AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (12) TMI 559
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....ction 138 of the Negotiable Instrument Act, 1881 (hereinafter referred to as the "NI Act") titled as Planetcast Media Services Ltd V Beret Media Services & Others bearing CC no. 5229/2017 subject matter of CRL.M.C 1745/2019 and CC No. 3047/2017 subject matter of CRL. M.C 1155/2019 respectively on the allegations that the respondent no. 1 is engaged in the business of providing Playout, Satellite bandwidth & Teleport (Up linking) services under the license of the Ministry of Information & Broadcasting (MIB), Government of India. The respondent no. 2, namely, Beret Media Pvt. Ltd./accused no. 1 (hereinafter referred to as the "respondent no. 2") is stated to be a company registered under the Companies Act, 1956. The petitioner/accused no. 2, respondent no. 3/accused no. 3 and respondent no. 4/accused no. 4 are stated to be directors of the respondents no. 2, and are in charge and responsible for the conduct, management and day-to-day affairs of the respondents no. 2. The respondents no.2 and 3 are jointly, severely liable for acts of the respondent no. 2. The accused no. 5 i.e. Bhola Baba Developers Ltd is stated to be company registered under the Companies Act, 1956 and is running a....
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....amounting to Rs.9,75,946/- in terms of the agreement. The respondent no. 2 in terms of the letter/written communication dated 30.10.2015, admitted its liability and accordingly, in discharge of its liability, the respondent no. 2 through petitioner, respondents no. 3 and 4, issued cheque bearing no. 190325 dated 03.02.2017 amounting to Rs.39,58,988/- subject matter of complaint bearing CC no. 5229/2017 and Crl.M.C.1745/2019 and cheques bearing no. 214270 dated 30.09.2016, 214281 dated 20.10.2016 and 214280 dated 30.10.2016 each amounting to Rs.6,00,000/-, drawn on Axis Bank, Meerut, Uttar Pradesh-250001 subject matter of complaint bearing CC No. 3047/2017 and CRL. M.C 1155/2019, respectively. However, when the said cheques were presented for encashment, returned back from the Bankers of the respondents no. 1 with remarks 'fund insufficient' vide return memo dated 06.02.2017 and 27.12.2016 respectively issued by the Canara Bank, Branch-Janpath i.e. the Banker of the respondent no. 1. The respondent no. 2 through the petitioner and the respondents no. 3 and 4, did not make the payment of the cheque amount despite the notice dated 15.02.2017. Hence, the present complaints. 3. The tri....
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....no proximate of direct or indirect involvement of the petitioner in the affairs of the respondent no. 2 as he was only a Non-Executive Director as such, he never involved in its day-to-day activities. The impugned orders would cause unnecessary hassles, prejudice, embarrassment and loss of reputation to the petitioner. The petitioner did not have any role to play in the entire transaction. The Trial Court has failed to appreciate that the entire transaction took place between the respondent no. 1 and the accused no. 5 i.e. M/s Bhola Baba Real Estate Developers Pvt. Ltd. The petitioner has not given any undertaking or confirmation to admit the alleged liability. The alleged undertaking/confirmation was given prior to the petitioner being inducted as the director in the respondent no. 2 and as such, the petitioner was not having any knowledge regarding the said undertaking and confirmation. There is no specific averment made against the petitioner in the complaints. The petitioner is not the signatory of the cheques in question. The petitioner was only the Non-Executive Director of the respondent no.2. The petitioner also raised other grounds as mentioned in the petitions. It is pray....
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....cy, etc., of funds in the account. -Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for 19 [a term which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice ....
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....e responsible for acts done on behalf of the company are personally liable for those acts including the criminal action. Every person who at the time of commission of offence is in charge and responsible for the conduct of the business of the company is liable for the offence stated to be committed by the company. However, the criminal liability arises when the offence was committed and not on the basis of merely holding a designation or office in a company. As per section 141 of the NI Act, a person is stated to be criminally liable when at the time of commission of offence was in charge and responsible for the conduct of the business of the company. Every person connected with the company may not fall within the ambit of section 141 of the NI Act. 8.1 The Supreme Court on various occasions, considered the liability of directors of a company in complaints filed under section 138 of NI Act. The Supreme Court in SMS Pharmaceuticals Ltd. V Neeta Bhalla & Anr., 2005 (8) SCC 89 held as under:- 4. a company being a juristic person, all its deeds and functions are the result of acts of others. Therefore, officers of a company who are responsible for acts done in the name of the compan....
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....ss of the company at the relevant time when the offence was committed and not on the basis of merely holding a designation or office in a company. Conversely, a person not holding any office or designation in a company may be liable if he satisfies the main requirement of being in charge of and responsible for the conduct of business of a company at the relevant time. Liability depends on the role one plays in the affairs of a company and not on designation or status. If being a director or manager or secretary was enough to cast criminal liability, the section would have said so. Instead of "every person" the section would have said "every director, manager or secretary in a company is liable"..., etc. The legislature is aware that it is a case of criminal liability which means serious consequences so far as the person sought to be made liable is concerned. Therefore, only persons who can be said to be connected with the commission of a crime at the relevant time have been subjected to action. 12. The conclusion is inevitable that the liability arises on account of conduct, act or omission on the part of a person and not merely on account of holding an office or a position in a ....