Important PointS1. Managing Director in a company must be taken to be a person responsible for conduct of business of company and in terms of Section 141 Negotiable Instruments Act he will be liable for dishonour of cheque issued by company.2. There is no requirement of law that notice u/s. 138(b) of Negotiable Instruments Act must be sent by regd. post.

Headnote:(i) Negotiable Instruments Act, 1881 — Sections 138 and 141 — Dishonour of cheque issued by company respondent No. 2 — Quashing petition by petitioner who was Managing director in Company — Contention that complaint nowhere averred that petitioner was responsible for payment of said amount — Transac-tion of agreement out of which cheque in question was issued was signed by petitioner with complainant — Petitioner being Managing Director in Company was responsible for carrying out the business of company and was liable for the offence. (Paras 6 to 8)
       (ii) Negotiable Instruments Act, 1881 — Section 138 — Dishonour of cheque issued by company — Petition to quash proceedings against petitioner, the Managing Director in company on ground that notice allegedly sent by UPC had not been served upon him and that notice must have been sent by regd. post -- Notice under UPC was sent on correct address and presumption was that said notice was served — Contention was otherwise of fact which could be decided during trial — No requirement of law that notice should have been sent by regd. post only — Prosecution could not be quashed. (Paras 9 & 10)
       Result : Petition dismissed.

ORDER

Subhash Samvatsar, J. — Disposal of this petition shall also govern the disposal of connected case Janak Gandhi v. Mohan Mandelia and two others.1

2. The brief facts of the case are that the present petitioner, who is Managing Director of a company, namely, M/s. O.T.G. Global Finance Company Ltd., has filed the present petition under Section 482 Cr.P.C. challenging an order dated 3-8-2004 passed in case No. 900/2004 whereby cognizance is taken against the present petitioner and other accused for committing offence under Section 138 of the Negotiable Instruments Act.

3. The brief facts of the case are that the respondent No. 1 filed a complaint under Section 138 of the Negotiable Instruments Act on 11-6-2004 against the present petitioner and other co-accused. It is alleged that respondent No. 1, the Company is owner of G.N.T. Television. It is further alleged that there was an agreement between respondent No. 1 and respondent Nos. 2 and 3 and the peti-tioner for carrying on cable television network in the city of Gwalior. The present petitioner carries on business of cable television network at Indore. A memorandum of undertaking was also entered into between the parties. As per the said agreement respondent No. 1 invested Rs. 42.46 lakhs while the petitioner invested Rs. 17.03 lakhs in the said business. There was some dispute between the parties and it was agreed upon that a sum of Rs. 31.96 lakhs will be paid to the petitioner by respondent No. 1. Towards this payment a cheque for Rs. 20 lakhs bearing Cheque No. 532357 dated 16-3-2004 was issued against State Bank of India, Branch Guna, was delive-red to respondent No. 1. The said cheque was deposited for collection by respondent No. 1 in his bank account. The said cheque was returned on 2-5-2004 with a memo of insufficient fund. Respondent No. 1 alleged that a notice dated 9-5-2004 was issued to the petitioner and respon-dents No. 2 and 3 about the dishonour of the cheque and a demand was raised for the said amount. Thereafter, a complaint under Section 138 of the Negotiable Instruments Act was filed. The Court below took cognizance of the said offence. Hence, this petition.

4. The main contention raised by the counsel for the petitioner is that as per the allegations, made in the comp-laint the offence under Section 138 of the Negotiable Instruments Act is not made out and, therefore, the said proceedings should be quashed as even if the allega-tions in the complaint are taken to be true the present petitioner cannot be convicted for committing the said offence. The second contention raised by the counsel for the petitioner is that the cheque is not signed by him but it is signed by respondent No. 3 on behalf of respondent No. 2. Counsel for the peti-tioner submits that as he has not signed the cheque he is not liable to be prose-cuted for committing the said offence. From the perusal of cheque it appears that the cheque is issued on behalf of respondent No. 2 M/s. O.T.G. Global Finance Company Ltd. Present petitioner is Managing Director of the said Com-pany. The contention raised by the coun-sel for the petitioner is that complainant has nowhere averred in his complaint that the present petitioner is responsible for the payment of the said amount.

5. Counsel for the petitioner relied upon by the counsel for the petitioner is in the case of Katta Sujatha (Smt.) v. Fertilizers & Chemicals Travancore Ltd. and another2. That case is clearly distingui-shable. In that case complaint was filed against all the persons of the firm without making any allegation that accused in that case was responsible for business of the firm. But in the present case the situation is different. The petitioner is a Managing Director in the Company and from the documents particularly, the agreement between the parties it is clear that he is responsible for carrying out the conduct of the company.

6. Section 141 of the Negotiable Instruments Act provides that if a cheque is issued on beh

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