ORDER : Venkata Jyothirmai Pratapa, J. These Criminal Petitions are filed under Section 482 of Code of Criminal Procedure, 1973, [In short 'the Code'] by the Petitioner who is arrayed as an Accused in a series of C.C.s on the file Court of Judicial Magistrate of First Class, Dharmavaram, registered for the offence punishable under Sections 409 and 420 r/w 34 of the Indian Penal Code, 1860., [In short 'IPC'] 2. The facts leading to filing of the present petitions are thus : a. Respondent No.2 in all these Crl.P.s filed private complaints on the file of the Court of Judicial Magistrate of First Class, Dharmavaram stating that A.1 is the Company, whereas A.2 is the Managing Director, and A.3 to A.5 are the Directors of A.1-Company. b. It is stated that A.2 to A.5 professed that it is a reputed business concern having turnover over crores of rupees and they are maintaining in different retail outlets in the name and style of Kalaniketan. All the accused are effectively participating in the promotion and business transactions of the Company. While so, A.2 and A.3 came down to Dharmavaram, and entered into business transactions with the de facto complainant. A.2 to A.5 with dishonest and fraudulent intention to cheat the de facto complainant and other businessmen, induced them to deliver huge quantity of silk sarees. c. Believing the words that the amount would be processed, the businessmen from Dharmavaram entrusted sarees to A.1-Company. Thereafter, they have cheated the de facto complainant and caused wrongful loss to the de facto complainant. Accused got intention to cheat the de facto complainant from the beginning. It is further stated that the accused are evading payment for the goods supplied by the de facto complainant and thereby cheated the poor and marginal weavers and thereby committed organized crime for the offence punishable under Sections 409 and 420 IPC. Along with the complaint, copies of five invoices and eight debit notes were filed. d. Learned Magistrate referred the cases to the Police by exercising the power under Section 156(3) of the Code. Police registered the crime for the offences punishable under Sections 409 and 420 r/w 34 I.P.C. After due investigation, Police filed a charge sheet against Accused Nos.1 to 6. e. Petitioner herein got stay of his arrest, vide Order of this Court dated 08.04.2016 in W.P.M.P.No.18585 of 2016 in W.P.No.14966 of 2016. Police registered the crime for the offences punishable under Sections 409 and 420 r/w 34 I.P.C. After due investigation, Police filed a charge sheet against Accused Nos.1 to 6. e. Petitioner herein got stay of his arrest, vide Order of this Court dated 08.04.2016 in W.P.M.P.No.18585 of 2016 in W.P.No.14966 of 2016. It is mentioned in the charge sheet that, as per the records, at the time of commission of offence, petitioner was the Additional Director of A.1-Company. f. For easy understanding, the C.Cs are tabulated hereunder; S. No. Criminal Petition No. C.C. No. Name of the Complainant Transaction dates Appointment Date of the petitioner as an Additional Director Date of resignation of the petitioner 1. 1234/21 349/18 M/s. Dasari Silk House 01.08.14 to 08.04.15 29.01.15 19.04.16 2. 1239/21 233/18 M/s.Ravali Silks 07.02.15 to 20.04.15 29.01.15 19.04.16 3. 1242/21 227/18 M/s.Dasari Ashok Silks 05.08.14 to 17.12.14 29.01.15 19.04.16 4. 1252/21 232/18 M/s.Lakshmi Silks 29.11.14 to 06.02.15 29.01.15 19.04.16 5. 1253/21 702/17 M/s.Omkar Creations --- 29.01.15 19.04.16 6. 1258/21 342/18 M/s.Deepam Manufacture of handloom pure pavadas 04.08.14 to 15.04.15 29.01.15 19.04.16 7. 1267/21 230/18 M/s.Rajyalakshmi Hall at Sale 07.02.15 to 20.04.15 29.01.15 19.04.16 8. 1271/21 235/18 M/s.Ravali Silks at Sale 11.05.14 to 24.04.15 29.01.15 19.04.16 9. 1273/21 315/18 M/s.Shiridi Sai Sarees 19.04.15 to 09.05.15 29.01.15 19.04.16 10. 1274/21 194/18 M/s.Krishna Ranga Silks 17.09.14 to 18.04.15 29.01.15 19.04.16 11. 1275/21 229/18 M/s.Dasari Ashok Silks 14.04.15 to 05.05.15 29.01.15 19.04.16 12. 1278/21 228/18 M/s.Mamilla Saree Centre 11.05.14 to 22.04.15 29.01.15 19.04.16 13. 1283/21 234/18 M/s.Ramaiah & Brothers Manufacturers of Handloom pure sarees 15.07.14 to 16.04.15 29.01.15 19.04.16 14. 5077/21 348/18 M/s.Shidhi Silk Creations 01.10.14 to 25.04.15 29.01.15 19.04.16 15. 5079/21 231/18 M/s.Parameswari Silks Emporium 17.04.15 to 09.05.15 29.01.15 19.04.16 16. 5098/21 195/18 M/s.Shri Sai Handlooms 06.02.15 to 11.02.15 29.01.15 19.04.16 17. 