Ajay Kumar Agarwal @ Ajay Kr. Agarwal, aged about 50 years, S/o Laxman Agarwal v. 1. The State of Jharkhand 2. Rishi Prasad, S/o Sri Harihar Prasad, R/o C/o
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI Cr.M.P. No.2771 of 2022 ------ Ajay Kumar Agarwal @ Ajay Kr. Agarwal, aged about 50 years, S/o Laxman Agarwal R/o Plot No. A-17, City Centre, Sector 4, PO & PS Sector 4, District Bokaro, Jharkhand, 827004. … Petitioner Versus 1. The State of Jharkhand 2. Rishi Prasad, S/o Sri Harihar Prasad, R/o C/o R.R. Tripathi, Plot No.F9, City Centre, PO & PS Sector 4, District Bokaro, Jharkhand, Opposite Parties 827004 … For the Petitioner For the State For the O.P. No.2 ------
Legal Reasoning
: Mr. Baibhaw Gahlaut, Advocate : Mr. Shailendra Kr. Tiwari, Spl.P.P. : Mr. Mukesh Kumar, Advocate ------ P R E S E N T HON’BLE MR. JUSTICE ANIL KUMAR CHOUDHARY By the Court:- 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 for quashing the entire criminal proceeding arising out of the order dated 12.07.2018 passed by learned J.M.F.C., Bokaro in connection with Complaint Case No.331 of 2018 by which learned J.M.F.C., Bokaro has taken cognizance of the offence punishable under Section 138 of Negotiable Instrument Act, 1881 against the petitioner only. 3. The brief facts of the case is that the petitioner took a friendly loan of Rs.2,00,000/- and issued a cheque on behalf of the partnership firm in the name and style of M/s New Saree Sangam, in the capacity of authorized signatory of the said partnership firm. The cheque was presented by the complainant- 1 Cr. M.P. No.2771 of 2022 opposite party No.2 in the bank and on 02.02.2018, the cheque was dishonoured due to insufficiency of fund in the said bank account of the partnership firm in the name and style of M/s. New Saree Sangam. The complainant- opposite party No.2 issued a notice of demand dated 19.02.2018, by registered post. Though the same was received by the petitioner but the petitioner did not pay the cheque amount within 15 days of the receipt of such notice of demand and the complainant instead of arraying the partnership firm in the name and style of M/s. New Saree Sangam as an accused filed the complaint case only against the petitioner; in his personal capacity. Consequent upon that, vide order dated 12.07.2018 in Complaint Case No.331 of 2018, learned J.M.F.C., Bokaro took cognizance against the petitioner under Section 138 of Negotiable Instrument Act, 1881. 4. Learned counsel for the petitioner relies upon the judgment of the Hon’ble Supreme Court of India in the case of the Dilip Hiraramani vs Bank of Baroda reported in 2022 0 Supreme (SC) 417 paragraph-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. 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, 2 Cr. M.P. No.2771 of 2022 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. 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) and submits that in the absence of partnership firm being arrayed as an accused, the petitioner having signed the cheque as an authorized signatory of the firm on its behalf, in the absence of notice of demand being served upon the partnership firm in the name and style of M/s. New Saree Sangam, and thus without compliance of the proviso to Section 138 of Negotiable Instrument 3 Cr. M.P. No.2771 of 2022 Act, learned J.M.F.C, Bokaro, the learned Magistrate has committed gross error in taking the cognizance of the offence punishable under Section 138 of the Negotiable Instrument Act, 1881 against the petitioner only, hence, it is submitted that the entire criminal proceeding arising out of the order dated 12.07.2018 passed by learned J.M.F.C., Bokaro in connection with Complaint Case No.331 of 2018, be quashed and set aside. 5. Learned Addl. PP appearing for the State and the learned counsel for the opposite party No.2 on the other hand, vehemently opposes the prayer for quashing the entire criminal proceeding arising out of the order dated 12.07.2018 passed by learned J.M.F.C., Bokaro in connection with Complaint Case No.331 of 2018 and submits that the facts of the case of Dilip Hiraramani vs Bank of Baroda (supra) is entirely different from the facts of this case, in the sense that in this case, petitioner himself took the friendly loan in her personal capacity hence, the ratio of Dilip Hiraramani vs Bank Of Baroda (supra) is not applicable to the facts of this case, hence, this criminal miscellaneous petition being without any merit be dismissed. 6. Having heard the rival submissions made at the Bar and after going through the materials in the record, it is pertinent to mention here that the corollary of the judgment passed by the Hon’ble Supreme Court of India in the case of Dilip Hiraramani vs Bank of Baroda (supra), is that in case, a cheque is issued on behalf of the partnership firm by its authorized signatory, then the notice demanding payment of money mentioned in the cheque, by giving notice in writing to the partnership firm is also a sine qua non and arraying the partnership firm as an accused, is also, the requirement of law and the complainant having not done neither, so this court has no hesitation in holding 4 Cr. M.P. No.2771 of 2022 that the order taking cognizance dated 12.07.2018, only against the petitioner in his individual capacity, though the cheque was admittedly not issued by him in his individual capacity, rather as an authorized signatory of the partnership firm, is not sustainable in law. Therefore, the continuation of the same will amount to abuse of process of law, and this is a fit case where the entire criminal proceeding arising out of the order dated 12.07.2018 passed by learned J.M.F.C., Bokaro in connection with Complaint Case No.331 of 2018, be quashed and set aside. 7. Accordingly, the entire criminal proceeding arising out of the order dated 12.07.2018 passed by learned J.M.F.C., Bokaro in connection with Complaint Case No.331 of 2018, is quashed and set aside. 8.
Decision
In the result, this Cr.M.P. stands allowed. (Anil Kumar Choudhary, J.) High Court of Jharkhand, Ranchi Dated the 01st of May, 2024 AFR/ Animesh-Saroj 5 Cr. M.P. No.2771 of 2022