The main legal point established in the judgment is that the liability of a company and its director under Section 138 of the Negotiable Instruments Act, 1881 is contingent on the relationship between the company and the firm, and the legal identity of the proprietorship firm.

JUDGMENT / ORDER

Aman Chaudhary, J. - This order shall dispose of abovementioned six petitions involving common questions of law and facts between the same parties. For the sake of brevity, the facts are being taken from CRM-M-30783-2017.

2. By means of the instant petitions, the jurisdiction of this Court under Section 482 Cr.P.C. has been invoked seeking quashing of criminal complaint dated 14.07.2016 bearing no. 4801 of 2016 titled as Bhushan Power and Steel Ltd. vs. Royal Pressing and Component Pvt Ltd. and another filed under Section 138 /141 of the Negotiable Instruments Act, 1881 (for short 'the Act') and consequent summoning order dated 14.07.2016, Annexure P-3.

3. Concisely, the facts are that, three cheques dated 02.05.2016, 16.05.2016 and 30.05.2016 issued by Royal Pressing and Components were dishonoured with remarks 'account closed' vide three different memos of even date 02.06.2016. The impugned complaint came to be filed on 13.7.2016 against the present petitioners. Consequent thereto, summoning order dated 14.07.2016, Annexure P-3, was issued, whereby they were summoned. Submissions:

4. Learned counsel for the petitioners had submitted that M/s Royal Pressing and Components Private Ltd. and Royal Pressing and Components, a proprietorship concern, are two separate legal entities, with petitioner no.2, as Director and Proprietor thereof. The cheques, the dishonour of which, has led to filing of the complaint had been issued by the Proprietorship concern-M/s Royal Pressing and Component operating from 436-C, Shri Developers, Industrial Estate, Mahuakhera Ganj, Kashipur, Uttrakhand and not by petitioner No.1 company, which carries its operations from I-36, Site -C, Greater Noida, UP. His solitary legal submission while making a reference to the provisions of Section 138 of the Act was that, no other person except the drawer of the cheque from whose account the cheque has been dishonoured can be held liable to face prosecution, as has been held in a catena of judgments of Hon'ble the Supreme Court of India. Reference in this regard is made by the learned counsel for the petitioners, to paras 5 and 11 of the petition. It has been mentioned in para 9 that cheques in question, that were issued and dishonoured, were drawn on the account of proprietorship concern and not on the private limited company.

5. Learned counsel drew the attention of the Court to the cheques, Annexure P-2, to show that the account from which the cheques were drawn was of the proprietorship concern Royal Pressing and Components and not on the account of petitioner No.1. - Royal Pressing and Components Pvt Ltd which is a Private Limited Company, which though were signed by petitioner No.2, a fact admitted, but in his capacity as a sole proprietor, not as Director of the petitioner no. 1 -private limited company, and as stated in para 3 of the petition, instead of arraying the proprietorship concern, the complaint has been wrongly filed against petitioner No. 1- private limited company.

6. In order to substantiate the fact that the cheques in question were, as matter of fact, drawn on the account of the proprietorship firm and not the private limited company, reference is made to the certificate issued by HDFC bank dated 4.8.2017, Annexure P-4, wherein it has been certified that Royal Pressing and Component was holding one proprietorship current account, which, according to the learned counsel for the petitioners is the same account as mentioned in the cheque Annexure P-2, which was closed on 19.2.2016.

7. To buttress his submissions, he placed reliance on the judgments of Hon'ble The Supreme Court of India in the cases of P.J. Agro Tech Limited and others vs. Water Base Limited 2010(12) SCC 146 and Hon'ble Delhi High Court in the case of Manish Kant Aggarwal vs. National Agricultural Cooperative Marketing Federation of India Ltd. 2008(23) RCR (Crl.) 353 (DH) to contend that a company and its Director, could not be held liable or prosecuted, for a cheque