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ANISH DAYAL
Yashovardhan Birla – Appellant
Versus
Cecil Webber Engineering Ltd. – Respondent
JUDGMENT
This petition has been filed seeking quashing of complaint qua the petitioner, being C.C. No.515453/2016 P.S. Rajendra Nagar pending in the court of Ld. MM, Tis Hazari Court, New Delhi and for setting aside order dated 6th July, 2017 by which Crl. Rev. No.219/2017 filed by petitioner was dismissed by the Ld. Special Judge (PC Act), CBI-08, Central District, Tis Hazari Court, New Delhi.
2. The said complaint was filed under section 138 read with section 141 & 142 of the Negotiable Instruments Act, 1881 against the principal accused M/s Birla Cotsyn (India) Ltd. (A-l) an incorporated company with its registered office at Mumbai. Its Managing Director, Mr. P.V.R. Murthy, who is also a signatory to the cheque in question, has been arrayed as A-2 while the Directors of A-1, who are stated to be in charge and responsible for the conduct of day-to-day affairs of the accused company, have been arrayed as A-3 to A-8. The gravamen of the complaint was that the accused company had approached the complainant company (M/s. Cecil Webber Engineering Ltd.) for advancement of a business loan of Rs.5 crores as an Inter Corporate Deposit (ICD). The said loan was advanced on mutually agree
Dishonour of cheque – Offence by company – Creeping up escalating liability to Chairpersons of large conglomerates/companies for cheques issued in day-to-day affairs of business of a company would un....
Non-executive directors are not automatically liable under the Negotiable Instruments Act, and specific averments are required to establish vicarious liability.
Non-Executive Directors cannot be held liable under Section 141 of the Negotiable Instruments Act without specific averments demonstrating their involvement in the company's day-to-day affairs.
Merely holding the designation of director does not establish liability under the Negotiable Instruments Act; specific allegations of involvement and responsibility in the company's affairs at the ti....
Vicarious liability under the Negotiable Instruments Act requires proof of a director's active involvement and responsibility in the company's operations, not merely their title.
The legal principle established is that a director, even if designated as an independent Non-Executive Director, can be held vicariously liable for the dishonor of a cheque under section 138 of the N....
The main legal point established in the judgment is the requirement for specific averments and unimpeachable evidence to establish vicarious liability of directors in cases of cheque bounce under Sec....
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