ANDHRA PRADESH HIGH COURT
VAMAN RAO, J.
Criminal Petition Nos. 3276 of 1999 and batch
Decided on 8-9-1999
B. MANIPAL REDDY
versus
STATE OF A.P. AND ANOTHER
Counsel for the parties :
Mr. Vedula Srinivas, Advocate— For the Petitioner.
Public Prosecutor— For the Respondent No. 1.
Mr. P.R. Balarami Reddy, Advocate— For the Respondent No. 2.
Headnote:Result : Petition dismissed.
Vaman Rao, J. - These petitions are filed under Section 482 of Code of Criminal Procedure (Cr.P.C.) seeking quashing of the proceedings in C.C. Nos. 484, 479, 481, 483, 480 and 768 of 1997 respectively, on the file of IV Metropolitan Magistrate, Hyderabad, in which the petitioner accused is facing charge under Section 138 of Negotiable Instruments Act (for short, the Act).
2. It appears that the Company, which is represented by the petitioner herein, had agreed to allot some of its shares by private placement out of promoter' quota in favour of the complainant and received certain amounts. Later the accused failed to allot the said shares and under a mutual agreement he agree to repay the amounts received towards the price of shares. Accordingly, towards repayment of .the said amount, a cheque for the requisite amount in each case was given by the Company, which is said to be represented by the accused, to the complainant. The cheques in question were presented for relaisation and they were returned on the ground of insufficiency of funds to the credit of the Company, which the accused represents. A notice under Section 138 of the Act was sent by the complainant
3. Learned Counsel for the petitioner seeks quashing of the proceedings mainly on the ground that the requirements of Section 141 of the Act are not complied with in the complaint. The contention is that the petitioner-accused is merely a Director of the Company and the complaint, a copy of which has been filed with the petition, does not mention anything as to how the petitioner-accused was incharge of the affairs of the Company and was responsible to the Company. A reading of the complaint would show that there is no averment that the petitioner-accused was incharge of and was responsible to the Company.
4. Learned Counsel for respondent No. 2, Sri P.R. Balarami Reddy, points out that the complaint itself has described the accused as the Managing Director of the Company. Apart from this, it is brought to the notice of this Court that the agreement, which is said to be the basis for the liability of the accused for payment, a copy of which has been filed with the relative petitions, also describes the petitioner as Managing Director of the Company. Learned Counsel for respondent No. 2 then invites my attention to the reply sent on behalf of the accused to the notice sent by the complainant under Section 138 of the Act, a copy of which has been filed as material alongwith the counter filed by respondent No. 2. The authenticity of this reply is not disputed by the learned Counsel for the petitioner except stating that it was sent by the Company and not by the petitioner-accused in his personal capacity, Even then document mentions that the Company, on whose behalf then reply was sent is represented by the petitioner-accused as its Managing Director. The contention of the learned Counsel for respondent No. 2 is that when an accused happens to be the Managing Director of the Company that in itself implies that he was incharge of and was responsible to the Company. The mere omission to specifically state so in the complaint and failure to reproduce the words occurring in Section 141 of. the Act would not vitiate and render it liable to be quashed on the ground or non-compliance of Section 141 of the Act.
5. There is some force in the contention advanced by learned Counsel for respondent No. 2. It is true that Section 141 of the Act contemplates that where the Company happens to be the accused, then apart from the Company every person, who was incharge of and was responsible to the Company, shall also be liable for the offence under section 138 of the Act, besides the Company itself.
6. Learned Counsel for the petitioner relying on the judgment of the Supreme Court in State of Haryana v. Brij Lal Mittal, Volume 93 Company Cases page 1, contends that unless there is an averment in the complaint in terms of Section 141 of the Act a person who is merely a Director of the