@JUDGMENTTAG-ORDER
P.R. Shivakumar, J.@mdashThe 3rd accused in STC. No. 899 of 2006 on the file of the learned Judicial Magistrate No. 1, Attur is the Petitioner 40 herein. This Criminal Original Petition has been filed for quashing the criminal proceedings initiated against the Petitioner herein and two other persons based on the private complaint of the Respondent herein for alleged commission of an offence punishable u/s 138 read with Section 142 of the Negotiable Instruments Act. According to the complaint, M/s. Palanimurugan Sago Factory, arrayed as the first accused in the complaint is a partnership firm of which the second accused/Dhanasekaran and Mallika, the third accused/Petitioner herein are partners. Contending that the above said firm, through its partners, borrowed a sum of Rs. 7,50,000/- from the Respondent/complainant on 15.01.2006 for its business and to discharge its pressing debts; that on the same day, Dhanasekaran/second accused, as a partner of the first accused firm, with the consent and knowledge of the third accused/Petitioner herein issued three post-dated cheques, each for a sum of Rs. 2,50,000/- drawn in favour of the Respondent/complainant putting the date in all the three cheques as 25.05.2006; that the said cheques drawn on the account of the first accused firm maintained with the Lakshmi Vilas Bank Limited, Attur bearing cheque Nos. 0081245, 0081246 and 0081247 when presented for collection through ICICI Bank, Attur branch on 21.06.2006 were returned unpaid citing the reason "exceeds arrangement"; that on receipt of the banker''s memo dated 01.07.2006, a statutory notice was issued to all the three accused demanding payment of the amount covered by the returned cheques; that even after the receipt of the notice, the accused persons, including the Petitioner herein, did not Law Weekly (Criminal), February 2009 make payment till the expiry of the date allowed by the Statute and that on the other hand, the accused came up with a reply notice confining false and untenable averments.
2. The learned Judicial Magistrate No. 1, Attur, after following necessary procedure and after recording the sworn statement of the Respondent/complainant, took the complaint on file as STC. No. 899/2006. After service of process on the Petitioner herein, she has approached this Court by way of the present petition stating that in case of an offence of dishonour of cheque, punishable u/s 138 of the Negotiable Instruments Act committed by a company (partnership firm in this case), unless necessary averments to bring the case of a particular director or partner as the case may be, within the ambit of Section 141(1) of the Negotiable Instruments Act, prosecution of such director or partner cannot be sustained.
3. This Court heard the submissions made on both sides and perused the materials available on record.
4. The learned Counsel for the Petitioner in his arguments, reiterating the contentions made by the Petitioner in the petition has submitted that the averments necessary for bringing the case against the Petitioner, a partner in the first Respondent firm, within the ambit of Section 141(1) of the Negotiable Instruments Act, have not been made in the complaint and hence the complaint should be quashed so far as the present Petitioner is concerned. In support of his contention the learned Counsel for the Petitioner has relied on the judgment of the Hon''ble Supreme Court in
5. Per contra, the learned Counsel for the Respondent contended that even applying the said view expressed by the Apex Court in
In the case on hand, reading the complaint as a whole, it is clear that the allegations in the complaint are that at the time at which the two dishonoured cheques were issued by the company, the Appellant and another were the Directors of the company and were in-charge of the affairs of the company. It is not proper to split hairs in reading the complaint so as to come to a conclusion that the allegations as a whole are not sufficient to show that at the relevant point of time the Appellant and the other are not alleged to be persons in-charge of the affairs of the company. Obviously, the complaint refers to the point of time when the two cheques were issued, their presentment, dishonour and failure to pay in spite of notice of dishonour. We have no hesitation in overruling the argument in that behalf by the learned Senior counsel for the Appellant.
We think that, in the circumstances, the High Court has rightly come tot he conclusion that it is not a fit case for exercise of jurisdiction u/s 482 of the Code of Criminal Procedure for quashing the complaint. In fact, an advertence to Sections 138 and 141 of the Negotiable Instruments Act shows that on the other elements of an offence u/s 138 being satisfied, the burden is on the Board of Directors or the Officers in-charge of the affairs of the company to show that they are not liable to be convicted. Any restriction on their power or existence of any special circumstance that makes them not liable is something that is peculiarly within their knowledge and it is for them to establish at the trial such a restriction or to show that at the relevant time they were not incharge of the affairs of the company. Reading the complaint as a whole, we are satisfied that it is a case where the contentions sought to be raised by the Appellant can only be dealt with after the conclusion of the trial.
6. In Rangachari''s case relied on by the learned Counsel for the Respondent, the allegations found in the complaint which were held sufficient for launching the prosecution are reproduced here under:
accused No. l is a company incorporated under the companies act. Accused No. 2 and 3 are its directors. They are in charge and responsible to accused No. l for conduct of business of accused No. 1 company. They are jointly and severally liable for the acts of the accused No. 1.
