Delhi District Court
Mr Karori Mal Saxena Directorsaxena ... vs M/S Shahi Exports Pvt. Ltd on 17 September, 2024
IN THE COURT OF SH. LOVLEEN, ADDITIONAL SESSIONS
JUDGE-03, SAKET COURTS, NEW DELHI
DLSE010084132024
Crl. Rev. No. 469/2024
KIRORI MAL SAXENA
Director - M/S MAHABALI CARGO MOVERS PVT. LTD.
Having Office at:
C-86-87, Site No. C-1,
Bulandshahr Road Industrial Area,
Ghaziabad,
Uttar Pradesh-201001
...Revisionist
Versus
1. M/S SHAHI EXPORTS PVT. LTD.
Through Its Directors
Having its registered Office at:
F-88, Okhla Industrial Area,
Phase-1, South East,
Delhi-110020
2. VINOD KUMAR BHARADWAJ
Director - M/s. Shahi Exports Pvt. Ltd.
F-88, Okhla Industrial Area,
Phase-1, South East,
Delhi-110020
...Respondents
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 1/20
Date of institution : 16.08.2024
Date of reserving the order : 17.09.2024
Date of pronouncement : 17.09.2024
JUDGMENT
1. This is a revision petition u/s 438/440 of BNSS against order dated 28.02.2024 passed by Ld. Metropolitan Magistrate (NI Act), Digital Court-01, South East, Saket in CC No. 2565/2023 titled "Shahi Exports Pvt. Ltd. Vs. Saxena Marine Tech Pvt. Ltd." whereby the revisionist was summoned to face trial for the commission of an offence punishable u/s 138 Negotiable Instruments Act (hereinafter referred to NI Act). The said complaint was filed by the respondent herein.
Brief Facts
2. Briefly stated, the case put forth by the respondent against the revisionist and others (including a company namely M/s. Saxena Marine Tech Pvt. Ltd.) in the said complaint is that the cheque(s) issued by the said company in its favour was dishonoured upon presentation. The said company and its Directors were served a legal notice demanding the payment due under the said cheque(s), but no response was received. Consequently, the above mentioned complaint was filed against the said company as well as its four Directors including the revisionist.
Grounds of Revision
3. The grounds cited by the revisionist are as under:-
A. That the learned trial Court while passing the impugned order has completely ignored and failed to Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 2/20 appreciate established as well as statutory law and the law laid down by Hon'ble Supreme Court of India and various High Courts which warrants that if there is no material on record to connect a person then merely on the basis of surmises or conjectures a person cannot be put to trial to suffer on account of unnecessary trial. B. That the learned trial Court has completely ignored and failed to appreciate that no prima facie case is made out against the petitioner and thus he deserves to be discharge.
C. That learned Trial Court committed material irregularity while summoning the petitioner, only on the basis that the other petitioner /accused No.3 is merely the silent/sleeping director of the company/ accused No.1 and it is submitted that the petitioner herein is neither the active director of the accused company nor involved or engaged in day to day affairs of the company/ accused No.1 and there is no liability qua the petitioner and even otherwise there is no material on record even to remotely connect the petitioner from the commission of alleged offence.
D. It is pertinent to mention here that the petitioner/accused No.3 is active Director in M/s. Mahabali Cargo Movers Pvt. Ltd., and a silent Director in M/S Saxena Marine Tech Pvt. Ltd. The petitioner / accused No.3, is only concerned with the day to day affairs of the M/S Mahabali Cargo Movers Pvt. Ltd. and Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 3/20 not of the accused No. 1 / company in the complaint filed by the plaintiff. It is further submitted that the petitioner has neither signed the said cheque in question nor any direct allegations are their against the petitioner/accused No.3 in the whole complaint filed by the respondent/complainant.
E. That the impugned order is illegal, bad in law, perverse and violating of established and statutory principle of laws and thus the same is liable to be set aside.
