Narsingh Sah Son of Late Shri Hanshraj Shah v. State of Jharkhand
2025-06-18
ANIL KUMAR CHOUDHARY
body2025
DigiLaw.ai
JUDGMENT : ANIL KUMAR CHOUDHARY 1. Heard the parties. 2. This Criminal Miscellaneous Petition has been filed invoking the jurisdiction of this Court under Section 482 of the Code of Criminal Procedure with a prayer to quash the entire complaint including the summons order dated 08.06.2022 passed by the learned Judicial Magistrate, Ranchi in connection with Complaint Case No.12129 of 2021 for the offence punishable under Section 138 of Negotiable Instruments Act. 3. The brief fact of the case is that a cheque was issued by M/s Govind Radhe Real Estate (P) Company Limited, through its Director, who is the petitioner herein. The said cheque was dishonoured. No notice of demand was issued to or served upon the company in the name and style of M/s Govind Radhe Real Estate (P) Company Limited. The said company- M/s Govind Radhe Real Estate (P) Company Limited has not been arrayed as an accused but Director of the said company who is the petitioner herein in this Criminal Miscellaneous Petition has only been arrayed as an accused in his personal capacity. 4. Learned counsel for the petitioner draws attention of this Court to the judgment of this Court in the case of Ajay Kumar Agarwal @ Ajay Kumar Agrawal vs. The State of Jharkhand & Another passed in Cr.M.P. No.2195 of 2022 dated 01.05.2024 and submits that this Court in that case relied upon the judgment of the Hon’ble Supreme Court of India in the case Dilip Hiramani vs. Bank of Baroda reported in 2022 0 Supreme (SC) 417 , para-14 of which reads as under:- “14. The provisions of Section 141 impose vicarious liability by deeming fiction which presupposes and requires the commission of the offence by the company or firm. Therefore, unless the company or firm has committed the offence as a principal accused, the persons mentioned in sub-section (1) or (2) would not be liable and convicted as vicariously liable. Section 141 of the NI Act extends vicarious criminal liability to officers associated with the company or firm when one of the twin requirements of Section 141 has been satisfied, which person(s) then, by deeming fiction, is made vicariously liable and punished. However, such vicarious liability arises only when the company or firm commits the offence as the primary offender. This view has been subsequently followed in Sharad Kumar Sanghi v. Sangita Rane, 17[ (2015) 12 SCC 781 : “11.
However, such vicarious liability arises only when the company or firm commits the offence as the primary offender. This view has been subsequently followed in Sharad Kumar Sanghi v. Sangita Rane, 17[ (2015) 12 SCC 781 : “11. In the case at hand as the complainant's initial statement would reflect, the allegations are against the Company, the Company has not been made a party and, therefore, the allegations are restricted to the Managing Director. As we have noted earlier, allegations are vague and in fact, principally the allegations are against the Company. There is no specific allegation against the Managing Director. When a company has not been arrayed as a party, no proceeding can be initiated against it even where vicarious liability is fastened under certain statutes. It has been so held by a three-Judge Bench in Aneeta Hada v. Godfather Travels and Tours (P) Ltd. in the context of the Negotiable Instruments Act, 1881.”] Himanshu v. B. Shivamurthy and Another, 18[ (2019) 3 SCC 797 : “13. In the absence of the company being arraigned as an accused, a complaint against the appellant was therefore not maintainable. The appellant had signed the cheque as a Director of the company and for and on its behalf. Moreover, in the absence of a notice of demand being served on the company and without compliance with the proviso to Section 138, the High Court was in error in holding that the company could now be arraigned as an accused.”] and Hindustan Unilever Limited v. State of Madhya Pradesh19[ (2020) 10 SCC 751 : “23. Clause (a) of sub-section (1) of Section 17 of the Act makes the person nominated to be in charge of and responsible to the company for the conduct of business and the company shall be guilty of the offences under clause (b) of sub-section (1) of Section 17 of the Act. Therefore, there is no material distinction between Section 141 of the NI Act and Section 17 of the Act which makes the company as well as the nominated person to be held guilty of the offences and/or liable to be proceeded and punished accordingly. Clauses (a) and (b) are not in the alternative but conjoint. Therefore, in the absence of the company, the nominated person cannot be convicted or vice versa.
Clauses (a) and (b) are not in the alternative but conjoint. Therefore, in the absence of the company, the nominated person cannot be convicted or vice versa. Since the Company was not convicted by the trial court, we find that the finding of the High Court to revisit the judgment will be unfair to the appellant nominated person who has been facing trial for more than last 30 years. Therefore, the order of remand to the trial court to fill up the lacuna is not a fair option exercised by the High Court as the failure of the trial court to convict the Company renders the entire conviction of the nominated person as unsustainable.”]. The exception carved out in Aneeta Hada (supra), 20[The exception would be when the company itself has ceased to exist or cannot be prosecuted due to a statutory bar.] which applies when there is a legal bar for prosecuting a company or a firm, is not felicitous for the present case. No such plea or assertion is made by the respondent.” (Emphasis supplied) has held that in the absence of a company being arrayed as an accused, the Director who signed the cheque in capacity of the Director of the company, for and on behalf of the company, in the absence of notice of demand being served upon the company and thus without compliance of the proviso of Section 138 of the Negotiable Instruments Act, the cognizance taken under Section 138 of the Negotiable Instruments Act is not sustainable in law and quashed and set aside the same. 5. Hence, it is submitted that the prayer as prayed for in this Criminal Miscellaneous Petition be allowed. 6. Learned Spl.P.P. appearing for the State and the learned counsel for the opposite party No.2 on the other hand vehemently oppose the prayer of the petitioner and fairly submit that neither the notice demanding the payment of the cheque amount was issued to M/s Govind Radhe Real Estate (P) Company Limited nor the said company- M/s Govind Radhe Real Estate (P) Company Limited has been arrayed as an accused in the Complaint Case No.12129 of 2021; but submitted that this Criminal Miscellaneous Petition, being without any merit, be dismissed. 7.
7. Having heard the submissions made at the Bar and after carefully going through the materials available in the record, it is pertinent to mention here that it is a settled principle of law as has been held by the Hon’ble Supreme Court of India in the case Dilip Hiramani vs. Bank of Baroda (supra) that in case a cheque is issued on behalf of the company by its Director, then, notice demanding payment of money mentioned in the cheque in writing is to be issued to the company also and the same is a sine qua non for instituting a complaint alleging commission of the offence punishable under Section 138 of the Negotiable Instruments Act; besides arraying the company as an accused, is also the requirement of law. 8. Now coming to the facts of the case, indisputably the complainant having not done either i.e. not issuing the notice of demand to the company- M/s Govind Radhe Real Estate (P) Company Limited nor arraying the said company as an accused in the complaint in this case, this Court has no hesitation in holding that the order taking cognizance dated 08.06.2022 in connection with Complaint Case No.12129 of 2021 only against the petitioner, in his individual capacity though the cheque was admittedly not issued by him in his individual capacity rather, for and on behalf of the company; is not sustainable in law. Therefore, continuation of the same will amount to abuse of process of law. Hence, this is a fit case where the entire complaint including the summoning order dated 08.06.2022 passed by the learned Judicial Magistrate, Ranchi in connection with Complaint Case No.12129 of 2021 be quashed and set aside. 9. Accordingly, the entire complaint including the summoning order dated 08.06.2022 passed by the learned Judicial Magistrate, Ranchi in connection with Complaint Case No.12129 of 2021 is quashed and set aside. 10. In the result, this Criminal Miscellaneous Petition is allowed.