2023 (9) TMI 1247 - HC - Indian Laws

Dishonour of Cheque - acquittal of accused - applicability of Section 141 of the Negotiable Instruments Act on proprietorship concern - HELD THAT - The learned Magistrate upon close examination of the evidence which has come on record, more particularly status of the drawer as reflected from the disputed cheque produced on record vide Exhs. 79 and 82, noticed that the cheque was drawn by Status Seramik India Private Limited. Though, the designation of the authorized signatory or the person who has drawn this cheque on behalf of company is not reflected in the disputed cheque, however, the fact remains that cheque has been drawn on behalf of the company. Having noticed the aforesaid fact, no error can be found with the approach of the learned Magistrate in applying provision of Section 141 of the Negotiable Instruments Act. The issue of maintaining the prosecution under the Negotiable Instruments Act without arraigning a company as a party accused has been decided by the Hon ble Supreme Court in the case of ANEETA HADA VERSUS GODFATHER TRAVELS TOURS (P.) LTD. 2012 (5) TMI 83 - SUPREME COURT has held that we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the dragnet on the touchstone of vicarious liability as the same has been stipulated in the provision itself. This Court is of the view that no arguable case is made out for reconsideration by admitting the appeal. Hence, present application seeking leave to appeal is hereby refused. Thus, present application stands rejected.

Summary

Issues involved:
The judgment involves the issue of appeal under Section 378(4) of the Code of Criminal Procedure against the acquittal of the accused for an alleged offence under Section 138 of the Negotiable Instruments Act.

Details of the Judgment:
The original complainant alleged that the accused had purchased goods from them and issued cheques which were dishonored. Legal notices were sent, but the accused denied repayment. The complainant filed a complaint under Section 138 of the Negotiable Instruments Act. The learned Magistrate recorded acquittal after trial, prompting the appeal seeking leave to appeal against the order.

The applicant argued that the company involved in the transaction was not joined as a party in the original complaint, leading to its dismissal under Section 141 of the Negotiable Instruments Act. The applicant urged the court to re-examine the issue.

Upon examination, the court found that the transaction had taken place with a company, and the accused were the Managing Directors of the company. The court noted that the cheque was drawn by the company, and the provision of Section 141 of the Negotiable Instruments Act applied. The court cited Section 141 regarding offences by companies and emphasized the liability of individuals in charge of the company's conduct.

Citing the Supreme Court's decision in Aneeta Hada vs. M/s. Godfather Travels & Tours, the court emphasized the necessity of arraigning a company as an accused for maintaining a prosecution under Section 141 of the Act. Based on settled legal positions, the court refused to admit the appeal, stating that no arguable case was made out for reconsideration, and thus, the application seeking leave to appeal was rejected.

Separate Judgment:
In a separate order, the court rejected the Criminal Appeal in view of the rejection of the leave to appeal.