F. That the Ld. Trail court has failed to appreciate that it is the settled law that the liability for an offence punishable under section 138 read with section 141 of the NI Act, 1881 will not arise by merely stating that the accused persons hold some designations in the accused company or by merely reproducing the section 141 of the act in the complaint. It is settled law that the complainant has to make specific averments in the complaint as to how in what manner the person accused of the offence under section 138 of NI Act was responsible or had a role in the conduct of the business of the accused company at the relevant time and actively engaged in the day to day affairs of the accused company. A mere fact that the accused persons was a director or was holding some other office in the company or is a silent/sleeping director of the company cannot make a person vicarious liable to face the prosecution as per the mandate of Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 4/20 section 141 of NI Act.
G. That the Ld. Trial court while issuing the summons to the petitioner had failed to appreciate that the complaint filed by the Respondent No. 1 is completely silent about the role of the petitioner in the conduct of the business of the respondent no. 2 at the time of placing the purchase order, at the time of execution of memorandum of understanding, and further dealings in between the complainant. Moreover, the petitioner was/is neither the signatory of the cheque in question nor participated in any deal with the respondent no.1 nor entered into any alleged MOU. It is further submitted that the petitioner herein is having no concern with the company/ accused No.1.
H. That the Ld. Trial court has failed to appreciate the law propounded by Hon'ble High Court of Delhi in CRL. M.C 1821/2013 entitled 'Sudeep Jain Versus M/S ECE Industries Ltd., wherein the Hon'ble High Court of Delhi has held that "Section 141 of NI Act is penal provisions creating vicarious liability and which as per settled law must be strictly construed. It is therefore, not sufficient to make a bald cursory statement in a complaint and that the director (arrayed as an accused) was incharge of and responsible of the conduct of the company. The complainant should spell out as to how and in what manner the petitioner was incharge or was responsible towards the accused company for the conduct of its Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 5/20 business." In the present case the entire complaint of the complainant is silent to this aspect and hence, the order for summoning the petitioner is liable to be set aside/quashed.
I. That the Ld. Trial court has failed to appreciate that the respondent no. 1 herein on the basis of almost similar verbatim story has filed total five cases and out of the said five cases the complainant/respondent No.1 has made all four directors party in 4 cases and only 1 director in one case, though the dealing's as alleged by the respondent No. 1/ complainant and accused persons are same with all five cheques and hence in all the complaints the contradictory memo of parties clearly proves in volume that all the complaints are false and has been filed by the complainant.
J. That the Ld. Trial court has failed to appreciate that on the one hand the respondent no. 1/accused is stating that all the dealings and MOU were agreed and signed by the accused no.2 on behalf of the accused no.1 and on the other hand the respondent No.1/complainant is involving every other director in the present matter. K. For that the Ld. Trial Court has failed to appreciate that no offence is made out against the petitioner at all for number of reasons including that there is nothing on record which may show that the petitioner was directly involved in the dealings with the respondent no.1 or actively engaged in the day to day affairs of the Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 6/20 company/ accused No.1. It was held by Hon'ble High Court of Delhi in 2009 (156) DLT 415 entitled "Manish Kant Aggarwal Versus National Agricultural Co- operative Marketing Federation of India Ltd. and Ors.", wherein it was held by the Hon'ble High Court of Delhi that "complaint qua dishonor of cheque - criminal liability of the offence enshrined in section 138 NI Act is squarely upon the person who has drawn the cheque alone is maintainable. The first pre requisite to maintain a complaint against any director or other functionaries of the company is to disclose sufficiently in the complaint as to how the company is liable and then only the director and other functionaries of the company can be made liable for the conduct of the business of the company and thereafter the other question would arise as to which of the directors and other functionaries of the company were responsible for the conduct and affairs of the business of the company.
