. 14. Again, the learned counsel has submitted that the alleged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dly dishonoured and was also not in charge of the affairs of the said partnership firm at the material time. 20. The respondent No. 1 has failed to make any material averment under Section 141 of the N.I. Act that the petitioner herein was in-charge of and was responsible to the respondent No. 2 Firm at the time the alleged offence was committed and only a bald or mechanical averment made in the complaint is not sufficient, but the specific role of the petitioner herein was required to be averred because a complaint under Section 138 N.I. Act seek to place vicarious criminal liability on individuals. The case of S.M.S. Pharmaceuticals Ltd. (supra) paragraph 18 as well as the case of Pooja Ravinder Devidasani (supra) at paragraphs 17 and 21 and also the case of K. K. Ahuja (supra) at paragraph 25 was referred to by the learned counsel for the petitioner to support his contention. 21. Yet another contention raised by the learned counsel for the petitioner is that the petitioner is not vicariously liable under the Partnership Act as the Act only contemplates civil liability and not criminal liability. The case of Shyam Sunder v. State of Haryana: (1989) 4 SCC, 630 paragraphs 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ratio of the said judgment of the Hon ble Supreme Court, particularly paragraph 102 and the guidelines issued therein, Mr. Jindal has submitted that the import of paragraph 102 is to apply only to cases arising out of police complaints under chapter XIV of the Cr.P.C, whereas private complaints which is the subject matter of the present proceedings are covered by chapter XV of the Cr.P.C and as such, the authority of the Bhajan Lal case would not come to the aid of the petitioners. 26. It is further submitted that in any event, the allegations at paragraphs 8 9 of the complaint petition by the respondent No.1 before the Trial Court do make out a prima facie case. As to the contention that there is no evidence against the petitioners being involved in the alleged offence, the fact that evidence has yet to be led before the Trial Court, the petitioners reliance on mere submissions or documents before this Court cannot be made the basis to quash the proceedings. The case of State of M.P. v. Awadh Kishore Gupta: (2004) 1 SCC 691 at paragraph 13 was also relied upon by the learned counsel for Respondent No. 1 in this regard. Paragraph 13 reads as follows: 13 . While exercisin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r a sentence occurring in a judgment of the Supreme Court, divorced from its context, as containing a full exposition of the law on a question when the question did not even fall to be answered in the judgment. 29. Again, the case of K. Pannir Selvam v. MMTC Ltd: 2000 Cri. L.J. 1002 (AP) at paragraph 18 was also referred to by the learned counsel for the respondent No.1 wherein the High Court has observed as follows: - 18. As observed by the Supreme Court in the case of Rajesh Bajaj v. State NTC of Delhi, AIR 1999 SC 1216 : (1999 Cri LJ 1833) in a petition under Section 482 of Cr.P.C. it is not permissible to adopt a strictly hyper technical approach and sieve the complaint through a cullendar of finest gauzes for testing the ingredients of the offence alleged against the accused. As to the whether the person in question was really in-charge of the affairs of the company and was responsible to the affairs of the Company or not, and as to what functions he was assigned in the affairs of the Company and whether those functions could be considered sufficient to hold that he was incharge of the affairs of the company are matters which have to be gone into during the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra) paragraph 15 was cited by the learned counsel for the respondent No. 1 to prove this point. 32. Though the authority cited vide the case of Gian Singh v. State of Punjab: (2012) 10 SCC 303 , wherein the inherent power of the High Court under Section 482 Cr.P.C to secure the ends of justice or to prevent abuse of the process of the Court, for which proceedings in a criminal court may be quashed has been reiterated, however with regard to the case in hand the learned counsel for the respondent No. 1 has submitted that the fact that the accused persons in the impugned analogous complaint proceedings have issued cheques amounting to ₹ 30 Lakhs, a further amount of ₹ 66 lakhs is still due to be paid by the accused persons. The attempt of the petitioners herein to wriggle out of the onerous liabilities by raising unsustainable grounds, could itself be termed as an abuse of the process of the Court. 33. Coming to the stand of the petitioner Mr. Mark Alexander Davidson who admittedly was a partner of the respondent No. 2 Firm but has since retired from the said firm vide Retirement Deed dated 01.04. 2018, that is before the offences were committed, the respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he see whether the petitioners herein are entitled to approach this Court for relief under the aforesaid provision of law. 38. Section 482 Cr.P.C reads as follows: 482. Saving of inherent powers of High Court. - Nothing in this Code shall be deemed to limit or affect the inherent powers of the High Court to make such orders as may be necessary to give effect to any order under this Code, or to prevent abuse of the process of any Court or otherwise to secure the ends of justice. 