VIJAYA ARUN Vs. NEW LINK OVERSEAS FINANCE LIMITED

JUDGEMENT

(1.) These criminal original petitions have been filed to quash the proceedings in CC.No.1706 of 2019 on the file of the Metropolitan Magistrate, George Town, Chennai, CC.No.5827 of 2019 and CC.No.5828 of 2019 on the file of the Fast Track Court-II, Metropolitan Magistrate, Egmore, Chennai.

(2.) The learned counsel for the petitioner would submit that the petitioner is arrayed as A3 on the complaint lodged by the respondent for the offences punishable under Section 138 of Negotiable Instruments Act. The learned Magistrate had taken cognizance mechanically as against the petitioner when there is absolutely no specific allegation as against the petitioner to attract the offences under Section 141 of NI Act and issued summon without application of mind. He further submitted that to attract the offences under Section 141 of NI Act as against the petitioner herein, the complainant should have specifically averred in the complaint that at the time of offence the petitioner was in charge of and responsible for the conduct and the business of the company. The petitioner is being merely Director of the company is not sufficient to make her liable to be prosecuted for the offences under Section 141 of NI Act. The respondent cannot presume every Director knows about the transaction while fastening criminal liability as against the Director of the company. The liability on the part of the Director cannot be inferred. The same need to be averred in the complaint so as to make the accused vicariously liable. He further submitted that the proviso categorically states that if a person who was in charge of the day to day management of the company or by stating that he / she was in charge of affairs of the company cannot be vicariously made liable under Section 141(1) of NI Act. In order to substantiate his contention, the learned counsel for the petitioner relied upon the following judgments of the Hon'ble Supreme Court of India:

(3.) Per contra, the learned counsel for the respondent would submit that there are totally four accused, in which the petitioner is arrayed as third accused on the complaint lodged by the respondent for the offence punishable under Section 138 of NI Act and 141 of NI Act. The petitioner herein is the Director of the first accused company. The complainant is non banking financial institution and in the course of business, the first accused availed various term loans from the complainant during the month of April 2016 and June 2016 to the tune of Rs.65 lakhs. Towards partial discharge of their legally enforceable liability, they issued eight cheques which have been signed by the fourth accused being its authorised signatory. All the cheques were presented for collection on 12.06.2019 and the same were returned dishonoured for the reason "account closed". After issuance of statutory notice to all the accused as contemplated under Section 138 of NI Act, the respondent lodged complaint as against the accused persons for the offence punishable under Sections 138 and 141 of NI Act.