Directors may be held liable under Section 138 of the Negotiable Instruments Act unless they can conclusively prove resignation prior to cheque issuance, necessitating a trial for disputed claims.

JUDGMENT :

(Sanjay Kumar Dwivedi, J.) :

Heard Md. Asghar, the learned counsel appearing on behalf of the petitioners, Mrs. Ruby Pandey, the learned counsel for the respondent State and Mr. Rajendra Krishna, the learned counsel appearing on behalf of the O.P.No.2.

2. Both the cases are arising out of common question of facts and law and the complaint cases have been filed under section 138 of Negotiable Instruments Act and in view of that these petitions have been heard together with consent of the parties.

3. In Cr.M.P. No.2366 of 2013, the prayer is made for quashing of the entire criminal proceeding in Complaint Case No.C/1-3250/2010 so far it relates to the petitioners including the order taking cognizance dated 21.12.2010 whereby the learned court has been pleased to take cognizance under section 138 of the Negotiable Instruments Act, pending in the court of learned Judicial Magistrate, First Class, Jamshedpur.

4. In Cr.M.P. No.2377 of 2013, the prayer is made for quashing of the entire criminal proceeding in connection with C/1-2162/ 2010 so far it relates to the petitioners including the order taking cognizance dated 07.01.2011 whereby learned court has been pleased to take cognizance under section 138 of the Negotiable Instruments Act, pending before the learned Judicial Magistrate, First Class, Jamshedpur.

5. The complaint case which is the subject matter in Cr.M.P. No.2366 of 2013 was lodged alleging therein that the complainant deals in machinery and industrial items and accused persons are its customers and known to it and that accused nos.2 to 5 including the petitioners are directors of the accused no.1 and are involved in day-to-day business of said accused company. It is further alleged that the accused persons purchased machines and other parts from complainant against their purchase order and complainant accordingly supplied the materials to them and against part payment of dues the accused persons issued cheque to the complainant amounting to Rs.2,63,463/- but when the said cheque was presented it was returned by its banker with the endorsement of ‘insufficient fund’ vide return memo dated 12.08.2010 and thereafter the complainant sent legal notice on 25.08.2010 but the accused persons did not pay the amount of cheque to the complainant and in this manner the accused persons have committed offence under section 138 of Negotiable Instruments Act.

6. The complaint case which is the subject matter of Cr.M.P. No.2377 of 2013 was lodged alleging therein that the complainant deals in machinery and industrial items and accused persons are its customers and known to it and that accused nos.2 to 5 including the petitioners are directors of the accused no.1 and are involved in day-to-day business of said accused company. It is further alleged that the accused persons purchased machines and other parts from complainant against their purchase order and complainant accordingly supplied the materials to them and against part payment of dues the accused persons issued cheque to the complainant amounting to Rs.2,63,463/- but when the said cheque was presented it was returned by its banker with the endorsement of ‘insufficient fund’ vide return memo dated 05.06.2010 and thereafter the complainant sent legal notice on 18.06.2010 but the accused persons did not pay the amount of cheque to the complainant and in this manner the accused persons have committed offence under section 138 of Negotiable Instruments Act.

7. Md. Asghar, the learned counsel appearing on behalf of the petitioners submits that the cheque in question was issued on 13.07.2010 and in both the cases the petitioner no.1 is the Director and the petitioner no.2 is not the Director. He submits that the petitioner no.1 has already resigned w.e.f 08.04.2009. He submits that in view of that, the petitioner no.1 in both the cases has been wrongly implicated in the case. He submits that so far as petitioner no.2 is concerned is not the Director.

8. The said argument of M