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Himachal Pradesh High Court · body

2015 DIGILAW 1257 (HP)

Vijay Kumar v. Rakesh Kumar

2015-09-07

SURESHWAR THAKUR

body2015
JUDGMENT Sureshwar Thakur 1. The petitioner herein in his capacity as authorized signatory of M/s Century Vision Organic Farm Pvt. Ltd., Village Tadoli, Post Office Saru, Tehsil and District Chamba, H.P., issued a negotiable instrument in the sum of Rs.78,000/- to the complainant/respondent herein. The negotiable instrument of 30.12.2012 drawn on State Bank of Patiala, Chamba stands comprised in Ex.CW1/B. It was presented by the respondent herein/complainant for payment to State Bank of Patiala, Chamba on 21.03.2013 hence within six months from the date of its issuance. However, on its presentation by him to his banker aforesaid, it was returned to him with an edorsement comprised in Ex.CW1/E of there being insufficient funds in the account of M/s Century Vision Organic Farm Pvt. Ltd for purported defrayment of whose liability towards the respondent herein, the petitioner herein issued it to the respondent herein being its authorised signatory. In other words, the negotiable instrument Ex.CW1/B on its presentation before the State Bank of Patiala, Chamba, by the respondent herein stood dishonoured by the latter. The dishonour of negotiable instrument, Ex.CW1/B by the bankers of the respondent led the respondent herein to, within 30 days from the date of intimation purveyed to him by his bankers comprised in Ex.CW1/E qua for insufficient funds existing in the account of M/s Century Vision Organic Farm Pvt. Ltd., having entailed the sequel of its being dishonoured, serve upon the petitioner a notice comprised in Ex.CW1/C, as he in his capacity as an authorised signatory of M/S Century Vision Organic Farms Pvt. Ltd., had issued to him Ex.CW1/B. Since the serving of notice Ex.CW1/C upon the petitioner herein by the complainant/respondent did not within 15 days of its receipt by the former sequel the eventuality of the petitioner herein defraying to the respondent/complainant the liability constituted in Ex.CW1/B, led the complainant/respondent herein to before the learned Judicial Magistrate 1st Class, Chamba institute a complaint against the petitioner herein under Section 138 of the Negotiable Instruments Act. On the learned Judicial Magistrate 1st Class, Chamba receiving the complaint took cognizance thereon and issued summons upon the petitioner herein constituted in Annexure P-4 warranting his appearance before it on 15.11.2013. However, Annexure P-4 as issued by the learned Judicial Magistrate 1st Class, Chamba calling upon the petitioner herein to appear before it on 15.11.2013 did not come to be served upon the petitioner herein. However, Annexure P-4 as issued by the learned Judicial Magistrate 1st Class, Chamba calling upon the petitioner herein to appear before it on 15.11.2013 did not come to be served upon the petitioner herein. The learned Judicial Magistrate 1st Class, Chamba issued subsequent to the issuance of Annexure P-4, fresh summons for procuring the presence before it of the petitioner herein on 28.10.2014, which too did not come to be served upon the petitioner herein. However, the summons issued by the learned Judicial Magistrate 1st Class, Chamba for procuring the presence before it of the petitioner herein on 18.12.2014 came to be served upon the petitioner herein. In consequence to the summons aforesaid as issued by the Court of the learned Judicial Magistrate 1st Class, Chamba having come to be served upon the petitioner, the latter put in through his counsel his appearance before the Court aforesaid on 18.12.2014. With the petitioner on 18.12.2014 appearing through his counsel before the Court of the learned Judicial Magistrate 1st Class, Chamba, the latter Court on the complaint instituted against him by the respondent herein under Section 138 of the Negotiable Instruments Act commenced proceedings against the petitioner herein. With the Court of the learned Judicial Magistrate 1st Class, Chamba having initiated proceedings against the petitioner herein upon the complaint of the respondent/complainant instituted before it under Section 138 of the Negotiable Instruments Act, led the petitioner herein to institute before this Court the instant petition under Section 482 of the Code of Criminal Procedure with a prayer therein that the complaint instituted by the respondent herein before the Court of the learned Judicial Magistrate 1st Class, Chamba be quashed and set aside. 2. 