5099/21 775/18 M/s.Sarika Sarees 16.07.14 to 10.12.14 29.01.15 19.04.16 g. The above-enumerated C.Cs. are sought to be quashed by the Petitioner/A-5, hence the Crl.Ps. Grounds Sought for Quashment 3. The Petitioner/A.5 filed the present petition seeking quashment of the case against him, on the following grounds; a. He was appointed as an Additional Director of A.1-Company in the meeting held on 29.01.2015, by way of a resolution, till next Annual General Meeting of the Company. Grounds Sought for Quashment 3. The Petitioner/A.5 filed the present petition seeking quashment of the case against him, on the following grounds; a. He was appointed as an Additional Director of A.1-Company in the meeting held on 29.01.2015, by way of a resolution, till next Annual General Meeting of the Company. Accordingly, the date of vacation was 30.09.2015 b. Petitioner was appointed as an Additional Director for the sake of release of loan from the Bank and no other duties were assigned to him. On 01.10.2015 the petitioner resigned, as no Annual General Meeting was held on 30.09.2015 and he expressed his disinterest for further appointment. If the Company failed to conduct Annual General Meeting, Additional Director automatically vacates on the date on which it falls due c. A letter dated 19.04.2016 was addressed to the Board of Directors and a copy of resignation was also sent to the Registrar of Companies, Hyderabad. Resignation of the petitioner was accepted by the Registrar of Companies with effect from 19.04.2016 under Form No.DIR-11. d. Charge sheet does not show any involvement of the petitioner in the affairs of the Company. e. Charge sheet wrongly reflects that as on 21.09.2017, the Petitioner was the Director of the Company. Certified copy of the said document has been filed f. Petitioner is not responsible, in any manner, much less for the day-to-day affairs of the Company. He is not even in charge of the affairs of the Company. He never executed any invoices or bills representing the Company. Petitioner is not even a signatory. The invoices referred only A.1 represented by A.2. g. Petitioner has not committed any offence. Hence, continuation of prosecution against him is nothing but a sheer abuse of process of law. Arguments Advanced at the Bar 4. Heard Sri Ch. Lakshmi Narayana, learned counsel for Petitioner, and Ms. D. Prasanna Lakshmi, learned Assistant Public Prosecutor representing the State/Respondent No.1. Despite service of notice to Respondent No.2, they have failed to appear before the Court. 5. Learned counsel for the petitioner in elaboration to the contents raised in the Petition, would submit that no iota of evidence was collected during investigation against the petitioner to show that he actively participated in the day-to-day affairs of the Company. Despite service of notice to Respondent No.2, they have failed to appear before the Court. 5. Learned counsel for the petitioner in elaboration to the contents raised in the Petition, would submit that no iota of evidence was collected during investigation against the petitioner to show that he actively participated in the day-to-day affairs of the Company. He would submit that the Petitioner is no more an Additional Director since 19.04.2016 i.e., the date on which the Registrar of the Companies accepted his resignation as an Additional Director of A.1-Company. Learned counsel would further submit that this Court granted stay of arrest of the petitioner in the W.P. referred to supra. He would urge that though the Petitioner was not an Additional Director, and the charge sheet wrongly reflected that the Petitioner as the Additional Director as on the date of either the transactions or on the date of the complaint. It is alleged in the complaint that the complainant and other weavers of Dharmavaram supplied the stock of silk sarees to A.1-Company and A.1-Company failed to repay the due amount. 