Delhi District Court
Mamta Suri vs M/S. Morgan Securities & Credit Pvt. Ltd on 29 January, 2019
IN THE COURT OF SHRI NARESH KUMAR MALHOTRA
ASJ/SPECIAL JUDGE, CBI02, NEW DELHI DISTRICT,
PATIALA HOUSE COURTS, NEW DELHI
Cr. Revision No. 506/2018
In the matter of:
Mamta Suri,
W/o Shri K.B. Suri,
C40, Anand Niketan, New Delhi.
....Revisionist.
Versus
M/s. Morgan Securities & Credit Pvt. Ltd.
53, Friends Colony (East), New Delhi65
Through its Authorised Representative
Shri Mahender Gautam.
.....Respondent.
Date of Institution : 10.10.2018
Date of Arguments : 24.01.2019
Date of Decision : 29.01.2019
Cr. Revision No. 540/2018
In the matter of:
K.S. Mehta,
S68, Panchsheel Park,
New Delhi110017
CR Nos. 506/18, 540/18 & 558/18.
1 of 16
07.01.2017
....Revisionist.
Versus
M/s. Morgan Securities & Credit Pvt. Ltd.
53, Friends Colony (East), New Delhi65
Through its Authorised Representative
Shri Mahender Gautam.
.....Respondent.
Date of Institution : 02.11.2018
Date of Arguments : 24.01.2019
Date of Decision : 29.01.2019
AND
Cr. Revision No. 558/2018
In the matter of:
Basant Kumar Goswami
F4, Kailash Colony,
New Delhi.
....Revisionist.
Versus
M/s. Morgan Securities & Credit Pvt. Ltd.
53, Friends Colony (East), New Delhi65
Through its Authorised Representative
Shri Mahender Gautam.
.....Respondent.
Date of Institution : 10.10.2018
CR Nos. 506/18, 540/18 & 558/18.
2 of 16
07.01.2017
Date of Arguments : 24.01.2019
Date of Decision : 29.01.2019
JUDGMENT
1. Vide this common judgment, I shall decide revision petition bearing No. 506/18 titled as "Mamta Suri Vs. Morgan Securities & Credit Pvt. Ltd", CR No.540/2018 titled as "K.S. Mehta Vs. M/s. Morgan Securities and Credit Pvt. Ltd." and CR No. 558/18 titled as "Basant Kumar Goswami Vs. M/s. Morgan Securities & Credit Pvt. Ltd." against the order dated 10.10.2018 passed by Ld. MM05, PHC, New Delhi, vide which Ld. Trial Court has held that prima facie case under Section 138 NI Act is made out against the petitioners/accused in CC No. 15857/17. All the revision petitions are being decided together as all the revision petitions are arising out of the same order dated 10.10.2018.
2. Aggrieved by the order dated 10.10.2018 , the petitioners have filed the revision petitions on the grounds that the petitioner Mamta Suri was NonExecutive Director, petitioner Basant Kumar Goswami was Independent NonExecutive Director and petitioner K.S. Mehta was Independent NonExecutive Director of the accused company and they are/were not responsible for the day to day conduct of the business of CR Nos. 506/18, 540/18 & 558/18.
3 of 16 07.01.2017 accused company. The impugned order for framing of notice qua the petitioners is bad in law due to non fulfillment of the essential ingredients of Section 141 N.I. Act. The petitioners have been falsely implicated as petitioner Mamta Suri was NonExecutive Director, petitioner Basant Kumar Goswami was Independent NonExecutive Director and petitioner K.S. Mehta was Independent NonExecutive Director of the accused company. It is mentioned that there must be some substantial material to show how the said person is incharge and responsible for the day to day conduct of the business of the company and the role played by them in the alleged transaction. Ld. Trial Court has passed the impugned order in mechanical manner. The complainant has not mentioned that accused was Incharge of for the conduct of the business of the company, which is a requirement for offence to be made out under Section 141 NI Act. There is no averments in the complaint as to how the petitioners Mamta Suri i.e. accused no. 2, Basant Kumar Goswami i.e. accused no. 3 and K.S. Mehta i.e. accused no. 4 are involved in the conduct of business of accused no. 1 company. It is the duty of the Magistrate to find out whether the complainant has shown that accused persons falls into one of the categories of persons envisaged in Sec. 141. The onus is on the complainant to make out prima facie case i.e. to show that accused was at the time of commission of the offence was in charge of and responsible for the day to day affairs of CR Nos. 506/18, 540/18 & 558/18.