L. That the Ld. Trial court is failed to appreciate the law propounded the Hon'ble Apex court in "SMS Pharmaceuticals Ltd. Versus Neeta Bhalla and Anr." (2007) 4 SCC 70, wherein it was held by the Hon'ble Supreme Court of India that it is necessary to specifically aver in the complaint under section 141 that at the time of offence was committed, the person accused was incharge of and responsible for conduct of business of the company. This averment is an essential requirement Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 7/20 of section 141 and has to be made in complaint. Without this averment being made in a complaint, the requirements of section 141 cannot be set aside. In catena of decisions passed by Hon'ble Supreme Court of India and various Hon'ble High Courts it was held that for making the directors liable for the offences committed by the company under section 141 of the Act, there must be specific averments against the directors showing as to how and in what manner the directors were responsible for the conduct of the business of the company and hence the order dated 28.02.2024 summoning the petitioner to face the trial is liable to be set aside/quashed.
M. That the learned Trial Court has completely failed to appreciate the judgment propounded by the Hon'ble Supreme Court of India in case cited as AIR 1977 SC 796 wherein, it was held that "mere conjecture and surmises cannot substitute the proof."
N. That the Ld. Trail court while passing the impugned order has failed to appreciate that in the other complaints filed by the respondent no. 1 pending before the same Trail court, vide order dated 07.08.2023 out of the total 5 accused the Ld. Trial court had summoned only two accused No 1 & 2, i.e. Whereas in the present complaint the Ld. Trial court without applying judicial mind and without considering the facts and circumstances that FORM 32 and company master Data are not annexed as Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 8/20 updated, summoned all the accused persons arrayed in the complaint without assigning any reason.
O. For that the Ld. Trail court has failed to appreciate the law propounded by the Apex Court in M/S Pepsi Food Ltd. and Anrs. Vs Sub Judicial Magistrate and Anrs. 1998 (5) SCC 749 and Amarnath Vs State of Haryana 1977 (4) SCC 137, the hon'ble apex court had observed that "summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and law applicable thereto. He has to examine the nature if allegations made in the complaint and the evidences both oral and documentary in support thereof and would that be sufficient for the complainant to succeeded in bringing charge home to the accused. It is not that the magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. Magistrate has to carefully scrutinize the evidence brought on record and may even himself put question to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine of any offence is Prima Facie committed by all or any of the accused." Mere Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 9/20 perusal of the impugned order it clearly reveals that the Ld. Trail court has not applied her judicial mind while summoning the accused persons and has ignored the established law propounded by the Hon'ble Supreme Court of India and various other High Courts including our own Hon'ble High Court and hence on this sole reason the impugned order dated 28.02.2024 is liable to be set aside / quashed.
P. That the complaint file by the complainant / respondent No. 1 is totally misconceived and filed with ulterior motives and the petitioner has been arrayed in order to pressurize the petitioner to squeeze money. Q. There are other factors and reasons also which renders the impugned order liable to be quashed / set aside.
4. It is prayed that the order dated 28.02.2024 may be set aside.
Arguments of Respondent.
5. None has appeared for the respondent despite service.
Decision
6. This Court has considered the rival submissions. The law regarding the liability of directors of a company was dealt with and expounded by the Hon'ble Supreme Court firstly in S.M.S. Pharmaceuticals Ltd. vs. Neeta Bhalla and Another, (2005) 8 SCC 89. The relevant part of the observations is reproduced below :-
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 10/20 "...(a) It is necessary to specifically aver in a complaint under Section 141 that at the time the offence was committed, the per- son accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential require- ment of Section 141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of Section 141 cannot be said to be satisfied.
(b) ...Merely being a director of a company is not sufficient to make the person liable under Section 141 of the Act. A director in a company cannot be deemed to be in charge of and responsi-
ble to the company for conduct of its business. The requirement of Section 141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as there is no deemed liability of a director in such cases.
(c) ...The question notes that the Managing Director or Joint Managing Director would be admittedly in charge of the com- pany and responsible to the company for conduct of its business. When that is so, holders of such positions in a company become liable under Section 141 of the Act. By virtue of the office they hold as Managing Director or Joint Managing Director, these persons are in charge of and responsible for the conduct of busi- ness of the company. Therefore, they get covered under Section
141. So far as signatory of a cheque which is dishonoured is concerned, he is clearly responsible for the incriminating act and will be covered under sub-section (2) of Section 141..."
