IMPORTANT POINT
In a case of dishonoured cheque issued by Company Director of Company could be prosecuted without company being impleaded as co-accused.

B. Seshasayana Reddy, J.—This Criminal Appeal is directed against the Judgment dated 30-11-2001 passed in C.C. No. 529 of 1999 on the file of III Metropolitan Magistrate, Hyderabad, by which the learned Magistrate dismissed the complaint and acquitted the accused – Dr. D. Sudhakar, Managing Director of M/s. Centaury Gardens (P) Limited under Section 255 (1) Cr. P.C. for the offence under Section 138 of the Negotiable Instruments Act.

2. The appellant and R-2 are the complainant and accused respectively in C.C No. 529 of 1999. The complainant presented a complaint before the III Metropolitan Magistrate, Hyderabad against the accused alleging, inter alia, that the accused as the Managing Director of M/s. Centuary Gardens Private Limited borrowed an amount of Rs. 1,00,000/- on 14-3-1997 from the complainant finance company under a loan account bearing No. K 1868/ P2 and agreed to pay the said loan amount alongwith interest @ 2.5 percent per month and executed all the necessary documents. The accused paid an amount of Rs. 55,302/- towards interest on various dates and thereafter stopped paying the amounts. The accused admitted his liability under Ex. P-8 letter dated 19-6-1999 and thereafter-issued Ex. P-1 cheque dated 8-10-1999 for Rs. 1,27,322/-. The complainant presented the cheque for payment but the said cheque came to be dishonoured for the reason of “account of the drawer is closed”. Thereupon, the complainant issued a statutory notice informing him the dishonour of cheque and demanding him to pay the amount covered under the said cheque. Ex.

P-3 is the office copy of the statutory notice. Since the accused failed to pay the amount covered under Ex. P-1 cheque, the complainant initiated proceedings before III Metropolitan Magistrate, Hyderabad by filing a complaint. The learned Magistrate took the complaint on file as C.C No. 529 of 1999 and issued process to the accused. On appearance of the accused, the learned Magistrate examined him under Section 251 Cr. P.C. putting the substance of accusation levelled against him. The accused pleaded not guilty and claimed to be tried. To substantiate the accusation levelled against the accused, the complainant got himself examined as P.W. 1 and marked as many as ten documents. On behalf of the accused he got himself examined as D.W.1. The learned Magistrate on appreciation of the evidence brought on record recorded a finding that the complaint is bad because of non-impleadment of the company as co-accused and thereby acquitted the accused under Section 255 (1) Cr. P.C. by Judgment dated 30-11-2001. Assailing the Judgment of acquittal, the complainant has filed this Criminal Appeal.

3. Learned Counsel for the appellant- complainant submits that the trial Court has not considered the preposition of law that the complaint against a Director of the company is maintainable without a company being impleaded as a party and therefore the impugned Judgment is liable to be set aside and R-2 accused is to be punished for the offence under Section 138 of Negotiable Instruments Act. He placed reliance on the Judgments of Supreme Court in R. Rajgopal v. S.S. Venkat1; Anil Hada v. Indian Acrylic Ltd.2; Sheoratan Agarwal v. State of M.P.3 and the decision of our High Court in R. Ramachandran v. Yerram Sesha Reddy4 and also the decision of Himachal Pradesh High Court in B.N Mehta v. M/s. Kapoor Agencies and another5.

4. Learned Counsel appearing for R-2- accused submits that there was no legally enforceable debt as on the date of Ex. P-1 cheque and therefore the proceedings initiated by the appellant –complainant against R-2 accused are vitiated. It is also submitted by him that the complaint is bad for want of service of statutory notice on the accused as contemplated under Sec. 138 (b) of Negotiable Instruments Act. His last submission is that the complaint against the accused without the company being impleaded as co-accused is not maintainable. He placed reliance on the decisions of our H