4 of 16 07.01.2017 the company. It is mentioned that presummoning evidence affidavit is not proper. It is also mentioned that photocopies of documents have been exhibited during pre summoning evidence and notice cannot be framed. It is prayed that revision petitions be allowed and order dated 10.10.2018 be set aside.
3. No reply to the revision petitions has been filed by Ld. counsel for respondent.
4. I have heard Ld. counsel for the petitioner and Ld. counsel for the respondent at length and perused the records of this court as well as of Trial Court very carefully.
5. Ld. counsel for the respondent has filed written arguments averring that the revision petitions are abuse of process of law and are filed only to delay the trial which has been stalled by the accused persons for the last 15 years by filing different frivolous applications and revisions. The petitioners have not approached this court with clean hands and concealed the orders dated 09.01.2017 and 28.08.2018 passed by Hon'ble High Court of Delhi directing the trail court to complete the trail and pronounce the final judgment within 1 year. The petitioners have also concealed the order CR Nos. 506/18, 540/18 & 558/18.
5 of 16 07.01.2017 dated 30.05.2018 passed by Ld. Revisionist Court dismissing the revision preferred by the petitioners against the order dated 01.02.2018. The present revision petitions are not maintainable as by way of present revision petitions the petitioners are seeking discharge in a summon trial which is not permissible. Admittedly the summons have been issued in this case way back in 2005 and the said summoning order has not been challenged either by way of revision or by way of petition under Section 482 of Cr.P.C, therefore, the summoning order has attained finality. There is no question of seeking discharge that too after 15 years in a case which is a summons trial having no statutory provision of discharge under Chapter XX of Cr.P.C. The revision petitions are without any merits. It is mentioned that pleas taken by the petitioners are the defence of the accused which needs to be proved during trial and not a ground of either dropping of proceeding or discharge. The accused persons filed an application under Section 219 & 220 of Cr.P.C claiming for a joint trial before the Ld. Trial Court. This application was rejected by Ld. MM and revision petition was also dismissed by Ld. ASJ. The present revision petitions have been filed to delay the trial. As per Section 138 NI Act, if a cheque has been issued by a company, then anyone who was incharge and responsible for the day to day affairs of the company is liable for prosecution under Section 141 of NI Act. The language of Section 141 NI Act is very clear. It is mentioned that CR Nos. 506/18, 540/18 & 558/18.
6 of 16 07.01.2017 specific averments have been made in this regard in para Nos. 2,4,5,6,8,9,11 & 12 and the averments made in these paras clear covers the mandate of Section 141 as being laid down by Hon'ble Supreme Court by way of its numerous judgments. It is prayed that revision petitions be dismissed.
6. Ld. counsel for the petitioners has vehemently contended that revision petitions against the order of framing of notice is maintainable and he has placed reliance on judgments:
(i) URRSHILA KERKAR Vs. MAKE NY TRIP (INDIA) PRIVATE LIMITED, Crl. M.C. No. 2598/2012 and Crl. M.A. No. 13279/2012.
(ii) Krishna Kumar Variar Vs. Share Shoppe, 2010 [12] SCC 485
(iii) Bhushan Kumar and Anr. Vs. State (NCT of Delhi) and Anr., 2012 [5] SCC 424.
(iv) Ambika Plastopack Pvt. Ltd. & Anr. Vs. State & Anr., 2014 [206] DLT 244
(v) Lilliput Kidswear Ltd. and Ors. Vs. Nahar Industrial Enterprises, Crl. M.C. 4706/2013.
