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2008(2) Bankmann 543 (Mad.)
MADRAS HIGH COURT
K.N. Basha, J.
Mrs. Pramila Bajoria, Director M/s Marshall Sons and Co. Ltd.
& Ors. —Petitioners
versus
M/s. Travicon Services
Pvt. Ltd. —Respondent
Criminal O.P. Nos. 4256 and 4257 of 2005 and Crl. M.P. Nos. 1660 and 1661 of 2005
Decided on 23.9.2008
Counsel for the Parties:
For the Petitioners in both the petitions:Mr. G. Ravikumar, Advocate.
For the Respondent in both the Petitions: Mr. B. Jayaraman, Legal Aid Counsel.
IMPORTANT POINT
In an offence of dishonour of cheque issued by company vague ad bald allegations that accused Directors in a Company were actively participated in day to day affairs of company, they could not be made liable for offence under Section 138 r/w 141 of NI Act.
Headnote:(i) Negotiable Instruments Act, 1986—Sections 138 and 141—Dishonour of cheque issued by company—Prosecution of Directors in vicarious liability—Petitioner A 4 had resigned as Director on 31.5.2002 and Form 32 produced of the fact—Cheque was issued on 7.9.2003—In view of unimpeachable document, petitioner No. 4 could not be implicated for alleged offence and proceedings were liable to be quashed against him. (Para 6)
(ii) Negotiable Instruments Act, 1881—Sections 138 and 141—Dishonour of cheque issued by company—Prosecution of Co. and accused 2 to 9 with allegations that accused 2 to 9 being Directors were actively participated in day to day affairs of accused Company—Petition by accused A2, A3 and A 5 for quashing of complaint and proceedings—Except bald and vague allegations that accused were actively participated in day to day affairs of accused company, no specific role was assigned as to how and in what to day to day manner they were responsible for day to day affairs of company—Proceedings were liable to be quashed against petitioners—Though accused A 6 and A 9 were not before High Court but in face of same allegations against them, proceedings quashed against them also. (Paras 7, 14 and 15)
Result: Petitions allowed.
K.N. Basha, J.—The petitioner in Criminal O.P. No. 4256 of 2005, has been arrayed as A 4, and the petitioners in Criminal OP No. 4257 of 2005, who have been arrayed as A-2, A-5 and A-3, are facing trial for the alleged offence under Section 138 of the Negotiable Instruments Act and they have come forward with this petition seeking for the relief of the quashing the proceedings pending in CC No. 467 of 2004 on the file of the learned III Metropolitan Magistrate, George Town, Chennai.
2. Mr. G. Ravikumar, learned counsel for the petitioners raised two main grounds in respect of the petitioner in Criminal OP No. 4256 of 2005 among which the second ground is also applicable to all the petitioners in both these petitions, viz. (i) that the petitioner (A3) in Criminal OP No. 4256 of 2005 has resigned her Directorship even prior to the date of issue of the cheque, i.e. as early as on 31.5.2002, whereas the disputed cheque was dated 7.3.2003 and as such the said petitioner A-4 could not be vicariously held liable for the offence said to have been committed by the first accused company, and (ii) that even assuming that the petitioners were the Directors during the relevant period of issuing the cheque, there is no specific and definite allegations levelled against the petitioners to show as to how and in what manner, the petitioners were responsible for the day to day affairs of the first accused company. The learned counsel would submit that there is only vague and bald allegations to the effect that A2 to A9, being the Directors are actively involved in the day to day affairs of the first accused company. Therefore, it is contended that allowing the proceedings to continue against the petitioners in both these petitions would amount to a clear case of abuse of process of court and the same is liable to the quashed.
3. Per contra, Mr. B. Jayaraman, learned counsel appearing for the respondent/complainant as legal aid counsel contended that there are specific allegations against the petitioners, who have been arrayed as A4, A2, A5 and A3. It is submitted that in the complaint it is stated that A2 to A 9, who are the Directors are actively participated in the day to day affairs of the company and as such they are also liable to be proceeded and it is open to the petitioners to raise all these points only at the time of trial. It is further contended that even in respect of the statement of resignation prior to the issuance of the disputed cheque, the petitioner in Criminal OP No. 4256 of 2005 is entitled to establish her case only at the time of trial as the same related to appreciation of evidence and it is only the trial court to scrutinize the authenticity of the Form 32 as well as the resignation of the said petitioner as a Director from the first accused company even prior to the date of issuance of the disputed dishonoured cheque in this matter.
4. I have carefully considered the rival contentions put forward by either wide and also perused the impugned complaint and other materials available on record.
5. The learned counsel for the petitioners mainly raised two contentions, viz., the petitioner in Criminal OP No. 4256 of 2005, who has been arrayed as A 4, has resigned from the Directorships even prior to the date of issuance of the cheque involved and there is no specific and definite allegations levelled against all the petitioners to show as to how and in what manner they were also responsible for the day to day affairs of the first accused company.
6. In respect of the first contention, it is pertinent to be noted that the said petitioner has also produced Form 32 before this Court which reveals that the petitioner has resigned as early as on 31.5.2002 and the disputed cheque involved in this case was admittedly said to have been signed and issued only on 7.9.2003 and as such in view of this unimpeachable document of sterling quality this court is of the considered view that the said petitioner A 4 cannot be impli
