The legal identities of directors and partners are distinct, yet partners are jointly liable for liabilities incurred by the firm under the Negotiable Instruments Act.

ORDER :

G. Girish, J.

The second accused in S.T No.1073/2017 on the files of the Judicial First Class Magistrate Court, Kakkanad, has filed this petition under Section 482 of the Code of Criminal Procedure, 1973 (in short, ‘Cr.PC’), to quash the proceedings against him in the aforesaid case. The offence alleged against the petitioner is one under Section 138 of the Negotiable Instruments Act, 1881 (in short, ‘ NI Act’).

2. The aforesaid complaint has been instituted arraigning the petitioner herein as the second accused in his capacity as the authorised signatory of a Private Limited Company by name M/s.Unique International Logistics. The first accused in the said case is that company represented by its Vice President, and the third accused is the said company which the first and second accused represented. The allegation is that a cheque for Rs.49,58,641/- which the petitioner herein issued as the authorised signatory of the company which he represented, in discharge of a legally enforceable debt which the said company owed the second respondent company, was dishonoured due to insufficiency of funds, and that the petitioner and the other two accused did not care to make payment of the cheque amount despite statutory notice issued against them. The petitioner herein is said to have received the statutory notice, but as against the other two accused, it was returned undelivered.

3. The challenge in this petition is that the criminal prosecution launched by the second respondent, in S.T No.1073/2017, is against a wrong entity which is not in existence. According to the petitioner, the entity shown as M/s. Unique International Logistics in Annexure-A complaint is not a company, but only a partnership firm. It is further stated that the petitioner is not the Director of a company as contended in Annexure-A complaint. However, it is contended by the petitioner that he is the authorised signatory to the partnership firm which the second respondent mistakenly mentioned in Annexure-A complaint as a company. Thus, it is stated that the second respondent has instituted the complaint against an entity which is not in existence, and that the petitioner herein is not liable to be prosecuted as the representative of such a non-existing entity. It is the further contention of the petitioner that he had not issued the impugned cheque in his personal capacity or as a partner, but merely as a signatory, and hence the offence alleged against the petitioner will not lie. For the above reasons, the petitioner seeks to quash the proceedings against him in the aforesaid case.

4. Heard the learned counsel for the petitioner, the learned counsel for the second respondent, and the learned Public Prosecutor representing the State of Kerala.

5. A reading of Annexure-A complaint, which the second respondent filed before the Trial Court, would reveal that the petitioner herein has been arraigned in that complaint as the second accused in his capacity as the authorised signatory of the first accused company who issued the cheque dated 03.05.2016 for an amount of Rs.49,58,641/-. It is further stated in the complaint that the second accused (petitioner herein) is responsible for the management and day to day affairs of the company. Now that the petitioner would contend that the entity by name M/s. Unique International Logistics, which the second respondent has mentioned as a company, is actually a partnership firm, and that he is only one of the partners of the said firm. Thus, the question to be resolved in this proceedings is whether the criminal prosecution launched against the petitioner is liable to be terminated in exercise of the powers of this Court under Section 482 Cr.PC. for the reason that the petitioner has been mistakenly arraigned