IN THE HIGH COURT AT CALCUTTA

CRIMINAL REVISIONAL JURISDICTION

APPELLATE SIDE

PRESENT:

THE HON’BLE JUSTICE UDAY KUMAR

CRR 2128 OF 2025

I.A. NO. CRAN 2 OF 2026

MASUD TARIF

-VS-

STATE OF WEST BENGAL & ANR.

For the Petitioner : Mr. Mayukh Mukherjee,

Mr. Anurag Modi,

Mr. Ankita Sikdar

For the Opposite Party No. 2 : Mr. Dipanjan Dutt

Mr. Soumodip Ghosh

Hearing concluded on : 26.02.2026

Judgment on : 20.03.2026

UDAY KUMAR, J.: –

1. This is an application under Section 528 of the Bharatiya

Nagarik Suraksha Sanhita, 2023 (formerly Section 482 of the

Code of Criminal Procedure, 1973), seeking the quashing of

proceedings in Complaint Case No. CN/608/2018, presently

pending before the Learned 14th Judicial Magistrate, Calcutta.

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CRR 2128 of 2025

2. The Petitioner, arrayed as Accused No. 4, challenges the legality

of his prosecution under Sections 138 and 141 of the Negotiable

Instruments Act, 1881, primarily on the ground that the

complaint is "fatally barren" of the jurisdictional facts requisite

to sustain vicarious liability.

3. The genesis of this litigation lies in a commercial transaction

dating back to August 2013. The Complainant/Opposite Party

No. 2, M/s. Garvit Consultancy Services Pvt. Ltd., purportedly

extended a "temporary monetary accommodation" of Rs.

40,00,000/- carried an interest rate of 12% per annum, to the

Accused No. 1 Company, M/s. Amrit Feeds Ltd. Following a

default in 2017, the Complainant initiated insolvency

proceedings under Section 7 of the Insolvency and Bankruptcy

Code (IBC) before the National Company Law Tribunal (NCLT),

Kolkata.

4. During the pendency of the NCLT proceedings, a Settlement

Agreement was executed on February 20, 2018. By virtue of

this novation, the debt was consolidated at Rs. 37,00,000/-, and

a series of Post-Dated Cheques (PDCs) were issued in discharge

of the restructured liability. One such instrument, Cheque No.

245009, dated 01.07.2018 for Rs. 6,00,000/-, was returned

unpaid with the remark "Funds Insufficient." Consequent to the

service of the mandatory statutory demand notice and the

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CRR 2128 of 2025

failure of the Accused to liquidate the sum, the Complainant

initiated the subject criminal proceedings.

5. While the Petitioner, Masud Tarif, is admittedly a Director of the

Accused Company, it is equally a matter of record that he was

neither a signatory to the dishonoured instrument nor a

participant in the negotiations culminating in the Settlement

Agreement of 2018. The Petitioner’s primary defense rests upon

the assertion that he is a non-executive director, tasked

exclusively with statutory compliance under the Companies Act,

and possessed no nexus with the financial management or the

debt-repayment mechanisms of the entity.

6. Subsequent to the issuance of process, the Petitioner moved an

application for discharge before the Learned Magistrate,

asserting that the complaint lacked the "foundational

averments" necessary to fasten vicarious liability upon a non-

executive director under the strictures of Section 141 of the NI

Act. In an Order dated 30.09.2019, the Learned Magistrate

noted the Complainant’s verbal admission that the complaint

was indeed "silent" regarding the Petitioner’s specific role in the

transaction.

7. However, the Learned Court below held that it was procedurally

incapacitated from "recalling" its own summoning order, placing

reliance on the restrictive mandates of the Hon’ble Supreme

Court in Adalat Prasad v. Rooplal Jindal and Subramanium

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CRR 2128 of 2025

Sethuraman v. State of Maharashtra. This refusal to intervene,

notwithstanding the acknowledged factual void in the pleadings,

has compelled the Petitioner to approach this Court, seeking the

exercise of its inherent power to prevent what is characterized

as a classic case of corporate over-implication

8. Mr. Mayukh Mukherjee, learned Counsel appearing for the

Petitioner, has mounted a formidable, two-pronged attack on

the continuation of the proceedings. He contended that the

prosecution of Accused No. 4 is a "classic example of over-

implication," predicated on a complaint that is fundamentally

barren of the jurisdictional facts required to trigger the vicarious

liability provisions of the Negotiable Instruments Act.

