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2019 DIGILAW 1299 (ALL)

Naththu Singh v. State Of U. P.

2019-05-13

SUDHIR AGARWAL

body2019
JUDGMENT : 1. Heard Sri Vikrant Rana, learned counsel for applicant, learned A.G.A. for State and Sri Vibhu Rai, Advocate holding brief of Sri Anoop Trivedi, learned counsel for respondent-2. 2. This application under Section 482 Cr.P.C. has been filed praying for quashing of proceedings of complaint under Section 138 of The Negotiable Instruments Act, 1881 (hereinafter referred to as “N.I. Act”) in Case No.246 of 2004 pending in the Court of Judicial Magistrate, Mawana, Meerut (Rajveer Singh vs. Naththu Singh). 3. It is submitted that cheque in question was issued by Firm, signed by authorized signatories i.e. three partners but complaint has been made without impleading the Firm and, therefore, it was not maintainable. In this regard reliance has been placed on Supreme Court's decision in Aneeta Hada Vs. Godfather Travels and Tours Private Limited, (2012) 5 Supreme Court Cases 661 and in Himanshu Vs B. Shivamurthy and Another, (2019) 3 Supreme Court Cases 797. 4. When questioned learned A.G.A. as well as learned counsel appearing for respondent 2 could not dispute aforesaid expositions of law. 5. From record it is evident that though cheque has been sent by partners of Firm, but it is by the Firm and on behalf of Firm i.e. M/S Nathu Singh and Others. This is evident from page 19 of paper book. So far as liability is concerned, in the matter of Firm, liability of partners is co-extensive. It is also of that Firm registered with Registrar of Firms and Societies and is a legal liability. Copy of partnership is on record and it shows that there were seven partners namely Sri Nathu Singh s/o Sri Shiv Charan Singh, Sri Lov Kush s/o Sri Rajbir Singh, Sri Jugberr s/o Sri yadram, Sri Arun Kumar s/o Sri Anand Pal Singh, Sri Arvind Kumar s/o Sri Rohtash Singh, Sri Rajbeer Singh s/o Sri Yadram Singh and Sri Rajbeer Singh s/o Sri Bhopal Singh. 6. As per averments in para 5 of complaint, the Firm was practically being run by Nathu Singh. In February 2004 all the partners decided to separate whereupon accused-applicant assured that share of partners in total profit shall be given to them and in respect thereto Cheque No.965804 for Rs.3,10,000/- dated 20.02.2004 was issued. 7. On above averment, it is evident that it is the share/profit of one of partner in the Firm for which cheque was issued by another partner. 7. On above averment, it is evident that it is the share/profit of one of partner in the Firm for which cheque was issued by another partner. Section 138 of N.I. Act will apply only when cheque is issued for payment of any amount of money to another person for discharging of any debt or other liability. Profit or share in a Partnership Firm is not a debt on any of the partner against another partner. In common parlance, a debt is something owed to another and liability is an obligation, a chosen action which is capable of being assigned by creditor to some other person. 8. Here two partners of a Firm qua share of profit in the Firm business, do not stand in the capacity of creditor and debtor. Both are in capacity of Owners of the Firm and being Owners of the Firm, partners are also jointly and severally liable. If for distribution of share, there is some dispute, under the provisions of The Partnership Act, 1932 (hereinafter referred to as “Act, 1932”), remedy lies to the partner to file suit for accounting in common law, but to bring it within the term of any debt or liability attracting Section 138 of N. I. Act, in my view is clearly erroneous. Here one partner do not owe anything to another partner. All the partners have their specified shares in the Firm and if there is any dispute with regard to receipt of such share between partners, the same can be settled by initiating proceeding of accounting, but not by taking recourse to Section 138 of N.I. Act. 9. Similarly, to attract the term 'liability', it is difficult to hold that one partner owes liability to another partner in respect to money or amount, which is claimed to be the share in profit, since, profit is earned by Firm and all the partners having similar and equal status in the Firm, it can be distributed amongst themselves as per their consent or taking remedy in common law, but Section 138 of N. I. Act would not be attracted, hence, proceedings under Section 138 N. I. Act, are wholly without jurisdiction. 10. In view thereof, application is allowed. The proceedings of Case No.246 of 2004, under Section 138 of N.I. Act, pending in the Court of Judicial Magistrate, Mawana, Meerut (Rajveer Singh vs. Naththu Singh) is hereby quashed.