TaxTMI 
TaxTMI 
2025 (4) TMI 356
X X X X Extracts X X X X
X X X X Extracts X X X X
....) being the Authorized Representative of the M/s Amira Pure Foods Pvt. Ltd. Company and others namely Shri. Shyam Poddar (Accused No. 3), Mr. Karan A. Chanana (Accused No. 4) and Shri. Anil Gupta (Accused No. 5) approached Respondent No. 2/Complainant for supply of rice. 3. For the supply of the agreed quantities of rice, Smt. Anita Dang/Accused No. 2 issued Cheques amounting to Rs. 7,55,00,000/- on behalf of M/s Amira Pure Foods Pvt. Ltd. in discharge of its legal debts and liabilities against the total outstanding of Rs. 7,77,18,400/- which were allegedly dishonoured, details of which are given below: Sr. No. Cheque No. Cheque Date Cheque Amount 1. 943369 09.05.2015 Rs. 25,00,000/- 2. 943370 13.05.2015 Rs. 25,00,000/- 3. 943378 14.05.2015 Rs. 25,00,000/- 4. 943371 19.05.2015 Rs. 25,00,000/- 5. 943377 11.05.2015 Rs.20,00,000/- 6. 943372 22.05.2015 Rs.20,00,000/- 7. 943379 18.05.2015 Rs. 25,00,000/- 8. 943380 20.05.2015 Rs. 25,00,000/- 9. 943381 23.05.2015 Rs. 25,00,000/- 10. 943382 26.05.2015 Rs. 25,00,000/- 11. 943383 26.05.2015 Rs. 25....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or in any way in knowledge of or connected with the transaction. The Ld. M.M. has issued summons against the Petitioner, without even prima facie satisfying herself as to whether the Petitioner had any role in the alleged offence as a Director on the Board of Accused No. 1 Company, or was in any manner, connected to the commission of the alleged offence. 9. It is submitted that the primary responsibility is on the complainant to make necessary averments in the complaint so as to make the accused vicariously liable. Section 141 does not make all partners liable for the offence. The criminal, liability has been fastened on those who, at the time of the commission of the offence, was in charge of and was responsible to the firm for the conduct of the business of the firm. The obligation of the appellants to prove that at the time the offence was committed they were not in charge of and were not responsible to the firm, for the conduct of the business of the firm, would arise only when first the complainant makes necessary averments in the complaint and establishes that fact. For this, reliance has been placed on Monaben Ketanbhai Shah and Anr. Vs. State of Gujarat and Ors., (MANU/S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....v. State of Gujarat & Ors., Criminal Appeal 1446 of 2021, wherein it is held that: - "44. The test to determine if the Managing Director or a Director must be charged for the offence committed by the Company is to determine if the conditions in Section 141 of the NI Act have been fulfilled i.e., whether the individual was in-charge of and responsible for the affairs of the company during the commission of the offence. ... There are sufficient averments in the complaint to raise a prima facie case against them. It is only at the trial that they could take recourse to the proviso to Section 141 and not at the stage of issuance of process." 17. Reliance has also been placed on Mainuddin Abdul Sattar Shaikh v. Vijay D Salvi, (2015) 9 SCC 622, Vipin Kumar Gupta vs Sarvesh Mahajan, 2019 ACD 362, Rajesh Chetwal vs State, 2011 SCC OnLine Del 5768, and Sunil Bharti Mittal v. CBI, (2019) 4 SCC 609. 18. It is asserted that the Ld. M.M. has appreciated the factual matrix of the present case and has rightly summoned the Petitioner herein and that there is no ground for setting aside the impugned Order of summoning. 19. It is submitted that the grounds raised ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of this section, - (a) "company" means any body corporate and includes a firm or other association of individuals; and (b) "director", in relation to a firm, means a partner in the firm." 24. It is a penal provision creating vicarious liability which must be strictly construed. Mere bald cursory statement in a Complaint that the Director (arrayed as an accused) is in charge of and responsible to the company for the conduct of the business of the Company without anything more as to the role of the Director, is not sufficient. The Complaint should spell out as to how and in what manner Respondent was in charge of or was responsible to the accused Company for the conduct of its business. 25. Apex Court explained in the case of N.K. Wahi v. Shekhar Singh, (2007) 9 SCC 481 that to launch a prosecution against the alleged Directors, there must be a specific allegation in the Complaint as to the part played by them in the transaction. There should be clear and unambiguous allegation as to how the Directors are in-charge and responsible for the conduct of the business of the Company. While the exact words of the Section may not be reproduced, but the role of the Dir....
X X X X Extracts X X X X
X X X X Extracts X X X X
....averred as a fact as there is no deemed liability of a Director in such cases." 28. The role and responsibility of Non-Executive Directors was considered by Apex Court in the case of Pooja Ravinder Devidasani v. State of Maharashtra, (2014) 16 SCC 1 wherein while taking into consideration that a non-executive Director plays a governance role and are not involved in the daily operations or financial management of the Company, held that to attract liability under section 141 of the NI Act, the accused must have been actively in-charge of the company's business at the relevant time. Mere Directorship does not create automatic liability under the Act. 29. Similar observations have been made in Ashok Shewakramani & Ors. vs State of Andhra Pradesh & Anr., (2023) 8 SCC 473 and reiterated in Hitesh Verma vs. M/s Health Care at Home India Pvt. Ltd. & Ors., Crl. Appeal No. 462/2025. 30. Recently, in the case of K.S. Mehta vs. M/s Morgan Securities & Credits Pvt. Ltd., in Crl. Appeal arising out of SLP Crl. No. 4774/2024 decided on 04.03.2025, the Apex Court in similar facts, after relying on the above cited precedents, has observed that there is no material on record to show that th....