ASSOCIATED TRANSPORT COMPANY Vs. P S R MURTHY

JUDGEMENT

(1.) The opposite party herein filed a complaint under Section 138/141/142 of the Negotiable Instruments Act in the Court of the Additional Magistrate at Sealdah, 24-Parganas. It seems that there was an agreement between the complainant-company which is a Government of India undertaking and the accused persons who are a partnership firm, namely, the Associated Transport Company and its three partners for engaging the said firm as the warehouse and handling agent of the complainant-company for storage and/or handling of fertilizer on hire commission basis. There was also an agreement, it seems, that the said firm would furnish security to the complainant-company. It is the allegation in the petition of complaint that in accordance with the said agreement the accused persons furnished security by issuing certain cheques. The cheques were issued by accused No. 2 on behalf of accused No. 1 which is the firm. The cheques were drawn on Indian Bank, Khidderpore branch, Calcutta, and the same were presented by the complainant for encashment at the Park Circus branch of the State Bank of India, Calcutta, which duly presented the same to the Indian Bank, Khidderpore branch, Calcutta. The cheques were, however, returned by the drawer bank on the ground of insufficiency of funds with a request to present again. On August 27, 1991, the cheques were again presented but they were again returned by the drawer bank with a note "refer to drawer". Then on September 6, 1991, a letter was issued by the solicitors on behalf of the complainant to the accused persons at their Burdwan address, inter alia, stating the fact that the cheques were dishonoured on presentation and demanding payment of the concerned amount within 15 days from the date of receipt of the letter. It was also stated therein that the same might be treated as notice under Section 138 of the Negotiable Instruments Act. The allegation is that in spite of such demand by notice under Section 138 of the said Act no payment against the dishonoured cheques had been made by the accused persons. Accordingly, the complainant-company filed the petition of complaint through its secretary and principal officer under Section 138/141/142 of the Negotiable Instruments Act in the Court of the Additional Chief Judicial Magistrate, Sealdah, and the learned Magistrate took cognizance of that complaint and transferred the same to the Judicial Magistrate, Fifth Court, Sealdah, for enquiry and trial. The learned Magistrate, Fifth Court, thereafter examined the complainant and witnesses on oath, perused and considered the complaint along with the xerox annexures thereto as well as the evidence on oath and then recorded his opinion that prima facie case did exist against the accused persons under the said Sections of the Negotiable Instruments Act and directed for issuing summons to the accused persons. The accused persons who are petitioners herein have now come up in this court for quashing the said proceeding under Section 482 of the Code of Criminal Procedure.

(2.) Three contentions have Been canvassed by Mr. S.C. Bose on behalf of the petitioners. The first contention is that the petition of complaint does not disclose any cause of action against petitioners Nos. 3 and 4, Mahamaya Laha and Debi Prosad Laha, who are partners of the firm, petitioner No, 1. (Associated Transport Company). The second contention is that the Sealdah Court of the Magistrate has no territorial jurisdiction to entertain the complaint or to try the case. The third contention is that the direction of the learned Magistrate for issuing summons to the petitioners is bad inasmuch as the relevant provisions of law were not compiled with.

(3.) As regards the first contention that the petition of complaint does not disclose any cause of action against petitioners Nos. 3 and 4, I find that there is substance in the same and Mr. B.C. Roy, appearing for the complainant opposite party, in his usual fairness, conceded the validity of the contention raised by Mr. Bose regarding non-disclosure of any cause of action against petitioners Nos. 3 and 4. The cheques in question were issued by accused No. 2 (who is also a partner of the firm) on behalf of the firm, accused No. 1. Under Section 141 of the Negotiable Instruments Act, 1881, where an offence under Section 138 has been committed by a company or firm, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company or the firm for the conduct of its business as well as the company or the firm, as the case may be, becomes liable to be proceeded against and punished. Where an offence under the Act is committed by a company or a firm, the director of the company or the partner of the firm is also liable to be proceeded against and punished if it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of such director or partner, as the case may be. The petition of complaint in the present case does not contain any such averment against petitioners Nos. 3 and 4 as could prima facie make out a case against them under Section 141 of the said Act. That being so the proceeding in the court below so far as accused petitioners Nos. 3 and 4 are concerned must be quashed.