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TMI Blog2024 (5) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... n to the drawer of the cheque - In the present cases, the cheques are drawn by the accused no. 2 Trust. It is, therefore, the drawer of the cheques . The notice has, admittedly, been issued to the drawer , that is, the accused no. 2- Trust. The same has been addressed to be served on the drawer/Trust through its Trustees. Presently, it is not disputed by the petitioners that they are the Trustees of the accused No. 2-Trust. Section 141 of the NI Act states that where the offence under Section 138 of the NI Act is committed by a company, every person who, at the time the offence was committed, was in-charge and was responsible to the company for the conduct of the business of the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly - the only plea of the petitioners is the lack of notice under Proviso (b) to Section 138 of the NI Act and the purported lack of pleadings in the Complaint Cases against the petitioners herein in their individual capacity. In Kirshna Texport and Capital Markets Ltd. [ 2015 (6) TMI 344 - SUPREME COURT ] the Supreme Court, considering the provision of Proviso (b), Section 141 and Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tled Puja Hemnani v. Mother's Pride Punjabi Bagh Ors. (in CRL.M.C. 6095/2022); Complaint case No. 5504/2019 titled Asha Hemnani v. Mother's Pride Punjabi Bagh Ors. (in CRL.M.C. 6096/2022) and Complaint case No. 5501/2019 titled Vinod Hemnani v. Mother's Pride Punjabi Bagh Ors. (in CRL.M.C. 6097/2022) (hereinafter collectively referred to as the Complaint Cases ), filed by the respondent(s) herein, under Section 138 of the Negotiable Instruments Act, 1881 (in short, NI Act ). 2. As common questions of law and facts arise in these petitions, and common submissions have been made by the learned counsels for the parties, these petitions are being considered and disposed of by way of this common judgment. 3. To appreciate the submissions made by the learned counsels for the parties, the following background facts leading to the filing of the present petitions deserve notice: a) The above complaint cases have been originally filed by the respondent(s) herein, making 10 (ten) accused including Presidium Eduvision Trust, through its Trustees. b) In the Complaints, it is averred that somewhere in December, 2014, the respective respondent(s)/complainant(s) had contacted either th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onnivance of each other have taken the loan amount and issued the repayment cheques. Accused nos. 1 lo 10 have hatched a conspiracy in connivance of each other against Complainant and cheated him and his family with huge amount, accordingly, Accused are responsible for all the aforesaid acts and deeds. xxxxx 23. That accused nos. 1 and 2 are being run managed by Mothers Pride Education Institution Pvt. Ltd. and accused nos. 3 to 10 are actively involved in handling and is in charge of the day to day affairs and business of accused no. 1 and accused no. 2. Accused nos 3 to 10 have personally entered into transactions and convinced the complainant to enter into the said transaction. Accused nos 1-10 falsely and dishonestly represented and assured the Complainant about the repayment of loan amount vide aforesaid cheque. However, conduct of accused nos 1-10 clearly proves that they have cheated Complainant with malafide intentions and caused huge wrongful losses to Complainant by making false representations and gained wrongful gains for themself. Accused has induced Complainant with his false assurances and representations to enter into the said transaction and to extend the loan faci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . He submits that, therefore, the complaint(s) against the petitioners are not maintainable and the petitioners cannot be summoned in the same. In support, he places reliance on the judgments of the Supreme Courts in Ashok Shewakramani Ors. v. State of Andhra Pradesh Anr., (2023) 8 SCC 473; the judgment of the High Court of Gujarat in Somesh Sarjivan Jain v. State of Gujrat Anr. Neutral Citation no. 2012:GUJHC:11959; High Court of Madhya Pradesh in Sanjay Singh Bisen v. Devendra Verma, (Order/Judgment dated 02.02.2023 in Criminal Revision no. 2611/2018); Sandeep Sabuu v. Gwalior Vyapar Mela Pradhikaran 2016 SCC OnLine MP 67; and of this Court in Amit Kumar Mishra v. The State Govt. of NCT of Delhi Anr.2020 SCC OnLine Del 2199. 