6. Learned counsel for the Petitioner would further submit that, only for the purpose of release of the loan from the Bank, the Petitioner was shown as an Additional Director. Though Annual General Meeting was supposed to be conducted by 30.09.2015, it was not conducted from 01.10.2015, thereby he was automatically vacated. Learned counsel would submit that the Petitioner had also expressed his disinterest to continue as an Additional Director of the Company and that the Company has sent the application to the Registrar of Companies and the resignation of Petitioner/A.5 was also accepted and the proceedings were also filed. It is also submitted that there are no specific overt acts were attributed against the Petitioner. The present case was registered only on the omnibus allegations. Ultimately, the learned counsel would seek for the quashment of proceedings in the C.Cs. 7. Contrasting the same, learned Assistant Public Prosecutor would submit that the Petitioner also assured the Complainants that they will return the amount, therefore, it is not accurate to quash the proceedings against the Petitioner. Hence, she prayed for dismissal of the petitions. Points for Determination 8. 7. Contrasting the same, learned Assistant Public Prosecutor would submit that the Petitioner also assured the Complainants that they will return the amount, therefore, it is not accurate to quash the proceedings against the Petitioner. Hence, she prayed for dismissal of the petitions. Points for Determination 8. Having heard the submissions made by the learned counsel and on perusal of the material available on record, the points for determination that arises in this case are as follows : (1) Whether vicarious liability can be attached on an Additional Director of a company under the provisions of I.P.C.? (2) Whether the cases against the Petitioner are liable to be quashed by exercising jurisdiction under Section 482 of the Cr.P.C.? Determination by the Court: Point No.1 9. The grievance of the complainant is that the accused with a fraudulent and dishonest intention from the beginning, having received the silk sarees supplied by various businessmen from Dharmavaram, secreted their money and, failed to pay the due amount to the poor weavers and evading to pay the due amount and thereby committed the offences under Sections 409 and 420 IPC. 10. It is profitable to refer to the decision in Ravindranatha Bajpe v. Mangalore Special Economic Zone Ltd., (2022) 15 SCC 430 the Hon'ble Apex Court reiterated the settled principle that the Directors cannot be imputed automatically, in the absence of statutory provision to such effect. The relevant para reads as under; “8. In Sunil Bharti Mittal [Sunil Bharti Mittal v. CBI, (2015) 4 SCC 609 (2015) 2 SCC (Cri) 687], it is observed by this Court in paras 42 to 44 as under : (SCC p. 638) “(iii) Circumstances when Director/person in charge of the affairs of the company can also be prosecuted, when the company is an accused person 42. No doubt, a corporate entity is an artificial person which acts through its officers, Directors, Managing Director, Chairman, etc. If such a company commits an offence involving mens rea, it would normally be the intent and action of that individual who would act on behalf of the company. It would be more so, when the criminal act is that of conspiracy. However, at the same time, it is the cardinal principle of criminal jurisprudence that there is no vicarious liability unless the statute specifically provides so. 43. It would be more so, when the criminal act is that of conspiracy. However, at the same time, it is the cardinal principle of criminal jurisprudence that there is no vicarious liability unless the statute specifically provides so. 43. Thus, an individual who has perpetrated the commission of an offence on behalf of a company can be made an accused, along with the company, if there is sufficient evidence of his active role coupled with criminal intent. Second situation in which he can be implicated is in those cases where the statutory regime itself attracts the doctrine of vicarious liability, by specifically incorporating such a provision. 44. When the company is the offender, vicarious liability of the Directors cannot be imputed automatically, in the absence of any statutory provision to this effect. One such example is Section 141 of the Negotiable Instruments Act, 1881. In Aneeta Hada [Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661 : (2012) 3 SCC (Civ) 350 : (2012) 3 SCC (Cri) 241], the Court noted that if a group of persons that guide the business of the company have the criminal intent, that would be imputed to the body corporate and it is in this backdrop, Section 141 of the Negotiable Instruments Act has to be understood. Such a position is, therefore, because of statutory intendment making it a deeming fiction. Here also, the principle of “alter ego”, was applied only in one direction, namely, where a group of persons that guide the business had criminal intent, that is to be imputed to the body corporate and not the vice versa. Otherwise, there has to be a specific act attributed to the Director or any other person allegedly in control and management of the company, to the effect that such a person was responsible for the acts committed by or on behalf of the company.” 