The legally enforceable debt or liability under Section 138 of the Negotiable Instruments Act would have a reference to the nature of the debt or liability and not the person against whom the debt or liability can be enforced.

The instant Crl.O.P. is to quash the proceedings in C.C. No. 413 of 1997 on the file of the Judicial Magistrate No. 1. Tuticorin.

2. This Crl.O.P. has arisen in this way :-

A complaint has been preferred by the respondent herein against five accused. Accused No. 3, M/s. Karthick Fisheries, and Accused No. 5, M/s. Karthick Multi Packs Pvt. Ltd., are companies. Accused No. 1, N. K. Kumar, is the Managing Director of Accused No. 3 and one of the Directors of Accused No. 5. Accused No. 2 is the Director of Accused No. 3 and Accused No. 5. Accused No. 4 is also a Director of Accused No. 5. Accused No. 3, M/s. Karthick Fisheries incurred debt to the tune of Rs. 42,31,737.00 with the complainant/respondent herein in purchasing prawns. The accused made certain payments. As on April, 1996, the outstanding due from Accused No. 3 was Rs. 22,12,000/-. As the Chairman-cum-Managing Director of Accused No. 5, i.e. M/s. Karthick Multi Packs Pvt. Ltd., Accused No. 1 issued a cheque for the said amount on 14-6-1997 drawn on Bank of Madura Ltd., T. Nagar, Madras. The Complainant/respondent herein presented the cheque through the Indian Bank, Melur, Tuticorin. On 2-7-1997, the cheque was returned with an endorsement as "Funds Insufficient". The complainant/respondent herein sent a legal notice to all the accused on 14-7-1997. But for the second accused, the others received the notice on 19-7-1997. The respondent preferred a complaint under Section 200, Cr.P.C. against Accused Nos. 1 to 5 alleging that all the accused have committed an offence under Section 138 of the Negotiable Instruments Act. The learned Judicial Magistrate No. I, Tuticorin took cognizance of the matter and issued summons for appearance of the accused.

3. At this stage, Accused No. 2 has come forward with this Criminal Original Petition to quash the proceedings on the following grounds :-

(i) The statutory notice was not served on him;

(ii) The proceeding was instituted against him after his resignation on 6-11-1996. He was not in charge of the affairs of the company.

and (iii) The dues were in respect of Accused No. 3 company and the cheque was issued by a different entity viz., Accused No. 5 company, and therefore, the cheque was not issued for any legally enforceable debt.

4. Heard both the sides. Mr. K. Sridhar, learned counsel for the petitioner submitted that the petitioner has not been served with any notice at all and as such, no demand was made to him to make payment and sans payment, cause of action for offence does not arise. In support of his contention, the learned counsel for the petitioner cited the decision reported in B. Adhikari v. Ponraj, 1996 Cri LJ 180 (Mad). In that case, the notice sent to the drawer was returned as not found. N. Arumugham, J. has held that no notice was served upon the drawer as contemplated under sub-clauses (b) and (c) of Section 138 of the Negotiable Instruments Act, which would mean that there was no demand for payment.

5. On the other hand, Mr. A. D. Jagadish Chandira, learned counsel appearing for the respondent, vehemently contended that once when notice was given to the company, notice need not be given to the Director individually. In support of his contention, the learned counsel for the respondent cited a decision report in Suraj Theatre v. Kakarla Bhorathe, 1998 Cri LJ 43 wherein a learned single Judge of the Andhra Pradesh High Court was of the view that in case of a complaint against a firm, notice need not be issued to each of the partners by virtue of Explanation (a) to sub-Section (2) of Section 141 of the Act, which reads that "company" means any body corporate and includes a firm or other association of individuals. What has been stated with respect to the firm would equally apply to a company also.

6. Under similar circumstances, the Delhi High Court in Jain Associated v. Deepak Chaudhary and Co. (2000) 2 Crimes 374 has held that Section 141 of the Act is a deeming provision holding every person who was in