Specific averments regarding the accused's role in the company's conduct of business are essential for vicarious liability under Section 141 of the Negotiable Instruments Act.

Anuja Prabhudessai, J.

This is an application filed under Section 482 of Cr.P.C. filed by the applicants, original accused nos.2, 5 and 7 for quashing the proceeding in C.C.No. 221/S/2002 pending on the file of the learned Metropolitan Magistrate's 34th Court, Vikhroli, for offence under Section 138 of the Negotiable Instruments Act.

2. Shri Kopty, the learned Counsel for the applicant has submitted that the complaint does not contain any averment as regards the role played by the aforesaid applicant in commission of the said offence. Relying upon the decision of the Apex Court in Gunmala Sales Pvt. Ltd. v. Anu Mehta and Ors. Dated 17.10.2014, submits that in the absence of basic averments against the applicants, they cannot be prosecuted for offence under Section 138 of the Negotiable Instruments Act.

3. I have perused the records and considered the submissions advanced by the learned Counsel for the applicant and the APP for the state. The records reveal that the respondent no.2 herein had lodged a complaint under Section 138 of the Negotiable Instruments Act against M/s. Pharma Off-set Ltd., (now known as M/s. Pharmacom (India) Ltd.) being the accused no.1 and six others. The present applicants are accused no.2, 5 and 7 in the said complaint. The complainant had alleged that all the accused are the Directors and partners of the firm known as M/s. Pharmacom (India) Ltd. The complainant has further stated that the accused no.1 firm had availed from her loan of Rs.3 lakhs and had issued a cheque bearing No.300854 towards repayment of the said loan. It is stated that the cheque was dishonoured with endorsement "refer to drawer". The statutory notice which was issued to the said firm and other accused has returned unclaimed. Since the accused no.1 firm and the other Directors did not pay the amount, the complainant filed complaint under Section 138 of the Negotiable Instruments Act.

4. It is pertinent to note that the applicants herein are prosecuted for the offence allegedly committed by the accused no.1 firm. Section 141 of the Negotiable Instruments Act which deals with the offence committed by the companies and firms reads as under:-

"141. Offences by companies- (1) If the person committing an offence under section 138 is a company, every person who, at the time the offence was committed, was incharge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

Provided that nothing contained in this subsection shall render any person liable to punishment if he proves that the offence was committed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence.

[Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for prosecution under this Chapter]

(2) Notwithstanding anything contained in subsection (1), where any offence under this Act has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer shall also be deemed to be guilty of the offence and shall be liable to be proceeded against any punished accordingly.

Explanation - For the purpose of this section-

(a) "Company" means any body corporate and includes a firm or other association of individuals; and

(b) "director" in relation to a firm, means a partner in the firm"

5. A plain reading of this section indicates that a person can be held vicariously liable for the offence committed by the company or firm only if at the time the offence was committed, such a person was incharge or and was responsible to the company or