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IN THE HIGH COURT OF GAUHATI, ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH
ROBIN PHUKAN, J.
Girish Mulshankar Chaudhary and Another – Petitioners
Versus
M/s. M.M. Enterprise and Others – Respondents
Crl. Pet. No. 397 of 2020
Decided On : 23-02-2022
Negotiable Instruments Act, 1881- Sections 138/141 read with Section 142 - Partnership firm - Loan - Cheques dishonoured - Vicarious liability of Directors - Respondent No.1 M/s M. M. Enterprise i s a registered partnership firm are its proprietor - Respondent Nos. 1 and 2 and petitioner No. 1- and petitioner No. 2- are Directors of Sanwaria Infra Space Pvt. Ltd. (accused No. 1), and they are responsible for day-to-day conduct of business of Company M/s M. M. Enterprise has carried out certain works within State of Assam with Sanwaria Infra Space Pvt. Ltd. (accused No. 1) - In order to discharge its liability, M/s Sanwaria Infra Space Pvt. Ltd., issued cheques to the respondent no. 1 amounting which are due - Cheques were deposited by the respondent firm but same were dishonoured and returned with a report that fund insufficient' - Thereafter, a statutory demand notice was served upon respondents and petitioners - Whether aforesaid averment made in complaint against petitioner Nos. 1 & 2 are sufficient to fasten vicarious liability upon them.
Finding of the Court:
Petitioners have not issued cheques and they have tendered their resignation much before issuance of said cheques - These are uncontrovertible facts - Only a bald averment is made in complaint against them that they were responsible for day to day affairs of the company - There is no specific averment against them to show, as to how and in what manner petitioners are responsible for the conduct of the business of Company - They were not Managing Director of Company - Court unable to record concurrence with the submissions, so advanced by learned counsel for respondent - And ratio laid down in case, so referred by him, would also not come into his aid.
Result: Petition and stands allowed
JUDGMENT :
ROBIN PHUKAN, J.
1. This petition under Section 482 of the Cr.P.C. is preferred by the petitioners, namely (i) Girish Mulshankar Chaudhary and (ii) Kusum Choudhary, for quashing the complaint case, being, C.R. Case No. 2845/2018, pending before the learned SDJM-II, Kamrup (Metro).
2. The factual background leading to filing of this petition is briefly stated as under:
3. The respondent firm M/s M.M. Enterprise has submitted affidavit-in-opposition denying all the averments made in the petition. It is stated that the case has been filed in accordance with law and that though the petitioners have tendered their resignation, the same were not accepted by the Company and their names are still reflected in the web-site of the Company and that the Company is not made a party in the present petition and that a prima-facie case is made out against both the petitioners, and therefore, the inherent power under section 482 Cr.P.C. cannot be exercised to quash the proceeding of this nature against both the petitioners. It is therefore contended to dismiss the petition.
4. Heard Mr. H. Talukdar, learned counsel for the petitioners and Mr. S.P. Das, learned counsel for the respondents.
5. Mr. H. Talukdar, learned counsel for the petitioner, advanced two fold arguments. Firstly, Mr. Talukdar submitted that at the time of issuance of the two cheques the petitioners were not the Directors of the Company and that they have tendered their resignation on 03.01.2018 and 01.02.2018 respectively, before the issuance of the two cheques on 27.03.2018, and their resignation letters were sent to the Registrar of the Company. Secondly, it is submitted that there is no averments in the complaint as to the role played by the petitioners in commission of the offence and they are responsible for the day to day affairs of the Company. It is further submitted that the petitioners are innocent and no case is made out against them even the allegations made in complaint is accepted as correct and the learned Court bel
Dishonour of cheque – Liability of director of firm - Not sufficient to make a bald cursory statement in a complaint that the Director (arrayed as an accused) is in charge of and responsible to the c....
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....
Directors who had resigned prior to the issuance of a dishonored cheque cannot be held liable under Sections 138 and 141 of the Negotiable Instruments Act, and specific averments are required to esta....
Liability under Section 141 of NI Act depends on the role in the conduct of the company's affairs, not just the designation, and the burden of proof lies on the accused to establish lack of knowledge....
Directors can only be held vicariously liable under Section 141 of the Negotiable Instruments Act if specific averments are made in the complaint regarding their responsibility for the company's cond....
Sufficient averments in a complaint against a director fulfill requirements of Section 141 of the NI Act for vicarious liability. Failure to respond to statutory notices under Section 138 infers liab....
The main legal point established in the judgment is that a former director of a company cannot be held liable for a dishonoured cheque issued after their resignation from the directorship, and the im....
Point of Law : Where there is not even an averment against the Managing Director or joint Managing Director of the Company therein. [Para 11]
A director who resigns before the cheque issuance cannot be held liable under Sections 138 and 141 of the NI Act, evidenced by credible documents demonstrating resignation.
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