The central legal point established in the judgment is the requirement for specific averments to establish the vicarious liability of directors under Section 141 of the Negotiable Instruments Act.

( 1 ) ABOVE captioned petitions arise out of the same complaint and the same summoning order hence all the petitions are being decided together.

( 2 ) RESPONDENT No. 2, M/s. Sabby Builders and Promoters Pvt. Ltd. filed a complaint under Section 138 read with Section 141 and 142 of the negotiable Instruments Act 1881 alleging that M/s. Jhalani Tools (India) Ltd. (impleaded as accused No. 1) had instructed the complainant to render services of settling its dues with banks and financial institutions. That in lieu of services rendered by it, a cheque in sum of Rs. 7,30,50,000/- dated 24. 5. 2004 drawn on State Bank of India was issued in the name of the complainant. That when presented for encashment, the cheque was returned dishonoured with the advice 'account closed'. That in spite of calling upon the accused company to pay the amount under the cheque none was paid.

( 3 ) P. C. JHALANI, Y. C. Jhalani, Pradeep Jhalani, Sandeep Jhalani, anoop Jhalani and Ashok Jhalani were impleaded as accused No. 2 to 7 respectively. In the memo of parties to the complaint they were described as directors.

( 4 ) ONLY allegations against the directors of accused No. 1 are as averred in para 2 of the complaint. The same reads as under:-

"2. That the accused No. 1 is the Limited Company and accused No. 2 to 7 are the Managing Director and Directors of the said accused No. 1, therefore all the accused persons are jointly and severally liable to the acts and deeds of the accused No. 1, all the Managing Directors and directors are supervising the affairs of the accused No. 1 actively. "

( 5 ) AFTER recording pre-summoning evidence, vide order dated 18. 9. 2004 learned Metropolitan Magistrate issued summons against all accused.

( 6 ) PRADEEP Jhalani, accused No. 4 seeks quashing of the complaint and summoning order vide Crl. M. C. No. 2760/2004

( 7 ) YOGESH Jhalani, accused No. 3 seeks quashing of the complaint and the summoning order vide Crl. M. C. No. 2894/2004 His co-petitioner is the company, accused No. 1.

( 8 ) ANOOP Jhalani, accused No. 6 seeks quashing of the complaint and the summoning order vide Crl. M. C. No. 2737/2004

( 9 ) THE company M/s. Jhalani Tools (India) Ltd. , accused No. 1, P. C. Jhalani, accused No. 2, Yogesh Jhalani, accused No. 3 and Ashok Jhalani, accused no. 7 have joined as co-petitioners in Crl. M. C. No. 2895/2004 while praying for quashing of the FIR and the summoning order.

( 10 ) I note that Yogesh Jhalani is a petitioner in 2 petitions.

( 11 ) FROM the averments against the directors of the company as averred in para 2 of the complaint, contents noted in para 4 above, it is to be noted that the complainant has stated that accused No. 2 to 7 are the managing director and directors of accused No. 1. In said para it is thereafter averred that all the managing directors and directors are supervising the affairs of accused No. 1.

( 12 ) IT has not been stated as to who is the managing director and who are the directors. Even in the pre-summoning evidence led by means of an affidavit filed by Sanjay Sabharwal, director of the complainant, accused No. 2 to 7 are stated to be the managing director and directors of accused No. 1, without specifying as to who is the managing director and who are the directors.

( 13 ) IT could be urged (an argument not advanced as a matter of fact) that since name of P. C. Jhalani was listed at serial No. 2 of the accused persons immediately after the name of the company, reference to the managing director in the complaint has to be a reference to P. C. Jhalani.

( 14 ) BUT, it cannot be so, for the reason in the memo of parties in the complaint P. C. Jhalani has been described as a director of the company.

( 15 ) IT is settled law that unless law makes him liable an individual is not vicariously liable for the act of another. Under the negotiable Instruments Act 1881 the directors of a company are made vicariously liable because of Section 141 of the Negotiable In