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2008(1) Bankmann 302 (A.P.)
ANDHRA PRADESH HIGH COURT
G.V. Seethapathy, J.
D. Shamantakamani and Anr. —Petitioners
versus
State of A.P. and Ors. —Respondents
Criminal Appeal No. 4252 of 2007
Decided on 24.9.2007
For the Petitioners:Mr. K. Someswara Kumar, Advocate.
For the Respondent No. 1: Public Prosecutor
For the Respondent Nos. 2 and 3:M/s. K. Venkatesh Gupta and K. Buchi Babu, Advocates.
Headnote:Negotiable Instruments Act, 1881—Sections 138 and 141—Dishonour of cheque—Offence by firm—Liability of partners—Petitioners contended that being ladies, they were sleeping partners and dishonoured cheque was not issued with their knowledge and connivance—Held, there are specific averments in the complaint that the disputed cheque was issued to the knowledge and with the connivance of petitioners—It cannot be said that there is no prima facie case made out from averments against petitioners—The question as to the truth or otherwise of said imputation of knowledge cannot be gone into in present proceedings—Petition dismissed—Criminal Procedure Code, 1973—Section 482—Partnership Act, 1932—Sections 32, 45, 63 and 72. (Para 11)
Facts of the Case:
Third respondent firm/A1 represented by its partners i.e. fourth respondent A2 and petitioners A3 and A4 borrowed a sum of Rs. 4,00,000 from complainant firm on 7.2.2005 and executed a promissory note to repay the said debt with interest at 18 % p.a. The accused paid only a sum of Rs. 12,600 and failed to pay the balance. On repeated demands, A1 through A2 issued a post dated cheque bearing No. 353582 dated 13.9.2006 of State Bank of India Mahabubnagar for Rs. 3,75,000 in discharge of debt. When complainant presented the cheque for payment, it was returned unpaid on the ground that A1 had already closed the account.
The complainant gave a statutory notice on 28.9.2006 to which accused issued reply notice denying their liability.
Thereafter second respondent/complainant filed complaint alleging offences not only under Section138 of the NI Act but also under Section 420 of IPC.
Aggrieved by the same, present petition has been filed by A3 and A4 seeking quashing of their prosecution.
Petitioners contended that being ladies, they were sleeping partners and were not in-charge of the day to day affairs of the firm and they retired from partnership on 30.6.2005 much prior to the issuance of cheque on 13.9.2006.
Counsel for second respondent contended that specific allegations are made against petitioners regarding their involvement in the offence not only under Section 138 of N.I. Act but also under Section 420 IPC.
Findings of the Court:
In the face of specific averment in the complaint attributing knowledge to and concurrence and connivance on the part of A3 and A4 in issuance of the disputed cheque by A2 on behalf of A1 it cannot be said that there is no prima facie case made out against A3 and A4. The question as to truth or otherwise of the said imputation of knowledge concurrence and connivance on the part of petitioners in issuance of disputed cheque cannot be gone into at this stage in the present proceedings.
Result: Petition dismissed.
G.V. Seethapathy, J.—This petition is filed under Section 482 Cr.P.C., by A3 and A4 seeking to quash their prosecution in C.C. No. 226 of 2007 on the file of the Court of the Judicial Magistrate of the First Class, Mahabubnagar.
2. The second respondent herein filed a complaint against the respondents 3 and 4, who are A1 and A2, and the petitioners herein (A3 and A4) alleging offences under Section 138 of the Negotiable Instruments Act (for short ‘the Act’) and Section 420 of the Indian Penal Code. Respondent No. 4 and the petitioners herein are stated to be the partners of the third respondent firm. According to the second respondent/complainant, the third respondent/A2 through the fourth respondent/A2 borrowed a loan of Rs. 3,00,000 on 7.2.2005 from the complainant firm by way of a cheque bearing No. 946964 of State Bank of India, Mahabubnagar Branch and realized the proceeds of the cheque and executed a promissory note to repay the debt at 18% per annum and passed receipt on the same day. The complainant alleges that the accused paid an amount of Rs.12,600 towards part of the interest and failed to pay the balance and on repeated demands A1 through A2 issued a post-dated cheque bearing No. 353582 dated 13.9.2006 of State Bank of India, Mahabubnagarfor Rs. 3,75,000 purporting to be in discharge of the debt and liability and when the complainant presented the cheque for payment, it was returned unpaid on the ground that A1 had already closed the account. The complainant gave a statutory notice on 28.9.2006 to which Accused No. 2 issued a reply notice on 13.10.2006 and A3 and A4 issued reply notice on 14.10.2006, denying their liability. Thereafter, the second respondent herein filed the complaint alleging offences not only under Section 138 of the Act, but also under Section 420 IPC. The complaint was taken on file by the learned Magistrate and numbered as C.C.No. 226 of 2007. Aggrieved by the same, the present petition is filed by A3 and A4 seeking to quash their prosecution.
3. Arguments of the learned counsel for the petitioners, the learned counsel for the second respondent and the learned Public Prosecutor representing the first respondent-State are heard. Records are perused.
4. The learned counsel for the petitioners contended that A3 and A4 being ladies were sleeping partners and were not in-charge of the day-to-day affairs of the firm and they retired from partnership on 30.6.2005 much prior to issuance of the cheque on 13.9.2006 and, therefore, they are not liable for the offences alleged and further proceedings against them are liable to be quashed.
5. The learned counsel for the second respondent, on the other hand, contended that as per sub-clause (2) of Section 141 of the Act where an offence is committed by a company and it is proved that it was committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer of the company, such person shall also be deemed to be guilty of the offence and, therefore, it is not necessary that the partners of the firm against whom the complaint is filed shall invariably be in-charge and responsible to the company for the conduct of the business. He would, therefore, submit that petitioners A3 and A4 are also liable for the offence as the cheque was issued with their concurrence and connivance. He further submitted that specific allegations are made against petitioners/A3 and A4 regarding their involvement in the offence not only under Section 138 of the Act, but also under Section 420 I.P.C.
6. According to the complainant, the third respondent firm/A1 represented by its partners i.e., fourth respondent A2 and petitioners/A3 and A4 borrowed a sum of Rs. 4,00,000 from the complainant firm on 7 .2.2005 and executed a promissory note to repay the said debt with interest at 18% per annum and paid only a sum of Rs.12,600 and pursuant to repeated demands by the complainant, the accused gave a cheque