8.1. In Maksud Saiyed v. State of Gujarat, (2008) 5 SCC 668 : (2008) 2 SCC (Cri) 692, in para 13, it is observed and held as under : (SCC p. 674) “13. Where a jurisdiction is exercised on a complaint petition filed in terms of Section 156(3) or Section 200 of the Code of Criminal Procedure, the Magistrate is required to apply his mind. Where a jurisdiction is exercised on a complaint petition filed in terms of Section 156(3) or Section 200 of the Code of Criminal Procedure, the Magistrate is required to apply his mind. The Penal Code does not contain any provision for attaching vicarious liability on the part of the Managing Director or the Directors of the Company when the accused is the company. The learned Magistrate failed to pose unto himself the correct question viz. as to whether the complaint petition, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The Bank is a body corporate. Vicarious liability of the Managing Director and Director would arise provided any provision exists in that behalf in the statute. Statutes indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegations which would attract the provisions constituting vicarious liability.” (emphasis supplied) 8.2. As observed by this Court in Pepsi Foods Ltd. v. Special Judicial Magistrate, (1998) 5 SCC 749 : 1998 SCC (Cri) 1400 and even thereafter in a catena of decisions, summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. In para 28 in Pepsi Foods Ltd. [Pepsi Foods Ltd. v. Special Judicial Magistrate, (1998) 5 SCC 749 : 1998 SCC (Cri) 1400], it is observed and held as under : (SCC p. 760) “28. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the Magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. He has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. He has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. The Magistrate has to carefully scrutinise the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused.” 8.3. As held by this Court in India Infoline Ltd. [GHCL Employees Stock Option Trust v. India Infoline Ltd., (2013) 4 SCC 505 : (2013) 2 SCC (Cri) 414], in the order issuing summons, the learned Magistrate has to record his satisfaction about a prima facie case against the accused who are Managing Director, the Company Secretary and the Directors of the Company and the role played by them in their respective capacities which is sine qua non for initiating criminal proceedings against them. Looking to the averments and the allegations in the complaint, there are no specific allegations and/or averments with respect to role played by them in their capacity as Chairman, Managing Director, Executive Director, Deputy General Manager and Planner & Executor. Merely because they are Chairman, Managing Director/Executive Director and/or Deputy General Manager and/or Planner/Supervisor of A-1 and A-6, without any specific role attributed and the role played by them in their capacity, they cannot be arrayed as an accused, more particularly they cannot be held vicariously liable for the offences committed by A-1 and A-6.” (emphasis supplied) 11. In the context of Sections 405 and 406 I.P.C. and the liability on Directors of a Company, the Hon'ble Supreme Court in S.K. Alagh v. State of U.P., (2008) 5 SCC 662 held that when the Code does not cast vicarious liability, the same cannot be attached on a party that is not directly charged for the commission of the offence. The relevant portion reads thus; “19. As, admittedly, drafts were drawn in the name of the Company, even if the appellant was its Managing Director, he cannot be said to have committed an offence under Section 406 of the Penal Code. The relevant portion reads thus; “19. As, admittedly, drafts were drawn in the name of the Company, even if the appellant was its Managing Director, he cannot be said to have committed an offence under Section 406 of the Penal Code. If and when a statute contemplates creation of such a legal fiction, it provides specifically therefor. In absence of any provision laid down under the statute, a Director of a Company or an employee cannot be held to be vicariously liable for any offence committed by the Company itself. (See Sabitha Ramamurthy v. R.B.S. Channabasavaradhya [ (2006) 10 SCC 581 : (2007) 1 SCC (Cri) 621].) 