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TMI Blog2018 (9) TMI 2030X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 1 company. It is further alleged that the said cheques were dishonored. Notice of demand was also served upon the accused however, it was not complied, hence all the accused are liable for the punishment under the provision of Section 138 of the Negotiable Instruments Act, 1881. 4. On 07.08.2014 the complaint was presented before the Judicial Magistrate First Class at Gangapur, vide SCC No. 595/2014. The said complaint was returned for want of territorial jurisdiction vide order dated 12.12.2014. 5. On 16.10.2015, the complaint was again presented before the Judicial Magistrate First Class, Gangapur and after its presentation, the Judicial Magistrate, First Class Gangapur issued the process against accused persons. Hence, the order of issuance of process dated 18.06.2018 and the proceeding under Section 138 of Negotiable Instruments Act against accused Nos. 2 to 4 are under challenged. 6. Heard Mr. S.G. Chapalgaonkar, learned counsel for the applicants, Mr. A.D. Namde, learned APP for the State and Mr. K.J. Suryawanshi learned counsel for the original complainant - respondent No. 2. 7. Mr. Chapalgaonkar, learned counsel for the applicants has advanced his arguments mainly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iles, however, the allegations in para No. 2 of the complaint reads as follows: That the accused Nos. 1 to 4 are directors of V.R. Textiles, Private Limited, and looking after all affairs and therefore are responsible for textiles. 10. The allegations in para No. 2 are vague and there is no allegations that at the time of the issuance of cheque or its presentation to the bank the present applicants were actively participated in the business of accused No. 1 - V.R. Textiles. 11. Mr. S.G. Chapalgaonkar, the learned counsel, further argued that since the present applicants have already resigned from the post of directors, they have nothing to do with the cheques signed and issued by the accused No. 1 and the liability towards the payment of amount as demanded by the complainant. 12. So far the arguments advanced by the S.G. Chapalgaonkar about the limitation is concern, I do not agree with the submission that the complaint is barred by the limitation as it was not presented within time after return of the complaint by the learned trial court. From the record, it appears that when the complaint was presented before the trial court, it was returned to the complainant for its presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akrishnan dated 05.04.2014, it appears that he resigned from the post of the director. The aforesaid correspondence was between the present applicants and the accused No. 1. Therefore, at this stage, the respondent No. 2 - original complainant cannot dispute the contents of such communication, one can understand, if, the accused No. 1 disputed such contents. From the aforesaid circumstances and the certified copy of the documents issued by the registry of companies, it appears that the applicants have already resigned from the post of directors even before issuance of the aforesaid two cheques by the accused No. 1. 16. The learned counsel for the respondent No. 2 has relied upon the observation of this Court in the case reported in 2017 ALL Mr. (Cri.) 533, wherein, it is observed that the averments in the complaint that the petitioner at the relevant time, was in-charge of and responsible for conduct of the business of the accused company are sufficient to make out the case against him. Therefore, complaint cannot be quashed. It is further observed in the same case that there was no evidence on record to show acceptance of the petitioner's resignation by the Company on date on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... support thereof and than to proceed further with proper application of mind to the legal principles on the issue. It is necessary for the courts to ensure strict compliance to the statutory requirement as well as settle principles of law before making a person vicariously liable, therefore, simply because a person is a director of a defaulter company does not make him liable under the Act for the offence committed by the company under Section 141 of the Negotiable Instrument's Act. There must be specific averments against direct showing as to how and in what manner the directors was responsible for the conduct and business of the company. The allegations in this complaint are absolutely short and vague as referred above. Mr. Chapalgaonkar also relied upon the observation in case reported in AIR 2015 Supreme Court 675 17. There is no dispute that the appellant, who was wife of the Managing Director, was appointed as a Director of the Company-M/S Elite International Pvt. Ltd. on 1st July, 2004 and had also executed a Letter of Guarantee on 19th January, 2005. The cheques in question were issued during April, 2008 to September, 2008. So far as the dishonor of Cheques is concern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Chapalgaonkar further relied upon the observations in case reported in (2001) 10 SCC 218 wherein, the appellant in the aforesaid case had not signed the cheque and he is sought to be prosecuted in view of Section 141 as he happened to be director of the company at one point of time. The allegations in the complaint not making out a case that at the time of commission of the offence, that appellant was in-charge of and was responsible to the company for the conduct of the business and it is held by the Apex Court that requirement under Section 141 of the Negotiable Instruments Act is not prima facie satisfied hence proceeding under Section 138 of the Negotiable Instrument's Act is quashed and set aside. 20. Mr. Chapalgaonkar learned counsel has placed reliance upon the copy of the annual return of the company for the succeeding year of the resignation of the present applicant and by referring the contents of the annual return, he argued that the names of the present applicants are not figured as a directors of the same company - accused No. 1, Mr. Chapalgaonkar has relied upon the observation in the case reported in (2012) SCC 520 wherein, it is observed that: This Court h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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