CRM-M-10340-2014 (O & M)

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGA RH

(148)

CRM-M-10340-2014 (O & M) 

  Reserved on: 23.07.2026

Date of Pronouncement:28.07.2026

Date of Uploading : 28.07.2026

Dharam Pal Singhal …... Petitioner(s)

V/s

IDBI Bank Ltd. ...Respondent(s)

CORAM: HON’BLE MR. JUSTICE JASJIT SINGH BEDI

Present: Ms. Ojaswini Gagneja, Avocate,

for the petitioner(s).

Mr. Deepinder Singh, Sr. Advocate with

Mr. Dharamvir Singh, Advocate and

Mr. Meyank Sarpul, Advocate,

for the respondent.

****

JASJIT SINGH BEDI,   

 J. (Oral)   

The prayer in the present petition under Section 482 of the

Code of Criminal Procedure is for quashing of criminal complaint No.

17486/2012 dated 22.10.2012 (Annexure P71), summoning order dated

23.10.2012 (Annexure P72), passed by the Court of the Judicial Magistrate

Ist Class, Chandigarh in a complaint filed under Sections 138 and 141 of the

Negotiable Instruments Act, 1881 and all the consequential proceedings

arising therefrom qua the petitioner.

2. The brief allegations levelled in the complaint are that in

discharge of its legal liability, 09 cheques were issued by the accused7

Company between March 2012 and May 2012, all of which were

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dishonoured, leading to the filing of the complaint under Section 138 read

with Section 141 of Negotiable Instruments Act, 1881 (Annexure P71) and

the consequential summoning order dated 23.10.2012 under Section 138

read with Sections 141/142 of Negotiable Instruments Act, 1881 (Annexure

P72), which are challenged in the present petition.

3. The learned counsel for the petitioner contends that the

petitioner was appointed as Additional Director (Independent) on 12.11.2011

and resigned on 15.06.2013. The petitioner was not an active Director. He

had no authorization to represent the company for negotiating a loan from

the Bank. There are no documents accompanying the complaint (Annexure

P71) showing the involvement of the petitioner in the day7to7day running of

the affairs of the company and only vague allegations have been levelled in

the complaint (Annexure P71) of him alongwith the co7accused being

incharge of and responsible for the day7to7day affairs of the company. He is

also not a signatory to the cheques. He, therefore, prays that the impugned

summoning order (Annexure P72) be quashed.

4. The learned Senior counsel for the respondent7Bank, on the

other hand, contends that there are clear and categoric averments against all

the accused including the petitioner who is an accused No.6 in the complaint

(Annexure P71). Not only are there categoric averments in terms of the

Section 141 of the Negotiable Instruments Act but there is an averment to

the effect that the accused No.2 to 6 including the petitioner came to

negotiate with the respondent7Bank for the purpose of availing a loan. Once

the necessary and specific averments regarding the role played by the

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petitioner have been made in the complaint, then, whether or not he was

incharge of or responsible for the affairs of the company shall be a matter of

his defence which shall be adjudicated upon during the course of the Trial.

He, therefore, prays that the present petition is liable to be dismissed.

5. I have heard the learned counsel for the parties.

6. Section 141 of the Negotiable Instruments Act, 1881 reads as

under:7

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 sub7section 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:

6[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 attributable to, any

neglect on the part of, any director, manager, secretary or other

officer of the company, such director, manager, secretary or

other officer shall also be deemed to be guilty of that offence

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and shall be liable to be proceeded against and punished

accordingly.

7. The Hon’ble Supreme Court in the case of ‘ S.M.S.

Pharmaceuticals Ltd. vs. Neeta Bhalla and anr’ 2005(4) RCR (Criminal)

141,

bearing Criminal Appeal No.664 of 2002 decided on 20.09.2005, it has

been categorically held that the designation of a person of a company is not

relevant, but the nature of the job that he performs in the company is. Every

Director/officer of the company is not liable if he is not stated to be in

charge of and responsible for running the business of the company.

Conversely, if a person is stated to be in charge of and responsible for

running the business of the company but does not hold any post, he can still

be liable. The relevant extract of the judgment in S.M.S. Pharmaceuticals

Ltd. (supra) is as under:7

“13. While analysing Section 141 of the Act, it will

be seen that it operates in cases where an offence under

Section 138 is committed by a company. The key words

which occur in the Section are "every person". These are

general words and take every person connected with a

company within their sweep. Therefore, these words have

been rightly qualified by use of the words "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 etc." What is required

is that the persons who are sought to be made criminally

liable under Section 141 should be at the time the offence

was committed, in charge of and responsible to the

company for the conduct of the business of the company.

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Every person connected with the company shall not fall

within the ambit of the provision. It is only those persons

who were in charge of and responsible for conduct of

business of the company at the time of commission of an

offence, who will be liable for criminal action. It follows

from this 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 under the provision. The liability arises from being

in charge of and responsible for conduct of 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. Conversely, a person

not holding any office or designation in a Company may

be liable if he satisfies the main requirement of being in

charge of and responsible for conduct of business of a

Company at the relevant time. Liability depends on the

role one plays in the affairs of a Company and not on

designation or status. If being a Director or Manager or

Secretary was enough to cast criminal liability, the

Section would have said so. Instead of "every person" the

section would have said "every Director, Manager or

Secretary in a Company is liable"....etc. The legislature is

aware that it is a case of criminal liability which means

serious consequences so far as the person sought to be

made liable is concerned. Therefore, only persons who

can be said to be connected with the commission of a

crime at the relevant time have been subjected to action.

14. A reference to sub!section (2) of Section 141

fortifies the above reasoning because sub! section (2)

envisages direct involvement of any Director, Manager,

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Secretary or other officer of a company in commission of

an offence. This section operates when in a trial it is

proved that the offence has been committed with the

consent or connivance or is attributable to neglect on the

part of any of the holders of these offices in a company.

In such a case, such persons are to be held liable.

Provision has been made for Directors, Managers,

Secretaries and other officers of a company to cover

them in cases of their proved involvement.

