IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE G.GIRISH FRIDAY, THE 6TH DAY OF DECEMBER 2024 / 15TH AGRAHAYANA, 1946 CRL.MC NO. 1883 OF 2020 IN CC NO.2862 OF 2016 OF JUDICIAL FIRST CLASS MAGISTRATE COURT (NI ACT CASES), KOCHI PETITIONER/1ST ACCUSED:
MR.RENJITH K.V., AGED 46 YEARS, S/O.VISWANATHAN.K.P., AUTHORISED SIGNATORY, OASIS SYSTEMS AND TECHNOLOGIES, FIRST FLOOR, AMBISWAMY BUILDING, KARIKKATH LANE, BEHIND D.C.C.OFFICE, M.G.ROAD, THRISSUR, NOW RESIDING AT KALAYIL HOUSE, MARVEL NAGAR, OPP.NANDANAM, PARADISE APARTMENT, PADUKKAD, VIYYUR.P.O, THRISSUR BY ADV P.K.SAJEEV RESPONDENTS/COMPLAINANT & STATE:
1 M/S.RASHI PERIPHERALS (PRIVATE LIMITED)
REGISTERED OFFIE AT MUMBAI, ARISTO HOUSE, 5TH FLOOR, CORNER OF TELLI GALLI, ANDERI EAST, MUMBAI-4006.HAVING BUSINESS AT KERALA, RAVIPURAM BRANCH, DOOR NO.39/6179 AND 6180, CEARS TOWERS, ALAPPATT CROSS ROAD, KOCHI-682015, REP BY POWER OF ATTORNEY HOLDER MR.M.MUKUNDAN, S/O.LATE SIVARAMAN MENON, AGED 66 YEARS, MANAGER, RASHI PERIPHERALS PRIVATE LIMITED, RAVIPURAM BRANCH, ERNKULAM.
2 STATE OF KERALA REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM - 31 BY ADV SMT.MERIL MUTHU P.JOHN SRI PRASANTH MP, PP THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION ON
06.12.2024, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:
G.GIRISH, J.
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Crl.M.C.No.1883 of 2020 ---------------------------------------------
Dated this the 6th day of December, 2024
O R D E R
The petitioner, who is the 1st accused in C.C.No.2862 of 2016 on the files of the Judicial First Class Magistrate Court (NI Act Cases), Kochi, has filed this petition under Section 482 of the Code of Criminal Procedure to quash the proceedings in the said case.
2. The aforesaid case originated from a complaint preferred by the 1st respondent herein against the present petitioner and one Sijo Sunny, in respect of the commission of offences under Sections 138 and 142 of the Negotiable Instruments Act. In the complaint filed before the learned Magistrate, the petitioner herein and the other accused by name Sijo Sunny were arraigned in their capacity as authorised signatories to ‘Oasis Systems and Technologies’, a partnership firm engaged in the business of selling computer peripherals and allied equipments. The grievance of the 1st respondent was that a cheque dated 23.02.2016 for an amount of Rs.1,68,529/- drawn by the aforesaid partnership firm in favour of the 1st respondent, towards the discharge of that debt, happened to be dishonoured for the reason of insufficiency of funds, and that in spite of issuance of legal notice, the petitioner herein and the other accused did not care to make payment of the cheque amount. However, the 1st respondent did not care to arraign ‘Oasis Systems and Technologies’, the partnership firm, which had drawn the impugned cheque and issued it towards payment of the amount stated above, as an accused.
3. In the present petition, the petitioner would contend that the proceedings before the learned Magistrate in C.C.No.2862 of 2016 are bereft of legal sanctity since the partnership firm which had drawn the cheque in question, had not been arraigned as an accused in the complaint.
4. Heard the learned counsel for the petitioner, the learned counsel for the 1st respondent and the learned Public Prosecutor representing the 2nd respondent.
5. The learned counsel for the petitioner, by relying on the decision rendered by the Apex Court in Aneeta Hada and Others v. M/s. Godfather Travels & Tours Pvt. Ltd. [2012 KHC 4244], argued that the non impleadment of the partnership firm, which had issued the impugned cheque, is fatal for the maintainability of the proceedings initiated against the petitioner under Section 138 of the Negotiable Instruments Act. In the aforesaid decision, a three Judge Bench of the Apex Court had laid down the proposition of law, in unequivocal terms, that in the light of the provisions contained in Section 141 of the Negotiable Instruments Act, for maintaining a prosecution under Section 138 of the Negotiable Instruments Act for the cheques issued by a company, the directors cannot be prosecuted without the company being arraigned as an accused. The abovesaid decision has been rendered overruling an earlier decision of the Apex Court in Sheoratan Agarwal and Another v. State of Madhya Pradesh [1984 KHC 734]. As regards the question whether a partnership firm could be considered on par with a company on the matter of criminal prosecutions initiated under Section 138 of the Negotiable Instruments Act, the learned counsel relied on the decision of this Court in Balakrishna Prabhu S. v. V. Indira [2023 (7) KHC 587] It has been held by a learned Single Judge of this Court in the aforesaid decision that even though partnership firm is not a legal entity, a legal fiction had been created under Section 141 bringing the firm or association of individuals within the term “company” in Section 141 and thus, if a person committing the offence is a firm, the firm as well as the categories of persons in charge and responsible for the conduct of business of the firm shall be deemed to be guilty of the offence under Section 138 of the Negotiable Instruments Act. Paragraphs 8 and 9 of the order of this Court in the aforesaid case are extracted hereunder, for the sake of easy reference :
“8. Admittedly, the Apex Court in Aneeta Hada’s case cited supra was considering the question as to whether
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