K. S. Gupta ( 1 ) IN this petition under Section 482 cr. P. C. the petitioners seek setting aside of the order dated 16th January, 2001 passed by a metropolitan Magistrate where by the applications filed for dropping the proceedings by them were dismissed and quashing of complaint case no. 4193/99 filed by respondent No. 1. ( 2 ) SUBMISSION advanced by Sh. H. S. Phool ka for petitioners was that unless there is aversment in the complaints and/or evidence in terms of Section 141 of the Negotiable Instruments Act (for short the "act ) person who is merely a director of company, cannot be held liable under Section 138 of the Act. According to him, in view of averments as made in the complaint and statement recorded on 3rd December, 1999 of respondent no. 1/complainant (CM-l), the trial Magistrate was unjustified in declining to drop the proceedings against the petitioners. Reliance was placed on the decisions in Smt. Naqawwa, Vs. veeranna shivalingappa Konjalgi and Ors. AIR 1976 SC 1947 , Girdhari Lal Rathi Vs. P. T. V. Ramanujachari and Anr. . 1997 (2) Crimes 658 , Smt. Sharda Agiarwal and Ors. Vs. Add. Chief Metropolitan Miagistrate and Anr. . 1992 (1) Crimes 812 , Mahendra Pratap singh Ratra and. Anr. . Vs. M/s. N. K. Metals and Anr. . 75 (1998) DLT 155. Ashok Chaturvedi and Ors. Vs. Shitui H. Chanchani and Anr. . . . (1998) 7 SCC 698 . Mohan Kumar Mukherjee Vs. Ledo,. Tea Company limited. 1998 (4) Crimes 270 , Saraswathy Amma and anr. Vs. Swil Limited and Anr. . 2000 (52) DRJ 261 , K. P. G. Nair Vs. M/s. Jindal Menthol India ltd. JT 2000 (Supp1) SC 519, Shanku Concretes pvt. Ltd. and Ors. vs. state of Gujarat and anr,. 2000 (3) Civil Court cases 126 (Gujarat) and D. chandra Reddy Vs. Ghourisetti prabhahar and Anr 2000 (3) Civil Court Cases 315 (AP ). On the other hand, it was urged by Ms. Anu Narula appearing for respondent No. I that at the time of issuing two cheques in question, the petitioner no-1 was working a a vice Chairman-oum-wholetime director while petitioners 2 and 3 as wholetime directors in Ac Laboratories Ltd. and a wholetime director is virtually a Managing director. On the other hand, it was urged by Ms. Anu Narula appearing for respondent No. I that at the time of issuing two cheques in question, the petitioner no-1 was working a a vice Chairman-oum-wholetime director while petitioners 2 and 3 as wholetime directors in Ac Laboratories Ltd. and a wholetime director is virtually a Managing director. My attention, was invited to the notices dated 26th December, 1998, 9th April, 1999 and 11th June, 1999 got sent by respondent no. 1 complainant to the petitioners, para No. 4 of the reply filed to petitioners application for dropping proceedings as also photostat copy of the relevant extract from 13th annual report of said Ace Laboratories Ltd. As part of said submission, it was further urged that the petitioners even had admitted liability for payment of the amounts of cheques in question and sought time for payment as is evident from the orders dated 1st May, 2000 , 19th May, 2000 and 18th July, 2000 passed in Cri. M. (M)No. 3865/99 filed by the petitioners on 17th December, 1999. Reliance was also placed on the decisions in Anil hada Vs. Indian Acrylic Ltd. (2000) 1 SCC 1 , natesha Singh and Anr. vs. M/s. Klen and marshalls of Manufacturers and Exporterg Pvt. Ltd. . 1999 Cri. L. J. 2693, Sunil Sareen Vs. Govt. of NCT of Delhi and Anr. . 83 (2000) DLT 380, A. K. Goenka Vs. State and Anr. . 87 (2000) dlt 190, Rajesh Bajaj Vs. State NCT of Delhi and ors. . AIR 1999 SC 1216 , Suman Sethi Vs. Ajay k. churiwal and Anr. (2000) 2 comp. L. J. 40 (sc), cranex Ltd. and Anr. Vs. Nagarjuna Finance ltd. and Anr. . (2000) 4 Comp. L. J. 206 (SC ). B. Manipal Reddy Vs. State of Andhra Pradesh and anr. . (2001) 2 Comp. L. J. 126 (AP), smt. M. Sivakami Vs. Bharat Ginning and Oil Mill factory and Anr. . 2000 Cri. L. J. 1043 and Gyan chand Kotia Vs. Indian Renewable Energy development Agency Ltd. (IREDA ). 83 (2000) DLT 447. ( 3 ) SECTION 141 of the Act which is material, reads as followas- "offences by companies. . (2001) 2 Comp. L. J. 126 (AP), smt. M. Sivakami Vs. Bharat Ginning and Oil Mill factory and Anr. . 2000 Cri. L. J. 1043 and Gyan chand Kotia Vs. Indian Renewable Energy development Agency Ltd. (IREDA ). 