(vi) Anand J. Datwani Vs. Geeti Bhagat Datwani, Crl. M.C. No. 3098/2008
(vii) Arvind Kejriwal & Ors. Vs. Amit Sibal & Anr. (Delhi), 2014[1] JCC 229.
CR Nos. 506/18, 540/18 & 558/18.
7 of 16 07.01.2017
(viii) SBQ Steels Ltd. and Ors. Vs. Goyal MG Gases Pvt. Ltd., Crl. M.C. 2950/2013.
On the other hand, Ld. counsel for the respondent submits that revision petitions are not maintainable as there is no provisions in the Cr.P.C to discharge the accused in summons trial and Ld. counsel for the respondent has placed reliance on following judgments:
(i) M/s. Asian Fans & Appliances Vs. Usaka Industrial reported in (2009 Cri. L.J. 4083).
(ii) R.K. Aggarwal & Ors. Vs. Madan Lan Nassa reported in MANU/DE/ 2529/2016.
(iii) Amit Sibal Vs. Arvind Kejriwal & Ors. reported in MANU/SC/ 1630/2016.
(iv) Subramanium Sethuraman Vs. State of Maharashtra & Ors., 2004 (13) SCC 324.
(v) Food Inspector Vs. K.P. Alavikutty reported in (1987 Cri.L.J 1298).
(vi) Tanjit Singh Vs. Jugraj Singh, CR No. 758/2001
(vii) G. Chandrasekaran Vs. C.R. Umapathy reported in MANU/TN/ 1051/2004.
(viii) Kuamr Vs. Perumal 1997 Cri.L.J. 907 I have perused the judgments relied upon by Ld. counsel for CR Nos. 506/18, 540/18 & 558/18.
8 of 16 07.01.2017 petitioner and Ld. counsel for respondent with utmost regard. As per judgments, relied upon by Ld. counsel for the petitioners, I am of the view that Hon'ble High Court in various pronouncement has directed the Trial Courts to dealt with the pleas raised by the petitioner at the time of hearing arguments on notice under Section 251 Cr.P.C. Ld. counsel for the petitioner has placed reliance on judgment titled as "SBQ STEELS LTD AND ORS VS GOYAL MG GASES PVT. LTD." Crl. M.C. 2950/2013 and in this judgment reliance is placed on judgment titled as "Bhushan Kumar and Anr. Vs. State (NCT of Delhi) and Anr." In view of the judgments relied upon by Ld. counsel for the petitioners, I am of the view that revision petition against the order of framing of notice is maintainable.
7. Now, the question arises whether the order passed by Ld. MM ordering to frame notice under Section 251 Cr.P.C against the petitioners is as per law or not. It is to be seen whether the complainant in the complaint has mentioned that the petitioners are responsible for day to day affairs of the company or not.
If we peruse the para no. 2 of the complaint, it is mentioned that accused no. 2 with the consent of accused nos. 3 to 6 (present petitioners) on behalf of accused no. 1 has approached complainant CR Nos. 506/18, 540/18 & 558/18.
9 of 16 07.01.2017 company for the financial assistance for business purposes by way of Inter Corporate Deposit (ICD) facility with a promise to repay back the money of the ICD as per the terms mutually agreed and reduced in writing by way of an Inter Corporate Deposit Agreement dated 09.09.2002.
In para no. 4 of the complaint, it is mentioned that complainant company has extended the financial assistance to accused no. 1 company to the tune of Rs. 5 crores according to the usual prevailing corporate convention and believing and acting upon promises of the accused persons. Accused no. 2 is the Managing Director and Authorized Signatory, Accused No. 3 to 5 are the Directors and accused no. 6 is the authorized signatory of the company, who are incharge of day to day affairs and are responsible for the conduct of the business of the accused no. 1 company and for all acts and deeds committed by or on behalf of accused no. 1 company.