6. He further submits that merely by amending the complaints and now, in the relevant paragraphs, making averments against inter alia the petitioners, and by merely changing the number of the accused, the respondent(s) cannot be said to have satisfied the requirements of Section 141 of the NI Act. He submits that, therefore, even otherwise the Complaint Cases, as against the petitioners, are liable to be dismissed. Submissions of the Learned Counsel for the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice; in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation . For the purposes of this section, debt of other liability means a legally enforceable deb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation . For the purposes of this section, (a) company means any body corporate and includes a firm or other association of individuals; and (b) director , in relation to a firm, means a partner in the firm. 16. Section 141 of the NI Act states that where the offence under Section 138 of the NI Act is committed by a company, every person who, at the time the offence was committed, was in-charge and was responsible to the company for the conduct of the business of the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly . Explanation (a) to Section 141 of the NI Act states that for the purpose of Section 141 of the NI Act, the term company means anybody corporate and includes a firm or other association of individuals. It is not disputed by the petitioners that a Trust will be covered by the above definition of the term company and, therefore, the Trustee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany, every Director of such company who was in charge of and responsible to that company for conduct of its business shall also be deemed to be guilty. The reason for creating vicarious liability is plainly that a juristic entity i.e. a company would be run by living persons who are in charge of its affairs and who guide the actions of that company and that if such juristic entity is guilty, those who were so responsible for its affairs and who guided actions of such juristic entity must be held responsible and ought to be proceeded against. Section 141 again does not lay down any requirement that in such eventuality the Directors must individually be issued separate notices under Section 138. The persons who are in charge of the affairs of the company and running its affairs must naturally be aware of the notice of demand under Section 138 of the Act issued to such company. It is precisely for this reason that no notice is additionally contemplated to be given to such Directors. The opportunity to the drawer company is considered good enough for those who are in charge of the affairs of such company. If it is their case that the offence was committed without their knowledge or th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uirement could or ought to be read into Section 138 of the Act. 20. The above judgment has been followed by a learned Single Judge of this Court in DSC Ltd. v. Dada Jeetu Buildcon Pvt. Ltd. Neutral Citation no. 2018:DHC:7297 , by observing as under: 13. Vicarious liability is created by section 141 as the company being a juristic entity, is run by living persons who are in charge of its affairs and who guide the actions of that company and that if such company is guilty, those who were so responsible for its affairs and who guided actions of such juristic entity must be held responsible and ought to be proceeded against. Persons who are in charge of the affairs of the company and running its affairs must naturally be aware of the notice of demand under Section 138 of the Act issued to such company. That is the reason that no notice is additionally contemplated to be given to such Directors. 14. The opportunity to the drawer company is considered good enough for those who are in charge of the affairs of such company. Lapse or negligence on part of the company could easily be rectified and amends could be made upon receipt of a notice under Section 138 by the company. There is no req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charge of the entire business transaction of accused nos 1 2. Accused nos. 9, 11 and 12 are Trustees to accused no. 2 and also incharge of entire business and activities of accused no. 2. Hence, Accused nos. 9, 11, and 12 are responsible for all the acts and deeds of the accused no. 2. It was also informed to the complainant that Presidium Eduvision Trust is the senior wing of the Mothers Pride Education institution for school going kids. Accused nos. 1 and 2 in connivance of each other have taken the loan amount and issued the repayment cheques. Accused nos. 1 to 12 have hatched a conspiracy in connivance of each other against Complainant and cheated him and his family with huge amount, accordingly, Accused are responsible for all the aforesaid acts and deeds. 24. In my view, the above averments are sufficient for the purpose of attracting Section 141 of the NI Act against the petitioners. Even otherwise, in their capacity as Trustees of the accused no. 2, the petitioners are officers in charge of the Trust. The petitioners shall have to lead their defence under Section 141 of the NI Act, in case they are to escape their liability as the Trustees of the accused no. 2- Trust, who i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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