7. In K.K.Ahuja V. V.K. Vohra (2009) 10 SCC 48, the Hon'ble Supreme Court had summarised the position under Section 141 as under:
"20. The position under section 141 of the Act can be summa- rized thus :
(i) If the accused is the Managing Director or a Joint Managing Director, it is not necessary to make an averment in the com-
plaint that he is in charge of, and is responsible to the company, for the conduct of the business of the company. It is sufficient if an averment is made that the accused was the Managing Director or Joint Managing Director at the relevant time. This is because the prefix `Managing' to the word `Director' makes it clear that Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 11/20 they were in charge of and are responsible to the company, for the conduct of the business of the company.
(ii) In the case of a director or an officer of the company who signed the cheque on behalf of the company, there is no need to make a specific averment that he was in charge of and was re- sponsible to the company, for the conduct of the business of the company or make any specific allegation about consent, con- nivance or negligence. The very fact that the dishonoured cheque was signed by him on behalf of the company, would give rise to responsibility under sub-section (2) of Section 141.
(iii) In the case of a Director, Secretary or Manager (as defined in Sec. 2(24) of the Companies Act) or a person referred to in clauses (e) and (f) of section 5 of Companies Act, an averment in the complaint that he was in charge of, and was responsible to the company, for the conduct of the business of the company is necessary to bring the case under section 141(1). No further averment would be necessary in the complaint, though some par- ticulars will be desirable. They can also be made liable un- der section 141(2) by making necessary averments relating to consent and connivance or negligence, in the complaint, to bring the matter under that sub-section.
(iv) Other Officers of a company can not be made liable under sub-section (1) of section 141. Other officers of a company can be made liable only under sub-section (2) of Section 141, be averring in the complaint their position and duties in the com- pany and their role in regard to the issue and dishonour of the cheque, disclosing consent, connivance or negligence..."
8. On similar lines, the Hon‟ble Apex Court in National Small Industries Corp. Ltd. V. Harmeet Singh Paintal (2010) 3 SCC 330 carved out the following principles:
"39. From the above discussion, the following principles emerge:
(i) The primary responsibility is on the complainant to make spe-
cific averments as are required under the law in the complaint so as to make the accused vicariously liable. For fastening the crim-
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 12/20 inal liability, there is no presumption that every Director knows about the transaction.
(ii) Section 141 does not make all the Directors liable for the of- fence. The criminal liability can be fastened only on those who, at the time of the commission of the offence, were in charge of and were responsible for the conduct of the business of the com- pany.
(iii) Vicarious liability can be inferred against a company regis- tered or incorporated under the Companies Act, 1956 only if the requisite statements, which are required to be averred in the complaint/petition, are made so as to make the accused therein vicariously liable for offence committed by the company along with averments in the petition containing that the accused were in charge of and responsible for the business of the company and by virtue of their position they are liable to be proceeded with.
(iv) Vicarious liability on the part of a person must be pleaded and proved and not inferred.
(v) If the accused is a Managing Director or a Joint Managing Director then it is not necessary to make specific averment in the complaint and by virtue of their position they are liable to be proceeded with.
(vi) If the accused is a Director or an officer of a company who signed the cheques on behalf of the company then also it is not necessary to make specific averment in the complaint.
9. In S.P. Mani and Mohan Dairy vs. Dr. Snehlatha Elangovan 2022 SCC OnLine SC 1238, Hon'ble Supreme Court has reiterated the law as under :-
45. Once the necessary averments are made in the statutory notice issued by the complainant in regard to the vicarious liability of the partners and upon receipt of such notice, if the partner keeps quiet and does not say anything in reply to the same, then the com-
plainant has all the reasons to believe that what he has stated in the notice has been accepted by the noticee. In such circumstances what more is expected of the complainant to say in the complaint. ................................................................................. ......