9. Mr. Mukherjee drawn the pointed attention of this Court to

Paragraph 4 of the petition of complaint. He emphasized that

while the Complainant specifically identifies Accused Nos. 2 and

3 as the individuals who "requested," "negotiated," and

"discussed" the financial accommodation, the Petitioner is

conspicuously omitted from the entire transactional narrative. It

is forcefully submitted that the Petitioner is a stranger to the

liability; he was neither a signatory to the dishonoured

instrument nor a party to the Settlement Agreement dated 20th

February 2018. Counsel argues that when a debt is restructured

via a specific novation—as in the present case—criminal liability

cannot be broadcast over the entire Board of Directors but must

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CRR 2128 of 2025

be strictly confined to those who participated in the execution of

the new contract.

10. To fortify the argument that criminal liability cannot be a "game

of chance," the Petitioner relied on the landmark Three-Judge

Bench decision in S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla

(2005) 8 SCC 89. Mr. Mukherjee highlights Paragraphs 19(a)

and (b), which establish that it is an "essential requirement" to

specifically aver that the accused was in charge of, and

responsible for, the conduct of business at the material time. He

emphasized the Court’s clarification that there is no "deemed

liability" of a director; merely holding a designation is a legal

neutrality that cannot be converted into criminal culpability

without a factual link.

11. Further reliance is placed on the dictum in Susela Padmavathy

Amma v. M/s Bharti Airtel Limited (2024) INSC 206 . Mr.

Mukherjee underscored Paragraph 10, where the Hon’ble

Supreme Court clarified that the position of a Managing Director

or a Signatory is distinct from that of a Director. It was held that

for a director to escape liability, they must prove lack of

knowledge only if they hold positions of active management;

where the complaint itself fails to aver such a role, the

prosecution fails at the threshold. The Petitioner asserts that as

a director tasked solely with "statutory compliance," he

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CRR 2128 of 2025

possessed no nexus with the company's financial repayment

mechanisms.

12. Addressing the Complainant’s plea of laches, Mr. Mukherjee

invoked the mandate of Anukul Singh v. State of Uttar Pradesh

(2025) INSC 1153. Referring to Paragraph 11.5, he asserted

that it is the "solemn duty of the High Court to intervene where

the continuation of criminal proceedings would amount to an

abuse of process of law." It is submitted that the "total silence"

in the complaint regarding the Petitioner’s role constitutes a

jurisdictional void. Such a void is not a "curable irregularity" but

a fundamental defect that no amount of trial can rectify. Mr.

Mukherjee concludes that forcing a non-signatory director to

endure the rigors of a criminal trial, despite the Complainant's

own admission of the complaint’s silence, would amount to

"weaponizing" the criminal machinery for civil recovery.

13. Opposing the prayer for quashing, Mr. Dipanjan Dutt, learned

counsel appearing for the Complainant/Opposite Party No. 2,

contends that the present petition is a belated afterthought,

strategically timed to derail the trial. He emphasizes that the

Petitioner has approached this Court nearly seven years after

the inception of the case and four years after having submitted

to the jurisdiction of the Learned Trial Court to obtain bail. It is

forcefully argued that the Petitioner is effectively seeking to

convert this revisional jurisdiction into a "mini-trial" by inviting

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CRR 2128 of 2025

this Court to appreciate evidence and factual nuances that are

yet to be tested through the crucible of cross-examination.

14. It is the Complainant’s primary stance that the averments

contained in Paragraph 3 of the Complaint, which describe the

Directors as being responsible for "carrying on the business" of

the company, are sufficient to satisfy the statutory requirements

at the summoning stage. To fortify this position, Mr. Dutt relies

on the recent dictum of the Hon’ble Supreme Court in HDFC

Bank Ltd. v. State of Maharashtra (2025) 9 SCC 653 . Drawing

attention to Paragraph 27 of the said judgment, he argues that

the law specifically warns against a "mechanical parroting" of

the statute. The Apex Court observed:

“Merely reading para 19(a) to contend that what is

required is parroting of the words of the section for a

complaint to be sustained is completely unjustified.”

