A non-signatory director cannot be held liable under Section 138 of the Negotiable Instruments Act if not responsible for the company's conduct at the time of the offence.

Order :

(Arvind Kumar Verma, J.)

1. With the consent of the parties, matter is heard finally.

2. The present petition under Section 482 of the Code of Criminal Procedure, 1973 has been preferred by the petitioner for quashment of Criminal Proceedings bearing Case No.4823/2018 which is pending in the Court of Judicial Magistrate First Class, Raipur (Annexure P/2) and the subsequent revision order dated 13.09.2023 passed by the learned 4^th ADJ, Raipur (C.G.) (Annexure P/1).

3. Brief facts of the case is that the petitioner was made Director's of Net Ink Technologies Pvt. Ltd. without his knowledge on 31.03.2018 and in a matter of few hours were removed from the post of Director. Two cheques bearing No.000268 and 000269 dated 21.03.2018 and 11.04.2018 were issued by Respondent No. 2 in favour of Respondent No. 1 for an amount of Rs. 17,50,000/- (Rupees Seventeen Lacs Fifty Thousand Only) and Rs. 50,00,000/- (Rupees Fifty Lacs Only) respectively and the same had been dishonoured by drawee Bank on 20.06.2018. At a later stage, Respondent No. 1 (Sky High Media) preferred a complaint u/s 138 of Negotiable Instruments Act, 1881 against Respondent No. 2. (Net Ink Technology) and made many random persons a party in capacity of a Director of Respondent No. 2 Company one of which was petitioner.

4. Learned counsel for the petitioner contended that continuation of proceeding against the petitioner is an abuse of process of law in as much as the instant proceeding is not maintainable against the petitioner who is a non-relevant former Director of Respondent No. 2 and was not the concerned/relevant Director for the purposes of this trial. The petitioner was not responsible for the conduct of business of the company at any given stage nor was he an authorized signatory or relevant person for this alleged transaction. The aforesaid cheques were issued before and after the petitioner became Director and was dishonoured after he was removed from the position, the petitioner was a Director only for a matter of hours and was then dismissed from that position all without the knowledge of the petitioner. It is pertinent to note that the present petitioner was not the Director when the cheques were issued nor was he one at the time of dishonor and was only Director of the company for a few hours on 31.03.2018. He further contended that no statutory demand notice was received by the petitioner before filing of the proceeding u/s 138 of Negotiable Instruments Act, 1881 and hence, the proceedings u/s 138 are not maintainable. It is, therefore, prayed that this Court may kindly be pleased set-aside/quash the Revision Order dated 13.09.2023 passed by Learned 4th ADJ, Raipur (Annexure P/1), set-aside/quash the proceedings in Criminal Case No. 4823/2018 to the extent of petitioner's role and liability.

5. On the other hand, learned counsel for the respondents contended that after due investigation the petitioner has been charge-sheeted for the aforesaid offence and prima-facie material collected are sufficient to put the petitioner at trial and he is standing trial also and considering the material available on record, it cannot be held that no prima-facie case against the petitioner for standing trial is made out, as such, it is the case where the petition deserves to be dismissed.

6. I have heard learned counsel for the respective parties and considered their submissions made herein above and also went through the records with utmost circumspection.

7. On perusal of the records, it reveals that the cheques were issued on 21.03.2018 and 11.04.2018 while the petitioner was appointed as the Director of the company on 31.03.2018 at 11:00 AM and he resigned on the same day at 03:00 PM, therefore, it is crystal clear that when the cheques were issued, petitioner was not holding the post of Director of the company. He was not conducted the day to day business of the Company. Therefore, petitioner is not responsible for the conduct of business of the company at any give