47. Our final conclusions may be summarised as under:
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 13/20 a.) The primary responsibility of the complainant is to make spe- cific averments in the complaint so as to make the accused vicari- ously liable. For fastening the criminal liability, there is no legal re- quirement for the complainant to show that the accused partner of the firm was aware about each and every transaction. On the other hand, the first proviso to subsection (1) of Section 141 of the Act clearly lays down that if the accused is able to prove to the satisfac- tion of the Court that the offence was committed without his/her knowledge or he/she had exercised due diligence to prevent the commission of such offence, he/she will not be liable of punish- ment.
b.) The complainant is supposed to know only generally as to who were in charge of the affairs of the company or firm, as the case may be. The other administrative matters would be within the spe- cial knowledge of the company or the firm and those who are in charge of it. In such circumstances, the complainant is expected to allege that the persons named in the complaint are in charge of the affairs of the company/firm. It is only the Directors of the company or the partners of the firm, as the case may be, who have the special knowledge about the role they had played in the company or the partners in a firm to show before the court that at the relevant point of time they were not in charge of the affairs of the company. Ad- vertence to Sections 138 and Section 141 respectively of the NI Act shows that on the other elements of an offence under Section 138 being satisfied, the burden is on the Board of Directors or the officers in charge of the affairs of the company/partners of a firm to show that they were not liable to be convicted. The existence of any special circumstance that makes them not liable is something that is peculiarly within their knowledge and it is for them to establish at the trial to show that at the relevant time they were not in charge of the affairs of the company or the firm.
c.) Needless to say, the final judgement and order would depend on the evidence adduced. Criminal liability is attracted only on those, who at the time of commission of the offence, were in charge of and were responsible for the conduct of the business of the firm. But vi- carious criminal liability can be inferred against the partners of a firm when it is specifically averred in the complaint about the status of the partners 'qua' the firm. This would make them liable to face the prosecution but it does not lead to automatic conviction. Hence, they are not adversely prejudiced if they are eventually found to be not guilty, as a necessary consequence thereof would be acquittal.
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 14/20 d.) If any Director wants the process to be quashed by filing a peti- tion under Section 482 of the Code on the ground that only a bald averment is made in the complaint and that he/she is really not con- cerned with the issuance of the cheque, he/she must in order to per- suade the High Court to quash the process either furnish some ster- ling incontrovertible material or acceptable circumstances to sub- stantiate his/her contention. He/she must make out a case that mak- ing him/her stand the trial would be an abuse of process of Court.
48. We reiterate the observations made by this Court almost a decade back in the case of Rallis India Ltd v. Poduru Vidya Bhusan & Ors., (2011) 13 SCC 88, as to how the High Court should exer- cise its power to quash the criminal proceeding when such proceed- ing is related to offences committed by the companies. "The world of commercial transactions contains numerous unique intricacies, many of which are yet to be statutorily regulated. More particularly, the principle laid down in Section 141 of the NI Act (which is pari materia with identical sections in other Acts like the Food Safety and Standards Act, 2006; the erstwhile Prevention of Food Adulter- ation Act, 1954; etc.) is susceptible to abuse by unscrupulous com- panies to the detriment of unsuspecting third parties."
10. In Siby Thomas Vs. M/s. Somany Ceramics Ltd. 2023 Livelaw (SC) 869, Hon'ble Supreme Court has reiterated the law as under :-
9. Bearing in mind the averments made in the complaint in rela-
tion to the role of the appellant and subsection (1) of Section 141, we will have to appreciate the rival contentions. Going by the de- cision relied on by the respondent in S.P. Mani's case (supra) it is the primary responsibility of the complainant to make specific averments in the complaint, so as to make the accused vicari- ously liable. Relying on paragraph 47(b) of the said decision learned counsel appearing for the respondent would also submit that the complainant is supposed to know only generally as to who were in charge of the affairs of the company or firm, as the case maybe and he relied on mainly the following recitals there- under:
"47......
a.) ......