13. To address the issue of the Petitioner’s "deep slumber," Mr. Dutt

cites the principle laid down in Vandana Agarwal v. State of

West Bengal (2015) SCC OnLine Cal 3372 . He submits that an

accused who has actively participated in the trial for years and

suddenly "wakes up" to challenge the summoning order should

not be granted the benefit of discretionary relief under the

Court's inherent powers. It is contended that the Petitioner’s

long-standing acquiescence in the trial process serves as a

constructive waiver of any technical objections regarding the

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CRR 2128 of 2025

specificity of averments, as the focus must now shift to the

merits of the evidence.

14. Finally, reliance is placed upon the settled principle in Amar

Chand Agarwalla v. Shanti Bose (1973) 4 SCC 10 . Referring to

Paragraph 17, Mr. Dutt argues that once a trial has reached an

advanced stage, the High Court is not justified in embarking

upon an independent appreciation of evidence to quash the

proceedings. It is the Complainant's submission that the

question of whether the Petitioner was "in charge of and

responsible for" the affairs of the company is a triable issue of

fact. Such a determination, it is argued, must be adjudicated by

the Learned Magistrate upon a full consideration of the evidence

led during the trial, rather than being stifled at this revisional

stage.

15. The resolution of this controversy requires an answer to three

pivotal questions:

i. Whether the "silence" in the complaint regarding the

specific role of a non-signatory director renders the

summoning order legally unsustainable?

ii. Whether a fundamental jurisdictional defect in a

complaint overrides procedural delay or laches?

iii. Whether the continuation of a trial following a

"Novation of Debt" (to which the Petitioner was not a

party) constitutes an abuse of the process of law?

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CRR 2128 of 2025

16. Upon a comprehensive review of the rival contentions and a

meticulous scrutiny of the records, the quintessential question

emerges: can a non-signatory director be compelled to endure

the rigors of a criminal trial when the complaint remains

admittedly silent as to his specific role in the transaction? The

resolution of this issue necessitates an examination of the

"Transactional Link" and the jurisdictional requirements of

vicarious liability under the Negotiable Instruments Act.

17. In addressing the Complainant's contention that a specific

"form" of words is not required, this court acknowledges the

law, as recently ruled in HDFC Bank Ltd. v. State of Maharashtra

(2025) 9 SCC 653. At Paragraph 27, the Apex Court observed:

"Merely reading para 19(a) [of SMS Pharmaceuticals] to

contend that what is required is parroting of the words

of the section for a complaint to be sustained is

completely unjustified. What is required is that the

overall reading of the complaint must show that the

person was in charge of and responsible for the conduct

of the business."

18. While the law discourages the "mechanical parroting" of

statutory language, it absolutely mandates the presence of a

factual nexus. In Paragraph 4 of the instant complaint—the

operative portion describing the grant of the loan—the

Complainant specifically attributes the request, negotiations,

and discussions to Accused Nos. 2 and 3 alone. The Petitioner is

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CRR 2128 of 2025

conspicuously omitted. This is not a mere failure of elective

language; it is a fundamental failure of jurisdictional fact.

19. To arrive at a legally sound conclusion, this Court must examine

the "Initial Transaction" versus the "Novation of Debt." The

records reveal that the liability in question stems from a

Settlement Agreement dated 20.02.2018. This agreement

functioned as a "novation," effectively replacing the original

2013 contract with a restructured obligation. It is an undisputed

fact that the negotiations for this settlement and the subsequent

issuance of Post-Dated Cheques were handled exclusively by

Accused Nos. 2 and 3. The Petitioner was a stranger to this

agreement. In the eyes of the law, where a debt is restructured,

the circle of vicarious liability narrows strictly to those who were

"in charge of" that specific settlement process.

20. Turning to the averments, this Court finds a significant factual

vacuum. While Paragraph 3 of the complaint makes a blanket

statement that all directors were "carrying on business," it fails

to provide the specific disclosure of facts required to link the

individual director to the default. As observed in Paragraph 27 of

HDFC Bank Ltd. (Supra), the law does not require exact words,

but it does require a disclosure of facts "Merely reading para

19(a) to contend that what is required is parroting of the words

of the section... is completely unjustified." The "total silence"

regarding the Petitioner's overt acts breaks the chain of liability.

