2019 (12) TMI 927 - HC - Indian Laws

Dishonor of Cheque - section 138 of NI Act - forgery for the purpose of cheating - present petition is filed on the ground that the petitioner since beginning had been disputing over the working style of the management of M/s Vigyan Chemicals Pvt. Ltd. therefore the petitioner was never involved in any affairs of the company - HELD THAT - The fact remains that as for the signing of Master Facilities Agreement and supplementary agreements the FSL has opined that the signatures are not of the petitioner. Further the petitioner filed police complaint as well as complaint under section 156(3) Cr.P.C. to lodge FIR against respondent no.2 and same has been lodged vide FIR No.168/2019 dated 02.12.2019. On perusal of the order dated 16.09.2019 whereby the Trial Court directed to register FIR it is revealed that as per the FSL report the disputed signatures on the loan documents are different from the specimen signatures of the respondent no.2. The signature on the resolution passed by the company are forged therefore there was no occasion for the petitioner to appoint Mr.Sanjay Jain to issue cheque in question. Since the document itself is forged therefore under no stretch of imagination it can be held that the petitioner has been looking after day-to-day affairs of the company and is responsible for the offence under section 138 of the NI Act - In the present case the signatures were not of the petitioner and because he had complaints regarding day-to-day business of the company he resigned from the company on 22.02.2016 which is not in dispute much prior to cheque issued on 10.11.2016. The complaint set aside - petition allowed.

Summary

Issues:
1. Setting aside the summoning order dated 10.01.2017 under section 138 of the Negotiable Instruments Act, 1881.
2. Allegations of involvement in financial transactions without consent.
3. Implications of being a director in a company facing legal proceedings.
4. Vicarious liability under Section 141 of the NI Act.
5. Dispute over signatures on loan documents and related legal implications.
6. Allegations of forgery, cheating, and fraud against the respondent.
7. Dispute over the responsibility of the petitioner in financial transactions.
8. Evaluation of evidence and legal precedents in determining liability.

Analysis:
1. The petitioner sought to set aside the summoning order dated 10.01.2017 under section 138 of the Negotiable Instruments Act, 1881, arguing that he was not involved in the financial transactions and had resigned from the company before the disputed cheque was issued.
2. The petitioner denied involvement in the financial dealings, stating that he had resigned from the company and had no role in the transactions, emphasizing that his signatures were forged on the loan documents and the cheque in question.
3. The petitioner raised concerns about being falsely implicated in the recovery proceedings, highlighting his lack of involvement in the company's affairs and disputing the allegations made against him in the complaint.
4. The legal counsel argued that the petitioner's liability under Section 141 of the NI Act is based on being in charge of the company's business, emphasizing the need for specific averments in the complaint to establish such liability.
5. The petitioner's defense relied on legal precedents and interpretations of Section 141 of the NI Act to argue that vicarious liability applies only when the accused was in charge and responsible for the company's conduct of business.
6. Allegations of forgery, cheating, and fraud were made against the respondent, leading to the petitioner filing complaints and initiating legal proceedings against them for illegal activities, including the issuance of false cheques and forging documents.
7. The court considered the evidence, including forensic reports on signatures, to determine the petitioner's involvement in the financial transactions, ultimately finding that the petitioner's signatures were forged, and he had resigned from the company before the disputed cheque was issued.
8. The judgment highlighted the importance of evaluating evidence and legal precedents in determining liability, emphasizing that allowing the proceedings to continue would be an abuse of the court process, leading to the setting aside of the complaint and further proceedings against the petitioner.