20. We may, in this regard, notice that the provisions of the Essential Commodities Act, the Negotiable Instruments Act, the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, etc. have created such vicarious liability. It is interesting to note that Section 14-A of the 1952 Act specifically creates an offence of criminal breach of trust in respect of the amount deducted from the employees by the company. In terms of the Explanations appended to Section 405 of the Penal Code, a legal fiction has been created to the effect that the employer shall be deemed to have committed an offence of criminal breach of trust. Whereas a person in charge of the affairs of the company and in control thereof has been made vicariously liable for the offence committed by the company along with the company but even in a case falling under Section 406 of the Penal Code vicarious liability has been held to be not extendable to the Directors or officers of the company. (See Maksud Saiyed v. State of Gujarat [ (2008) 5 SCC 668 : (2007) 11 Scale 318 ].)” (emphasis supplied) 12. In Shiv Kumar Jatia v. State (NCT of Delhi), (2019) 17 SCC 193 reiterating the position of law held in the aforesaid cases, the Hon'ble Supreme Court was of the view that since the Penal Code does not provide a specific statutory provision concerning vicarious/constructive liability, it is essential that direct actions of the individual concerned must be established to prove culpability. 13. To sum up, it is settled legal position that in so far as the criminal offences are concerned, there is no vicarious liability on the Directors of a Company unless the statute specifically provides so. 13. To sum up, it is settled legal position that in so far as the criminal offences are concerned, there is no vicarious liability on the Directors of a Company unless the statute specifically provides so. There is no provision in Indian Penal Code which makes the Directors of a Company vicariously liable for the offences committed by the Company. Naturally, since vicarious liability cannot be attributed, this aspect can be safely ruled out in respect of the IPC offences in the instant case. Therefore, Petitioner cannot be made vicariously liable for the acts of the company. Accordingly Point answered. Point No.2 14. Inherent powers, as the word suggests, are inalienably present in the Court. They are not conferred, but are merely safeguarded and preserved by provision under Section 482 to the High Court. A bare perusal of Section 482 makes it clear that the Code envisages that inherent powers of the High Court are not limited or affected so as to make orders as may be necessary; (i) to give effect to any order under the Code or, (ii) to prevent abuse of the process of any Court or, otherwise (iii) to secure ends of justice. A court while sitting in Section 482 jurisdiction must exercise its powers to do real and substantial justice, depending on the facts and circumstances of the case for compelling reasons of abuse of process of law or glaring injustice, which are against sound principles of criminal jurisprudence. 15. As already discussed supra, it has to be seen as to whether there are direct acts on part of the Petitioner to support the allegation of culpability. Needless to say, in the complaint, the charge sheet as well as in the final report filed by the Police, there is no reference that that the petitioner herein as being responsible for the day-to-day affairs of the Company. Be that as it may, even if any name of the Director of the Company is referred to in the complaint saying that he has actively participated in the affairs of the Company, it is not suffice to attract the offences under Sections 409 and 420 IPC. This is a case of non-payment of the amount due for the supply of goods made on credit. This is a case of non-payment of the amount due for the supply of goods made on credit. The final report as well as the complaint do not show any resolution made by the Government making the petitioner/Accused No.5 responsible for the affairs of the Company. 16. It is not the case that the petitioner acknowledged the amount due to the complainant, in writing, or to the least his signature is also not found in any invoice representing the Company. The complaint as well as the final report are bereft of any details as to how the petitioner is responsible for the day-to-day affairs of the Company. In addition to that the document filed by the petitioner would show that his appointment is made for the purpose of release of the bank loan and no duties were assigned to the petitioner. 