15. The conclusion is inevitable that the liability arises

on account of conduct, act or omission on the part of a

person and not merely on account of holding an office or

a position in a company. Therefore, in order to bring a

case within Section 141 of the Act the complaint must

disclose the necessary facts which make a person liable.

XXXX XXXX XXXX

20. To sum up, there is almost unanimous judicial

opinion that necessary averments ought to be contained

in a complaint before a persons can be subjected to

criminal process. A liability under Section 141 of the Act

is sought to be fastened vicariously on a person

connected with a Company, the principal accused being

the company itself. It is a departure from the rule in

criminal law against vicarious liability. A clear case

should be spelled out in the complaint against the person

sought to be made liable. Section 141 of the Act contains

the requirements for making a person liable under the

said provision. That respondent falls within parameters

of Section 141 has to be spelled out. A complaint has to

be examined by the Magistrate in the first instance on the

basis of averments contained therein. If the Magistrate is

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satisfied that there are averments which bring the case

within Section 141 he would issue the process. We have

seen that merely being described as a director in a

company is not sufficient to satisfy the requirement of

Section 141. Even a non!director can be liable under

Section 141 of the Act. The averments in the complaint

would also serve the purpose that the person sought to be

made liable would know what is the case which is alleged

against him. This will enable him to meet the case at the

trial.

21. 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 question posed in sub!para (b)

has to be in 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 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

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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 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 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.

8. The Hon’ble Supreme Court in the case of   ‘N.Rangachari

versus Bharat Sanchar Nigam Ltd. 2007(2) RCR (Criminal) 875’, has held

that if the complaint contains necessary averments against the

Director/Manager/Officer of the company in terms of Section 141 of the

Negotiable Instruments Act, then, it is lawful to summon the said

Director/Manager/Officer as an accused. The defence of the said accused

that he was not in charge of and responsible for the affairs of the company is

a matter of Trial and cannot be gone into in summary proceedings under

Section 482 Cr.P.C. The relevant extract of the said judgment is as under:7

5. The appellant herein moved the High Court under

Section 482 of the Code of Criminal Procedure seeking

the quashing of the complaint insofar as it related to him.

The appellant pleaded that he was nominated as

Honorary Chairman without any remuneration, sitting

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fee etc. by the investors and promoters of the Company of

Data Access (India) Limited on 24.7.2004 and he was

designated as Chairman of the Company. Being a

nominated Chairman and holding an Honorary post in

the Company, he was never assigned with any of the

Company's financial or other business activities. He was

the Chairman for name sake and was never entrusted

with any job or business or constituted a signing

authority. He had resigned effectively on 26.8.2004 when

problems between the promoters and investors of Data

Access (India) Limited started developing. The two

cheques that were the subject matter of the complaint,

were dated 31.8.2004, after the appellant had effectively

resigned. He had not signed those cheques. He was not

liable. According to him, the Data Access (India) Limited

had two Managing Directors at the relevant time and

they were the ones who were invested with substantial

powers of management of the Company and as such the

Managing directors were involved in the day to day

affairs of the Company and not himself, who had only

acted for a short period as Honorary Chairman. The

complaint did not contain adequate averments to justify

initiation of a criminal proceeding against him and hence

the complaint was liable to be quashed.

6. On behalf of B.S.N.L., it was contended that the

Petition under Section 482 of the Code of Criminal

Procedure was not maintainable and that the questions

sought to be raised by the appellant were questions that

had to be decided at the trial. The complaint disclosed

sufficient materials justifying the commencement of the

proceedings against Data Access (India) Limited and the

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other two accused including the appellant. The appellant

who was the Chairman of the Data Access (India)

Limited was incharge of and responsible to the Company

for the conduct of its business, and no occasion had

arisen for quashing the complaint. The question whether

a person is incharge of and responsible for the conduct of

the business of the Company, is to be adjudged during the

trial on the basis of the materials to be placed on record

by the parties. That could not be decided at the stage of a

motion under Section 482 of the Code of Criminal

Procedure.

7. The High Court, on going through the complaint in the

context of Sections 138 and 141 of the Negotiable

Instruments Act, came to the conclusion that the court

could not decide the pleas put forward by the appellant in

dealing with a petition filed under Section 482 of the

Code of Criminal Procedure and that the defences sought

to be put forward by the accused had to be established at

the trial. Taking the view that the complaint disclosed

adequate material for proceeding against the appellant

in terms of Section 138 read with Section 141 of the

Negotiable Instruments Act, the High Court refused to

accede to the prayer of the appellant and dismissed the

application filed under Section 482 of the Code of

Criminal Procedure. Challenging the said order of the

High Court, this appeal is filed by the appellant.

XXXX XXXX XXXX

13. A Company, though a legal entity, cannot act by itself

but can only act through its directors. Normally, the

Board of Directors act for and on behalf of the company.

This is clear from Section 291 of the Companies Act

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which provides that subject to the provisions of that Act,

the Board of Directors of a Company shall be entitled to

exercise all such powers and to do all such acts and

things as the Company is authorised to exercise and do.

Palmer described the position thus :

"A company can only act by agents, and usually

the persons by whom it acts and by whom the

business of the company is carried on or

superintended are termed directors... ... ..."

It is further stated in Palmer that :

"Directors are, in the eye of the law, agents of the

company for which they act, and the general

principles of the law of principal and agent

regulate in most respects the relationship of the

company and its directors."

The above two passages were quoted with approval in

R.K. Dalmia & ors. v. The Delhi Administration [(1963)1

SCR 253 at page 300]. In Guide to the Companies Act by

A. Ramaiya (Sixteenth Edition) this position is summed

up thus :

"All the powers of management of the affairs of

the company are vested in the Board of Directors.

The Board thus becomes the working organ of the

company. In their domain of power, there can be

no interference, not even by shareholders. The

directors as a board are exclusively empowered to

manage and are exclusively responsible for that

management."