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 15/20 b.) The complainant is supposed to know only gener- ally as to who were in charge of the affairs of the company or firm, as the case may be. The other ad- ministrative matters would be within the special knowledge of the company or the firm and those who are in charge of it. In such circumstances, the com- plainant is expected to allege that the persons named in the complaint are in charge of the affairs of the company/firm."
10. We are of the considered view that the respondent has mis- read the said decision.Under the sub-caption 'Specific Averments in the complaint', in paragraph 41 and sub-paragraphs (a) and (d) as also in paragraph 42 thereof, it was held in the decision in S.P. Mani's case (supra) thus: -
"41. In Gunmala Sales Private Limited (supra), this Court after an exhaustive review of its earlier deci- sions on Section 141 of the NI Act, summarized its conclusion as under:-
"(a) Once in a complaint filed under Section 138 read with Section 141 of the NI Act the basic averment is made that the Director was in charge of and responsi-
ble for the conduct of the business of the company at the relevant time when the offence was committed, the Magistrate can issue process against such Direc- tor;
(b) ......
(c) ......
(d) No restriction can be placed on the High Court's powers under Section 482 of the Code. The High Court always uses and must use this power sparingly and with great circumspection to prevent inter alia the abuse of the process of the Court. There are no fixed formulae to be followed by the High Court in this re- gard and the exercise of this power depends upon the facts and circumstances of each case. The High Court at that stage does not conduct a mini trial or roving in- quiry, but nothing prevents it from taking unimpeach- able evidence or totally acceptable circumstances into Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 16/20 account which may lead it to conclude that no trial is necessary qua a particular Director."
42. The principles of law and the dictum as laid in Gunmala Sales Private Limited (supra), in our opin- ion, still holds the field and reflects the correct posi- tion of law."
11. In the light of the afore-extracted recitals from the decision in Gunmala Sales Private Limited v. Anu Mehta 1 , quoted with agreement in S.P. Mani's case (supra) and in view of sub-section (1) of Section 141 of the N.I. Act it cannot be said that in a com- plaint filed under Section 138 read with Section 141 of the N.I. Act to constitute basic averment it is not required to aver that the accused concerned is a person who was in charge of and respon- sible for the conduct of the business of the company at the rele- vant time when the offence was committed. In paragraph 43 of S.P. Mani's case (supra) it was held thus:
"43. In the case on hand, we find clear and specific averments not in the complaint but also in the statutory notice issued to the respondent."
It is thereafter that in the decision in S.P. Mani's case (supra) in paragraph 47 (a) it was held that the primary responsibility of the complainant is to make specific averments in the complaint so as to make the accused vicariously liable.
14. In view of the factual position relating the averments revealed from the complaint as aforesaid it is relevant to refer to the deci- sions relied on by the learned counsel appearing for the appel- lant. In the decision in Anita Malhotra's case (supra) in para- graph 22 it was held thus:-
"22. This Court has repeatedly held that in case of a Director, the complaint should specifically spell out how and in what manner the Director was in charge of or was responsible to the accused company for con- duct of its business and mere bald statement that he or she was in charge of and was responsible to the com- pany for conduct of its business is not sufficient. (Vide National Small Industries Corpn. Ltd. v. Harmeet Singh Paintal). In the case on hand, particu- larly, in Para 4 of the complaint, except the mere bald Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 17/20 and cursory statement with regard to the appellant, the complainant has not specified her role in the day-to- day affairs of the Company. We have verified the averments as regards to the same and we agree with the contention of Mr. Akhil Sibal that except repro- duction of the statutory requirements the complainant has not specified or elaborated the role of the appel- lant in the day-to-day affairs of the Company. On this ground also, the appellant is entitled to succeed."
