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2009(1) Bankmann 496 (Del.)
DELHI HIGH COURT
Sunil Gaur, J.
Renu Madan —Petitioner
versus
State and Anr. —Respondents
Criminal M.C. No. 751 of 2007
Decided on 29.9.2008
For the Petitioner:Anurag Kumar Agarwal and Umesh Mishra, Advocates.
For the Respondents:Amit Sharma, Addl. P.P. and Ms. Gaganpreet Chawla, Advocates.
IMPORTANT POINT
Need to spell out specific role of the Directors of a Company is required, where they are not closely related to each other.
Headnote:Negotiable Instruments Act, 1881—Sections 138 and 141—Dishonour of cheque drawn by company—Prosecution of company and its two directors—Petition to quash complaint and proceedings by one of the director on ground that petitioner had no role to play in the loan transaction—Specific role played by a particular director in alleged transaction is a matter which is particularly within the knowledge of accused company—Need to spell out specific role of the directors of company was required where they were not closely related to each other—Petitioner was wife of other director—No good ground for quashing of complaint. (Paras 11 to 14)
Sunil Gaur, J. —Petitioner claims herself to be sleeping Director of M/s. Shree Conveyor Systems Pvt. Ltd. and that she has nothing to do with day-to-day business affairs of the aforesaid company. She has been summoned as an accused in Criminal Complaint No.73/2005 titled M/s. R.B.G. Leasing and Credit Limited, under Section 138 of Negotiable Instruments Act.
2. Quashing of the aforesaid complaint filed by respondent No.2 and proceedings pursuant thereto, is prayed for, in this petition. According to the petitioner, she has no role to play as she had not approached respondent No.2 for any loan nor it was given to her and petitioner had not given any assurance of repayment, nor the cheques in question have been signed by her and even the statutory notice regarding dishonouring of aforesaid cheques is not sent to her and, therefore, quashing of aforesaid complaint is sought by placing reliance upon judgments reported in (2005) 8 SCC 89 and AIR 2007 SC 1454.
3. Respondent No. 2/complainant has drawn attention of this Court to para 2 of the criminal complaint to show that petitioner as well as her husband were both in-charge of their company and were responsible for the conduct and business of their company. Whereas, petitioner has pointed out that in paras 4 to 7 of the complaint in question, the active role is attributed to accused No.2 who is the husband of the petitioner and not to accused No.3 who is the petitioner.
4. Both the sides have been heard and the record as well as judgments cited are perused.
5. The contention of the petitioner is that the statutory notice Annexure P5 has been sent to accused No.1 i.e. the private company of the petitioner and not to the petitioner. This contention does not cut any ice for the reason that in the notice Annexure P5, it is clearly mentioned that the company and all its Directors who are in-charge of and are responsible to the company for the conducts or its business are liable.
6. In case of S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla and anotherl, a Constitution Bench of the Apex Court has held as under:
“Therefore, in order to bring a case within Section 141 of the Act the complaint must disclose the necessary facts which make a person liable. It is necessary to specifically aver in a complaint that at the time the offence was committed, the person accused was in-charge of, and responsible for the conduct of business of the company. This averment is an essential requirement of Section 141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of Section 141 cannot be said to be satisfied.”
7. In case of J.N. Bhatia and others v. State and another2, a Single Judge of this Court has held as under:
“It can, therefore, be safely concluded that the view, which is now accepted by the Supreme Court, is that mere repetition of the phraseology contained in Section 141 of the N.I. Act. i.e. ‘the accused is in-charge of and responsible for the conduct of the day-to-day affairs of the company’, may not be sufficient and something more is to be alleged to show as to how he was so responsible.”
8. Pertinent observations made by the Apex Court in case of N.K. Wahi v. Shekhar Singh and others3, are as under:
“To launch a prosecution, therefore, against the alleged Directors there must be a specific allegation in the complaint as to the part played by them in the transaction. There should be clear and unambiguous allegation as to how the Directors are in-charge and responsible for the conduct of the business of the company. The description should be clear. It is true that precise words from the provisions of the Act need not be reproduced and the Court can always come to a conclusion in facts of each case. But still in the absence of any averment or specific evidence the net result would be that complaint would not be entertainable.”
9. In case of Saroj Kumar Poddar v. State (N.C. T of Delhi} and another, 2007(3) SCC 693, while dealing wi