The said allegation itself was held to be enough for maintaining a prosecution for an offence punishable u/s 138 read with Section 141(1) of the Negotiable Instruments Act.
7. In the case on hand the relevant portion of the complaint containing necessary allegations is extracted here under:
The accused numbers 2 and 3 are the partners of the first accused. The accused 2 and 3 are the responsible and in charge of the business and day-today affairs of the first accused. The first accused through its partners viz. Accused 2 and 3 of you have borrowed 7,50,000/- from the complainant on 15.01.2006 for sago business and to discharge their pressing debts. On the same day towards the discharge of the amount due to the complainant from the first accused as said supra, the second accused as partner of first accused with the knowledge and consent of the third accused being the partners of the first accused, have issued three post dated cheques drawn in favour of the complainant, each for a sum of Rs. 2,50,000/- for a total sum of Rs. 7,50,000/- (seven lakhs and fifty thousand only) dating all the cheques to 25.05.2006.
8. A comparison of the allegations made in the complaint in Rangachari''s case and the allegations made in the complaint in the case on hand will make it abundantly clear that the averments made in the present complaint are more than the averments made in the case before the Apex Court in Rangachari''s case. Hence the same cannot be held insufficient to maintain the prosecution of the Petitioner herein for the offence committed by the partnership firm of which she is a partner.
9. However, the learned Counsel for the Petitioner relying on the judgment of a learned single judge (Justice K.B. Basha) in Capt. D. Karunakar, Director, Manito Electronics Pvt. Ltd., Anchorage, East Hill, Calicut- 673 005 and Ors. v. Tamil Nadu News Print & Papers Ltd. Rep. By Sr. Officer (Marketing) S. Anbusamy having its office at Mount Road, Guindy, Chennai -32 reported in (2008) 1 MLJ 391, argued that the mere statement that accused as a director/ partner was taking part in the management, business and day-to-day affairs of the company/firm would not be enough to bring the case against him within Section 141 of the Negotiable Instruments Act. Of course, the learned single Judge of this Court quashed the prosecution launched against the directors of the company in the said case with the following observation:
14. In the instant case also, as already pointed out, there is absolutely no specific, clear and unambiguous allegations as to how and in what manner the Petitioners were responsible for the conduct of the business and there is absolutely no specific role assigned to the Petitioners in respect of the conduct of the business of the first accused company.
The above said judgment of this Court was pronounced on 12.04.2007. Naturally the judgment of the Hon''ble Supreme Court in Rangachari''s case could not have been brought to the notice of this Court, as the said judgment in Rangachari''s case was pronounced subsequently, namely on 19.04.2007. Hence it goes without saying that the judgment of the Hon''ble Supreme Court pronounced in Rangachari''s case shall have the effect of overruling the view expressed by this Court in (2008) 1 MLJ 391. Therefore we have to apply the view expressed by the Hon''ble Supreme Court in Rangachari''s case.
10. A reading of the said complaint will show that necessary averments to the effect that the Petitioner herein/third accused was not only a partner of the firm but also was responsible and in-charge of the business and day-to-day affairs of the first accused firm have been made. It has also been clearly averred that the petitiner, along with the second accused, as partner of the first accused firm borrowed the amount. The further averment in the complaint is to the effect that the cheques were issued by the second accused as a partner of the first accused firm to the knowledge and with the consent of the Petitioner herein/third accused. Such averments in the opinion of this Court are sufficient to sustain a prosecution of the Petitioner herein/third accused for the offence of dishonour of cheque committed by the first accused partnership firm as its partner. It is for the Petitioner/third accused to establish in the trial that she was no way connected with the day-to-day affairs of the partnership firm as on the date on which the cause of action arose.
11. All the grounds raised in the present petition are valid grounds to be raised and proved in the trial of the case. They are not sufficient to foreclose the complaint at the inception itself. Hence this Court comes to the conclusion that the Petitioner has not made out a case for quashing of the complaint against her and that there is no merit in the petition and the same deserves to be dismissed. However, this Court makes it clear that the dismissal of the present petition will not be construed as an expression of any opinion regarding the correctness of the allegations made in the petition. The consideration of this Court is confined to the sufficiency of the averments made in the petition for quashing the complaint. Therefore, there shall not be any bar for raising all these grounds before the Trial Court and in the case such grounds of defence are raised, the Trial Court shall consider them on their own merit without being influenced by the dismissal of the present Criminal Original Petition.
12. In the result, subject to the above said observation, the Criminal Original Petition is dismissed. There shall be no order as to costs. Consequently the connected miscellaneous petition is closed.