Therefore, a person in the commercial world having a

transaction with a company is entitled to presume that

the directors of the company are incharge of the affairs of

the company. If any restrictions on their powers are

placed by the memorandum or articles of the company, it

is for the directors to establish it at the trial. It is in that

context that Section 141 of the Negotiable Instruments

Act provides that when the offender is a company, every

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person, who at the time when the offence was committed

was incharge of and was responsible to the company for

the conduct of the business of the company, shall also be

deemed to be guilty of the offence along with the

company. It appears to us that an allegation in the

complaint that the named accused are directors of the

company itself would usher in the element of their acting

for and on behalf of the company and of their being

incharge of the company. In Gower and Davies'

Principles of Modern Company Law (Seventh Edition),

the theory behind the idea of identification is traced as

follows :

"It is possible to find in the cases varying

formulations of the under7lying principle, and the

most recent definitions suggest that the courts are

prepared today to give the rule of attribution based

on identification a somewhat broader scope. In the

original formulation in the Lennard's Carrying

Company case Lord Haldane based identification

on a person "who is really the directing mind and

will of the corporation, the very ego and centre of

the personality of the corporation". Recently,

however, such an approach has been castigated by

the Privy Council through Lord Hoffmann in the

Meridian Global case as a misleading "general

metaphysic of companies". The true question in

each case was who as a matter of construction of

the statute in question, or presumably other rule of

law, is to be regarded as the controller of the

company for the purpose of the identification rule."

But as has already been noticed, the decision in S.M.S.

Pharmaceuticals Ltd. (supra) binding on us, has

postulated that a director in a company cannot be

deemed to be incharge of and responsible to the company

for the conduct of his business in the context of Section

141 of the Act. Bound as we are by that decision, no

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further discussion on this aspect appears to be

warranted.

14. A person normally having business or commercial

dealings with a company, would satisfy himself about its

creditworthiness and reliability by looking at its

promoters and Board of Directors and the nature and

extent of its business and its Memorandum or Articles of

Association. Other than that, he may not be aware of the

arrangements within the company in regard to its

management, daily routine, etc. Therefore, when a

cheque issued to him by the company is dishonoured, he

is expected only to be aware generally of who are

incharge of the affairs of the company. It is not

reasonable to expect him to know whether the person

who signed the cheque was instructed to do so or

whether he has been deprived of his authority to do so

when he actually signed the cheque. Those are matters

peculiarly within the knowledge of the company and

those in charge of it. So, all that a payee of a cheque that

is dishonoured can be expected to allege is that the

persons named in the complaint are in charge of its

affairs. The Directors are prima facie in that position.

XXXX XXXX XXXX

19. We think that, in the circumstances, the High Court

has rightly come to the conclusion that it is not a fit case

for exercise of jurisdiction under Section 482 of the Code

of Criminal Procedure for quashing the complaint. In

fact, an advertence to Sections 138 and 141 of the

Negotiable Instruments Act shows that on the other

elements of an offence under Section 138 being satisfied,

the burden is on the Board of Directors or the Officers

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incharge of the affairs of the company to show that they

are not liable to be convicted. Any restriction on their

power or existence of any special circumstance that

makes them not liable is something that is peculiarly

within their knowledge and it is for them to establish at

the trial such a restriction or to show that at the relevant

time they were not incharge of the affairs of the company.

Reading the complaint as a whole, we are satisfied that it

is a case where the contentions sought to be raised by the

appellant can only be dealt with after the conclusion of

the trial.

9. The Hon’ble Supreme Court in the case of ‘National Small

Industries Corp. Ltd. versus Harmeet Singh Paintal & Anr. 2010(2) RCR

(Criminal) 122’,  has held that no specific averments qua a Managing

Director or Joint Managing Director are required regarding the role played

by them in running the affairs of the company as they are deemed to be

liable. However, qua other officers, there must be specific averments more

than reiteration of the mere language of Section 141 of the Negotiable

Instruments Act. The relevant extract of the said judgment is as under:7

4. The appellant ! National Small Industries Corporation

Ltd. had filed 12 criminal complaints under Section 138

read with Sections 141 and 142 of the Act against M/s

Jay Rapid Roller Limited, a Company incorporated

under the Companies Act, its Managing Director ! Shri

Sukhbir Singh Paintal, and its Director ! Shri Harmeet

Singh Paintal. It is the claim of the appellant that so as to

make the Managing Director and Director of the

Company liable to be prosecuted under the provisions of

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the Act, they had specifically averred in the complaint

that all the accused persons approached it for financing

of bill integrated market support programme. It was also

stated that the accused persons had issued cheques which

were dishonoured on presentation against which the

appellant had filed criminal complaints under the

provisions of the Act against all the respondents herein. It

is their further case that all the accused persons accepted

their liability and delivered various cheques, which are

the subject matter of the present appeals.

XXXX XXXX XXXX

6. In this factual matrix, the issue which arises for

determination before this Court is whether the order of

the High Court quashing the summoning orders insofar

as the respondents are concerned is sustainable and what

should be the averments in the complaint under Section

138 read with Section 141 of the Act against the Director

of a Company before he can be subjected to criminal

proceedings.

XXXX XXXX XXXX

9. Section 141 is a penal provision creating vicarious

liability, and which, as per settled law, must be strictly

construed. It is therefore, not sufficient to make a bald

cursory statement in a complaint that the Director

(arrayed as an accused) is in charge of and responsible

to the company for the conduct of the business of the

company without anything more as to the role of the

Director. But the complaint should spell out as to how

and in what manner Respondent No. 1 was in!charge of

or was responsible to the accused company for the

conduct of its business. This is in consonance with strict

interpretation of penal statutes, especially, where such

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statutes create vicarious liability. A company may have a

number of Directors and to make any or all the Directors

as accused in a complaint merely on the basis of a

statement that they are in!charge of and responsible for

the conduct of the business of the company without

anything more is not a sufficient or adequate fulfillment

of the requirements under Section 141.

