TaxTMI 
TaxTMI 
2023 (7) TMI 1107
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....ed Metropolitan Magistrate, Kolkata is allowed to proceed it will amount to gross abuse of the process of Court/law. 3. It is alleged that the post dated cheque drawn at State Bank of India, Mandi, Gobindgarh, District- Fatehgarh Sahib, Punjab bearing No.561491 dated 08.06.2018 for a sum of Rs.6,60,499/- was issued in favour of the opposite party no.1 herein and admittedly the said cheque was signed by the authorised signatory/Director of the opposite party no.2 herein and the said cheque was later dishonoured by the Banker of the opposite party no.2 with the remarks "Funds Insufficient" and the opposite party no.1 received the said dishonoured cheque along with "Cheque Return Memo" dated 11.09.2018 from its bank on 11.09.2018. 4. It is also submitted that it is well settled law by the Hon'ble Supreme Court that complaint under Section 138 read with Section 141 of the Negotiable Instrument Act can only be initiated against the Director of the company and as such, there exists no criminality on the part of the petitioner. The petitioner is not even a signatory of the said cheque. 5. Mr. Jibantaraj Dan Roy, learned counsel for the petitioner has submitted that the learne....
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....under Section 138 is committed by a company. The key words which occur in the section are "every person". These are general words and take every person connected with a company within their sweep. Therefore, these words have been rightly qualified by use of the words: "Who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence, etc." What is required is that the persons who are sought to be made criminally liable under Section 141 should be, at the time the offence was committed, in charge of and responsible to the company for the conduct of the business of the company. Every person connected with the company shall not fall within the ambit of the provision. It is only those persons who were in charge of and responsible for the conduct of business of the company at the time of commission of an offence, who will be liable for criminal action. It follows from this that if a director of a company who was not in charge of and was not responsible for the conduct of the business of the company at the relevant time, wil....
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.... company, would give rise to responsibility under sub-section (2) of Section 141. (iii) In the case of a Director, secretary or manager [asdefined in Section 2(24) of the Companies Act] or a person referred to in clauses (e) and (f) of Section 5 of the Companies Act, an averment in the complaint that he was in charge of, and was responsible to the company, for the conduct of the business of the company is necessary to bring the case under Section 141(1) of the Act. No further averment would be necessary in the complaint, though some particulars will be desirable. They can also be made liable under Section 141(2) by making necessary averments relating to consent and connivance or negligence, in the complaint, to bring the matter under that sub-section. (iv) Other officers of a company cannot be made liableunder sub-section (1) of Section 141. Other officers of a company can be made liable only under sub-section (2) of Section 141, by averring in the complaint their position and duties in the company and their role in regard to the issue and dishonour of the cheque, disclosing consent, connivance or negligence." 29. In Pooja Ravinder Devidasani v. State of ....
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....dequate fulfilment of the requirements under Section 141." *** 18. In Girdhari Lal Gupta v. D.H. Mehta [Girdhari Lal Gupta v. D.H. Mehta, (1971) 3 SCC 189 : 1971 SCC (Cri) 279 : AIR 1971 SC 2162] , this Court observed that a person "in charge of a business" means that the person should be in overall control of the day-to-day business of the Company. 19. A Director of a company is liable to be convicted for an offence committed by the company if he/she was in charge of and was responsible to the company for the conduct of its business or if it is proved that the offence was committed with the consent or connivance of, or was attributable to any negligence on the part of the Director concerned (see State of Karnataka v. Pratap Chand [State of Karnataka v. Pratap Chand, (1981) 2 SCC 335 : 1981 SCC (Cri) 453] ). 20. In other words, the law laid down by this Court is that for making a Director of a company liable for the offences committed by the company under Section 141 of the NI Act, there must be specific averments against the Director showing as to how and in what manner the Director was responsible for the conduct of the business of the company.....