IMPORTANT POINT
Where allegations in complaint, though not in words used in Section 141 of Negotiable Instruments Act are sufficient indicative of fact that an accused a Director in the Company was associated with day today management of Company. Proceedings were not liable to be quashed against him.

ORDER

Vaman Rao, J. - This petition under Section. 482 Cr. P.C. seeks quashing of proceedings in C.C. No. 2241 of 1998 on the file of the XXIII Metropolitan Magistrate. Hyderabad in which the petitioner as A-4 alongwith other accused are sought to be prosecuted for an offence under Section 138 of the Negotiable Instruments Act (hereinafter called the Ace).

2. It appears that in connection with contract- for supply of pharmaceutical products between the complainant TTK Pharma Limited and MI s. Targos Pure Drugs Limited, certain amount became due and payable by A-1 company. On behalf of the said company a cheque for Rs. 12,275/- was drawn and issued to the complainant, which on presentation was returned on the ground of insufficiency of funds in the account of A-1 Company. After issuing the requisite statutory notice as contemplated under the Act, this complaint has been filed.

3. The learned Counsel for the petitioner in this case seeks quashing of the proceedings as far as the petitioner is concerned on the ground that the petitioner is merely a Director of A-1 Company. The contention is that A-1 Company has a regular Chairman A-2 and Managing Director A-3 and In view of this the question of petitioner (A-4) being liable for the cheque issued on behalf of A-1 Company does not arise. Where a Company is prosecuted for an offence under Section 138 of the Act, persons other than the Company would also be liable alongwith the Company if they are in-charge of and responsible to the Company for the affairs of the Company. The contention appears to be that the requirement of Section 141 of the Act has not been specified In this case. This again appears to be on the ground that the petitioner A-4 is only a Director and not a Managing Director. For liability of a person for an offence under Section 138 of the Act alongwith the Company, it is not necessary that the person concerned should hold a particular position In a Company. What Section 141 of the Act contemplates is that the person sought to be proceeded against must have been at the time of the offence In charge of and responsible to the Company for the conduct of the business of the Company. Whether a particular person proceeded against was in-charge of and was responsible to the company for the conduct of its business is a question of fact, which is obviously required to be decided during the trial.

4. In this case there is a specific averment' In para 2 of the complaint Indicating that the petitioner alongwith other accused was associated with the affairs of the company. The relevant averment reads as follows:

"That the accused Nos. 2 to 4 are Chairman. Managing Director and Directors of the Accused No. 1 Company, who are actively involved In day-to day proceedings of Accused No. 1 Company and also aware of the transaction with the Complainant Company."

5. Again in para No. 7 of the complaint the following allegation is found:

"The Accused Nos. 1, 2 and 3 issued the cheque with active connivance of Accused No. 4 knowing fully well that there are no sufficient funds in the account and subsequently failed to arrange the cheque amount even amount receipt of statutory notice and there committed an offence under Section 138 of the Negotiable Instruments Act and as such they are liable for punishment."

6. The plea on behalf of the petitioner appears to be that the necessary averment as contemplated under Section 141 of the Act is lacking In the complaint. It is true that the exact words used In Section 141 of the Act do not find place in the complaint stating that the petitioner herein was In charge of and was responsible to the company for the business affairs of the company'. The lack of the exact words used In Section 141 of the Act does not appear to be significant. At this stage what is relevant is whether there are sufficient allegations indicating that the petitioner was involved with the management and conduct of the affairs of the company. The above referred allegations in t