2024 (2) TMI 868 - HC - Indian Laws

Dishonour of Cheque - cheque issued by the petitioner or not - Petitioner is an agent of the accused no. 1 firm - vicarious liability of the petitioner - HELD THAT - A reading of the complaints would show that barring the assertion that the petitioner had acted as an agent of the accused no. 1, there is no other assertion that the petitioner, in any manner, was incharge of the firm of the accused no. 1 or had any say in its working. The cheques are not stated to be issued by the petitioner. It is trite law that for a person to be subjected to criminal proceedings, specific averments have to be in a complaint. It is also imperative to establish that a person who is sought to be made criminally liable should, at the time of the commission of the offence, be in charge of and responsible for the conduct of the business of the company, to initiate proceedings under Section 141 of the Negotiable Instruments Act, 1881 The petitioner herein is averred to only be an agent of the accused no. 1 firm. There is not even an assertion in the complaint that the petitioner was in any manner in charge of or was responsible to the accused no. 2 for the conduct of its business - Applying the above test to the facts of the present case, therefore, the offence under Section 138 of the Act is not made out against the petitioner. The prejudice caused to the petitioner is evident from the fact that though the complaint has been filed in the year 2014 and was re-filed before the learned MM in 2017, the accused nos. 1 to 3 are yet to be served with the summons issued by the Court. As far as the plea of the learned counsel for the respondent that the petitioner be allowed to be summoned by the respondent as a witness in the subject complaints, as the petitioner is now not an accused in the complaints, the respondent shall be at liberty to move an appropriate application, if so advised, to include the petitioner in the list of witnesses to be examined. Petition allowed.

Summary

Issues Involved:
The issues involved in the judgment are quashing of criminal proceedings under Article 227 of the Constitution of India and Section 482 of the Code of Criminal Procedure, pertaining to the petitioner being accused as an 'agent' in two criminal complaints.

Details of the Judgment:

Issue 1: Quashing of Criminal Proceedings
1. The petitioner filed petitions under Article 227 of the Constitution of India and Section 482 of the Code of Criminal Procedure seeking quashing of Criminal Complaints no. 6831/2017 and no. 6830/2017 pending before the Metropolitan Magistrate.
2. The complaints alleged that the accused firm purchased textile products and issued cheques which were dishonored, leading to criminal proceedings.
3. The petitioner was described as an 'agent' in the complaints, with no further averments of his involvement in issuing the cheques or managing the firm.
4. The Supreme Court judgment in Siby Thomas v. Somany Ceramics Ltd. was cited by the petitioner's counsel to support the argument against summoning the petitioner based on the complaint's averments.
5. The Court observed that specific averments are necessary to subject a person to criminal proceedings and that vicarious liability under Section 141 of the Negotiable Instruments Act requires the accused to be in charge of the company's conduct at the time of the offense.
6. Since the complaints only labeled the petitioner as an agent without showing his responsibility for the firm's conduct, the Court quashed the complaints against the petitioner.
7. The remaining accused were directed to proceed with the legal process, while the petitioner was relieved of the accusations.

Issue 2: Summoning the Petitioner as a Witness
1. The respondent's counsel requested the liberty to summon the petitioner as a witness if the Court found him wrongly accused.
2. As the petitioner was no longer an accused, the respondent was granted the liberty to include the petitioner as a witness by filing an appropriate application.
3. The Trial Court would consider the application to summon the petitioner as a witness at the relevant stage of the proceedings.

Conclusion:
The petitions were allowed, quashing the complaints against the petitioner and directing the legal process against the remaining accused. The respondent was permitted to move an application to summon the petitioner as a witness if deemed necessary. No costs were awarded in the matter.