TaxTMI 
TaxTMI 
2021 (10) TMI 1067
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....unt was not granted, and even the title deeds and revenue extracts were not returned. According to respondent, petitioners committed breach of trust and committed fraud. 4. Upon presentation of complaint by respondent, the Trial Court vide order dated 19th January 2019, said that commission of offences punishable under Sections 409, 420 RPC were made out against accused no. 2 and that accused no. 1 was also liable to be prosecuted under vicarious liability and directed to issue summons to accused for their appearance before the Trial Court. 5. Learned senior counsel appearing for petitioner-Bank has stated that complainant/respondent has admitted that her husband has availed TOD of Rs. 7.00 Lakhs and the said amount along with interest has not been returned by husband of complainant. It is stated that husband of complainant failed to repay, so petitioner no. 1, in order to secure interests of bank, asked revenue authorities to put a lien on property of complainant. He has averred that complainant in her complaint has not named the accused at all and this fact is evident form complaint itself. It is contended that petitioner no. 2 has been sued as Chairman of the Bank. According t....
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....14 40 SCC 609: "(iii) Circumstances when Director/Person in charge of the affairs of the company can also be prosecuted, when the company is an accused person: No doubt, a corporate entity is an artificial person which acts through its officers, directors, managing director, chairman etc. If such a company commits an offence involving mens rea, it would normally be the intent and action of that individual who would act on behalf of the company. It would be more so, when the criminal act is that of conspiracy. However, at the same time, it is the cardinal principle of criminal jurisprudence that there is no vicarious liability unless the statute specifically provides so. Thus, an individual who has perpetrated the commission of an offence on behalf of a company can be made accused, along with the company, if there is sufficient evidence of his active role coupled with criminal intent. Second situation in which he can be implicated is in those cases where the statutory regime itself attracts the doctrine of vicarious liability, by specifically incorporating such a provision. When the company is the offender, vicarious liability of the Directors cannot be imputed automatical....
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.... the prosecution to prove affirmatively that the appellant was directly and personally connected with acts or omissions pertaining to Items 2, 3 and 4. It is conceded by Mr. Phadke that no such direct evidence is forthcoming and he tried to argue that as the appellant was Chairman of the Sangh and used to sign papers and approve various tenders, even as a matter of routine he should have acted with care and caution and his negligence would be a positive proof of his intention to commit the offence. We are however unable to agree with this somewhat broad statement of the law. In the absence of a charge of conspiracy the mere fact that [pic]the appellant happened to be the Chairman of the Committee would not make him criminally liable in a vicarious sense for items 2 to 4. There is no evidence either direct or circumstantial to show that apart from approving the purchase of fertilisers he knew that the firms from which the fertilisers were purchased did not exist. Similar is the case with the other two items. Indeed, if the Chairman was to be made liable then all members of the Committee viz. Tehsildar and other nominated members, would be equally liable because all of them parti....
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.... is the Company. The learned Magistrate failed to pose unto himself the correct question viz. as to whether the complaint petition, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The Bank is a body corporate. Vicarious liability of the Managing Director and Director would arise provided any provision exists in that behalf in the statute. Statutes indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegations which would attract the provisions constituting vicarious liability." 5. R. Kalyani v. Janak C. Mehta (2009) 1 SCC 516: "32. Allegations contained in the FIR are for commission of offences under a general statute. A vicarious liability can be fastened only by reason of a provision of a statute and not otherwise. For the said purpose, a legal fiction has to be created. Even under a special statute when the vicarious criminal liability is fastened on a person on the premise that he was in charge of the affairs of the company and responsible to it, all....
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....nto motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the Magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. He has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. The Magistrate has to carefully scrutinise the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused." 9. As can be seen in Pepsi Foods Ltd. v. Special Judicial Magistrate (1998) 5 SCC 749, summoning of an accused in a criminal case is a serious matter as criminal law cannot be set into motion....