ANDHRA PRADESH HIGH COURT
Ramesh Madhav Bapat, J.
M/s. Jord Engineers India Ltd., Mumbai
and Ors. - Petitioners
versus
M/s. Nagaijuna Finance Ltd. Hyderabad
and
Another - Respondents
Crl. P. Nos. 4906 of 1999 and Batch
Decided on 4-2-2000
Counsel for the parties:
For the Petitioners: Mr. M.V.S. Suresh Kumar. Advocate.
For the Respondent No.1: Mr. G. Anandam, Advocate.
For the Respondent No.2: Public Prosecutor.
(Para 7)
Result: Petition allowed partly.
Ramesh Madhav Bapat, J. – The -petitioners herein have filed the present petitions under Section 482, Cr. P.C. for quashing the criminal complaints lodged against them under Section 200, Cr. P.C. and Sections 138 and 142 of the Negotiable Instruments Act. The petitioners herein were the accused in the criminal complaints. The first -respondent herein was the complainant in all the petitions. It was averred in the complaints that the complainant Company is incorporated under the Companies Act. 1956 having its Registered Office at Nagarjuna, Hills, Panjagutta, Hyderabad, engaged in the business of finance under hire-purchase and leasing and the complainant is represented by its Legal Officer Authorised Signatory.
2. It is further stated by the complainant in its complaints that the accused executed hire-purchase agreements in favour of the complainant and the amounts are payable as per the agreements. Some amounts were due to the complainant's company and therefore the accused issued cheques in favour of the complaint. When they were presented for honour, they were returned with an endorsement "Refer to Drawer".
Thereafter the complainant issued legal notices under Section 138 of the Negotiable Instruments Act. Notices were not claimed and they were refused by the accused. The complainant waited for 15 days and thereafter filed the complaints.
3. On presentation of the, complaints, cognizance was taken by the learned Magistrate and summons were issued to the accused. On receipt of summons, the accused petitioners herein have filed the petition under Section 482. Cr. P.C. for quashing the same:
4. The learned Counsel Mr. M.V.S. Suresh Kumar appearing on behalf of the petitioners herein submitted at the l3ar that while drafting the complaints under Section 138 of the Negotiable Instruments Act, the complainant did not comply with the legal requirements as enumerated in Section 141 of the Negotiable Instruments Act and therefore, it was submitted that the complainant has to make a specific averment as to how all the Directors of the Company are liable to be prosecuted under Section 141 of the Negotiable Instruments Act. Section 141 of the said Act 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 sub-section shall render 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.
(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has been committed by a Company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any Director, Manager, Secretary to other officer of the Company such Director, Manager. Secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation: - For the purpose of this section (a) 'Company', means anybody 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. The learned Counsel Mr. M.V.S.) Suresh Kumar drew my attention to the averments made by the complainant in para (5) of the complaints. which reads as under:
"5. The accused No.1 is the firm and the accused No 2 is CMD and Signatory, accused No. 3 is Director and Authorised Signatory accused No. 4 is Director and Accused No. 5 is Finance Controller of A-1 firm as such they are also responsible for - the conduct of the businesses of A-1 firm,
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