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KARNATAKA HIGH COURT
A.N. Venugopala Gowda, J.
B.L. Boolani —Petitioner
versus
Vasanth Kumar Bangera —Respondent
Cri. Revision Petition No. 236 of 2012
Decided on 6.11.2012
Counsel for the Parties:
For the Petitioner:Sri V.B. Shivakumar, Advocate.
For the Respondent:Sri K.A. Ariga, Advocate.
IMPORTANT POINT
For maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative.
Headnote:Negotiable Instruments Act, 1881—Sections 138, 141—Complaint alleging dishonor of cheque against Director of company—Conviction by Courts below—Revision thereagainst—Whether the petitioner, a Director of the company, could have been prosecuted for the offence punishable under the provisions of the Act, without the company also being arraigned as an accused? —Held No—For maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative—The other categories of offenders can only be brought in the dragnet on the touchstone of vicarious liability as the same has been stipulated in the provision itself—Instantly both the Courts below had not considered the material contention relating to non-maintainability of the complaint, in the absence of the company, in which, the accused persons were the Managing Director and the Director respectively—The Courts below were expected to consider said contention—Impugned judgments of Courts below set aside-Revision Petition allowed. (Paras 7 to 9)
A.N. Venugopala Gowda, J.— The XVI Additional Chief Metropolitan Magistrate, Bangalore City, on 6.7.2011, convicted both the accused in C.C. No. 15622 of 2008, a case related to the dishonour of cheques, under Section 138 of Negotiable Instruments Act, 1881 (for short, ‘the Act’) and sentenced the accused to pay fine of Rs. 4,02,000.
Rs. 4,00,000, from the fine amount, when realised, was ordered to be paid to the complainant as compensation. In default of payment of the compensation amount, the accused were ordered to undergo simple imprisonment for a period of 4 months. Cri. A. No. 577 of 2011 filed, thereagainst, in the City Civil and Sessions Court, Bangalore City, assigned to the Fast Track (Sessions) Court-XVII, was dismissed by a judgment dated 30.11.2011. Assailing the said judgments and orders, petitioner/accused 2, has filed this criminal revision petition.
2. The respondent filed a private complaint against one N. Bharath Shetty and the petitioner, Managing Director and Director respectively of a company, M/s. Canara Polypack Limited (for short, ‘company’) for the offence punishable under Section 138 of the Act, alleging that, for the purpose of the company, the accused borrowed Rs. 4,00,000 and towards repayment of the loan, issued in his favour two cheques, dated 30.11.2007, each for Rs. 2,00,000, drawn on Vijaya Bank, Vijayanagar Branch, Bangalore-40. The said cheques when presented for encashment, came to be dishonoured and returned with endorsements ‘account recalled’. By a notice dated 24.2.2008, the complainant called upon the accused to pay the cheque amount within 15 days of the receipt of notice. The notice sent to N. Bharath Shetty/accused 1, was returned with postal shara ‘left’. The notice sent to the petitioner was served. The petitioner, disowning the liability to pay the demanded amount, sent a reply dated 12.3.2008. As the accused failed to pay the cheque amount, a private complaint was filed. Learned Magistrate took cognizance. Case was ordered to be registered and process was issued against the accused. Both the accused appeared and were released on bail. The accused denied the charge. During trial, the complainant got himself examined as PW1 and marked Exs. P1 to P.10. The accused were examined under Section 313 of Criminal Procedure Code, 1973. Accused 1 got himself examined as DW 1. Accused 2 got himself examined as DW2. Son of accused 2 was examined as DW 3. Exs. D 1 to D19 was marked. The learned Magistrate having found that, ‘there existed a legally enforceable debt as on the date the cheques in question were issued and the cheques so issued having been returned unpaid because of non-availability of fund in the account of the company—Canara Polypack Limited, held that the complainant has proved beyond all shadow of doubt that the accused have committed the offence under Section 138 of the Act. As a result, the Judgment of conviction and Order of sentence, noticed supra, was passed. The same was questioned on various grounds in an appeal filed by the petitioner. It was pointed out that the alleged transaction being of the company and the cheques in question having been issued on behalf of the company, and M/s. Canara Polypack Limited, the company, having not been arraigned as accused, the complaint being not maintainable, ought to have been dismissed. The Appellate Judge, without considering the said material contention, concurring with the findings recorded by the Magistrate, dismissed the appeal.
3. Appearing for the petitioner, Sri V.B. Shiva Kumar, learned Advocate, by placing reliance on the decision in the case of Aneeta Hada v. M/s. Godfather Travels and Tours Private Limited1, contended that the offence, if any, having been committed by the company, without the company being arraigned as an accused in the case, the prosecution of the petitioner a director of the company, is impermissible. He submitted that the Courts below, without examining the defence put forth, by keeping in v