XXXX XXXX XXXX

11. In the light of the above provision and the language

used therein, let us, at the foremost, examine the

complainta filed by National Small Industries

Corporation Limited and the DCM Financial Services

Ltd. In the case of National Small Industries Corpn. Ltd.,

the High Court has reproduced the entire complaint in

the impugned order and among other clauses, clause 8 is

relevant for our consideration which reads as under :

"8. That the accused No. 2 is the Managing

Director and accused No. 3 is the Director of the

accused company. The accused No. 2 and 3 are the

in7charge and responsible for the conduct of the

business of the company accused No. 1 and hence

are liable for the offences."

XXXX XXXX XXXX

23. Section 291 of the Companies Act provides that

subject to the provisions of that Act, the Board of

Directors of a company shall be entitled to exercise all

such powers, and to do all such acts and things, as the

company is authorised to exercise and do. A company,

though a legal entity, can act only through its Board of

Directors. The settled position is that a Managing

Director is prima facie in!charge of and responsible for

the company's business and affairs and can be

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prosecuted for offences by the company. But insofar as

other Directors are concerned, they can be prosecuted

only if they were in!charge of and responsible for the

conduct of the business of the company. A combined

reading of Sections 5 and 291 of Companies Act, 1956

with the definitions in clauses 24, 26, 30, 31 and 45 of

Section 2 of that Act would show that the following

persons are considered to be the persons who are

responsible to the company for the conduct of the

business of the company :

(a) the Managing Director/s;

(b) the whole7time Director/s;

(c) the Manager;

(d) the Secretary;

(e) any person in accordance with whose directions

or instructions the Board of Directors of the

company is accustomed to act;

(f) any person charged by the Board of Directors

with the responsibility of complying with that

provision;

Provided that the person so charged has given his

consent in this behalf to the Board;

(g) where any company does not have any of the

officers specified in clauses (a) to (c), any director

or directors who may be specified by the Board in

this behalf or where no director is so specified, all

the directors :

Provided that where the Board exercises any power

under clause (f) or clause (g), it shall, within thirty

days of the exercise of such powers, file with the

Registrar a return in the prescribed form.

But if the accused is not one of the persons who falls

under the category of "persons who are responsible to

the company for the conduct of the business of the

company" then merely by stating that "he was in!charge

of the business of the company" or by stating that "he

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was in!charge of the day!to!day management of the

company" or by stating that "he was in!charge of, and

was responsible to the company for the conduct of the

business of the company", he cannot be made vicariously

liable under Section 141(1) of the Act. To put it clear that

for making a person liable under Section 141(2), the

mechanical repetition of the requirements under Section

141(1) will be of no assistance, but there should be

necessary averments in the complaint as to how and in

what manner the accused was guilty of consent and

connivance or negligence and therefore, responsible

under sub!section (2) of Section 141 of the Act.

24. From the above discussion, the following principles

emerge :

(i) The primary responsibility is on the

complainant to make specific averments as are

required under the law in the complaint so as to

make the accused vicariously liable. For fastening

the criminal liability, there is no presumption that

every Director knows about the transaction.

(ii) Section 141 does not make all the Directors

liable for the offence. The criminal liability can be

fastened only on those who, at the time of the

commission of the offence, were in charge of and

were responsible for the conduct of the business of

the company.

(iii) Vicarious liability can be inferred against a

company registered or incorporated under the

Companies Act, 1956 only if the requisite

statements, which are required to be averred in the

complaint/petition, are made so as to make accused

therein vicariously liable for offence committed by

company along with averments in the petition

containing that accused were in7charge of and

responsible for the business of the company and by

virtue of their position they are liable to be

proceeded with. (iv) Vicarious liability on the part

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of a person must be pleaded and proved and not

inferred.

(v) If accused is Managing Director or Joint

Managing Director then it is not necessary to make

specific averment in the complaint and by virtue of

their position they are liable to be proceeded with.

(vi) If accused is a Director or an Officer of a

company who signed the cheques on behalf of the

company then also it is not necessary to make

specific averment in complaint.

(vii) The person sought to be made liable should be

in7charge 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.

10. The Hon’ble Supreme Court in the case of ‘Ashutosh Ashok

Parasrampuriya & Anr. Versus M/s Gharrkul Industries Pvt. Ltd. & Ors.

2021(4) RCR (Criminal) 483’, has held as under:7

8. In the background of the above facts, respondent no. 1

filed a complaint against the appellants under

section  138 of NI Act in which a specific averment was

made that respondent no. 1 by considering the need of

the appellants for financial assistance and their relations,

provided such financial assistance to the appellants by

executing Memorandum of Understanding, which was

signed by Appellant no. 2!Dilip Shrikrishna Andhare. It

is specifically contended that appellant no. 2 signed the

said document with consent of all the remaining

appellants in the presence of two attesting witnesses. It is

the case of respondent no. 1!complainant as revealed

from the complaint that all the appellants agreed that the

amount provided by respondent no. 1 would be refunded

within one or two years. The contents of the complaint

CRM-M-10340-2014 (O & M)

::20::

further reveal that respondent no. 1 had demanded

balance!sheet of appellant no. 1 Company, which was

provided and the appellants also confirmed the balance

in their accounts by issuing letter dated 21st June, 2012.

The cheque involved in the criminal case initiated by

respondent no. 1 against the appellants is dated 2 nd

June, 2012. It is further averred in para 5 & 7 of the

complaint that all Directors of the appellant Company

are responsible for its business and all the appellants are

involved in the business of the Company and are

responsible for all the affairs of the Company.

XXXX XXXX XXXX

11. The learned trial Court taking cognizance of the

complaint by order dated 10th November, 2012 issued

summons to the appellants herein directing them to

appear before the Court on 23rd November, 2012 and the

appellants were granted bail on furnishing security of

Rs.2,000/! by an Order dated 23rd November, 2012 by

the Court of Chief Judicial Magistrate.

12. The order passed by the learned trial Judge

summoning the present appellants came to be challenged

in two separate criminal petitions filed under section 482

CrPC, 1973 seeking quashing/setting aside of the

criminal complaints/Summary criminal case registered

against them as well as the summons dated 10th

November, 2012. Both the petitions were tagged together

and came to be dismissed by the High Court under the

order impugned dated 18th July, 2014.

