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TMI Blog2010 (2) TMI 1290X X X X Extracts X X X X X X X X Extracts X X X X ..... yer made by the complainant was to take cognizance of the offence committed by both the accused, which obviously meant the company M/s. Vijay Remedies Limited and the petitioner Kamal Goyal. 3. The case of the petitioner is that he continued to be Director of M/s. Vijay Remedies Limited only till 29th May, 1997 when he resigned. It has also been claimed by him that the accused company had issued a blank cheque to the complainant company under his signature, towards security, with an understanding that the cheque will not be presented for clearance. 4. The petitioner has filed, in the trial court, a certified copy of Form-32 issued by Registrar of Companies. A perusal of the document would show that the petitioner Kamal Goyal resigned as a Director of Vijay Remedies Limited with effect from 29th May, 1997 and intimation in this regard was given to the Registrar of Companies on 18th June, 1997. This is complainant s own case that the cheque in question is dated 15.7.1997. Thus, the petitioner was not a Director of the company, Vijay Remedies Limited even on the date when this cheque purports to have been issued. Since the cheque in question was issued by the company and not by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued by it, was ignored by the company with the consent or connivance of the petitioner or it was otherwise attributable to any act on the part of the petitioner. Therefore, he has not covered even by sub Section (2) of Section 27of SEBI Act. 7. The plea taken by the complainant that the information contained in Form No.32 was a defence available to the accused which could not be considered at the initial stage was dealt with by this Court as under: Though as a general proposition of law, the defence available to the accused is not to be examined at this stage, there can be no valid objection to considering an authentic Public Document such as certified copy of Form-32, issued by Registrar of Companies, in a petition under Section 482 of the Code of Criminal Procedure, when the genuineness of the documents is not disputed and the matter can be finally disposed of on the basis of such a documents. A criminal trial is a serious matter, having grave implications for an accused, who not only has to engage a lawyer and incur substantial expenditure on defending him, but, has also to undergo the ordeal of appearing in the Court on every date of hearing, sacrificing all hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sible to the company for conduct of its business. Vicarious liability to the petitioner has been imputed solely on account of his being a Director of Vijay Remedies Limited, as is evident from paragraph 4 of the complaint wherein it is alleged that Kamal Goyal, one of the Directors of the Company, is looking after day-to-day working of the company. This is also not the case of the complainant that cheque in question was dishonoured or the notice of demand was not complied with the consent or connivance of the petitioner or that it was otherwise attributable to any negligence on the part of the petitioner. This is also not the case of the complainant that even after resigning as Director of the company, the petitioner continued to control the affairs of Vijay Remedies Limited and was a person who could have given instructions to the Board of Directors of the Company to ensure that the cheque signed by him, when presented for encashment, was honoured or that the notice of demand sent to the company was duly complied with by making payment of the amount of the cheque. Therefore, the petitioner is not a person covered even under sub-Section 2 of Section 141 of the Negotiable Instrument ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Company with the consent and connivance of accused Nos.2 to 10, which included respondent No.1 before the Hon ble Supreme Court. He filed an application seeking discharge, relying upon Form No.32 issued by Registrar of Companies in support of his contention that he had resigned as a Director of the Company much prior to dishonour of the cheque in question. The learned Additional Sessions Judge took note of Form No.32 and also noted that the complainant had not filed any affidavit to the effect that it had verified from the Registrar of Companies and Form No.32 filed by the accused was not genuine. A Criminal Revision Petition filed against the order of the learned Additional Sessions Judge was dismissed by the High Court. Relying upon its earlier decisions in the case of K.Srikanth Singh Vs. M/s.North East Securities Limited Another , 2007(3) RCR (Criminal) 934 : 207 (4) RAJ 226 : JT 2007 (9) SC 449 , the Hon ble Supreme Court observed as under: Section 141 of the Act provides for a constructive liability. A legal fiction has been created thereby. The statute being a penal one, should receive strict construction. It requires strict compliance of the provision. Specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towards discharge of the debt or other liability of the Company, would be liable to prosecution and conviction under Section 138 of Negotiable Instruments Act even after he resigns from the company and is no more in its employment. This certainly could not have been the intention of the legislature. Even the vicarious liability created under Section 138 of Negotiable Instruments Act would not be attracted in respect of a Director or an employee of the Company who resigns and severs his connections with the company, unless the complainant is able to bring his case within the purview of sub-Section 2 of Section 141 of Negotiable Instruments Act, by proving that the offence had been committed with his consent or connivance or was otherwise attributable to any neglect on his part. 14. For the reasons given in the preceding paragraphs, summoning of the petitioner as an accused, in the criminal complaint filed by the respondent against Vijay Remedies Limited, and subsequent proceedings, to the extent they pertain to the petitioner, are, hereby, quashed. Trial Court will, however, proceed with the complaint as far as the Company Vijay Remedies Limited is concerned. - - TaxTMI - TM ..... X X X X Extracts X X X X X X X X Extracts X X X X
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