JUDGMENT Surinder Singh, J.(Oral)-In these petitions, preferred under Section 482 of the Code of Criminal Procedure, a common question of law and fact is involved therefore, taken up together for its decision. 2. In short, facts giving rise to the present petitions are that M/s Talwar and Sood Hotel (Pvt.) Ltd. is a company duly incorporated under the Companies Act, 1956 having its registered office at M/s S. Moon & Company, Kotwali Bazar, Cantt Road Dharamshala District Kangra, H.P. 3. In Cr.M.M.O. No. 77 of 2008, respondent No. 2 Vijay Singh is stated to be the authorized signatory of the said Company. He had issued cheque bearing No. 887601 dated 31.12.2002 of Citi Bank Calcutta for Rs.13,28,157/- on behalf of the accused Company towards the repayment of the loan and interest advanced by the respondent Corporation, which was dishonoured. 4. In Cr.M.M.O. No. 78/2008 respondent No. 2 had issued cheque No. 887602 dated 28.2.2003 amounting to Rs. 19,97,988/- towards the repayment of the loan amount to respondent No. 1 Corporation. It was also dishonoured. 5. A statutory notice was issued for the repayment of the amount but the cheque amount was not liquidated as such separate complaints were filed in the court of learned Chief Judicial magistrate, Shimla under Section 138 of the Negotiable Instruments Act. 6. Respondent No. 1 complainant impleaded M/s Talwar Sood Hotel (Pvt.) Ltd company as an accused through its director, i.e., the present petitioner Col. Vipul Talwar in both the complaints. Process was issued against the company through its Director Col. Vipul Talwar. Earlier, process was issued against the accused company through the petitioner and also against Vijay Singh signatory of the cheques. Since the petitioner was not served for and on behalf of the company as such his non-bailable warrants were issued and later in one complaint, he was declared as a proclaimed offender. 7. Feeling aggrieved and dissatisfied by the said orders, instant petitions have been filed. 8. Mr. Puneet Bali, learned counsel for the petitioner duly assisted by Ms. Yogita Dutta submitted that respondent-complainant sued the company through its Director without any averment that he was Incharge of, and was responsible to the Company for the conduct of its business. Therefore, proceedings against him are required to be dropped. 9. Contra Mr. Ajay Kumar, learned counsel for respondent No. 1 corporation supported the impugned order. 10. Yogita Dutta submitted that respondent-complainant sued the company through its Director without any averment that he was Incharge of, and was responsible to the Company for the conduct of its business. Therefore, proceedings against him are required to be dropped. 9. Contra Mr. Ajay Kumar, learned counsel for respondent No. 1 corporation supported the impugned order. 10. The perusal of the complaint, documents attached thereto and the statement of Deputy Manager of the respondent Corporation reveals that the cheques in question were signed by respondent No. 2 in his capacity as authorized signatory of the Company which were dishonoured. Said Vijay Singh is a co-accused impleaded along with the Company. 11. Section 141 of the Negotiable Instruments Act 1881 deals with the offences by the Companies which reads as under:- “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 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. ["Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for prosecution under this Chapter.] (2) Notwithstanding anything contained in sub-section (1), where any offence under 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 attribute to, any neglect on the part of, any director, Manager, secretary, or other office 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 purpose of this section. Explanation:- For the purpose of this section. – (a) Company means any body corporate and includes a firm or other association of individuals; and (b) Director, in relating to a firm, means a partner in the firm.” [Emphasis supplied] 12. This Section is imperative, creates legal obligation and provides for constructive liability. The statute being penal one, should receive strict construction which also requires strict compliance with the provisions, specific averments in the complaint/ petition so as to satisfy the requirement of Section 141 aforesaid. 13. The constructive liabilityof the Director/employee of the Company under this Section was considered while deciding a reference, by the Supreme Court in Ramraj Singh versus State of M.P.: (2009) 6 SCC 729, against the back ground of decision rendered in N.K. Wahi versus Shekhar: (2007) 9 SCC 481 and S.M.S. Pharmaceuticals Ltd. versus Neeta Bhalla: (2005) 8 SCC 89, which was answered in para 19 as under:- “19. In view of the above discussion, our answers to the questions posed in the reference are as under: (a) It is necessary to specifically aver in a complaint under Section 141 that at the time the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential requirement of Section 141 and has-to be made in a complaint. Without this averment being made in a complaint, the requirements of Section 141 cannot be said to be satisfied. (b) The answer to the question posed in sub-para (b) has to be in the negative. Merely being a director of a company is not sufficient to make the person liable under Section 141 of the Act. A director in a company cannot be deemed to be in charge of and responsible to the company for the conduct of its business. The requirement of Section 141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as there is no deemed liability of a director in such cases. (c) The answer to Question (c) has to be in the affirmative. This has to be averred as a fact as there is no deemed liability of a director in such cases. (c) The answer to Question (c) has to be in the affirmative. The question notes that the managing director or joint managing director would be admittedly in charge of the company and responsible to the company for the conduct of its business. When that is so, holders of such positions in a company become liable under Section 141 of the Act. By virtue of the office they hold as managing director or joint managing director, these persons are in charge of and responsible for the conduct of business of the company. Therefore, they get covered under Section 141. So far as the signatory of a cheque which is dishonoured is concerned, he is clearly responsible for the incriminating act and will be covered under sub-section (2) of Section 141". [Emphasis mine] 14. The above judgments were also relied upon by the Supreme Court in its judgment rendered in National Small Industries Corporation Ltd. versus 15. Harmeet Singh Paintal and another: (2010) 3 SCC 330 and reiterated that Section 141 of the Act aforesaid requires that the persons who are sought to be made vicariously liable for a criminal offence under Section 141 should be, 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. Every person connected with the company shall not fall within the ambit of the provision. Only those persons who were in-charge of and responsible for the conduct of the business of the company, at the time of commission of an offence, will be liable for criminal action. 16. It follows from the fact that if a Director of a Company who was not in-charge of and was not responsible for the conduct of the business of the company at the relevant time, will not be liable for a criminal offence under the provisions. The liability arises from being in-charge of and responsible for the conduct of the business of the company at the relevant time when the offence was committed and not on the basis of merely holding a designation or office in a company. 17. What flows from the above discussion is that for fastening criminal liability, there is no presumption that every Director knows about the transaction. 17. What flows from the above discussion is that for fastening criminal liability, there is no presumption that every Director knows about the transaction. Vicarious liability on the part of a person must be pleaded and proved and is not to be inferred. 18. Therefore, order for issuing process against the petitioner for and on behalf of the company in Complaint No. 158-3 of 2003 and 123-3 of 2003 is wrong and illegal and is hereby set aside and quashed. However, it is made clear that apart from respondent No. 2 Vijay Singh, the authorized signatory, the Company would remain as an accused. The complainant/respondent No. 1 Corporation is hereby directed to apply for requisite amendment of the complaint to sue the company through its Managing Director/Joint Managing Director, in the memo of parties. 19. Parties are directed to be present before the learned trial Court on 30th April, 2010. 20. Send down the record so as to reach before the learned trial court on or before the date fixed.