13. Ms. Arundhati Katju, learned counsel for the

appellants submits that there is no specific averment

CRM-M-10340-2014 (O & M)

::21::

made that they have committed the offence and are

responsible for conduct of business of the Company,

which is one of the essential ingredient/requirement and

in the absence of such averment, merely because the

appellants are the Directors of the Company, they are not

to be held vicariously liable and cannot be made accused

in the proceedings.

XXXX XXXX XXXX

15. Mr. Sidhartha Dave, learned senior counsel for the

appellants in Criminal Appeal @ SLP(Criminal) No.

7573 of 2014 further submits that they are the non!

executive Directors of the Company and were not

responsible for the conduct of the business of the

Company which is the mandatory requirement for

initiation of the proceedings under section  138 of NI Act

and submits that the precondition as referred to under

section 141 of NI Act not being complied with, the order

passed by the learned trial Judge in summoning the

present appellants is nothing but a clear abuse of process

of law and the finding which has been recorded by the

High Court in the impugned judgment is not legally

sustainable in law and in support of his submission has

placed reliance on the judgments of this Court in S.M.S.

Pharmaceuticals Ltd. v. Neeta Bhalla and Another

2005(8) SCC 89 and Pooja Ravinder Devidasani v. State

of Maharashtra and Another 2014(16) SCC 1.

16. Per contra, Mr. Pallav Shishodia, learned senior

counsel for the respondents, while supporting the order

passed by the High Court in the impugned proceedings,

submits that the appellants in Criminal Appeal @

SLP(Criminal) No. 7573 of 2014 claimed themselves to

CRM-M-10340-2014 (O & M)

::22::

be a non!executive Directors but the record indicates that

they are the Directors of the Company and in support

thereof, Form No. 32 which has been obtained from the

Registrar of Companies placed on record clearly

indicates that all are the Directors of the Company as on

1st April 2007 and responsible to the Company for the

conduct of business actively involved in the business of

the Company and responsible for the affairs of the

Company and there is nothing to indicate that they were

appointed as non!executive Directors and what is being

urged by the learned counsel for the appellants may be

their defence which is a matter of trial and is not open to

be examined at this stage and once the compliance of the

statute has been made as required by law, their petitions

have been rightly rejected by the High Court and needs

no further indulgence of this Court.

XXXX XXXX XXXX

20. In this regard, taking note of the three!Judge Bench

decision of this Court in S.M.S. Pharmaceuticals Ltd.

(supra) would be apposite. While dealing with an offence

under section  138 of the NI Act, the Court explaining the

duty of a Magistrate while issuing process and his power

to dismiss a complaint under Section 203 without even

issuing process observed thus:!

"5. ... a complaint must contain material to enable

the Magistrate to make up his mind for issuing

process. If this were not the requirement,

consequences could be far7reaching. If a

Magistrate had to issue process in every case, the

burden of work before the Magistrate as well as the

harassment caused to the respondents to whom

process is issued would be tremendous. Even

Section 204 of the Code starts with the words `if in

the opinion of the Magistrate taking cognizance of

CRM-M-10340-2014 (O & M)

::23::

an offence there is sufficient ground for

proceeding'. The words `sufficient ground for

proceeding' again suggest that ground should be

made out in the complaint for proceeding against

the respondent. It is settled law that at the time of

issuing of the process the Magistrate is required to

see only the allegations in the complaint and where

allegations in the complaint or the charge7sheet do

not constitute an offence against a person, the

complaint is liable to be dismissed."

21. After so stating, the Court analysed section  141 of the

NI Act and after referring to certain other authorities

answered a reference which reads as follows:!

19(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 sub7para

(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. 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

CRM-M-10340-2014 (O & M)

::24::

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

subsection (2) of Section 141."

XXXX XXXX XXXX

23. In the light of the ratio in S.M.S. Pharmaceuticals

Ltd. (supra) and later judgments of which a reference has

been made what is to be looked into is whether in the

complaint, in addition to asserting that the appellants are

the Directors of the Company and they are incharge of

and responsible to the Company for the conduct of the

business of the Company and if statutory compliance of

section 141 of the NI Act has been made, it may not open

for the High Court to interfere under section 482 CrPC,

1973 unless it comes across some unimpeachable,

incontrovertible evidence which is beyond suspicion or

doubt or totally acceptable circumstances which may

clearly indicate that the Director could not have been

concerned with the issuance of cheques and asking him

to stand the trial would be abuse of process of Court.

Despite the presence of basic averment, it may come to a

conclusion that no case is made out against the

particular Director for which there could be various

reasons.

24. The issue for determination before us is whether the

role of the appellants in the capacity of the Director of

the defaulter company makes them vicariously liable for

the activities of the defaulter Company as defined under

section 141 of the NI Act? In that perception, whether the

appellant had committed the offence chargeable under

section 138 of the NI Act?

CRM-M-10340-2014 (O & M)

::25::

25. We are concerned in this case with Directors who are

not signatories to the cheques. So far as Directors who

are not the signatories to the cheques or who are not

Managing Directors or Joint Managing Directors are

concerned, it is clear from the conclusions drawn in the

afore!stated judgment that it is necessary to aver in the

complaint filed under Section  138 read with

section 141 of the NI Act that at the relevant time when

the offence was committed, the Directors were in charge

of and were responsible for the conduct of the business of

the company.

26. This averment assumes importance because it is the

basic and essential averment which persuades the

Magistrate to issue process against the Director. That is

why this Court in S.M.S. Pharmaceuticals Ltd.(supra)

observed that the question of requirement of averments in

a complaint has to be considered on the basis of

provisions contained in sections 138 and 141 of the NI

Act read in the light of the powers of a Magistrate

referred to in sections 200 to 204 CrPC, 1973 which

recognise the Magistrate's discretion to take action in

accordance with law. Thus, it is imperative that if this

basic averment is missing, the Magistrate is legally

justified in not issuing process.