83 (2000) DLT 447. ( 3 ) SECTION 141 of the Act which is material, reads as followas- "offences by companies. (1) If the person committing an offence under section 138 ie 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 the proceeded against and punished accordingly; provided that nothing contained in this. sub-section chall. render any person liable. to punishment if he proves that the offence was committed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence. (2) Notwithstanding anything contained in sub-section (1), where any offenceunder this act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect, 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. " ( 4 ) BARE reading, of the said Section would indicate that the persons who may be held vicariously liable thereunder fall in two categories - (i) those who are incharge of the company and responsible for conduct of its business, and (ii) person other than falling in first category who is a mere director, manager or secretary etc. of the company. Sub-section (1) deals with the first category while sub-section (2) with the second category. ( 5 ) COPY of complaint filed by respondent no. 1 is placed at pages 52 to 55 while that of statement of respondent No. 1 recorded as CW-1 on 3rd December, 1999 at pages 56 and 57 on the file. In the cause title of the complaint, the, designations of petitioners. who have been impleaded as accused 3, 4 and 5 respectively, have been shown as directors. Ajit Chand Srimal. In the cause title of the complaint, the, designations of petitioners. who have been impleaded as accused 3, 4 and 5 respectively, have been shown as directors. Ajit Chand Srimal. , accused No. 2 has been shown as a Managing. Director of company. In short, it is alleged in the complaint that complainant is the proprietor of M/s. Apex Prints and M/s. Bloom Prints which are engaged in the business of manufacturing, packing and printing material. Total supplies of the materials made to the accused from 1st. April, 1998 to 30th January, 1999 by M/s. Apex Prints was of Rs. 24,77,983. 23. A sum of Rs. 2. 09. 941. 04 was due on account of supplies made by M/s. Bloom prints during tta,period, from 1st. April, 1997 to 31st March, 1998. Against that liability, accused issued cheque No. 192408, dated 28th May. 1991 for Rs. 23,96,173. 68 in favour of M/s. Apex prints. Another cheque No. 192441 dated 28th May, 1999 for Rs. 2,09,947. 94 was issued in favour of m/s. Bloom Prints. On presentation both these cheques were dishonoured. The complainant got a legal notice dated 11th June, 1999 issued to accused persons calling upon them to make payment of both the cheques within 15 days from the date of receipt of the notice. Despite receipt of notice on 12th June, 1999, the accused did not make payment of the said cheques. Accused had, thus, rendered themselves liable for the offence under Section 138. To be-only noticed that no averment is made either directly or indirectly in the complaint about petitioners/accused 3 to 5 being incharge for conduct of the business of accused No. 1 company or the offence under Section 138 arising out of dishonour of said two cheques being committed with their consent or connivance. Statement of respondent No. 1/complainant as CM-l is also silent in that regard. Aforesaid three notices too are silent on the said aspect. It is true that in the photostat copy of the extract from 13th annual report of accused No. 1 company flled alongwith list of documents dated 10th april, 2001 (at page 29), the petitioners have been shown as wholetime directors and in para no. Aforesaid three notices too are silent on the said aspect. It is true that in the photostat copy of the extract from 13th annual report of accused No. 1 company flled alongwith list of documents dated 10th april, 2001 (at page 29), the petitioners have been shown as wholetime directors and in para no. 4 of the reply to petitioners application for dropping proceedings (at pages 40 to 44), there is mention about petitioner No. 1 being the vice-chairman and wholetime director and petitioners 2 and 3 being wholetime directors of the said company but, in my view, neither of these documents being not part of either the complaint and/or statement of Cw-1 can be taken note of in deciding the issue in hand. Further, in aforesaid Crl. M. (M)No. 3865/99, the relief sought, by petitioners was for setting; aside, the, order dated 3rd December,,. 1999 where by NBWs were, ordered to be issued against them by the trial magistrate. Order dated 18th October, 2000 would show that said petition was dismissed as petitioners had failed to deposit Rs. 20 lacs which they undertook to pay to respondent no. 1-company on 19th May, 2000 and 18th July, 2000. In my opinion, none of the orders passed in above petition can come in the way of petitioners in assailing the legality of a different order dated 16th January, 2001. Ratio in decisions in Smt. Sharda Aaarwal. Mohan Kumar mukherjee. Mahendra Pratap Singh Ratra and k. P. G. Nair s cases (supra) supports the petitioners case that a person can be proceeded against under Section 138 only if he was incharge of and responsible to the company for conduct of its business at the relevant time and in case of mere director it is shown that alleged offence was committed with his consent or connivance or was attributable to any neglect on his part. In view of foregoing discussion, the prosecution of petitioners being abuse of process of Court, deserves to be set aside. None of aforementioned decisions relied on behalf of respondent No. 1 are of any assistance in the matter. ( 6 ) THUS, while allowingpetition, the order dated 16th January, 2001 is set aside and. qua, the petitioners, complaint case No. 4193/99 is quashed.