KISHANDAS JETHANAND Vs. ACROPETAL TECHNOLOGIES LIMITED AND ORS.

JUDGEMENT

(1.) The petitioner filed a complaint against the respondents in respect of the offence under Section 138 of the Negotiable Instruments Act, 1881 ('the Act' for brevity). His allegation was, he lent a loan of Rs.25,00,000/- by way of cheque to the accused persons (Company registered under the Companies Act and its Directors), on the accused executing a Promissory Note on 15.8.2012 agreeing to repay the amount with interest @ 2% per annum. When he demanded for the repayment of the amount, accused paid him Rs.12,50,000/- towards part payment of the loan and in respect of the remaining Rs.12,50,000/- and the accrued interest, they issued two cheques for a sum of Rs.12,50,000/- The cheques when presented dishonoured with the endorsement "funds insufficient". In respect of the above said amount, they have given personal guarantee. The complainant issued a demand notice. Same is served on them. The first accused being the Company, accused Nos.2 to 6 being its Directors actively involved in the day-to-day transaction of the Company are liable to comply the demand. They have not replied to the notice nor repaid the amount thereby committed an offence under Section 138 of the Act.

(2.) After presentation of the complaint, on recording the sworn statement of all the accused, the learned Magistrate ordered to register the criminal case and ordered summons against them. The accused approached the Sessions Court by way of revision challenging the summons ordered against them. The learned Revisional Court vide its considered judgment allowed the revision petition and set aside the order whereby summons was issued against accused Nos.3 to 6. Aggrieved by the said order, the complainant is before this Court.

(3.) Sri.K.S.Chandrahasa, learned Counsel appearing for the petitioner submits that, the contention of the accused before the Revisional Court was that they cannot be prosecuted on the basis of vicarious liability. They are independent Directors of the first accused/Company, wherefore, independent of the Management of the Company also. Their role is only to the extent of scrutinizing the performance of the Management, but they have no role in day-to-day management of the Company. The notarized copy of Form No.32 discloses that they are independent Directors and cannot be brought under the ambit of Section 141 of the Act. The above contention was a matter of defence, which had to be established during trial. The second respondent executed a Promissory Note and the consideration receipt as the authorized signatory of the first accused/Company. There is clear averment in the complaint about the active role of the respondents in the day-to-day transaction of the Company. When there is pleading sufficient to make out an offence against the accused complying with the provisions of Section 141 of the Act, summons ordered against the accused cannot be challenged. Despite receipt of the legal notice, they did not reply. Hence, the order of the Sessions/Revisional Court is liable to be quashed.