The main legal point established in the judgment is that the SPA holder had the authority to prosecute the petitioners as directors of the company under section 138 N.I. Act, and the Ld. MM had jurisdiction to proceed in the matter.

JUDGMENT :

1. Vide this petition filed u/S. 482 of Code of Criminal Procedure, 1973 (“Cr.PC” in short), the petitioners have sought :-

(i) setting aside of order dated 29.04.2022 (“impugned order” in short), passed by Ld. MM (N.I. Act)-01, SW/DWK/ND in C.C. No. 44350/2019 (“complaint” in short), titled as Kawaljeet Singh Duggal vs. C.P. Systems Pvt. Ltd. & Ors., whereby the petitioner’s application under section 322 Cr.PC was dismissed; and

(ii) dropping of the proceedings against the petitioners under section 138 of Negotiable Instruments Act (“N.I.Act” in short) in the aforesaid complaint.

2. Briefly stating, the facts relevant for disposal of this petition are that :

(i) Kawaljeet Singh Duggal/respondent no. 2 herein through his Special Power of Attorney (“SPA” in short)/Authorized Representative Sh. Sanjeev Malik Chand filed the complaint under Section 138 N.I. Act against the respondent no. 3 i.e. M/s. C.P. Systems Pvt. Ltd. and its directors, namely, Sanjay Shandilya (petitioner no. 1 herein) and Vikas Ahuja, Akash Rai Gupta (petitioner no. 2 herein) and Suchan Jamkhandi Sunil;

(ii) vide order of Ld. MM dated 11.12.2019, the accused persons including the petitioners herein were summoned for 13.02.2020;

(iii) the accused no. 2 & 4/the petitioners herein filed an application u/s. 322 Cr.PC for review of summoning order dated 11.12.2019 and for dropping of the proceedings u/s. 138 N.I. Act against them;

(iv) the said application was dismissed by the Ld. Magistrate vide order dated 29.04.2022/the impugned order, observing that the Ld. MM does have criminal and territorial jurisdiction to proceed in the matter, rejecting the petitioner’s plea of lack of jurisdiction against them.

3. The petitioners have challenged the impugned order dated 29.04.2022, inter alia, on the grounds that:

(i) the Special Power of Attorney holder Sh. Sanjeev Malik Chand had no authority to file the complaint u/s. 138 N.I. Act against the petitioners as the Special Power of Attorney (“SPA” in short), on the basis of which he filed the complaint on behalf of Kawaljeet Singh Duggal, did not empower him to implead the petitioners herein;

(ii) the Ld. Magistrate failed to appreciate that as the said Special Power of Attorney only mentioned that Sh. Sanjeev Malik Chand could initiate, file, institute and do other things “in the matter of Kawaljeet Singh Duggal Vs. C.P. Systems Pvt. Ltd.”, it did not authorize the SPA holder to implead the petitioners herein as accused in the aforesaid complaint; and no such proceedings could have been continued by him before the Ld. Trial Court;

(iii) Ld. Magistrate failed to appreciate that when the SPA holder did not have authority to implead the petitioners/accused persons and to continue such proceedings, the issuance of summons by the Ld. MM was without jurisdiction, in view of the law as laid down in TimbloIrmaos Ltd. Margo vs. Jorge Anibal Matos Sequeria and Ors, 1977 AIR 734.

3.1 During arguments, with respect to scope of power of attorney, the Ld. Counsel for the petitioners also referred to the judgment in Jimmy Jahangir Madan vs. Bolly Cariyappa Hindley (Dead) by LRs, (2004) 12 SCC 509.

4. On the other hand, Ld. counsel for the respondent no. 2 sought dismissal of this petition with heavy costs pleading that it lacks merits and has been filed only to harass the complainant and delay the proceedings before the Ld. Trial Court. It is submitted that the application under Section 322 Cr.PC filed by the petitioner was not maintainable and was rightly dismissed by the Ld. MM. Even the present petition is not maintainable.

4.1 Ld. counsel for the respondent no. 2 also submitted that the respondent no. 3 – M/s. C.P. Systems Pvt. Ltd. is a company, a juristic person and in terms of Section 141 N.I. Act, every person, who at the time the offence was committed, was in charge of/responsible to the company for conduct of its business shall be deemed to be guilty of the offence and is liable to be prosecuted u/S. 138 N.I. Act. Thus, the SP