2. The Negotiable instrument comprised in Annexure P-1 exhibited before the Court of learned Judicial Magistrate 1st Class, Chamba as Ex.CW1/B on whose presentation by the respondent herein before his bankers sequelled an endorsment from the latter comprised in Ex.CW1/E of there being insufficient funds in the account of M/s Century Vision Organic Farm Pvt. Ltd., on whose behalf the petitioner herein as its authorised signatory had issued Ex.CW1/B. The petitioner herein while donning the capacity of his being the authorised signatory of M/s Century Vision Organic Farms Pvt. Ltd., and in that capacity having issued Ex.CW1/B which stood dishonoured rendered him to stand encompassed within the domain, ambit and gamut of the provisions of Section 141 of the Negotiable Instruments Act, whose provisions are extracted hereinafter, especially with a contemplation existing therein of 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, besides also rendered him amenable to, as also, attracting its penal provisions to himself arising from dishonour of Ex.CW1/B which he while his being the authorised signatory of the aforesaid Pvt. Ltd. Company signatured it and issued it on its behalf to the respondent herein. Indubitably, further when the petitioner herein, signatured and issued the negotiable instrument constituted in Ex.CW1/B for withdrawal of the amount mentioned therein from the account maintained by M/s Century Vision Organic Farm Pvt. Ltd., with State Bank of Patiala, Chamba for purported discharge of the former's liability towards the respondent herein, in his capacity as its authorised signatory, which however for insufficiency of funds in the account of M/s Century Vision Organic Farm Pvt. Ltd., on whose behalf he issued it, as its authorized signatory stood dishonoured, as imminent from an endorsement of his bankers comprised in Ex.CW1/E and with the petitioner herein despite his having been served by the respondent herein with notice EX.CW1/C not having within the stipulated period therein defrayed to the respondent herein the amount comprised in Ex.CW1/B rendered himself amenable to besides, attracted to himself the penal provisions engrafted in Section 138 of the Negotiable Instruments Act. However, the inculpatory besides the criminal liability of the petitioner herein arising from the dishonour of the negotiable instrument while his having signatured it, in his capacity as the authorized signatory of M/s Century Vision Organic Farms Pvt. Ltd., was not his sole liability rather was a vicarious criminal liability along with M/s Century Vision Organic Farms Pvt. Ltd. Company for discharging whose liability towards the respondent herein, he being its authorised signatory issued Ex. CW1/B for withdrawal by the respondent from the account of M/s Century Vision Organic Farm Pvt. Ltd., maintained in the State Bank of Patiala, Chamba, the sum comprised in Ex.CW1/B. The provisions of Section 141 of the Negotiable Instruments Act read 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 of 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.” 3. A circumspect study, besides a close perusal of the provisions of Section 141 of the Negotiable Instruments Act unveils the fact of besides the petitioner herein while in his capacity as an authorised signatory of M/s Century Vision Organic Farms Pvt. Ltd. Company having issued the negotiable instrument which stood dishonoured for inadequacy or insufficiency of funds in the account of aforesaid company hence having rendered himself to operability qua him the afore referred provisions, he hence rendered also M/s Century Vision Organic Farms Pvt. Ltd., which had authorised him to issue the dishonoured negotiable instrument comprised in Ex.CW1/B to be legally susceptible to attraction to it or amenability qua operability qua it, the criminal liability constituted under Section 138 of the Negotiable Instruments Act arising from the dishonour of the negotiable instrument. The signification and import of the occurrence of the phrase “as well as the Company” in Section 141 of the Negotiable Instruments Act is of its peremptorily fastening criminal liability upon a corporate body besides attracting to a juristic legal entity, the penal provisions embedded in Section 138 of the Negotiable Instruments Act arising from the dishonour of a negotiable instrument sprouting from inadequacy or insufficiency of funds in its account maintained in the bank concerned for withdrawal wherefrom for discharge of its outstanding liability towards the respondent herein, the petitioner as its authorized signatory issued Ex.CW1/B. For reiteration, the phrase “as well as the company” occurring in Section 141 of the Negotiable Instruments Act indubitably manifest that M/s Century Vision Organic Farm Pvt. Ltd., hence rendered itself amenable to, along with the petitioner herein on whose behalf he as its authorised signatory issued cheque Ex.CW1/B to the respondent herein, the penal liability constituted in Section 138 of the Negotiable Instruments Act. The peremptory mandate of Section 141 of the Negotiable Instrument Act rendering the authorized signatory of the negotiable instrument “as well as the company”, for discharge of whose liability towards the respondent herein, he issued cheque Ex. CW1/B to the respondent for withdrawal from the account maintained by M/s Century Vision Organic Farm Pvt. Ltd., in the bank concerned, the sum displayed in it, to be both amenable to operability qua both the penal provisions engrafted therein, obviously made it incumbent upon the respondent