Delhi District Court
Babita Khurana vs M/S Northend Distributors on 1 October, 2022
IN THE COURT OF SH. VIKRAM:ADDL. SESSIONS
JUDGE-02-CUM-SPECIAL JUDGE-NDPS ACT, NORTH
WEST DISTRICT, ROHINI COURTS, DELHI.
Criminal Revision No. 46/2022
1. Babita Khurana
W/o Sh. Mukesh Khurana
R/o B-7/100 Extn. Safdarjung
Enclave, Delhi-110029.
2. Mukesh Khurana
S/o Sh. Ram Prakash Khurana
R/o B-7/100 Extn. Safdarjung
Enclave, Delhi-110029.
....Petitioners
Vs.
M/s Northend Distributors
Having its registered office at:
AG-15, Sanjay Gandhi Transport Nagar,
New Delhi-110042.
....Respondent
Date of Institution : 02.03.2022
Date when judgment was reserved : 30.09.2022
Date when judgment is pronounced : 01.10.2022
JUDGMENT
1. This is a revision petition u/S 397 Cr.P.C filed by Smt. Babita Khurana and Sh. Mukesh Khurana (hereinafter referred to as 'the Petitioners') seeking setting aside C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 1 summoning order dated 07.08.2021, passed by ld. MM, Digital Courts, NI Act, North-West District, Rohini Courts, Delhi, in complaint case bearing no. 771/2021.
2. The revision is filed on the ground that the summoning order dated 07.08.2021 was passed by ld. Trial Court in a mechanical and arbitrary manner without due application of judicial mind and in utter disregard and contravention to the settled proposition of law.
3. The brief facts of the case are that respondent/complainant herein is a partnership firm dealing in the business of motor spare parts and a complaint u/S 138 Ni Act was filed against accused persons (petitioners/revisionists herein) beings partners in M/s Classic Spares (Partnership Firm) alleging that in discharge of liabilty against business dealings the the firm of petitioner through its authorised signatory issued two cheques of Rs. 5 lacs each which on presentation were returned dishonoured with remarks Exceeds arrangement and subsequent to issuing notice u/S 138 NI Act upon the firm as well as petitioners individually the cheque amount was not paid.
4. Revision is filed on the ground that the petitioners are falsely implicated by the respondent and erroneously summoned by ld. Trial Court in an incoherent, unjust and C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 2 mechanical manner. It is further submitted that in as much as the revisionist no. 1, Babita Khurna is concerned, she was not even remotely associated with the respondent herein.
5. It is submitted on behalf of petitioner that Ld MM while taking cognizance has erred by not taking into consideration the mandatory requirement if section 141 and 142 of NI Act as the petitioners are neither partners nor officials involved in the business of any firm, which has issued the cheque to complainant and that there are no specific allegations in the complaint to show that petitioners are in any manner related to the business or dady to day affairs of the firm. It is submitted that the complaint is completely silent qua the roles of accused/petitioners with the the drawer of the cheque i.e. the firm and it is not even shown as to who is signatory of the cheque. Therefore since section 141 NI Act fastens vicarious liability of the firms over the persons responsible for the business of firm and the complaint fails to show such relation of petitioners with the firm, Ld. MM should not have summoned the petitioners. Hence the summoning order is liable to be set aside.
Reliance placed on:-
a) SMS Pharmaceuticals Vs. Neeta Bhalla AIR 2005 SC 3512,
b) Monaben Ketanbhai Shah Vs. State of Gujrat AIR C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 3 2004 SC 4274
c) Smt Dharna Goel @ Dharna Garg Vs. M/S Aryan Infratech Pvt. Ltd. CRL.M.C.708/2020.
6. In reply/objections the respondent/complainant objects to maintainability of this petition on the ground of delay as the same is filed on 02.03.2022 against order 07.08.2021 as such same is barred limitation and in violation of sec, 392(2) Cr.P.C and is filed without any application for condonation of delay.
7. On merits the revision is contested stating that there is no apparent illegality or irregularity in passing summoning order by Ld. MM. It is stated by respondent that the accused firm M/S Classic Spares runs at property no. 2821/2 Guru Nanak Auto market Kashmere Gate and the same is owned by petitioner no.2, who is husband of petitioner no.1. It is also stated by respondent that when the petitioners have denied their involvement in the business of accused firm they have not disclosed who is running that firm, had it been the case that petitioners have no relation with accused firm they would have disclosed the identity of the owner/proprietor/partner of the firm. It is submitted on behalf of firm that the before filing the complaint the petitioners were served with legal notices u/S 138 NI Act and they never replied to that notice denying that they are not the partners of the firm or that C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 4 they have no concern with the cheques in question. It is also submitted that in memo of parties in the complaint, the complainant/respondent has shown the petitioner as partners in the accuse and since the complaint read as whole along with the documents including legal notices show that petitioners are the partners in the firm, the complainant is not required to make any specific averment in the complaint as to what part they had played in dealing with complainant/respondent.