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CRR 2128 of 2025

21. The determination of vicarious liability in the context of

corporate entities is governed by Section 141 of the Negotiable

Instruments Act, 1881, which stipulates:

"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..."

22. The interpretation of this provision was definitively settled by

the Three-Judge Bench of the Hon’ble Supreme Court in S.M.S.

Pharmaceuticals Ltd. v. Neeta Bhalla (2005) 8 SCC 89 . The

Court, at Paragraph 19(a), mandated the following requirement

for a valid complaint:

"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, the

requirements of Section 141 cannot be said to be

satisfied."

23. Regarding the distinction between different categories of

directors, this Court finds the observations in Susela

Padmavathy Amma v. M/s Bharti Airtel Limited (2024) INSC 206

at Paragraph 10 to be particularly germane:

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CRR 2128 of 2025

"The position of a Managing Director or a Joint Managing

Director in a company is distinct... However, in the case of a

Director, the complaint should specifically spell out how and in

what manner the Director was in charge of or was responsible

to the accused company for the conduct of its business... To

fasten vicarious liability, at the material time that person shall

have been at the helm of affairs."

24. A pivotal factor is the proceeding before the Learned Magistrate

on 30.09.2019. The Learned Magistrate correctly noted the

Complainant’s admission regarding the silence of the complaint

but felt "procedurally hamstrung" by the rulings in Adalat Prasad

and Subramanium Sethuraman , which prohibit a Magistrate

from recalling a summoning order. However, while the

Magistrate’s hands were tied, this Court’s inherent jurisdiction is

not. If a complaint, on its face, discloses no offence against a

specific individual, the continuation of that proceeding becomes

an exercise in futility and a manifest violation of the right to

personal liberty under Article 21 of the Constitution of India.

25. The Complainant’s plea regarding the Petitioner’s "deep

slumber" (from 2018 to 2025) has been examined in light of the

dictum in Vandana Agarwal (Supra). While delay is a relevant

factor in discretionary relief, it cannot sanitize a proceeding that

is fundamentally void of jurisdictional competence.

26. However, this Court distinguishes the present case by noting

that "silence" is not a failure to parrot, but a failure to provide

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CRR 2128 of 2025

any factual link whatsoever. On the issue of maintainability

despite delay, the recent guidance in Anukul Singh v. State of

Uttar Pradesh (2025) INSC 1153 at Paragraph 11.5 is

conclusive:

"It is the duty of the High Court to intervene where

continuation of criminal proceedings would amount to an

abuse of process of law. The inherent power is to be

exercised ex debito justitiae to do real and substantial

justice for the administration of which alone courts

exist."

27. The High Court’s duty to prevent such abuse is not bound by a

stopwatch. If a non-signatory director, who had no role in the

settlement or the cheque issuance, is forced to stand trial

merely because of a delayed filing, it would amount to

"weaponizing" criminal law for civil recovery. On a holistic

appreciation of the facts, it appears the Petitioner was

impleaded solely by virtue of his designation. The Complainant’s

own admission, the Petitioner’s non-signatory status, and his

absence from the NCLT settlement led to the irresistible

conclusion that no prima facie case is established against

Accused No. 4. Consequently, the procedural delay, while

regrettable, cannot outweigh the substantive injustice of an

untenable prosecution.

28. Therefore, on the basis of the above discussions, this court

concludes that:

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CRR 2128 of 2025

a. There is no "deemed liability" for a Director merely by

virtue of their designation. The presence of specific

factual averments linking a director to the day-to-day

management of a company is not a mere procedural

formality but a jurisdictional prerequisite under Section

141 of the Negotiable Instruments Act. "Silence" in a

complaint regarding an individual director’s specific role

constitutes a substantive failure to establish a prima

facie case.

b. Where an underlying debt is restructured through a

Settlement Agreement, the "material time" for

assessing liability shifts to the execution and

implementation of said settlement. In settlement-based

transactions, vicarious liability must be examined

strictly against those who negotiated and executed the

restructured debt. A director who is a documented

stranger to such an agreement cannot be held

vicariously liable for the dishonor of cheques issued

pursuant thereto.