15. Paragraph 19 of the Ashok Shewakramani's case (supra) is also relevant for the purpose of the case and it, in so far as rele- vant, reads thus:
"19. Section 141 is an exception to the normal rule that there cannot be any vicarious liability when it comes to a penal provision. The vicarious liability is attracted when the ingredients of subsection 1 of Sec- tion 141 are satisfied. The Section provides that every person who at the time the offence was committed was in charge of, and was responsible to the Company for the conduct of business of the company, as well as the company shall be deemed to be guilty of the of- fence under Section 138 of the NI Act. In the light of sub-section 1 of Section 141, we have perused the averments made in the complaints subject matter of these three appeals. The allegation in paragraph 1 of the complaints is that the appellants are managing the company and are busy with day to day affairs of the company. It is further averred that they are also in charge of the company and are jointly and severally li- able for the acts of the accused No.1 company. The re- quirement of sub-section 1 of Section 141 of the NI Act is something different and higher. Every person who is sought to be roped in by virtue of sub-section 1 of Section 141 NI Act must be a 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. Merely because somebody is managing the affairs of the company, per se, he does not become in charge of the conduct of the busi- ness of the company or the person responsible for the company for the conduct of the business of the com-
Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 18/20 pany. For example, in a given case, a manager of a company may be managing the business of the com- pany. Only on the ground that he is managing the business of the company, he cannot be roped in based on sub-section 1 of Section 141 of the NI Act. The second allegation in the complaint is that the appel- lants are busy with the day-to-day affairs of the com- pany. This is hardly relevant in the context of subsec- tion 1 of Section 141 of the NI Act. The allegation that they are in charge of the company is neither here nor there and by no stretch of the imagination, on the basis of such averment, one cannot conclude that the allegation of the second respondent is that the appel- lants were also responsible to the company for the conduct of the business. Only by saying that a person was in charge of the company at the time when the of- fence was committed is not sufficient to attract sub- section 1 of Section 141 of the NI Act."
11. Thus, the settled position of law is that for a Director of a company to be summoned u/s 138 NI Act r/w Section 141 NI Act, the record must reflect specific averments (against the said Director) as mentioned in the aforegoing citations.
12. A bare perusal of the Trial Court record reflects that the above said complaint filed under section 138 NI Act by respondent herein against Saxena Marine Tech Pvt. Ltd. and its Directors on account of dishonour of relevant cheque(s). A legal demand notice was sent by respondent to Saxena Marine Tech Pvt. Ltd. and its Directors seeking payment of funds due under the said cheque(s) before the filing of said complaint. Respondent also placed on record Form-32 pertaining to Saxena Marine Tech Pvt. Ltd., which reflects the name of revisionist herein as a Director (the fact that the revisionist is a Director in Saxena Marine Tech Pvt. Ltd. is not disputed by the Ld. Counsel before this Court either). Respondent has Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 19/20 averred categorically in the above said complaint that revisionist herein is a Director of Saxena Marine Tech Pvt. Ltd. and is incharge and responsible for day to day affairs of Saxena Marine Tech Pvt. Ltd. Witness Krishan Dutt Vashisth, whose affidavit was placed before the Ld. Magistrate in support of the above said allegations by respondent, has reiterated the above said facts in his affidavit.
13. Prima facie all the above facts were sufficient to order the summoning of Saxena Marine Tech Pvt. Ltd. and its Directors (including the revisionist herein) as accused persons. The order passed by Ld. Magistrate does not seem to be arbitrary, perverse or irrational nor does it reflect any jurisdictional error which occasioned any injustice in the matter. The contentions raised by revisionist herein could not be gone into or decided at this stage as the same require evidence to be lead on record before the Ld. Metropolitan Magistrate seized of the complaint filed u/s 138 Negotiable Instruments Act. The present petition is devoid of any merits and is hereby dismissed.
14. TCR be sent back along with the copy of this judgment.
15. Revision file be consigned to record room.
Digitally
signed by
Announced & Dictated in the LOVLEEN
LOVLEEN
Date:
Open Court today i.e. 17.09.2024. 2024.09.18 15:31:43 +0530 (Lovleen) ASJ-03 (South East) Saket Courts, Delhids Crl. Rev. No. 469/2024 Kirori Mal Saxena Vs. M/s. Shahi Exports 20/20