In para no. 5 of the complaint it is mentioned that in compliance of the above said award and as per terms of the compromise/ Memorandum of Settlement dated 27.05.2003 and accused no. 2 on behalf of accused no. 1 with the consent and knowledge of accused no.
CR Nos. 506/18, 540/18 & 558/18.
10 of 16 07.01.2017 3 to 6 have signed and issued several cheques and most of them were got dishonour. Accused no. 2 on behalf of the accused no. 1 with the consent of the accused no. 3 to 6 in the part payment of the outstanding bill had issued cheque no. 842629 dated 30.03.2005 amounting to Rs. 50 lacs drawn on ICICI Bank Ltd. Connaught Place, New Delhi.
In para no. 11 of the complaint, it is mentioned that accused no. 2 is the Managing Director and authorized signatory and accused Nos. 3 to 6 are the Directors of accused no. 1 company are incharge of and are responsible to the company for the conduct of business and day to day affairs and management of the company and all accused persons have consented, connived and neglected to make repayment and dishonouring of the said cheque and are liable for that offence.
8. Ld. counsel for the petitioner has vehemently contended that petitioner Mamta Suri was NonExecutive Director, petitioner Basant Kumar Goswami was Independent NonExecutive Director and petitioner K.S. Mehta was Independent NonExecutive Director of the accused no. 1 company and cheque is not issued by any of the Directors. It is also contended that it is specifically not mentioned in the complaint that these Directors are responsible for the day to day affairs of the company so no CR Nos. 506/18, 540/18 & 558/18.
11 of 16 07.01.2017 notice can be framed against the petitioners. Ld. counsel for the petitioner has placed reliance on judgments:
(i) S.M.S. Pharmaceuticals Ltd. Vs. Neeta Bhalla and Anr., 2005 III AD (CR.) SC 593.
(ii) Raminder Kaur Narula & Anr. Vs. Prem Chemicals P. Ltd. Cri.M.C 2690/2004.
(iii) Smt. Vidyawati Kanodia Vs. Local Health Authority, 2002 Cr.L.J. 471
(iv) Pepsi Food Ltd. and Anr. Vs. Special Judicial Magistrate and Ors. 1998 SCC (Cri.) 1400
(v) Sudeep Jain Vs. M/s. ECE Industries, 2013[201] DLT 461
(vi) Jwala Devi Enterprises P. Ltd. Vs. Fadi El Jaouni, Crl.M.C. 3257/16 & Crl.M.A. 13910/2016
(vii) Nandakumar & Ors. Vs. M/s. ECE Industries Ltd., Appeal No. 2770/13.
(viii) Sonia Mittal Vs. Yogshri Chemicals Pvt. Ltd., Crl.M.C. 4213/2016 and Crl.M.A. 1754117542/2016 Ld. counsel for the petitioners has also placed reliance on judgment titled as "Ashoke Mal Bafna Vs. Upper India Steel Manufacturing and Engineering Company Limited" (2018) 14 SCC 202. I have perused this judgment. In this judgment, it is held that " To fasten vicarious liability CR Nos. 506/18, 540/18 & 558/18.
12 of 16 07.01.2017 under Section 141 of the Act on a person, the law is well settled by this Court in a catena of cases that the complainant should specifically show as to how and in what manner the accused was responsible. Simply because a person is a Director of a defaulter Company, does not make him liable under the Act. Time and again, it has been asserted by this Court that only the person who was at the helm of affairs of the Company and in charge of and responsible for the conduct of the business at the time of commission of an offence will be liable for criminal action". As per this judgment, the petitioner has resigned as director with effect from 02.01.2006 and the fact of his resignation has been furnished by Form 32 to the Registrar of Companies on 24.03.2006 in conformity with the rules and the cheques were bounced on 24.08.2006.
In the present case, the petitioners have not resigned from the post of NonExecutive Director and Independent NonExecutive Directors. Thus, this judgment is not helpful to the petitioner. There are specific averments in the complaint by the complainant that the petitioners were responsible for day to day affairs of accused no. 1 company.