39. From the above, what can be understood is that Section 482 Cr.P.C can be resorted to, to ensure that orders under the code of criminal procedure are given effect to, secondly, to prevent abuse of the process of any Court and thirdly, to secure ends of justice, Court can always take note of any miscarriage of justice and prevent the same by exercising its powers under Section 482 of Cr.P.C. These powers are neither limited nor curtailed by any other provisions of the Code. 40. For the sake of clarity, a reference to the complaint made before the learned Addl. Deputy Commissioner (Judicial), Shillong would reveal that the said complaint was basically one under Section 138 read with Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Section 141 of the Act in SMS Pharma (I) and held that it is necessary to specifically aver in a complaint under Sections 138 and 141 of the Act, that at the time when the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company and that in the absence of such averment, Section 141 cannot be invoked. This Court held: (SCC pp. 98-99 102-03, paras 10 18) 10 .What is required is that the persons who are sought to be made criminally liable under Section 141 should be, at the time the offence was committed, in charge of and responsible to the company for the conduct of the business of the company. Every person connected with the company shall not fall within the ambit of the provision. It is only those persons who were in charge of and responsible for the conduct of business of the company at the time of commission of an offence, who will be liable for criminal action. It follows from this that if a Director of a company who was not in charge of and was not responsible for the conduct of the business of the company at the relevant time, will not be liable under the provision. The liability arises from being in ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al. (emphasis supplied) 44. To fasten a liability under Section 141 of the N.I. Act, a clear case should be spelled out in the complaint against the person sought to be made liable is what the Hon ble Supreme Court has held in the case of S.M.S. Pharmaceuticals Ltd. (supra). A bald and vague averment made in the complaint would not suffice to compel a person to subject him or herself to criminal prosecution particularly, in cases under Sections 138, 141 142 N.I. Act. The Hon ble Supreme Court in the case of Maksud Saiyed (supra) at paragraph 15 has referred to the case of Pepsi Foods Ltd Anr. v. Special Judicial Magistrate Ors: (1998) 5 SCC 749 and has held as follows: - 15. This Court in Pepsi Foods Ltd. v. Special Judicial Magistrate: (1998) 5 SCC 749 held as under: (SCC p. 760, para 28) 28. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the Magistrate summoning the accused must reflect that he has applied his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence is made out at all against the Director. 46. As pointed out, the averments made at paragraphs 8 9 of the complaint petition, especially as regard the role of the petitioner (accused No. 4) who is neither a partner or anywhere involved with the affairs of the said Partnership Firm are indeed very general and not specific. In the case of Awadh Kishore Gupta (supra) it was held that ..the Court has to only prima facie be satisfied about existence of sufficient ground for proceeding against the accused. For that limited purpose, the Court can evaluate material and documents on records but it cannot appreciate evidence Evaluation of materials and documents on records can be resorted to which is done so in this case and in the considered opinion of this Court, having taken into consideration the authorities cited by the respondent No. 1, there is prima facie no indication that the petitioner (Smti. Sarita Harish Kanchan) is liable for prosecution on the basis of the said complaint before the learned Addl. Deputy Commissioner (Judicial), Shillong. 47. As to the role of the petitioner Mr. Mark Alexander Davidson, the Partnership Deed has clearly indicated that he is one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out in the complaint against a person sought to be made liable and again, it is said that the mere fact of being described as a Director in a company is not sufficient to satisfy the requirement of Section 141. 50. The case of K. Pannir Selvam (supra) as well as the case of S.V. Muzumdar (supra) duly taken note of herein placed in juxtaposition with the case of K. K. Ahuja (supra) and S.M.S. Pharmaceuticals Ltd (supra) would led one to understand that even for the adjudicatory process to be initiated on the basis of a complaint, for which evidence is to be led, basically a prima facie case against the person proceeded against is required to be made out in the said complaint. In the case in hand, this has been found wanting. Therefore, this Court is of the respectful opinion that the ratio of the case of K. Pannir Selvam (supra) and S.V. Muzumdar (supra) are not applicable to the present case. 51. In the case of MMTC Ltd (supra) cited by the learned counsel for the respondent No. 1 at paragraph 13, the Hon ble Supreme Court has held that the inherent powers do not confer an arbitrary jurisdiction on the court to act according to its whim or caprice. At this stage, the court co ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
