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        Case ID :

        2018 (1) TMI 1644 - HC - Indian Laws

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        Curable defect in cheque dishonour complaint allows amendment to implead company; notice to signing Managing Director is sufficient. An order declining cognizance against a company and permitting correction of the cause title was treated as quasi-final and therefore revisable under ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.

                          Curable defect in cheque dishonour complaint allows amendment to implead company; notice to signing Managing Director is sufficient.

                          An order declining cognizance against a company and permitting correction of the cause title was treated as quasi-final and therefore revisable under Section 397 of the Code of Criminal Procedure. In a prosecution under Section 138 of the Negotiable Instruments Act, a complaint may be amended to implead the company where the body of the complaint and prayer clause already contain allegations against it, because omission from the cause title is a curable defect. Notice served on the Managing Director who signed the cheque was held sufficient notice to the company, so separate service on the company was not necessary on the facts. The revisional order allowing amendment and cognizance against the company was upheld.




                          Issues: (i) whether the order refusing to take cognizance against the company and permitting correction of the cause title was revisable under the Code of Criminal Procedure, 1973; (ii) whether, in a prosecution under Section 138 of the Negotiable Instruments Act, 1881, the complaint could be amended to implead the company where the body of the complaint already contained allegations against it; and (iii) whether service of notice on the Managing Director who signed the cheque was sufficient notice to the company.

                          Issue (i): whether the order refusing to take cognizance against the company and permitting correction of the cause title was revisable under the Code of Criminal Procedure, 1973;

                          Analysis: The order of the Magistrate declining cognizance against the company was treated as an order of a quasi-final nature, not a mere interlocutory order. Such an order was held to be amenable to revisional jurisdiction under Section 397 of the Code of Criminal Procedure, 1973.

                          Conclusion: The revision was maintainable.

                          Issue (ii): whether, in a prosecution under Section 138 of the Negotiable Instruments Act, 1881, the complaint could be amended to implead the company where the body of the complaint already contained allegations against it;

                          Analysis: The complaint was read as a whole, and the absence of the company's name in the cause title was treated as a curable defect because the body of the complaint and the prayer clause disclosed allegations against the company. In a private complaint, a simple legal infirmity capable of formal correction could be permitted to be amended, and wrong or incomplete mentioning of a provision was not by itself fatal. The application was therefore treated as one seeking amendment of the complaint, not as a fresh invocation of Section 319 of the Code of Criminal Procedure, 1973.

                          Conclusion: Amendment of the complaint was permissible, and the company could be impleaded.

                          Issue (iii): whether service of notice on the Managing Director who signed the cheque was sufficient notice to the company;

                          Analysis: Notice issued to the Managing Director/signatory of the cheque was treated as notice to the company for the purposes of Section 138 of the Negotiable Instruments Act, 1881. The complaint also contained the essential ingredients of the offence against the company from the inception, so non-service of a separate notice on the company did not invalidate the prosecution.

                          Conclusion: Separate notice to the company was not necessary in the facts of the case.

                          Final Conclusion: The revisional court's order permitting amendment of the cause title and allowing cognizance against the company was upheld, and the petition was dismissed.

                          Ratio Decidendi: In a Section 138 prosecution, if the body of the complaint already discloses allegations against the company and the defect lies only in the cause title, the defect is curable by amendment, and notice to the company may be satisfied by notice to its Managing Director who signed the cheque.


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