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As per case facts, the respondent-complainant filed a complaint under Section 138 of the Negotiable Instruments Act, 1881, against the petitioner, a Director of M/s Orient Clothing Company Private Limited.
...The complaint alleged that a cheque issued to discharge the company's liability was dishonoured for "insufficient funds." A demand notice was served, but payment was not made, leading to the complaint and summoning order. The petitioner and another Director were impleaded as accused, but the company itself was not. The question arose whether criminal proceedings under Section 138 of the Negotiable Instruments Act can be maintained against Directors without impleading the company. Finally, citing Supreme Court precedents, the High Court held that impleading the company as an accused is a mandatory condition precedent for prosecuting its Directors under Section 141 of the NI Act. Therefore, the proceedings against the petitioner were deemed not maintainable, and the complaints and summoning orders were set aside.
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