27. In the case on hand, reading the complaint as a

whole, it is clear that the allegations in the complaint are

that at the time at which the cheques were issued by the

Company and dishonoured by the Bank, the appellants

were the Directors of the Company and were responsible

for its business and all the appellants were involved in

the business of the Company and were responsible for all

the affairs of the Company. It may not be proper to split

CRM-M-10340-2014 (O & M)

::26::

while reading the complaint so as to come to a

conclusion that the allegations as a whole are not

sufficient to fulfil the requirement of section 141 of the NI

Act. The complaint specifically refers to the point of time

when the cheques were issued, their presentment,

dishonour and failure to pay in spite of notice of

dishonour. In the given circumstances, we have no

hesitation in overruling the argument made by the

learned counsel for the appellants.

XXXX XXXX XXXX

29. The submission of learned counsel for the appellants

that they are the non!executive Directors in the light of

the documentary evidence placed on record by Form No.

32 issued by the Registrar of Companies, both the

appellants are shown to be the Directors of the Company,

still open for the appellants to justify during course of the

trial.

30. In our considered view, the High Court has rightly

not interfered in exercise of its jurisdiction under section

482 CrPC, 1973 for quashing of the complaint.

11. In ‘ Bharat Poonam Chand Shah versus Dominos Printech

India Pvt. Ltd. 2007(19) RCR (Criminal) 440’, the Delhi High Court has

held as under:7

2. The plea of the accused is that the accused was merely

a sleeping director of the company and no specific role

has been assigned by the complainant as to how the

accused was managing the affairs of the company and

only vague allegations have been made that the accused

being a director, was responsible for management of the

CRM-M-10340-2014 (O & M)

::27::

company. The other plea taken by the accused is that at

the time when instrument was executed, the accused had

already resigned from the directorship and he was not

liable for dishonour of the cheque and the instrument was

not signed by him.

3. When a cheque is issued by a company to a supplier or

to any person against liability, the person only knows

that the cheque was issued by the company. He may not

be knowing the directors of the company. A creditor or

supplier need not come in contact with directors of the

company. He may be dealing with lower level

management of the company. When a cheque is

dishonoured, he makes efforts to find out as to who were

the directors. This information he gets from the Articles

of Association of the company or from ROC Office. The

documents which are prepared by the companies for

public consumption, like Annual Reports, Articles of

Association and Returns filed with ROC Office do not

disclose as to who are the sleeping directors and who are

active directors. This information is within the special

knowledge of the company i.e. Board of Directors

managing the company as per law.

4. Section 106 of the Evidence Act provides that where a

fact is in the special knowledge of a person, the burden of

proving that fact lies on him. If any director of the

company claims that despite being the director and

legally responsible for management of the company in

terms of the Companies Act, he was not the person

looking after the affairs of the company, this fact has to

be proved by him by cogent evidence before the trial

Court concerned. Management of a company is an

CRM-M-10340-2014 (O & M)

::28::

internal affair of the company. A creditor or supplier is

not supposed to know neither can be presumed to know

as to who are the sleeping directors or actively involved

directors in the management of the company or who were

the directors only lending their names. Only a director

can prove all this before the trial Court.

XXXX XXXX XXXX

6. This Court under its inherent powers cannot

adjudicate the facts as to who was the sleeping director

or a non working director. It is undisputed that petitioner

was the director of the company and the complainant has

alleged him to be in charge of management. The

resignation of the petitioner from the company, is a

defense of the petitioner, which he can take before the

trial Court concerned and this Court cannot quash a

judicial order of summoning on the ground that the

petitioner had resigned. The petitioner shall be given an

opportunity before the Court concerned to prove that he

was not a director at the relevant time. If an offence is

committed by the company under 138 of Neotiable

Instruments Act, all those who were directors of the

company, except those excepted by law are responsible.

The accused/petitioner is not covered by exception laid

down by law.

12. In ‘ P. Apparasamy versus Kalaimani 2008(51) RCR(Civil)

401’, the Madras High Court held as under:7

4. The petitioner, who is the third accused, would contend

in the petition seeking quashment that he was not the

signatory to the alleged cheques which gave rise to the

criminal proceedings under Section 138 of the

CRM-M-10340-2014 (O & M)

::29::

Negotiable Instruments Act. There was no averment that

he was in charge of and responsible for the conduct of

the business of the partnership firm. No materials are

also produced to show that he was responsible for the

day to day affairs of the firm. No notice was issued to the

petitioner individually prior to launching the complaint

under Section 138 of the Negotiable Instruments Act.

Therefore, the entire criminal proceedings initiated by the

respondent under Section 138 of the Negotiable

Instruments Act are liable to be quashed, it is contended.

5. The points that arise for determination are!

(i) whether there is necessary and sufficient

averment in the complaint under Section 138 of the

Negotiable Instruments Act laid by the respondent.

(ii) whether there shall be a necessary averment to

indicate as to how and in what manner, the partners

were responsible for the conduct of the business of

the partnership firm.

(iii) whether the complainant is bound to give

individual notice to each and every partner of the

partnership firm.

XXXX XXXX XXXX

8. The averment found in the complaint, of course, is not

the verbatim reproduction of the requirement under

Section 141 of the Negotiable Instruments Act. But, on

reading the entire averment found in the complaint as a

whole, one can easily come to a conclusion that there is

sufficient averment to the effect that the third accused

also was in charge of and responsible for the conduct of

the business of the fourth accused partnership firm.

Therefore, it is held that there is necessary averment in

the complaint in terms of Section 141 of the Negotiable

Instruments Act.

XXXX XXXX XXXX

CRM-M-10340-2014 (O & M)

::30::

10. It is found from the above ratio that the Magistrate

has to consider the complaint before issuing the process

and he has the power to reject the complaint at the

threshold itself if necessary and sufficient averment

required under Section 141 of the Negotiable Instruments

Act have not been found in the complaint. But, at the

same time, the complaint cannot be read in isolation. The

complaint includes the documents annexed therewith. In

the instant case, the Managing Partner of the fourth

accused partnership firm has issued reply to the statutory

notice as follows:!