17. Here, the petitioner being an Additional Director of the Company, to whom no duties were assigned and his appointment as an Additional Director is only for the purpose of complying with the conditions of the bank for release of the loan, but not responsible for conduct of the business at relevant point of time, will not be made liable for the criminal offence. The complaint shows that the Company and its Directors committed cheating and criminal breach of trust on the ground of non-payment of dues to the complainant for the goods supplied. 18. A perusal of Form 32 and the provisions of the Companies Act reveals that the petitioner was appointed as an Additional Director of the Company on 29.01.2015 and he submitted his resignation on 01.10.2015 and the certificate from the Registrar of Companies would clearly demonstrate that, with effect from 19.04.2016, he is no more Additional director of the Company. Furthermore, Section 406 IPC would construe the entrustment of the property and misappropriation of the same with dishonest intention. In the present case, at the relevant point of time, when the goods were supplied, no iota of evidence was placed to show that the petitioner being an Additional Director actively participated in the day-to-day affairs of the Company and the property was entrusted to him, as such, the question of the petitioner cheating or dishonestly inducing the complainant to deliver the goods does not arise. 19. 19. The primary requirement to make out an offence of cheating under Section 415 IPC punishable under Section 420 IPC is dishonest/ fraudulent at the time of inception. In order to appreciate the controversy in a proper perspective, it is beneficial to reproduce Section 415 IPC, which reads as under : “415. Cheating.—Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to “cheat”. Explanation.—A dishonest concealment of facts is a deception within the meaning of this section.” 20. To attract the offence under Section 420 IPC, twin conditions are to be complied i.e., dishonest and fraudulent intention. At this juncture, for better understanding, it is relevant to reproduce Sections 24 and 25 IPC, which read as under : “24. “Dishonestly”.—Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing “dishonestly”. 25. “Fraudulently”.—A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise.” 21. In the instant case, no material whatsoever has been produced by the Complainant, which would indicate any such dishonest or fraudulent intention on the part of the Petitioner at any stage, at least at the time of inception. The reason being, the Petitioner entered in the Company as an Additional Director on 29.01.2015. By that time, in fact, much prior to that, the Complainant had been supplied goods to the Company and the Company was also repaying the amount for the supply of the goods. There is not even a whisper in the complaint or in the final report or in the material collected during the course of investigation to show the direct participation of the Petitioner in the alleged crime. Petitioner was shown as an Accused only on the ground that, he was once upon a time an Additional Director of the Company. 22. There is not even a whisper in the complaint or in the final report or in the material collected during the course of investigation to show the direct participation of the Petitioner in the alleged crime. Petitioner was shown as an Accused only on the ground that, he was once upon a time an Additional Director of the Company. 22. In the light of the above discussion and in the backdrop of the legal positions, this Court is of the considered view that it is a fit case to quash the proceedings against the Petitioner in the above mentioned Criminal Cases. 23. In result, the Criminal Petitions are allowed. The proceedings against Petitioner/Accused No. 5 in C.C.Nos.349, 233, 227, 232 of 2018, 702 of 2017, 342, 230, 235, 315, 194, 229, 228, 234, 348, 231, 195 and 775 of 2018 respectively on the file of the Court of Judicial Magistrate of First Class, Dharmavaram, which were registered for the offences punishable under Sections 409 and 420 read with 34 I.P.C., are hereby quashed. Pending miscellaneous petitions, if any, shall stand closed.