2023 (8) TMI 598 - HC - Indian Laws

Appeal granted, amendment allowed to include company in complaint under Section 138.

The appeal was allowed, setting aside the judgment that found the respondents not guilty under Section 138 of the Negotiable Instruments Act. The trial ... Dishonour of Cheque - acquittal of the accused - acquitting the private respondents on the ground of maintainability of the instant case in terms of Section 141 of the Negotiable Instruments Act - HELD THAT:- The prosecution of other persons under Section 138 NI Act is permissible only when the Company is named as an accused in the complaint. Where the Company due to, inter alia, inadvertence of the complainant may not have been named as one of the accused(s) in the cause title of complaint, however, from a perusal of such complaint, it can be observed that specific averments/ingredients for the commission of offence under Section 138 NI Act against the company are made out. Under such circumstances, considering the same as mere curable infirmity, Courts have permitted the complainant to amend the complaint by adding the name of Company as one of the accused(s). In the present case, the petition of complaint itself starts with the statement “It is the case of the complainant that he as a proprietor of M/s. Maa Manasha Enterprise had made payment to Delicious Agro Food Pvt. Ltd. for food product, but the said company had not delivered any such food item and accused being director of the said company had returned the money by issuing a cheque in favour of the complainant”. The accused/petitioner had on application before the trial court also stated that the complainant had entered into the transaction with the company, “Delicious Agro Food Pvt. Ltd.”. The petitioner as director of the company was the person who issued the cheque in this case and the transaction was carried out by the petitioner as director on behalf of the company. As such there is clear averments in the complaint itself, against the company and also its director. The trial court shall permit the complainant to amend the petition of complaint and then proceed with the case in accordance with law - Appeal allowed. Issues Involved:1. Maintainability of the complaint under Section 138 of the Negotiable Instruments Act, 1881.2. Requirement to name the company as an accused for prosecuting its directors under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881.3. Amendment of the complaint to include the company as an accused.Summary:Issue 1: Maintainability of the ComplaintThe appeal was filed against the judgment dated 27.04.2018 by the Learned Additional Chief Judicial Magistrate, Contai, Purba Medinipur, which found the respondents not guilty under Section 138 of the Negotiable Instruments Act, 1881, and acquitted them. The appellant had advanced payment to Delicious Agro Pvt. Ltd. for goods that were never delivered. The respondents issued a cheque that was dishonored due to insufficient funds. The appellant issued a notice demanding payment, which was not accepted, leading to the filing of the complaint.Issue 2: Requirement to Name the Company as an AccusedThe trial court dismissed the complaint on the grounds that the company was not named as an accused, which is required for prosecuting its directors under Section 141 of the Negotiable Instruments Act. The appellant argued that the dismissal was erroneous as the petition dated 17.02.2018 by the respondents was not maintainable. The court noted that a company must be named as an accused to hold its directors liable, referencing the Supreme Court's decision in Aneeta Hada v. Godfather Travels and Tours Private Limited, which stated that prosecuting directors without naming the company is not permissible.Issue 3: Amendment of the ComplaintThe appellant sought to amend the complaint to include the company as an accused, relying on the Supreme Court's judgment in S.R. Sukumar vs. S. Sunaad Raghuram, which allows amendments to correct curable legal infirmities. The court cited several precedents, including U.P. Pollution Control Board v. Modi Distilleries, where amendments were permitted to correct such errors. The court concluded that the complaint contained clear averments against the company and its directors, thus allowing the amendment.Conclusion:The appeal was allowed, and the order dated 27.04.2018 was set aside. The trial court was directed to permit the amendment of the complaint to include the company as an accused and proceed with the case accordingly. All connected applications were disposed of, and any interim orders were vacated. The judgment was to be sent to the trial court for compliance.