TMI Blog2023 (3) TMI 224X X X X Extracts X X X X X X X X Extracts X X X X ..... when the alleged offence was committed by the company, the petitioner was not a partner and had nothing to do with the affairs of the partnership firm. It is a settled law that the powers of quashing should be used sparingly, and where the factual matrix in a complaint are laid down clearly and not in a routine manner where bald and unspecified averments are made against the accused persons, the complaint ought not to be quashed. However, where ingredients of an offence are lacking against an accused, it is the duty of the Court to discharge such accused. Holding a Trial against the petitioner under Section 138 read with Section 141, is utmost abuse of the process of law and the Learned Trial Court has passed the summoning order without any application of mind. Petition allowed. - CRL.M.C. 197/2022 & CRL.M.A. 775/2022 - - - Dated:- 3-3-2023 - HON BLE MR. JUSTICE AMIT MAHAJAN Advocates who appeared in this case: For the Petitioner :Mr. Sameer Chandra and Mr. Yash Kirti Kumar Bharti, Advs. For the Respondent :Ms. Charu Sangwan, Adv. JUDGMENT 1. The present petition is filed seeking quashing of the order dated 31.03.2021, passed by the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. In relation to the role of the petitioner (Accused No. 3), it is stated as under : 24. That the Accused no. 1, Accused no.2 and Accused no.3 failed to complete its part of the promise and honour its commitments of payment of its legal and legitimate dues towards Complainant. That the Accused have issued cheques without having the intention to pay and fully knowing that it will not be honoured have devoid the Complainant of its rightful money. 25. That the Accused no. 1, Accused No. 2 and Accused no.3 were very well aware that the above mentioned cheques will not be honoured and with malafide intention and ulterior motives to defraud and cheat the Complainant issued the cheques favour of the Complainant. That the Complainant trusted all the Accused that the they will come with their promise of making payment of all its legally arising dues towards the Complainant, however, the Accused no. 1. Accused no.2 and Accused no.3 asked the Complainant to deposit the said cheques fully knowing that the said cheques would not be honoured by the bank upon presentation thereby misleading the Complainant. 26. That even after repeated reminders all the Accused herein did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only happens to be the wife of the Accused No. 2, who is running the accused firm. He submits that the petitioner cannot be made accused and liable for the dishonour of cheque only for the reason that she used to accompany her husband on few occasions. 7. He submits that in terms of Section 138 of the Negotiable Instrument Act, the person who is not signatory to the cheque cannot be held liable for its dishonour. He further submits that even in terms of Section 141 of the Negotiable Instrument Act, it is only the person incharge and responsible for the conduct of the business of the company who shall be deemed to be guilty of the offence and is liable to be proceeded against. 8. Learned counsel for the respondent submits that the arguments raised are matter of trial and should be addressed before the learned Trial Court. He submits that the petitioner has actively participated in the execution of the purchase/works order, communicated with the respondent company through e-mails and acted on behalf of the accused firm. 9. He further denies the fact that the petitioner is not a partner in the accused firm and in this regard relies upon the impugned order which records that, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness, is liable to be proceeded against and punished accordingly. Issue with regard to holding any person to be vicariously liable for an offence under Section 138 of the NI Act, has been subject matter of numerous cases dealt by the Hon ble Apex Court. It has been held that the complainants unnecessarily implead all the Directors of the accused company irrespective of whether they were actually involved or responsible for the commission of the alleged offence. In S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla: (2007) 4 SCC 70, it was observed as under: 9. Requirements of law for proceeding against the Directors of the Company for their purported constructive liability came up for consideration in this case before a Division Bench of this Court, wherein the following questions were posed: (a) Whether for purposes of Section 141 of the Negotiable Instruments Act, 1881, it is sufficient if the substance of the allegation read as a whole fulfils the requirements of the said section and it is not necessary to specifically state in the complaint that the person accused was in charge of, or responsible for, the conduct of the business of the company. (b) Whether a Dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ars of the dishonoured cheque/cheques; Person/Company in whose favour the cheque/cheques were issued Drawer of the cheque/cheques Date of issuance of cheque/cheques Name of the drawer bank, its location Name of the drawee bank, its location Cheque No./Nos. Signatory of the cheque/cheques c. Reasons due to which the cheque/cheques were dishonoured; d. Name and Designation of the persons sought to be vicariously liable for the commission of the offence by the accused Company and their exact role as to how and in what manner they were responsible for the commission of the alleged offence; e. Particulars of the legal notice and status of its service; f. Particulars of reply to the legal notice, if any. 14. Therefore, in order to make a person vicariously liable for an offence committed by company under Section 138 of the NI Act, the first and foremost pre-condition is that the said person should either be a signatory of the cheque or should be holding a position in the company and should also be responsible for the conduct of the business of the company while holding such designation. The complainant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by original Accused 1 - husband of the appellant. It was drawn from the bank account of original accused 1. The dishonoured cheque was signed by original accused 1. Therefore, the dishonoured cheque was signed by original accused 1 and it was drawn on the bank account of original accused 1. The appellant herein-original accused 2 is neither the signatory to the cheque nor the dishonoured cheque was drawn from her bank account. That the account in question was not a joint account. In the light of the aforesaid facts, it is required to be considered whether the appellant herein-original accused 2 can be prosecuted for the offence punishable under Section 138 read with Section 141 of the NI Act? 9. On a fair reading of Section 138 of the NI Act, before a person can be prosecuted, the following conditions are required to be satisfied: 9.1. That the cheque is drawn by a person and on an account maintained by him with a banker. 9.2. For the 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; and 9.3. The said cheque is returned by the bank unpaid, either because of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 141 of the NI Act. Therefore, the High Court has committed a grave error in not quashing the complaint against the appellant for the offence punishable under Section 138 read with Section 141 of the NI Act. The criminal complaint filed against the appellant for the offence punishable under Section 138 read with Section 141 of the NI Act, therefore, can be said to be abuse of process of law and therefore the same is required to be quashed and set aside. 13. In view of the above and for the reasons stated above, the present appeal succeeds. The impugned judgment and order dated 21-8-2019 passed by the High Court in Alka Khandu Avhad v. Amar Syamprasad Mishra [Alka Khandu Avhad v. Amar Syamprasad Mishra, 2019 SCC OnLine Bom 1630] refusing to quash the criminal complaint against the appellant for the offence punishable under Section 138 read with Section 141 of the NI Act is hereby quashed and set aside. The complaint case pending in the Court of the learned Metropolitan Magistrate filed by Respondent 1-original complainant being CC No. 2802/SS/2016 is hereby quashed and set aside. The appeal is allowed accordingly. 20. This Court is conscious of the fact tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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