High Court of Kerala
Alexander Thomas, J.
Indira Gandhi Memorial General Marketing Society Ltd - Appellant
Versus
Roys Abraham & Ors - Respondent
Crl. M. C. No. 497 of 2015
Decided On : 15-06-2017
Key Points: - The judgment discusses the applicability of Section 141 to a company and its directors/officers and extends considerations to partnerships/firm as per the Explanation to Section 141 (!) (!) (!) . - It analyzes the doctrine of prospective overruling (Aneeta Hada / three-judge bench) and its applicability to pending cases and High Court vs Supreme Court scope (!) (!) (!) . - It examines the use of Section 319 Cr.P.C. to proceed against other persons in the context of Section 138 NI Act and holds that non-issuance of mandatory statutory demand notice precludes resort to Section 319 to add drawer/other persons (!) (!) . - It notes the general rule of initiation of prosecutions under Section 177 Cr.PC for Section 138 cases, and the accrual of cause of action after proviso conditions, including the necessity of a statutory demand notice (!) (!) . - It references the Anil Hada and Dashrath Rathod line of authorities regarding shifting legal positions and applicability to pending cases (!) (!) . - It discusses that the legal principles for companies travel to partnerships and that directors cannot be held liable under certain circumstances as per Aneeta Hada and IT Act parallel, applying logic to NI Act (!) (!) .
Alexander Thomas, J.
1. The petitioner herein is the complainant in Annexure-1 in S.T.No.216 of 2009 on the file of the Judicial First Class Magistrate Court-I, Kottayam, which has been instituted alleging offence punishable under Section 138 of the Negotiable Instruments Act. The first respondent herein is the accused in that complaint.
2. The cheque amount involved in Annexure-1 complaint is Rs.3,21,375/-. The petitioner has also filed another complaint as S.T.No.129 of 2010 (Annexure-2) alleging the same offence against the first respondent herein due to dishonour of a cheque for an amount of Rs.6,75,800/-. It is not in dispute that in Annexure-1 (S.T.No.216 of 2009) R-1 is the sole accused. Whereas in Annexure-2 (S.T.No.129 of 2010), R-1 and M/s.Abraham Varghese & Company (Additional R-3 herein) are the two accused persons. Now both the complaints have been transferred to the Judicial First Class Magistrate Court-IV, Kottayam. It is averred that the application for joint trial of the abovesaid two cases has been allowed and the present complaint in S.T.No.216 of 2009 has been taken as the leading case. Annexure-1 is the copy of the impugned complaint in S.T.No.216 of 2009. In Annexure-1 complaint (S.T.No.216 of 2009), the first respondent herein has been arrayed as the sole accused and the partnership firm has not been arrayed as accused, whereas in Annexure-2 complaint (S.T.No.129 of 2010), the first respondent herein as well as the partnership firm concerned (Additional R-3 herein) have been made as accused. It is the case of the petitioner that as on the date of filing of Annexure-1 complaint in S.T.No. 216 of 2009, the legal position settled by the judgment dated 26.11.1999 of the two Judge Bench of the Apex Court in the case in Anil Hada v. Indian Acrylic Ltd. reported in (2000) 1 SCC 1 = 2001 SCC (Cri.) 174, had governed the field. As per the said legal position settled by the two Judge Bench of the Apex Court in Anil Hada's case (supra), it has been held that it is not mandatory that the Company or partnership firm concerned (from whose account dishonoured cheque has been drawn) should be made an accused and that a complaint either against the Managing Director/Director of the Company or the managing partner or partner of the partnership firm, as the case may be, is maintainable even if the Company/partnership firm is not made as accused. So it is contended that as on the date of Annexure-1 complaint, there was no legal infirmity in the institution of the above complaint in not arraying the partnership firm as the principal accused, even though the dishonoured cheque has been drawn from an account maintained by that firm. It is pointed out that, by the subsequent judgment dated 27.4.2012 of the Apex Court in the case in Aneeta Hada v. Godfather Travels & Tours Pvt. Ltd. reported in (2012) 5 SCC 661, it has been held by the three Judge Bench of the Apex Court that prosecution for an offence under Section 138 of the Negotiable Instruments Act is not maintainable solely against the Managing Director or Director of the Company in respect of a dishonoured cheque, which has been drawn from the account of such a Company, unless the Company/ partnership firm from whose account the dishonoured cheque has been drawn, is arrayed as an accused, etc. and that the persons responsible for and in charge of the affairs of the Company/partnership firm could also be arrayed as accused in such a complaint, in view of the concept of vicarious liability as envisaged in Section 141 of the Negotiable Instruments Act.
3. It is stated that it has come out in evidence in this case that the cheque involved in the present complaint is issued by the first respondent for and on behalf of additional respondent No.3, M/s.Abraham Varghese & Company, which is a partnership firm and that the rubber sheets were purchased for M/s.Abraham Varghese & Company and that the dishonoured cheque was issued in this case for the sale consideration of the rub
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