"That my client and his brother7in7law in the

normal course were in the habit of signing of the

cheque leaves in the entire cheque books without

being filled up in order to meet any emergent

situation as may require."

The above averment found in the reply given by the

Managing Partner of the fourth accused partnership firm

would go to show that the third accused, who is none

other than the brother!in!law of the first accused, was in

charge of and responsible for the conduct of the business

of the partnership firm. The aforesaid reply notice given

by the first accused has been annexed along with the

complaint launched under Sections 138 and 141 of the

Negotiable Instruments Act by the respondent. The stand

taken by the first accused on behalf of the partnership

firm and the partners therein would go to show, prima

facie, that the third accused also has played a vital role

in the administration of the fourth accused partnership

firm.

11. In view of the ratio laid down by the Supreme Court

referred to above, the submission made by the learned

CRM-M-10340-2014 (O & M)

::31::

counsel appearing for the petitioner that the complaint

should be separately scanned and analysed by the court

without any reference to the reply notice given by the first

accused is rejected outright. Further, the Managing

Partner has given the reply notice not in his individual

capacity but in his capacity as the Managing Partner of

the partnership firm. His stand in the reply notice shall

be construed as the stand of the other partners in the

partnership firm. An agent cannot take a different stand

from that of the partnership firm. Therefore, the further

submission made on the side of the petitioner that the

stand taken by the Managing Partner in the reply notice

is not the stand of the third accused does not merit

consideration.

XXXX XXXX XXXX

13. In the case on hand, there is a clear averment to

satisfy the requirement under Section 141 of the

Negotiable Instruments Act. Further, the reply notice

issued by the Managing Partner of the partnership firm

unambiguously reflects the major role played by the third

accused in the day to day administration of the

partnership firm. When the complaint read along with the

documents produced satisfies the necessary and sufficient

averment as contemplated under Section 141 of the

Negotiable Instruments Act, the lack of averment in the

sworn statement of the de facto complainant in this case

as to the specific role of the petitioner herein does not go

to the root of the case.

14. In N.K.Wahi v. Shekhar Singh, (2007) 2 MLJ (Cri)

241 (SC) : 2007 ALL MR (Cri) 1445 (S.C.), the Supreme

Court has held in para 8 as follows:!

CRM-M-10340-2014 (O & M)

::32::

"To launch a prosecution, therefore, against the

alleged Directors there must be a specific

allegation in the complaint as to the part played by

them in the transaction. There should be clear and

unambiguous allegation as to how the Directors are

in charge and responsible for the conduct of the

business of the company. The description should

be clear. It is true that precise words from the

provisions of the Act need not be reproduced and

the Court can always come to a conclusion in facts

of each case. But still in the absence of any

averment or specific evidence the net result would

be that complaint would not be entertain7able."

"In the said judgment, it has been laid down that

there should be a clear and unambiguous allegation

as to how the Directors were in charge of and

responsible for the conduct of the business of the

company in the complaint laid under section 138

read with 141 of the Negotiable Instruments Act.

15. Relying on the aforesaid ratio laid down by the

Supreme Court, this court in Capt. D. Karunakar,

Etc. & Others v. Tamil Nadu News Print & Papers

Limited, 2007 2 LW (Crl.) 806 has held that a

complaint under Section 138 and 141 of the

Negotiable Instruments Act, without an allegation

in the complaint to indicate as to how and in what

manner a Director of the Company was responsible

for the conduct of the business of the Company, is

liable to be quashed."

15. But, in the later judgment pronounced by the Supreme

Court, in Rangachari, N. v. Bharat Sanchar Nigam

Limited, 2007 (3) CTC 495 : 2007 ALL MR (Cri) 1437

(S.C.), it has been held in paragraphs 19, 24 and 25 as

follows:!

"19. A person normally having business or

commercial dealings with a company, would

satisfy himself about its creditworthiness and

reliability by looking at its promoters and Board of

Directors and the nature and extent of its business

and its Memorandum or Articles of Association.

Other than that, he may not be aware of the

arrangements within the company in regard to its

management, daily routine, etc. Therefore, when a

CRM-M-10340-2014 (O & M)

::33::

cheque issued to him by the company is

dishonoured, he is expected only to be aware

generally of who are incharge of the affairs of the

company. It is not reasonable to expect him to

know whether the person who signed the cheque

was instructed to do so or whether he has been

deprived of his authority to do so when he actually

signed the cheque. Those are matters peculiarly

within the knowledge of the company and those in

charge of it. So, all that a payee of a cheque that is

dishonoured can be expected to allege is that the

persons named in the complaint are in charge of its

affairs. The Directors are prima facie in that

position.

...

24. In the case on hand, reading the complaint as a

whole, it is clear that the allegations in the

complaint are that at the time at which the two

dishonoured cheques were issued by the company,

the appellant and another were the Directors of the

company and were in7charge of the affairs of the

company. It is not proper to split hairs in reading

the complaint so as to come to a conclusion that

the allegations as a whole are not sufficient to

show that at the relevant point of time the appellant

and the other are not alleged to be persons in7

charge of the affairs of the company. Obviously,

the complaint refers to the point of time when the

two cheques were issued, their presentment,

dishonour and failure to pay in spite of notice of

dishonour. We have no hesitation in overruling the

argument in that behalf by the learned Senior

Counsel for the appellant.

25. We think that, in the circumstances, the High

Court has rightly come to the conclusion that it is

not a fit case for exercise of jurisdiction under

section 482 of the Code of Criminal Procedure for

quashing the complaint. In fact, an advertence to

Sections 138 and 141 of the Negotiable

Instruments Act shows that on the other elements

of an offence under Section 138 being satisfied, the

burden is on the Board of Directors or the Officers

in7charge of the affairs of the company to show

that they are not liable to be convicted. Any

restriction on their power or existence of any

special circumstance that makes them not liable is

CRM-M-10340-2014 (O & M)

::34::

something that is peculiarly within their knowledge

and it is for them to establish at the trial such a

restriction or to show that at the relevant time they

were not in7charge of the affairs of the company.