herein to, in the complaint instituted by him before the learned Judicial Magistrate 1st Class, Chamba array besides the petitioner herein while his being the authorised signatory of M/s Century Vision Organic Farms Pvt. Ltd. Company, the latter company as well as an accused therein. Since the arraying of M/s Century Vision Organic Farms Pvt. Ltd. Company as an accused by the respondent herein in his complaint instituted by the respondent herein before the learned Judicial Magistrate 1st Class, Chamba arising from the dishonour of negotiable instrument comprised in Ex.CW1/B was a mandatory obligation cast upon him to render the complaint to be legally constituted, especially when the amenability to prosecution of the petitioner herein arising from his having issued negotiable instrument comprised in Ex.CW1/B to the respondent herein in his capacity as the authorised signatory of M/s Century Vision Organic Farms Pvt. Ltd., was legally permissible only when the prosecution of the company on whose behalf he issued it, was also facilitated by the complainant/respondent herein by his arraying it as an accused in the complaint instituted by him, before the learned Judicial Magistrate 1st Class, Chamba. Besides when the prosecution of M/s Century Vision Organic Farms Pvt. Ltd., for the offence arising from the dishonour of negotiable instrument Ex.CW1/B issued by the petitioner to the respondent herein while his being its authorised signatory was peremptory, especially when the withdrawal of Ex.CW1/B would have borne fruition only with the occurrence of sufficient funds in the account maintained in the bank concerned by M/s Century Vision Organic Farm Pvt. Ltd., besides when it was enjoined upon M/s Century Vision Organic Farm Pvt. Ltd., to ensure sufficiency of funds occurring therein to facilitate encashment of Ex.CW1/B, necessarily then when hence its prosecution was mandatory for its having not maintained sufficient funds in its account in the bank concerned entailing the dishonour of the negotiable instrument, the non arraying of M/s Century Vision Organic Farms Pvt. Ltd., by the respondent in his complaint as an accused has defacilitated its mandatory prosecution. In sequel, when hence the prosecution of the company as evident from the phrase “as well as company” occurring in Section 141 of the Negotiable Instrument Act was imperative along with the prosecution of the petitioner herein, hence, the non arraying of M/s Century Vision Organic Farms Pvt. Ltd., by the respondent in his complaint as an accused, for reiteration, has precluded, besides stalled the legally enjoined obligation of prosecution of the company aforesaid. Besides, the learned trial Court also appears to have overlooked and slighted the fact that Ex. Besides, the learned trial Court also appears to have overlooked and slighted the fact that Ex. CW1/B was issued by the petitioner herein as an authorised signatory of M/s Century Vision Organic Farms Pvt. Ltd., even, when Ex. CW1/B stood dishonoured, though hence the petitioner herein was liable, nonetheless, M/s Century Vision Organic Farms Pvt. Ltd., on whose behalf the petitioner herein being its authorised signatory issued the dishonoured negotiable instrument comprised in EX.CW1/B was rather the principal offender as it was from its account that the amount comprised in Ex. CW1/B was to be honoured or encashed whereas the petitioner herein was only vicariously liable along with it. Obviously when the principal offender has remained unarrayed as an accused, the vicarious liability fastened upon the petitioner herein could not have arisen or taken birth. The vicarious liability of the petitioner herein could take birth or could sprout only when the principal offender with which it shared a vicarious criminal liability stood arrayed as an accused in the array of accused in the complaint instituted by the respondent/complainant before the learned Judicial Magistrate 1st Class, Chamba. 4. In aftermath, the non impleadment of M/s Century Vision Organic Farm Pvt. Ltd as an accused by the respondent herein in his complaint has rendered the complaint to be not maintainable nor hence its non impleadment could attract the vicarious criminal liability of the petitioner herein with that of the company, the principal offender on whose behalf he as its authorised signatory, issued to the respondent Ex.CW1/B. More so, when it was the duty of the company, the holder of the account wherefrom the withdrawal of the amount comprised in Ex.CW1/B was to occur to ensure that its account held or maintained in the bank concerned carried funds sufficient and adequate for necessitating the honouring of Ex.CW1/B. In other words, it having derelicted from its enjoined duty to ensure the occurrence of adequate and sufficient funds in its account has constituted itself to be the principal offender whereas with the petitioner herein while his being its authorised signatory, besides not the holder of the account wherefrom the amount comprised in Ex.CW1/B was to be withdrawn was only vicariously criminally