Partners in a partnership can be held jointly and severally liable for business transactions; mere association does not imply vicarious liability without specific allegations.

JUDGMENT :

BRIJ RAJ SINGH, J.

1. Both applications have been filed seeking quashing of the entire proceedings of Criminal Complaint Case Nos.925 of 2022 and 926 of 2022, M/s Kalpana Industries Vs. M/s K.D. Overseas and others, under Section 138 of Negotiable Instrument Act, 1881 (for short ‘the Act, 1881’) as well as the summoning orders dated 01.06.2022 passed by the Additional Chief Judicial Magistrate-I, Unnao.

2. Since the common question of facts and law are involved in both the applications, therefore, they are being heard and decided by a common judgement.

3. Brief facts of the case, in nut shell, are that applicants had entered into a partnership deed dated 01.05.2016 for carrying on business under the name and style of “M/s K.D. Overseas” situated at Neelu Kheri, District Karnal, Haryana. The object of the partnership was to engage in the business of growing, cultivating, producing, manufacturing, trading, processing, purifying, renting, purchasing, selling, blending, importing, exporting, rendering marketable and transportable (whether in bulk, packed or concentrated form) various agricultural and allied products, including rice, wheat, gram, maize, other grains and cereals, pulses, spices, oils, oil seeds, flour, besan, daliya, maida, suji and related commodities. The applicants are sleeping partners of the partnership firm M/s K.D. Overseas having no role whatsoever in its management of day- to-day affairs. Both the applicants being ladies, engaged primarily in domestic and personal responsibilities, mutually resolved to appoint Mr. Sahil Verma, who is the husband of applicant no.1 and son of applicant no.2 to manage and take charge of daily business and operational affairs of the firm including execution of sale deeds, transfer deeds, lease deeds and other related documents, as well as to conduct all banking and financial transactions on behalf of the firm. Accordingly, the applicants executed a registered power of attorney bearing Certificate No.M0292017111, G.R.N. No.30696682 dated 29.09.2017 in favour of Mr. Sahil Verma, thereby authorising him to take charge and exercise all necessary powers for the smooth conduct and management of the firm’s day-to-day affairs.

4. It is stated that Criminal Complaint Case No.926 of 2022 has been filed by opposite parties no.2 and 3 under Section 138 read with Section 141 of the Act, 1881 and the applicants have been arrayed as accused nos.4 and 5, while Mr. Sahil Verma who is in-charge and managing affairs of the aforesaid partnership firm M/s K.D. overseas and had issued cheques in question in favour of opposite party no.2, had been arrayed as accused no.3. The aforesaid partnership firm M/s K.D. Overseas and the manager/competent officer of the same had been arrayed as accused nos.1 and 2 respectively. Similarly, other Complaint Case No.925 of 2022, M/s Kalpana Industries and another Vs. M/s K.D. Oversea and others, was also filed by opposite parties no.2 and 3 pertaining to different cheques number amounting to Rs.45,00,000/-.

5. Sri Abhineet Jaiswal, learned counsel for the applicants has submitted that applicants had long back executed a registered Power of Attorney dated 29.09.2017 in favour of Sahil Verma authorising him as in-charge and to exclusively manage, operate and conduct all business, financial and administrative activities of the aforesaid firm, including the operation of its bank accounts and issuance of cheques. At the relevant point of time when cheques in question were issued to opposite party no.2, Mr. Sahil Verma was solely in-charge of the affairs of the firm and had issued the cheques in question, which subsequently came to be dis-honoured. The applicants are not even signatories to the cheques