Reading the complaint as a whole, we are satisfied

that it is a case where the contentions sought to be

raised by the appellant can only be dealt with after

the conclusion of the trial."

In the aforesaid subsequent authority pronounced by the

Supreme Court, it has been held that a complainant is

supposed to know only generally as to who were in

charge of the affairs of the company. The other

administrative matters would be within the special

knowledge of the Company and those who are in charge

of it. Therefore, the complainant is expected to allege that

the persons named in the complaint are in charge of the

the affairs of the company. The Supreme Court has gone

a step further and observed that it is only the Directors of

the Company who have special knowledge about the role

they had played in the company to show before the court

that at the relevant point of time they were not in charge

of the affairs of the company. In the said case, it has been

simply averred to that the Directors of the Company were

in charge of and responsible for the conduct of the

business of the company. The Supreme Court, in the

aforesaid judgment, has held that the said allegation is

sufficient averment as required under Sections 138 and

141 of the Negotiable Instruments Act.

16. In view of the clarification found in the aforesaid

authority reported in 2007 (3) CTC 495, the court holds

that if the complainant, who is the payee or holder in due

course, who may not be aware of the indoor

administration of a company or the partnership firm,

lodges a complaint under Section 138 and 141 of the

CRM-M-10340-2014 (O & M)

::35::

Negotiable Instruments Act with the averment that the

Director or the Partners concerned were in charge of and

responsible for the conduct of the business of the

partnership firm concerned, then it will have to be

construed that such an averment is a necessary and

sufficient one as contemplated under Section 141 of the

Negotiable Instruments Act. Then the burden is shifted to

the Partner or the Director of the Company, who has got

thorough knowledge about the indoor management of the

company or partnership firm, to prove that he was not in

charge of and responsible for the conduct of the business

of the company at the relevant point of time. Therefore, I

reject, without any hesitation, the submission made by the

learned Senior Counsel appearing for the petitioner that

the complaint which does not whisper any averment as to

how and in what manner, the Partners of the partnership

firm played a role is not maintainable. Even otherwise,

the reply notice issued by the Managing Partner which

forms part of the complaint, prima facie, shows that the

petitioner herein had actually played a role in the day to

day administration of the fourth accused partnership

firm. Therefore, the court has to hold that the

complainant has come out with a prima facie material to

convince the learned Judicial Magistrate that the third

accused was also in charge of and responsible for the

conduct of the business of the fourth accused partnership

firm.

13. Coming back to the facts of the present case, it would be

apposite to examine the relevant extract of the impugned complaint

CRM-M-10340-2014 (O & M)

::36::

(Annexure P71) enumerating the role of all the accused including the

petitioner. The same is reproduced as under:7

“4. The accused No.2 is the Managing Director and

accused No.3 to 6 are the active Directors of the accused

Company and they are fully responsible for conduct of

the business of the accused Company. The day to day

affairs of accused No.1 Company are managed by

accused No.2 to 6 and as such they are in control of the

affairs of the accused No.1 Company and liable for all

the Acts and deeds committed on behalf of accused No.1

Company. The accused NO.2 to 6 are holding very

important positions in the management of accused No.1

Company as indicated above and are incharge of and

responsible to the Company for conduct of the business

of the company. The accused No.2 to 6 have been

regularly approaching the complainant for negotiation

regarding the financial assistance granted to the

complainant Company and it was, inter alia, on their

assurances that the financial assistance was granted to the

accused No.1 Company by the complainant.

5. That the accused No.1 Company through accused No.2

to 6 approached the complainant for financial assistants

by way of working capital facility and the complainant

sanctioned/enhanced a limit of Rs.40 Crores vide its

Letter of Intent dated Febraury 11, 2012.”

14. A perusal of the averments above clearly establish that the

accused Nos.2 to 6, including the petitioner, who is accused No.6 were

stated to be incharge of and responsible for the conduct of the business of

the company. It has also been categorically mentioned that it was accused

CRM-M-10340-2014 (O & M)

::37::

Nos.2 to 6 who approached the complainant for financial assistance on

behalf of the accused No.17Company.

15. Thus, there is a clear and categoric averment in Para 4 and 5 of

the complaint (Annexure P71) that accused No.27Rajiv Goyal being the

Managing Director and accused No.3 to 6, namely, Alka Goyal, Shiv Kumar

Yadav, Bharat Bhushan Jain and Dharmpal Singhal (petitioner) who are

directors of the company, were fully responsible for the conduct and

business of the company and were incharge of its day7to7day affairs.

Additionally, there is a specific allegation that accused No.17Surya

Pharmaceuticals Ltd.7company through accused Nos.2 to 6 approached the

complainant for financial assistance by way of working capital. Whether this

averment/allegation is correct or, on the other hand, the petitioner did not

have any role in obtaining financial assistance for the company shall be

adjudicated upon only during the course of the Trial. The internal workings

of the company and the exact designation of an officer of the company

cannot be known to a third person who deals with the company and its

officials on a day7to7day basis. Therefore, once necessary averments are

made in terms of Section 141 of the Negotiable Instruments Act and further,

specific allegations are also levelled against part icular

Directors/Managers/Officers of the company, then, it would be a matter of

their defence which would be established during the course of the Trial that

they were not liable because they were not incharge of and responsible for

running of the day7to7day affairs of the company.

CRM-M-10340-2014 (O & M)

::38::

16. Additionally, the co7accused of the petitioner, namely, Bharat

Bhushan Jain had approached this Court by way of a quashing petition

bearing No.CRM7M75498072018 which was dismissed vide order dated

21.07.2026 passed by this Court.

17. Keeping in view the aforementioned facts and circumstances, I

find no merit in the present petition and the same stands dismissed.

18. The pending application(s), if any, shall stand disposed of

accordingly.

July 28, 2026   ( JASJIT SINGH BEDI)

sukhpreet   JUDGE

Whether speaking/reasoned : Yes/No

Whether reportable : Yes/No