8. Heard. Record perused.
9. The objection of complainant/respondent regarding non maintainability of revision on the ground of expiry of limitation and the bar of section 397(2) are misplaced. Hon'ble Supreme Court has, in Suo Moto Writ Petition (3) of 2020 has extended the limitation period in all cases, notwithstanding actual balance period, for 90 days from 1 st March 2022. Therefore the revision being on 02.03.2022 is within limitation.
10. The summoning order of Court is not an interlocutory order because it decides the rights and liabilities of the parties concerning a particular aspect, in this case to face the trial.
11. The main ground of revision is that the complaint C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 5 read as whole do not make out the case of applicability of section 141 N I Act to fasten vicarious liability on petitioners. As per the memo of parties there are three accused. First is the partnership firm M/s Classic Spares having its office at 2821/2 Guru Nanak Auto Market Kashmere Gate, second is petitioner no.2 at same address and third is petitioner no.1 at same address.
12. In the body of complaint, para 1 introduces complainant, its business and through whom it is filed. Second para states about business dealings of complainant and accused. Third para is dedicated business of complainant and accused, outstanding liability, issuance of cheques in discharge of that liability and assurance of their clearance. 4th para states about presentation of cheque and its return with reason "Exceeds Arrangement". In 5th para complainant states about contacting the accused intimating the dishonour. In 6 th para complainant realizes that accused have no bonafide intention to pay cheque amount. 7th para is about issuance of legal notice. Subsequent paragraphs are for non payment of money despite notice, limitation in filing complaint and jurisdiction of Court.
13. It is a fact that in none of the paragraph complainant has mentioned any specific role of petitioners as accused no. 2 or 3. However, are not only shown as partners in C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 6 memo of parties, they were also served with individually where they are shown as partners in addressee no 2 and
3. Recently in "S P Mani and Mohan Dairy Versus Dr. Snehlatha Elangovan" it has been held by Hon'ble Supreme Court that "it is essential for the person to whom statutory notice is issued under section 138 of NI Act to give an appropriate reply. The person concerned is expected to clarify his or her stance. If the person concerned has some unimpeachable and incontrovertible material to establish that he or she has no role to play in the affairs of the company/firm, then such material should be highlighted in the reply to the notice as a foundation. If any such foundation is laid picture would be more clear before the eyes of complainant. The complainant would come to know as to why the person to whom he has issued notice says that he is not responsible for the dishonour of the cheque. Had the respondent herein given appropriate reply highlighting whatever she has sought to highlight before us then probably the complainant would have undertaken further enquiry and would have tried to find out what was the legal status of the firm on the date of the commission of the offence and what was the status of the respondent in the firm. The object of notice before the filing of the complaint is not just to give a chance to the drawer of the cheque to rectify his omission to make his stance clear so far as C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 7 his liability under section 138 of the NI Act is concerned"
Hon'ble Supreme Court finally summarised the law as:
a.) The primary responsibility of the complainant is to make specific averments in the complaint so as to make the accused vicariously liable. For fastening the criminal liability, there is no legal requirement 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 141of the Act clearly lays down that if the accused is able to prove to the satisfaction 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 punishment.
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 special 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 C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 8 of time they were not in charge of the affairs of the company. Advertence to section 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 judgment 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 vicarious 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.
d.) If any Director wants the process to be quashed by filing a petition under section 142 of the Code on the ground that only a bald averment is made in the complaint and that he/she is really not concerned with the issuance of the cheque, he/she must in order to persuade the High Court to quash the C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 9 process either furnish some sterling incontrovertible material or acceptable circumstances to substantiate his/her contention. He/she must make out a case that making him/her stand the trial would be an abuse of process of Court.
14. The petitioners never replied to legal notice denying their relationship with the partnership firm nor they have filed any incontrovertible or unimpeachable material or acceptable circumstance to show that they are not the partners in the accused firm. As per section 25 of Partnership Act 1932 Every partner is liable jointly with all the other partners and also severally, for all acts of the firm done while he is a partner.
15. It is pertinent to note here that notice under Section 251 Cr.P.C. against the petitioners as partners of the accused firm were framed on 03.02.2022 i.e. before this revision was filed and in response to that notice although it is claimed by the petitioners that they are not the partners in the accused firm nor signatory to the cheques, they have not mentioned who is running the firm M/s Classic Spares from their addresses. The petitioners have not stated in their reply to the notice that they are not residing at that address. It rather appears that the petitioners after coming to notice that the limitation period for all the cases in suo moto writ petition no. 3/2020 has extended, have filed this petition to try their luck when the notice was already framed C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 10 against them on 03.02.2022. Even otherwise I doubt if right to challenge the summoning order survives after framing of notice.
16. In view of discussion above held I do not find any infirmity in the order of Ld. MM summoning the petitioners as partners of the accused firm, warranting any interference u/S 397 Cr.P.C. Hence the same is dismissed.
Announced in open Court on 1st October, 2022 (Vikram) ASJ-02/Spl. Judge (NDPS), North West, Rohini Courts, Delhi/01.10.2022 C.R. No. 46/2022 Babita Khurana & Anr Vs. M/s Northend Distribution Page no. 11