Delhi District Court
M/S Indair Carrier vs . M/S Srinivaas Shipping Services & Ors. on 21 April, 2016
IN THE COURT OF SHRI GAGANDEEP JINDAL: MM (N.I.ACT):
SOUTH-EAST DISTRICT, SAKET COURTS COMPLEX: NEW DELHI
M/s Indair Carrier Vs. M/s Srinivaas Shipping Services & Ors.
CC No. 663/16
U/s 138 Negotiable Instruments Act, 1881
1. Unique Identification : 02406R1117152008
Number of the case
2. Name of the complainant : M/s Indair Carriers Pvt.
Ltd.,
Operating from
2nd Floor, Bldg. no. 8, Tower
'C', Gurgaon, Haryana-122002.
3. Name of the accused , : 1. M/s Srinivaas Shipping
parentage & residential Services,
address C-28, Masoodpur Main Road,
Vasant Kunj, New Delhi.
2. Mr. Mohana Chandraran VG,
Partner
M/s Srinivaas Shipping
Services,
C-28, Masoodpur Main Road,
Vasant Kunj, New Delhi.
Also at 6030, B-8, Vasant
Kunj, New Delhi.
3. Mr. Samrat Lahiri,
Partner.
M/s Srinivaas Shipping
Services,
C-28, Masoodpur Main Road,
Vasant Kunj, New Delhi.
Also at: 35, Kalu Sarai, Hauz
Khas, New Delhi.
4. Offence complained of or : U/s 138 of Negotiable
proved Instruments Act, 1881
5. Plea of the accused : Pleaded not guilty and
claimed trial
6. Final Judgment/order : Acquitted
Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 1 of 8
7. Date of judgment/order : 21.04.2016
Date of Institution : 11.01.2008
Date of receiving of case in this court : 29.02.2016
Date of Reserving Judgment/Order : 07.04.2016
Date of Pronouncement of Judgment/Order : 21.04.2016
JUDGMENT
1. By way of the present Judgment, I shall dispose off the present complaint filed by M/s Indair Carrier (hereinafter referred to as 'complainant') against M/s Srinivaas Shipping Services & Ors. and Mr. Mohana Chandraran & Mr. Samrat Lahiri (hereinafter referred to as 'accused no. 1, 2 & 3') u/s 138 of Negotiable Instruments Act, 1881 r/w Section 142 Negotiable Instruments Act, 1881 (hereinafter referred to as 'N.I. Act' in short).
2. Proceedings against accused no. 3 stood abated vide order dated 15.01.2010.
3. Accused NO. 2 has furnished bail bond u/s 437A Cr.P.C.
4. It is submitted by the complainant that accused no. 2 and 3 represent themselves to be partners of accused no.1 and at their assurance, complainant agreed to provide its good office to facilitate the booking and forwarding of the consignments to the various destinations in the name of complainant as per instructions and raised bills. As per statement of account maintained by the complainant in due cost of business, accused persons are liable to pay Rs. 2313965.50/-. Accused persons issued cheque no. 004378 dated dated 30.11.2007 for Rs. 1 lacs, cheque no. 004379 dated Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 2 of 8 dated 30.11.2007 for Rs. 1 lac, cheque no. 004377 dated dated 30.11.2007 for Rs. 1 lacs, all drawn on Canara Bank, Connaught Circus to the complainant to repay the loan amount. The complainant presented the said cheque for encashment, the same was returned unpaid with the remarks "exceeds arrangement/not arranged for " vide returning memo dated 03.12.2007. In the complaint, the complainant no where stated that legal demand notice u/s 138 NI Act was sent to the accused. Though, in pre-summoning evidence, it is submitted that legal demand notice dated 24.12.2007 was sent to which accused sent reply but accused failed to make the payment against the dishonoured cheque within 15 days from the date of service of legal demand notice. Hence, the present case was filed.
5. Notice u/s 251 Cr.P.C. was framed against the accused no. 1 and 2 to which they pleaded not guilty and claimed trial.
6. To prove his case, complainant has examined Mr. J.B. Verma as CW-1 who filed his evidence by way of affidavit and relied upon the following documents :-
(a) Board Ressolution dated 05.09.2007 Ex. CW1/A,
(b)Statement of account Ex. CW1/B,
(c)Original cheques in question Ex. CW-1/C to Ex. CW1/E,
(d)Returning memo is Ex. CW-1/F1 to Ex CW1/F3,
(e)Copy of legal notice and Registered post receipt, AD Card and UPC receipt are Ex. CW-1/G, Ex. CW1/H to Ex. CW1/J3 , Ex. CW1/X1 and Ex. CW1/X3 Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 3 of 8 CW-1 was cross examined on behalf of accused no. 2 and discharged.
7. In the statement of accused no. 2 recorded u/s 313 Cr.P.C., all the incriminating evidence were put to the accused no. 2 to which accused no. 2 stated that he is not authorised signatory of accused no. 1 firm nor was in employment of accused no. 1 firm when the cheques were issued to the complainant company. He further stated that accused no. 3 is a sole proprietor of accused no. 1 firm.
8. Accused no. 2 examined Sh. Jaya Kumar, Assistant Manager, Corporation Branch, Vasant Kunj as DW1 who proved the account opening firm of M/s Srinivaas Shipping Services, application for change of address, telephone bill as a proof of address, PAN and Voter ID Card as the Identity Proof of the applicant and letter of proprietorship as DW1/1 (colly.).
