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2007 Supreme(Cal) 97

High Court Of Calcutta
P. N. Sinha, J.
CHHEDI LAL GUPTA - Appellant
Versus
SURESH DAMANI - Respondent
C. R. R 3890  Of  2006
Decided On : 02/15/2007

Advocates Appeared:
Amit Bhattacharjee, AYAN BHATTACHARJI, INDRAJIT ADHIKARI, SANDIPTA BOSE, SUBRATA BOSE

A complaint under Section 141 of the Negotiable Instruments Act must specifically aver that the accused person was in charge of and responsible for the conduct of the business of the company at the time the offense was committed.

Headnote:

NEGOTIABLE INSTRUMENTS ACT - COMPLAINT - SECTION 138/141 - QUASHING OF COMPLAINT - PARTNERSHIP FIRM - VICARIOUS LIABILITY - ESSENTIAL REQUIREMENTS - AVERMENTS IN COMPLAINT - INTERPRETATION OF SECTION 141 - JUDICIAL PRECEDENTS - LEGAL FRAMEWORK FOR QUASHING CRIMINAL PROCEEDINGS.

Fact of the Case:

The petitioner, a partner in a partnership firm, challenged two criminal complaints filed against him under Sections 138/141 of the Negotiable Instruments Act (NI Act) for dishonor of cheques. The petitioner claimed that he was not a partner of the firm and had no role in the issuance or dishonor of the cheques.

Finding of the Court:

The High Court, after examining the averments in the complaint, found that there were specific allegations that the petitioner was a partner of the firm and was responsible for the conduct of the business. The Court held that the complaint contained sufficient prima facie materials to constitute an offense under Sections 138 and 141 of the NI Act.

Issues: 1. Whether the complaint contained sufficient averments to establish the petitioner's vicarious liability under Section 141 of the NI Act? 2. Whether the petitioner's claim that he was not a partner of the firm could be considered at the stage of quashing the complaint?

Ratio Decidendi: 1. The Court relied on several Supreme Court precedents, including Monaben Ketanbhai Shah v. State of Gujarat and S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla, to establish the essential requirements for a complaint under Section 141 of the NI Act. It held that the complaint must specifically aver that the accused person was in charge of and responsible for the conduct of the business of the company at the time the offense was committed. 2. The Court held that the petitioner's claim that he was not a partner of the firm could not be considered at the stage of quashing the complaint. The onus was on the petitioner to establish his defense in the trial.

Final Decision: The Court dismissed the petitioner's revisional applications, holding that there was no ground for quashing the complaint cases against him. The Court directed the trial court to proceed with the cases expeditiously.

( 1 ) THESE two revisional applications under section 401 read with section 482 of the Code of Criminal Procedure (in short the Code) are aimed at quashing the criminal proceedings being Complaint Case No. C-5488 of 2003 and Complaint Case No. C-5489 of 2003 under section 138/141 of the negotiable Instruments Act (hereinafter called the N. I. Act), 1881 now pending in the Court of the learned Metropolitan Magistrate, 12th Court, calcutta. As the facts and legal principles of both the complaint cases and the present revisional applications are identical, I intend to dispose of both the revisional applications by this common judgment and order.

( 2 ) BEFORE I proceed to enter into the merit of the revisional applications, i think it fruitful to mention the facts as disclosed in the complaints of the two cases. The revisional application bearing No. CRR No. 3890 of 2006 has been filed praying for quashing the case No. C-5488 of 2003 and the CRR no. 3891 of 2006 has been filed praying for quashing the case No. C-5489 of 2003. Both the complaints were filed by O. P. No. 1 against the petitioner and others. It was alleged in the complaint that, the complainant has been working for gain as the insurance agent of various reputed organisations. The accused No. 1 is the partnership firm and accused Nos. 2, 3 and 4 are the partners of the said firm. The accused Nos. 2, 3 and 4 being the partners of the firm were the persons in charge of, and responsible to, the conduct of the business of accused No. 1 firm and they were looking after the day-to-day affair of the said firm. The accused persons 2 to 4 obtained loan of Rs. 8,21,000/- (Rupees eight lakh twenty-one thousand) in the name and on behalf of the firm namely, M/s. Gaya Prasad Chhedilal upto 18th December, 2001 from the wife and minor son of the complainant on condition that the said loan would be repaid with interest by instalments to the complainant who was authorised by his wife and minor son to receive the said amount. The accused persons issued an account payee cheque bearing No. 293867 dated 30th July, 2003 for Rs. 1,00,000/- drawn on UCO Bank, Lower Circular road Branch in favour of the complainant to meet the liabilities or part debt. The said cheque was presented within the validity period for encashment by the complainant on 4th August, 2003 with the United Bank of india, Shakespeare Sarani Branch, Kolkata. The said cheque was dishonoured and returned by the drawers banker namely, UCO Bank on the reason

"payment stopped by the drawer" together with a memo dated 5th August, 2003. The petitioner, thereafter, sent demand notice through his Advocate on 10th August, 2003 and sent the same under speed post with A/d to the address of the accused persons and the accused persons duly received the notice on 14th August, 2003. The complainant received one letter on 18th august, 2003 sent by the Advocate on behalf of the accused persons mentioning therein that they received the demand notice, but the accused persons denied the allegations mentioned in the demand notice. The accused persons did not make payment of Rs. 1,00,000/- i. e. the amount of the dishonoured cheque within 15 days from the date of receipt of the demand notice. The complainant thereafter lodged the complaint against the accused persons including the present petitioner who was arrayed as accused No. 4.

( 3 ) THE facts of the Complaint Case No. C-5489 of 2003 were identical except the difference in respect of cheque No. and its date, date of presentation of the cheque for encashment, date of intimation from bank concerning dishonour of the cheque and date of demand notice. In this complaint it was mentioned that the cheque No. was 293866 dated 30th June, 2003 and the complainant deposited the said cheque for encashment on 2nd august, 2003 and on 4th August, 2003 he received the intimation from bank regarding dishonour of the cheque due to "payment stopped by the drawer". The complainant sent the demand notice by spe
























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