On the other hand, Ld. counsel for the respondent has contended that there are specific averments in the complaint that petitioners are responsible for day to day affairs of accused no. 1 company. He has CR Nos. 506/18, 540/18 & 558/18.
13 of 16 07.01.2017 placed reliance on judgment which are as under:
(i) N. Rangachari Vs. B.S.N.L, MANU/SC/7316/2017
(ii) K.K. Ahuja Vs. V.K. Vora & Anr., 2009 (10) SCC 48
(iii) Gunmala Sales Pvt. Ltd. Vs. Anu Mehta, MANU/SC/0959/2014
(iv) Standard Chartered Bank Vs. State of Maharashtra & Ors., 2016(6) SCC 62.
Ld. counsel for the respondent has also placed reliance on recent judgment titled as "Sh. Somendra Khosla & Ors. Vs. State & Anr." passed by Hon'ble High Court of Delhi on 09.01.2019. In this judgment the Hon'ble High Court has held that " Quashing of aforesaid complaints and the summoning order of 16th August, 2016 is sought on the ground that petitioners are independent directors and are not incharge of day to day business of the MIC Electronics Limited" . In this judgment, it is also held that "Learned counsel for respondents Complainant No. 2 has drawn attention of this Court to paragraphs no. 26, 31 and 32 of the decision in Standard Chartered Bank (Supra) to submit that in the complaints in question, there are allegations against petitioners being responsible for day to day functioning /business of accused company i.e. MIC Electronics Limited". In this judgment, it is also held that "Upon hearing and on perusal of the impugned CR Nos. 506/18, 540/18 & 558/18.
14 of 16 07.01.2017 complaints, summoning order and the decision cited, I find that Supreme Court in Standard Chartered Bank (Supra) has permitted summoning of the directors of accusedcompany, who were incharge of day to day business of the accusedcompany. Since there are allegations against petitioners of being responsible for day to day functioning of business of accusedcompany, therefore, in the considered opinion of this Court, no case for quashing complaint and summoning order is made out".
As I observed in para no. 7 of this judgment that complainant has specifically mentioned that accused no. 2 is the Managing Director and Authorized Signatory, Accused No. 3 to 5 are the Directors and accused no. 6 is the authorized signatory of the company, who are incharge of day to day affairs and are responsible for the conduct of the business of the accused no. 1 company and for all acts and deeds committed by or on behalf of accused no. 1 company. Taking into consideration that complainant has specifically averred in para no. 5 of the complaint that accused no. 2 on behalf of the accused no. 1 with the consent of the accused no. 3 to 6 in the part payment of the outstanding bill had issued cheque no. 842629 dated 30.03.2005 amounting to Rs. 50 lacs drawn on ICICI Bank Ltd. Connaught Place, New Delhi and taking into consideration that in para no. 11 of the complaint, the CR Nos. 506/18, 540/18 & 558/18.
15 of 16 07.01.2017 complainant has clearly mentioned that accused Nos. 3 to 6 are the Directors of accused no. 1 company are incharge of and are responsible to the company for the conduct of business and day to day affairs and management of the company and all accused persons have consented, connived and neglected to make repayment and dishonouring of the said cheque and are liable for that offence. I am of the view that complainant has specifically mentioned the roles of the petitioners in the complaint.
9. In view of the above discussions, I am of the view that there is no illegality or infirmity in the order dated 10.10.2018 passed by Ld. MM in CC No. 15857/17. Ld. Trial Court has passed a reasoned order. The revision petitions filed by the petitioners are without any merits and same are hereby dismissed. Trial Court Record be sent back with copy of common judgment. Revision files be consigned to Record Room, after necessary compliance.
Announced in Open Court (N.K. Malhotra)
on 29.01.2019. Spl. Judge, CBI02,
New Delhi District, PHC.
Digitally
signed by
NARESH
NARESH KUMAR
KUMAR MALHOTRA
MALHOTRA Date:
CR Nos. 506/18, 540/18 & 558/18. 2019.01.29
17:08:00 16 of 16
07.01.2017 +0530