B S K PRASAD Vs. LAXMI VESSELS HYDERABAD

JUDGEMENT

(1.) First respondent filed a complaint for an offence under Section 138 of the Negotiable Instruments Act ('the Act') against one Y.V.K. Prasad (Al) and the petitioner (A2) alleging that for a debt due to him, A-1 issued a cheque, which on presentation for payment into the bank was dishonoured and that statutory notice issued to A-l and the petitioner, intimating them about the dishonour of the cheque and demanding payment of the amount covered by the dishonoured cheque, was returned unclaimed.

(2.) The contention of the learned Counsel for the petitioner is that since Section 138 of the Act contemplates prosecution only of the drawer of the bounced cheque, and since petitioner, admittedly, did not draw the dishonoured cheque on any account maintained by him on any bank, even assuming that all the allegations in the complaint are true, question of petitioner being liable for an offence under Section 138 of the Act does not arise and so the complaint against the petitioner is liable to be quashed. The contention of the learned Counsel for first respondent is that since the dishonoured cheque was issued by A-1 .in respect of a debt due to the 1st respondent from a company of which petitioner is the Managing Director and A-1 is the Director, petitioner also is liable for the offence under Section 138 of the Act.

(3.) A-l and the petitioner are described as the Director and Managing Director, respectively, of a company which is not made an accused in the case. Though the complaint does not disclose as to who drew the cheque that was dishonoured, xerox copy of that cheque, filed along with this petition, (original of which was produced by the 1st respondent along with the complaint) shows that it was drawn by A-l in his individual capacity, but not for and on behalf of the company of which he is the Director and petitioner is the Managing Director. So it is clear that the dishonoured cheque was not issued for and on behalf of the company, of which petitioner is the Managing Director, for the 1st respondent to invoke the aid of Section 141 of the Act to make the Managing Director of the company vicariously liable for the offence committed by the company under Section 138 of the Act.