9. The evidence by way of affidavit of accused no. 2 can not be considered because his affidavit was expunged vide order dated 29.08.2014 and the accused did not challange the said order dated 29.08.2014.
10. Final arguments on behalf of accused no.2 heard. None had appeared on behalf of complainant to address the final arguments despite opportunities. Therefore, the court deemed it fit to pass the orders on merits.
11. Ld. Counsel for the accused no.2 submits that the accused no. 1 is a sole proprietorship ship owned by accused no. 3 and accused no. 2 has no concern with accused no. 1 company.
Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 4 of 8 He further submitted that complainant has failed to prove his case beyond reasonable doubt against accused no. 2 because complainant did not file any document to prove the the accused no. 2 either a partner or a authorised signatory of accused no. 1 firm. Accused no. 2 is not liable to pay anything to the complainant. Hence, accused no. 2 should be acquitted for the offence u/s 138 of Negotiable Instruments Act.
12. The complainant in memo of parties filed along with the complaint described accused no. 2 as a partner in the accused no. 1 firm. But, in the para no. 12 of the complaint, it is stated that accused no.2 and 3 are directors of accused no. 1 company. The complainant neither filed any document on record to prove that the accused no. 1 is a company or a partnership firm nor examined any witness from the register of companies or register of firm/society.
13. CW1 in his cross examination stated " I came to know during the course of business with the accused firm that accused is one of the partners. They were dealing with Mr. Ravinder Katyal, director of complainant company and Sh. R.M. Gupta, manager, (accounts) to whom, the accused persons represented him one of the partner in the accused firm. I can not answer the fact whether any document was tendered by the accused firm showing the accused no. 2 as its partner at the inception of business, without verifying it from Mr. Katyal......"
"......I was not party to the person interaction between the functionalies of the complainant company and the accused persons including accused no. 2 as I was not in employment or otherwise engaged in the commercial transaction of the company....."
14. The complainant did not examine Mr. Ravinder Katyal or Shri Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 5 of 8 R.M. Gupta to prove that the accused no. 2 was personally involved in the transaction executed between the complainant company and accused firm. From the above mentioned testimony of CW1, it is proved that CW1 has neither personal knowledge about the transactions executed between complainant company and accused firm nor have personal knowledge about the involvement of accused no. 2 into day to day affairs of accused no. 1 firm.
15. Moreover, accused examined Mr. Jaya Kumar from Corporation Bank who produced and proved the account opening form along with relevant documents of accused firm which are Ex. DW1/1(colly.). In the account opening form, Ex. DW1/1 (colly.), account was opened in the name of M/s Srinivaas Shipping Services and Mr. Samrat Lehri had been shown as a proprietor of M/s Srinivaas Shipping Services. Mr. Samrat Lehri had signed the account opening form in the capacity of proprietor of M/s Srinivaas Shipping Services. Mr. Samrat Lehri also submitted a letter of proprietorship while opening the account with Corporation Bank wherein, he showed himself as a sole proprietor of M/s Srinivaas Shipping Services.
16. From the above discussion, it is proved that M/s Srinivaas Shipping Services is a sole proprietorship firm and neither a partnership firm nor a company. It is also proved that the accused no. 2 Mr. Mohana Chandraran has no concern with M/s Srinivaas Shipping Services.
17. Section 141 NI Act Offence by companies.-(1) If the person committing an offence under Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 6 of 8 section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to the guilty of the offence and shall be liable to be proceeded against and punished accordingly:
Provided that nothing contained in this sub-section shall render any person liable to punishment if he proves that the offence was committeed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence:
Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for prosecution under this chapter.
(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has been committed by a company and 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, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
18. Under the provisions of section 141 NI Act, only a director of a company or a partner of a partnership firm who is involved into day to day affairs of company/firm can be held vicariously liable for the liability of said company/firm. In the present case, it is proved that accused no. 2 is neither a director nor a partner in the accused no. 1 firm as alleged by the complainant in its complaint. Therefore, Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 7 of 8 accused no. 2 can not be held vicariously liable for the liability of accused no. 1 firm.
19.The proceedings against accused no. 3 had already been abated vide order dated 15.01.2010. Accused no. 3 was a sole proprietor of accused no. 1 firm. The sole proprietorship firm has no separate legal entity other than from its proprietor. Once, the proceeding against the sole proprietor stood abated then, the proceedings against the sole proprietorship automatically stands abated. Conclusion
20. In view of the aforesaid findings, the proceedings against accused no. 1 (proprietorship firm) stands abated in terms of order dated 15.01.2010. The court is of the considered opinion that accused no. 2 is able to adduce a probable defence in his favour that he has no concern with accused no. 1 firm and rebut the presumption u/s 139 of Negotiable Instruments Act successfully. The onus to prove the legal liability of the accused no.2 shifts back to the complainant, which the complainant has failed to discharge. Hence, accused no. 2 is acquitted for the offence u/s 138 N.I. Act.
Announced in the open court (Gagandeep Jindal) on 21.04.2016 MM(N.I. Act):SED: Saket Courts, New Delhi Indair Carrier Vs. Srinivaas Shipping Services & Ors. page 8 of 8