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of <h1>Court quashes proceedings due to vague allegations under Section 141 - clarity needed in accusations</h1> <h3>K. Janaki Manoharan and Ors. Versus Gayatri Sugar Complex Limited and Ors.</h3> The court quashed the proceedings against the petitioners as the complaint failed to provide specific allegations against them under Section 141 of the ... - Issues Involved:1. Quashing of proceedings under Section 482 of the Code of Criminal Procedure, 1973.2. Liability of directors under Section 138 and Section 141 of the Negotiable Instruments Act, 1881.Detailed Analysis:Issue 1: Quashing of Proceedings under Section 482 of the Code of Criminal Procedure, 1973The petitioners sought to quash the proceedings in C.C. No. 484 of 1999 on the file of the IVth Metropolitan Magistrate, Hyderabad. The court considered the allegations made in the complaint against the petitioners, who were arrayed as accused Nos. 4 and 5. The court noted that the complaint only stated that the petitioners were directors of the company and hence liable under Section 141 of the Negotiable Instruments Act. The court found that there were no specific allegations against the petitioners detailing their role in the commission of the offence. It emphasized that the complaint must contain clear, unambiguous, and specific allegations against the directors to hold them liable. The court concluded that the proceedings against the petitioners would be an abuse of the judicial process and thus quashed the proceedings against them.Issue 2: Liability of Directors under Section 138 and Section 141 of the Negotiable Instruments Act, 1881The court scrutinized the provisions of Section 141 of the Negotiable Instruments Act, which holds every person, who at the time the offence was committed, was in charge of and responsible to the company for the conduct of its business, liable for the offence. The court analyzed previous judgments and reiterated that mere designation as a director does not automatically make one liable. There must be specific allegations that the directors were in charge of and responsible for the conduct of the business at the time the offence was committed. The court found that the complaint lacked such specific allegations against the petitioners. It noted that the cheques in question were signed by the managing director and dealt with by the joint managing director, with no role attributed to the petitioners. The court held that there was no factual foundation in the complaint to attract the ingredients of Section 138 read with Section 141 of the Act against the petitioners.Conclusion:The court quashed the proceedings against the petitioners, holding that the complaint did not meet the requirements of Section 141 of the Negotiable Instruments Act. The court emphasized the necessity of specific allegations against directors to hold them liable and prevent abuse of the judicial process. The order was specific to the petitioners and did not affect the proceedings against the other accused.
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