TMI Blog2017 (10) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... .484/SS/2016, 485/SS/2016, 486/SS/2016 and 487/SS/2016 pending in 53rd Court, Mulund, Mumbai and in Criminal Cases bearing Nos. 422/SS/2016, 428/SS/2016, 429/SS/2016 and 430/SS/2016 pending in 73rd Court, Vikroli, Mumbai. By these petitions, the petitioner/accused No.4 is praying for quashing and setting aside the Order of issuance of process against him passed by the learned trial Court on taking cognizance of offence alleged against him by respondent No.2. 4 Heard the learned Advocate appearing for the petitioner/accused No.4. He vehemently argued that only bald allegations are made against accused persons by respondent No.2/complainant. Averments against accused persons are general in nature with no specific act attributable to them. So far as the petitioner is concerned, the complaint has not alleged even mens rea against him and no specific act in the alleged transaction has averred against him. It is further argued that the petitioner/accused No.4 was not recipient of cash from respondent No.2/original complainant. He is neither signatory to the cheque nor signatory to the bill of exchange allegedly issued. The petitioner/respondent No.4 was merely a sleeping partner of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge of and responsible for the conduct of business of Firm at the time of commission of the offence. Paragraph 16 of the said Judgment reads thus : "16. After so stating, the Court adverted to the complaint filed under Section 138 of the Act and opined that the complaint should make out a case for issue of process. As far as the offficers responsbile for conducting the affairs of the company are concerned, the Court referred to various provisions of the Companies Act, 1956 and analysed Section 141 of the Act to lay down as follows :- "What is required is that the persons who are sought to be made criminally liable under Section 141 should be, at the time the offence was committed, in charge of and responsible to the company for the conduct of the business of the company. Everny person connected with the company shall not fall within the abmit of the provision. It is only those persons who were in charge of an responsible for the conduct of business of the company at the time of commission of an offence, who will be liable for criminal action. It follows from this that if a director of a company who was not in charge of and was not responsible for the conduct of the business of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at reply and contended that one of accused namely Haresh Gurbux Doulatani had sworn an affidavit by stating that the present petitioner/ accused No.4 is copartner in accused No.1 M/s.Tirupati Greenfield Developers and, therefore, it does not lie in the mouth of the writ petitioner that he is not concerned with the affairs of the Partnership Firm. 9 I have carefully considered the rival submissions and also perused material produced on record including the complaint for the offence punishable under Section 138 of the N.I.Act. At the outset, in order to decide the controversy, involved in the instant case, it is necessary to put on record the provision of Section 141 of the N.I.Act, which read thus : "S.141 Offences by companies. - (1) If the person committing an offence under section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any person liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cularly, accused No.2 Haresh Gurbux Doulatani induced them to invest in the project of accused No.1 M/s.Shree Tirupati Greenfield Developers of which remaining accused including petitioner/accused No.4 is partner. Respondent No.2/original complainant further pleaded in the complaint that accordingly, the amount was paid and bill of exchange came to be executed by accused persons. It is further averred that in order to repay the amount which was advanced by respondent No.2/original complainant, accused persons issued cheques, which were ultimately dishonoured. 12 It is not in dispute that accused No.1 M/s.Shree Tirupati Greenfield Developers is a Partnership Firm of which the present petitioner/accused No.4 is a partner. However, according to petitioner, he is merely a sleeping partner having no knowledge about the transaction and that he had not issued the cheque in question and had not signed any document in respect of the transaction. On this aspect, let us, therefore, consider what is averred in the complaint. In paragraph 2 of the complaint, respondent No.2/original complainant has made following averment : "The Complainant states that the Accused No.1 is a Partnership firm a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Paragraph Nos.8(a) and 9(c), pointed out by the learned Advocate, from the Judgment of Gunmala Sales Private Ltd. (supra) are paragraphs in which written submissions of parties are reproduced by the Honourable Apex Court. The ratio of that Judgment can be found in paragraph No.33 thereof. For the sake of convenience, the same is reproduced herein and it reads thus : "33. We may summarize our conclusions as follows: a) Once in a complaint fled under Section 138 read with Section 141 of the NI Act the basic averment is made that the Director was in charge of and responsible for the conduct of the business of the company at the relevant time when the offence was committed, the Magistrate can issue process against such Director; b) If a petition is fled under Section 482 of the Code for quashing of such a complaint by the Director, the High Court may, in the facts of a particular case, on an overall reading of the complaint, refuse to quash the complaint because the complaint contains the basic averment which is sufcient to make out a case against the Director. c) In the facts of a given case, on an overall reading of the complaint, the High Court may, despite the presence of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess against said Director/Partner. If such Director/Partner wants process to be quashed on the ground of bald or vague averments, then he must either furnish some sterning, incontrovertible or unimpeachable material in order to demonstrate that he is not at all concerned with the alleged offence. Such Director or Partner has to make out a case that the trial would be abuse of process of the Court. He is required to make out circumstances to substantiate his contention in this regard. 18 By now, it is well settled that there needs to be averment in the complaint that Partner of Firm or Director of the Company was in-charge of and was responsible to the Firm or the Company, as the case may be for conduct of the business of the Firm/Company, as the case may be. The basic requirement under Section 141 of the N.I.Act is to make specific averment in the complaint that accused Partner or Director who was neither signatory to the cheque nor the Managing Director or Managing Partner, as the case may be, at the time of commission of offence was incharge of and responsible to the Firm or Company for conduct of business. No particular form in this regard is necessary. It is not at all necessa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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