liable along with it. In coming to the above conclusion, I am supported by a judgment of the Hon'ble Apex Court reported in Aneeta Hada versus Godfather Travels and Tours Private Limited, (2012)5 SCC 661 , the relevant paragraphs No.58 whereof reads as under:- “58. Applying the doctrine of strict construction, we are of the considered opinion that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. Thus, the words :as well as the company” appearing in the section make it absolutely unmistakably clear that when the company can be prosecuted, then only the persons mentioned in the other categories could be vicariously liable for the offence subject to the averments in the petition and proof thereof. One cannot be oblivious of the fact that the company is a juristic person and it has its own repsectability. If a finding is recorded against it, it would create a concavity in its reputation. There can be situations when the corporate reputation is affected with a Director is indicated. “ 5. True it is that the company nomenclatured as M/s Century Vision Organic Farm Pvt. Ltd., is a legal entity or a juristic person would not, in case its prosecution was facilitated by the respondent herein by arraying it as an accused in the complaint along with the petitioner herein and its prosecution succeeding face imprisonment as imposed upon it, rather the Managing Director of the Company aforesaid through whom the company acts would on the prosecution against the company succeeding, face the consequence of conviction and sentence imposed upon the company. However, the complaint does not manifest that the petitioner herein while his being its authorized signatory was in that capacity also acting as the Managing Director of the company aforesaid. However, the complaint does not manifest that the petitioner herein while his being its authorized signatory was in that capacity also acting as the Managing Director of the company aforesaid. For inabundancy or scanty material displaying the fact of the petitioner herein while his being the authorised signatory of the company aforesaid his being also the Managing Director of M/s Century Vision Organic Farm Pvt. Ltd., whereas, in the event of the aforesaid material emanating on record, yet too it was legally imperative for the respondent herein to have arrayed in the complaint M/s Century Vision Organic Farm Pvt. Ltd., through the petitioner herein being its Managing Director along with the petitioner herein in his capacity of his being its authorised signatory as an accused for facilitating as well as paving way for prosecution of the aforesaid juristic person, besides on prosecution against both the petitioner herein as well as of the company succeeding, then the petitioner suffering the consequence of conviction and sentence both in his capacity of his being vicariously criminally liable along with the juristic person aforesaid, as also suffering the consequence of conviction and sentence imposed upon M/s Century Vision Organic Farm Pvt. Ltd., while his being its Managing Director. Necessarily then, when the petitioner herein has not been divulged by any material on record to be the Managing Director of M/s Century Vision Organic Farm Pvt. Ltd., rather when in the memo of parties in the complaint he has been arrayed therein as an accused while his only being its authorised signatory and not its Managing Director, nor when M/S Century Vision Organic Farm Pvt. Ltd., peremptorily enjoined to be impleaded as an accused along with the petitioner herein in the complaint arising from the dishonour of negotiable instrument has remained unimpleaded through its Managing Director, in sequel, the singular impleadment of the petitioner herein dehors the impleadment of M/s Century Vision Organic Farm Pvt. Ltd., through its Managing Director, cannot constitute satiation of the enjoined mandatory legal obligation of M/s Century Vision Organic Farm Pvt. Ltd., through its Managing Director being arrayed by the respondent as an accused in his complaint. 6. The summom bonum of the above discussion is that not only the complaint was not properly constituted, besides it was not maintainable. 6. The summom bonum of the above discussion is that not only the complaint was not properly constituted, besides it was not maintainable. Moreover, it was jurisdictionally not open for the learned Judicial Magistrate 1st Class, Chamba, in the absence of the complaint not disclosing the arraying therein of M/s Century Vision Organic Farm Pvt. Ltd., through its Managing Director as an accused to have entertained it, besides to have served summons upon the petitioner herein calling upon him to appear before it and face proceedings arising from a legally misconstituted complaint instituted before it by the respondent herein. Consequently, the instant petition is allowed and complaint instituted before the learned trial Court is quashed and set aside. In sequel, further proceedings are also quashed and set aside. All pending applications also stand disposed of. Records be sent back forthwith.