IMPORTANT POINT
The court established that the interpretation of liability under Sections 138 and 141 of the NI Act requires a holistic reading of the complaint, allowing for multiple individuals to be held liable based on their roles during the sequence of events leading to the cheque's dishonor.

JUDGMENT

1. The petitioners, accused in a proceeding under section 138 of the Negotiable Instruments Act, 1881 (hereafter 'NI Act', for short), are challenging the order of issuance of process on the following grounds:

(a) the averments in the complaint are not sufficient to constitute pleading as mandatorily required under section 141 of the NI Act;

(b) petitioner no.2 resigned with effect from 16th September 2014 and petitioner no.3 has resigned with effect from 20th September 2015 before the fifteenth (15 th) day of dishonor of cheque; and

(c) petitioner no.3 being independent non-executive director, cannot be proceeded against.

2. Facts giving rise to the filing of the present petition relevant for the adjudication of the issue involved are as under:

3. Respondent no.2 filed a complaint before the learned Metropolitan Magistrate, 43rd Court at Borivali, Mumbai (hereafter 'learned Magistrate', for short) alleging that he had sold polypropylene and towards satisfaction of the price of the goods, cheques in question have been issued. Both the cheques were dated 23rd August 2014. The date of dishonor of cheque is 25th August 2014. The date of receipt of demand notice is 20th September 2014. Fifteenth (15th) day after the date of receipt of demand notice is 4th October 2014.

4. Respondent no.2, therefore, filed a complaint before the learned Magistrate and the learned Magistrate by order dated 30th March 2015 issued process against the petitioners. Aggrieved thereby, the petitioners have filed present writ petition.

5. Learned advocate for the petitioners submitted that the averments in the complaint are not sufficient to attract liability under section 141 of the NI Act. To bolster his submission, he relied on the judgment of the Apex Court in the case of SMS Pharmaceuticals v. Neeta Bhalla & Anr. reported in (2005) 8 SCC 89. In so far as the said averment is concerned, the relevant averments in the complaint read as under:

'1. ... I say that accused No.2 to 5 are the Directors of the accused No.1. I say that accused Nos.2 to 5 are looking after day to day affairs of the business of the accused No.1 and are fully liable and responsible for the act of the accused No.1....'

6. On perusal of the averments quoted above, in my opinion, the said averments constitute sufficient compliance as mandated by section 141 of the NI Act.

7. Learned advocate for the petitioners submitted that the words 'at the time of offence' have not been incorporated in the complaint and, therefore, there is non-compliance of the averments as mandated by section 141 of the NI Act. The interpretation of the averments and the approach of the Court while interpreting the averments in no longer res integra in view of the authoritative pronouncements of the Apex Court in S.P Mani and Mohan Dairy v. Dr. Snehalata Elangovan reported in 2022 SCC OnLine SC 1238. In paragraph 33, the Apex Court has laid down the legal principles to be adopted by the Courts while approaching the averments as required under section 141 of the NI Act as under:

'33. Thus, the legal principles discernible from the aforesaid decision of this Court may be summarised as under:-

(a) Vicarious liability can be fastened on those who are incharge of and responsible to the company or firm for the conduct of its business. For the purpose of Section 141, the firm comes within the ambit of a company;

(b) It is not necessary to reproduce the language of Section 141 verbatim in the complaint since the complaint is required to be read as a whole'

(c) If the substance of the allegations made in the complaint fulfill the requirements of Section 141, the complaint has to proceed in regards the law.

(d) In construing a complaint a hyper-technical approach should not be adopted so as to quash the same;

(e) The laudable object of preventing bouncing of cheques and sustaining the credibility of commercial transactions resulting in the enactment of Sections 138 and 141 respectively should be kept in mind by the Court concerne