c. In the exercise of inherent powers under Section 528 of

the BNSS, the High Court must prioritize the prevention

of an illegal prosecution over procedural technicalities

such as "laches." Procedural delay is intended as a

shield to prevent the abuse of the legal system, not a

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CRR 2128 of 2025

sword to perpetuate an illegal prosecution where the

complaint is "facially deficient." An inherent illegality in

a summoning order cannot be cured by the mere

passage of time.

d. The issuance of process is a serious judicial act with

grave consequences for personal liberty. A summoning

order that fails to distinguish between "Managing

Directors/Signatories" and "Non-Executive Directors"—

particularly in the absolute absence of specific

averments regarding the latter’s role—reflects a failure

of judicial application of mind. To allow such a trial to

proceed would be to "weaponize" criminal machinery for

civil recovery, amounting to a manifest abuse of the

process of law.

29. From the synthesized reading of the statutes and precedents,

the following principles emerge:

I. Specific factual averments linking a director to day-

to-day management are a jurisdictional prerequisite.

II. In cases of restructured debt (novation), liability is

confined to those who negotiated and executed the

settlement.

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CRR 2128 of 2025

III. Procedural delay (laches) cannot validate a

summoning order that is void ab initio for lack of

factual pleadings.

30. In light of the findings recorded hereinabove and the conclusion

that the continuation of the proceedings against the Petitioner

would be a manifest abuse of the process of law, this Court

issues the following consequential orders and directions to

ensure the effective implementation of this judgment and the

orderly progression of the trial against the remaining accused:

a. The proceedings in Complaint Case No.

CN/608/2018 (TR Case No. 2575/2018) pending

before the Court of the Learned 14th Judicial

Magistrate, Calcutta, including the order taking

cognizance dated 29.08.2018 and the summoning

order, are hereby quashed and set aside

specifically and exclusively in respect of the

Petitioner, Masud Tarif (Accused No. 4).

b. The Petitioner is hereby discharged from his bail

bonds.

c. The sureties, if any, furnished by the Petitioner

before the learned Trial Court stand discharged.

d. Any documents or securities deposited by the

Petitioner as a condition for bail shall be returned

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to him by the learned Trial Court upon proper

identification and application, subject to the rules

of the Court.

e. It is expressly clarified that this judgment shall

not be construed as an interference with the trial

against the Accused Company (Accused No. 1) or

the other Directors (Accused Nos. 2 and 3).

f. The learned Trial Court is directed to proceed with

the trial against the remaining accused Company

(Accused No. 1) and Accused Nos. 2 and 3 with

utmost expedition, keeping in view the mandate

of Section 143(3) of the Negotiable Instruments

Act, which requires the trial to be concluded

within six months from the date of filing of the

complaint.

g. The records indicate that the matter was fixed for

hearing on an application under Section 143A of

the NI Act (Interim Compensation).

h. The learned Trial Court is directed to dispose of

the Section 143A application against the

remaining accused on its own merits, uninfluenced

by the quashing of proceedings against the

present Petitioner by this judgment.

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i. The observations made in this judgment regarding

the lack of specific averments are strictly confined

to the role of Accused No. 4 (the Petitioner). The

learned Trial Court shall not be influenced by any

observation made herein while adjudicating the

guilt or innocence of Accused Nos. 2 and 3, who

are alleged to be the active negotiators and

signatories of the settlement agreement.

j. The Department is directed to send a copy of this

judgment and the case records (if called for) to

the learned 14th Judicial Magistrate, Calcutta,

within a period of seven (7) working days from

today.

k. The learned Trial Court shall record the factum of

the quashing of proceedings against Accused No.

4 in the order sheet on the very next date of

hearing fixed in the matter.

l. Urgent certified copies of this judgment, if applied

for, be supplied to the parties upon compliance

with all requisite formalities.

31. With the aforesaid directions, C.R.R. No. 2128 of 2025 is

allowed. The Petitioner stands exonerated from the present

criminal proceedings.

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32. I.A No. CRAN 2 of 2026 is also disposed of accordingly.

33. There shall be no order as to the cost.

34. The Trial Court Record (TCR), if any, shall be sent down to the

Trial Court, at once.

35. Case diary, if any, be returned forthwith.

36. Urgent Photostat certified copy of this judgment, if applied for,

be given to the parties, as expeditiously as possible, upon

compliance with the necessary formalities in this regard.

(Uday Kumar, J.)