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IN THE HIGH COURT OF DELHI AT NEW DELHI
ANEES UR RAHMAN – Appellant
Versus
M/S SMAL FARMERS AGRIBUISNESS CONSORTIUM – Respondent
JUDGMENT :
AMIT MAHAJAN, J.
1. By the present petition, the petitioner challenges the proceedings in Complaint Case No. 476576/2016 filed by the respondent under Section 138 of the Negotiable Instruments Act, 1881 (‘NI Act’).
2. The complaint was filed alleging that the petitioner and other co-accused persons, acting on behalf of the accused company namely M/s Fresco Foods Pvt. Ltd., entered into an agreement dated 12.03.2009 with the complainant whereby the respondent disbursed a sum of Rs. 1,60,00,000/- as a venture capital amount to the accused. This venture capital assistance was refundable upon the full repayment of the term loan. It is the case of the respondent that the accused undertook that in the event of the venture capital amount not being refunded on the same date as that of the repayment of the term loan from the bank, the same would attract interest at the same rate as that being charged by the bank for the term loan.
3. It is further the case of the respondent that the accused company had issued a cheque for a sum of Rs. 1,60,00,000/- being cheque no. 970600 dated 26.09.2016. The said cheque, upon presentation, was dishonoured with remarks “funds insufficient” vide Bank
Vicarious liability under Section 141 of the NI Act requires proof that a director was in charge of the company at the time the offence was committed, mere prior association is insufficient.
Vicarious liability under the Negotiable Instruments Act requires proof of a director's active involvement and responsibility in the company's operations, not merely their title.
Liability under Section 141 of the Negotiable Instruments Act depends on the role played by a person in the affairs of the company at the time of the offence, not just on designation.
Dishonour of cheque – Offence by company – It may not be proper to split while reading complaint so as to come to a conclusion that allegations as a whole are not sufficient to fulfil requirement of ....
The main legal point established in the judgment is the requirement for specific averments and unimpeachable evidence to establish vicarious liability of directors in cases of cheque bounce under Sec....
Vicarious liability under Section 141 of the Negotiable Instruments Act requires specific allegations showing a person's responsibility for conduct of a company's affairs; mere involvement is insuffi....
(1) Dishonour of cheque – Impleadment of all Directors of Accused Company on the basis of a statement that they are in charge of and responsible for conduct of business of company, without anything m....
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