TaxTMI 
TaxTMI 
2023 (4) TMI 1476
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....08 during pendency of the complaint. His heirs, the present complainant nos.1 to 4, are allowed to prosecute the complaint. The deceased complainant had agreed to sell his land to accused nos. 1 to 4. The accused issued a cheque bearing No. 493369 dated 30.06.2006 for Rs. 10,00,000/-, drawn on the account of the firm maintained with the Buldhana Urban Cooperative Bank Ltd., Branch Wardha. The deceased complainant presented the cheque for encashment through his bank namely Central Bank of India, Darwha. The bank informed the deceased complainant that the cheque was dishonoured on the ground that "the drawer had stopped the payment". The deceased complainant issued notice dated 30.08.2007 to the accused. It is stated that despite receipt of the notice, the accused did not pay the amount. Therefore, the deceased complainant filed the complaint. 3. Learned Magistrate took cognizance of the offence and issued process against the accused persons. The complaint was fixed for recording of the evidence. The complainants at that time made an application at Exh.75 for amendment. The proposed amendment was set out in paragraph 2 of the application. The sum and substance of the amendment app....
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....he partners of the firm. Learned advocate submitted that the notice was replied, but the amount of cheque was not paid. Learned advocate submitted that the complaint was otherwise in accordance with law. Learned advocate submitted that while drafting the complaint, a specific statement of fact that, accused nos.1 to 4 being the partners of the firm were responsible for the conduct of day-to-day business of the firm and as such vicariously liable for commission of the offence punishable under Section 138 of the N.I. Act, remained to be made. Learned advocate submitted that this was a curable infirmity and defect. Learned advocate submitted that the legal position has been well settled that an application can be made for amendment of a complaint to remove such curable infirmity or defect. Learned advocate further submitted that the facts stated in the complaint and in the reply by the accused, would show that no prejudice has been caused to them by granting the amendment. In order to substantiate his submissions, learned advocate has relied upon the following decisions : 1] Rajendra Prasad Gupta .vs. Krakash Chandra Mishra and others, reported at (2011) 2 SCC 705 2]....
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....the decision in U.P. Pollution Control Board (supra). It is held by the Hon'ble Supreme Court that if the amendment sought to be made relates to simple infirmity, which is curable by means of formal amendment and by granting such an amendment, no prejudice is likely to be caused to the other side, notwithstanding the fact that there is no enabling provision in the Code for entertaining such amendment, the Court may permit such an amendment to be made. It is further held that if the amendment sought to be made in the complaint does not relate either to a curable infirmity which can be corrected by a formal amendment or if there is likelihood of prejudice to the other side, then the Court shall not allow the amendment in the complaint. It is further pertinent to note that in this case, the Hon'ble Supreme Court granted amendment despite making a note that the amendment sought to be made in the complaint was not of a formal in nature, but a substantial amendment. It is further seen on perusal of this judgment that in the case before the Hon'ble Supreme Court, the amendment application was made before taking cognizance and issuance of process. 12. Learned advocate for th....
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....awer of the cheque the payment of the amount of money due under the cheque to payee; and (5) such a notice of payment is made within a period of 30 days from the date of the receipt of the information by the payee from the bank regarding the return of the cheque as unpaid. It is obvious from the scheme of Section 138 that each one of the ingredients flows from a document which evidences the existence of such an ingredient. The only other ingredient which is required to be proved to establish the commission of an offence under Section 138 is that inspite of the demand notice referred to above, the drawer of the cheque failed to make the payment within a period of 15 days from the date of the receipt of the demand. A fact which the complainant can only assert but not prove, the burden would essentially be on the drawer of the cheque to prove that he had in fact made the payment pursuant to the demand. 27. By the nature of the offence under Section 138 of the Act, the first ingredient constituting the offence is the fact that a person drew a cheque. The identity of the drawer of the cheque is necessarily required to be known to the complainant (payee) and needs investigation ....
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....Aneeta Hada's case (supra). Paragraphs 58 and 59 of the report would be relevant. The same are extracted below : "58. Applying the doctrine of strict construction, we are of the considered opinion that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. Thus, the words "as well as the company" appearing in the Section make it absolutely unmistakably clear that when the company can be prosecuted, then only the persons mentioned in the other categories could be vicariously liable for the offence subject to the averments in the petition and proof thereof. One cannot be oblivious of the fact that the company is a juristic person and it has its own respectability. If a finding is recorded against it, it would create a concavity in its reputation. There can be situations when the corporate reputation is affected when a Director is indicted. 59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the drag-....
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....nts against the company in the complaint for commission of an offence under Section 138 of N.I. Act, the same cannot be rectified by taking recourse to general principles of criminal jurisprudence. It is held that since the provisions of Section 141 of the N.I. Act impose vicarious liability by deeming fiction which pre-supposes and requires the commission of the offence by the company or firm and therefore, unless the company or firm has committed the offence as a principal accused, the persons mentioned in sub-section (1) and sub-section (2) of Section 141 of the N.I. Act would not be liable to be convicted on the basis of the principles of vicarious liability. 19. The legal position is, therefore, well settled that the curable infirmity or defect can be removed by amending the complaint. The amendment cannot be allowed to change the basic core, crux and tenor of the complaint. The amendment, which results in prejudice to the other side, cannot be allowed. In other words, the amendment sought for to the complaint, if does not cause prejudice to the other side, the same can be allowed. When the amendment application pertains to addition of company or firm as a principal offende....
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....n the Court has to consider the prayer for such an amendment keeping in mind the above legal position. It has to be mentioned that the question whether the amendment is formal and intended to curable defect or infirmity depends upon the facts and circumstances of each case and has to be addressed accordingly. 22. The order passed by the learned Judicial Magistrate First Class, Darwha needs to be examined keeping the above stated settled legal position in mind. Similarly, the nature of the amendment sought for as well as the facts of the case needs to be appreciated. Accused no.1 is the partnership firm. The remaining accused are the partners of the said firm. The cheque in question was issued on behalf of the firm by the Partner accused Nos.2 and 4. The partnership firm and all the Partners of the firm have been arrayed as accused. The notice before filing the complaint was issued to all the Partners of the firm. The Partners of the firm replied the said notice. The Partners have stated that stop payment instructions were given to the bank in respect of the cheque in question because after execution of the sale-deed of the property, the sister of the deceased complainant had cla....
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....cumstances, on this sole ground, the amendment sought for cannot be rejected. 26. The question whether the amendment sought for is intended to remove the curable legal infirmity or defect needs to be considered in the backdrop of above legal position as well as the undisputed facts. Perusal of the complaint would show that a statement of fact has been made in the complaint that the Partners and the firm are liable to pay the amount of the cheque. They have failed to pay the same on receipt of the notice. It is stated that the accused have committed an offence punishable under Section 138 of the N.I. Act. The proposed amendment, therefore, needs to be examined in juxtaposition with the above undisputed facts and the settled legal position. By way of the proposed amendment, it is sought to be contended that the accused Nos.1 to 4 are the Partners of Ramdeobaba Developers and Builders. They have purchased the land from the complainants and converted the same for NA purpose. It is stated that as such the Partners are jointly and severally liable for prosecution under Section 138 of the N.I. Act. 27. In my view, if this proposed amendment is examined in the backdrop of the above s....