The necessity of specific averments in the complaint to establish the liability of the accused under Section 138 of the Negotiable Instrument Act, 1881.

Om Prakash-VII,J.

This application under Section 482 Cr.P.C. has been filed for quashing the entire proceedings of Complaint Case No. 1592 of 2015 (Kedar Singh Bargoti Vs. M/s. Helios and Matheson Information Technology and others) under Section 138 of the Negotiable Instrument Act, 1881 (In Short the 'Act'), Police Station Link Road, District Ghaziabad pending in the Court of Addl. Civil Judge (J.D.)/Judicial Magistrate, Court No.3, Ghaziabad. Further prayer has been made to stay the further proceedings of the aforesaid case.

2. Heard learned counsel for the applicant and learned A.G.A. for the State.

3. It was submitted by the learned counsel for the applicant that the complainant has not averred in the complaint about the responsibility/liability of the applicant for the conduct of the business of the company. He has not disclosed that applicant was also responsible for day-to-day affairs of the company or its business transactions. In this state of affair, complaint cannot go on against the applicant. Attention of the Court was drawn to the averments made in the complaint by the learned counsel, who further submitted that mere assertion that the applicant is the director of the company is not sufficient to make him liable under section 138 of the Act. In support of his contention, learned counsel for the applicant placed reliance on the decision of the Apex Court in the case of A.K. Singhania Versus Gujarat State Fertilizer Co. Ltd. & Anr., [2014 (1) JIC 648 (SC)].

4. Per contra, learned A.G.A. opposed the prayer made by the applicant and submitted that the complaint clearly demonstrates that the persons, including the present applicant, arrayed as opposite parties in the complaint are the directors and officials of the company and they are responsible for the conduct of the business of the company. It was further submitted that the complainant - opposite party no.2 had invested some money in that company in term deposit plan. On maturity of the term deposit, cheques in question were issued by the company in favour of the complaint, which, on presentation before the bank, were dishonoured. Thus, the applicant, who is one of the directors of the company, cannot take such plea that he cannot be prosecuted.

5. I have considered the submissions made by learned counsel for the parties and have gone through the entire record.

6. Apex Court in the case of A.K. Singhania (supra) in paragraphs no. 16 to 20 held as under.

16. We have perused the complaints and, in fact, the relevant portions of the allegations have been reproduced in the foregoing paragraphs of the judgment. From that it is difficult to infer that there is any averment that these two accused were in-charge of and responsible for the conduct of the business of the company at the time the offence was committed. The allegations in the complaints in sum and substance mean that business and financial affairs of the company used to be decided, organized and administered by accused Nos. 2 to 6 and while doing so, other Directors including the two accused herein were consulted. The inference drawn by the complainant on that basis that these two accused, therefore, are in- charge and responsible to the company for the conduct of its business, is absolutely misconceived. We are, therefore, of the opinion that essential averment in the complaints is lacking.

17. In case of offence by company for dishonour of cheque, the culpability of the Directors has to be decided with reference to Section 141 of the Act, same reads as follows:

"141. Offences by companies.-(1) If the person committing an offence under section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall