Delhi District Court
Mukul Singhal And Vishal Satinder Sood vs M/S Curo India Pvt. Ltd on 24 February, 2014
Cri. Rev. no. 10 and 11 of 2014
Mukul Singhal and Vishal Satinder Sood
Vs
M/s Curo India Pvt. Ltd.
24.02.2014
Pre: None.
By this single order I shall dispose of two revision revision
petitions filed against the summoning order dated 09.01.2013.
Vide separate detailed order placed along side in the file, in
view of the submissions of ld. Counsel for the revisionists that in this case
Ashwani Kumar Chawla who has signed the cheque in question can only
be summoned in this case and in light of the observations made in
judgment 'National Small Industries Corporation Limited vs. The National
Capital' discussed (supra), the impugned order dated 09.01.2013 is
set aside qua the revisionists Mukul Singhal and Vishal Satinder Sood
and case is remanded back to the ld. Trial Court with the directions to
pass a reasoned and speaking order. Accordingly, the revision petitions
are disposed of. Trial Court record, if any, be sent back with a copy of the
order. Revision petitions/ proceedings be consigned to record room.
(RAJ KAPOOR)
ADDITIONAL SESSIONS JUDGE-03
PATIALA HOUSE COURTS
NEW DELHI
IN THE COURT OF SH. RAJ KAPOOR, ADDITIONAL SESSIONS
JUDGE (03) , PATIALA HOUSE COURT, NEW DELHI
Criminal Rev. No.10/14
Mukul Singhal
6386, Sector B9,
Vasantkunj,
Delhi - 110070
..............Revisionist
Versus
M/s Curo India Pvt. Ltd.
755, Gurdev Nagar, Ludhiana,
Punjab; and
K-28, Green Park Extension
New Delhi.
................Respondent
AND
Criminal Rev. No.11/14
Vishal Satinder Sood
B-902, Central Park 1,
Sector 42, Gurgaon
..............Revisionist
Versus
M/s Curo India Pvt. Ltd.
755, Gurdev Nagar, Ludhiana,
Punjab; and
K-28, Green Park Extension
New Delhi.
................Respondent
24.02.2014
ORDER
1. By this single order I shall dispose of two revision revision petitions filed against the summoning order dated 09.01.2013 passed by ld. MM (hereafter referred as impugned order) whereby ld. trial court took the cognizance for the offence u/s 138 N. I. Act against the revisionists.
2. Briefly the factual matrix of the case is that a complaint case is pending between the parties before ld. trial court for the offence u/s 138 N. I. Act. In this case ld. trial court after perusal of the entire record, took the cognizance for the offence u/s 138 N I Act, 1881 and issued summons against the aforesaid revisionists. Feeling aggrieved with the impugned order dt.09.01.2013 ld. counsel filed these revision petitions.
3. Arguments on revision petition heard at length. During the course of arguments, Ld. Counsel for the revisionists submitted that cognizance of the offence U/Sec.138 NI Act has been taken against the seven accused persons in which company M/s Catmoss Retails Ltd is also involved at Sl. No.1 and the revisionist Vishal Satinder Sood was cited as accused No.5 and revisionist Mukul Singhal was sited as accused no.7 in the said complaint case and six revision petitions in total are arising out of three complaint cases filed against the respondent. It is further argued that cognizance U/Sec.138 NI Act has been taken which refers to only the natural person not artificial person. On this ground Ld. Counsel for revisionist submitted that the Company M/s Catmoss Retails Ltd cannot be arrayed as party in this case. Ld. Counsel for revisionist further submitted that vicarious liability only arises against other persons in case the cognizance has been taken U/Sec.141 NI Act whether it is natural person or an artificial person and in this case Ashwani Kumar Chawla who has signed the cheque in question can only be summoned in this case. On these ground he submitted that order of cognizance dated 09.01.2013 is liable to be set aside.
4. Contrary to it, Ld. Counsel for respondent argued and submitted that it is matter of trial whether cognizance is required to be taken up against natural or artificial person. On this ground he submitted that revision petitions are liable to be dismissed.
5. Again, Ld. Counsel for revisionists has relied upon following judgments i.e.
1. Om Kumar Dhankar Vs. State of Haryana & Anr (2012) 11 SCC 252
2. Desh Deepak Sharma Vs. State of Delhi & Ors 147 (2008) DLT 293
3. Rajender Kumar Sitaram pande & Ors. Vs Uttam & Anr (1999) 3 SCC 134
4. National Small Industries Corporatin Ltd. Vs. Harmeet Singh Paintal & Anr (2010)3 SCC 330
5. Manish Parwani Vs. NCT of Delhi (2010) ILR 5 Delhi 262
6. S.M.S. Pharmaceutical Ltd. Vs. Neeta Bhalla & Anr (2005) 8 SCC 89
7. P.S. Shrinivasan & Ors Vs. VLS Finance Ltd CRL.MC Nos.7423-25,7430-32, 7435-37 and 7458-60 of 2006
8. Anita Malhotra Vs. Apparel Export Promotion Council & anr (2012) 1 SCC 520
9. National Bank of Oman Vs. Barakara Abdul Aziz & Anr (2013) 2 SCC 488
10. Sudeep Jain Vs. M/s ECE Industries Ltd. CRL. M.C. Nos.1821 & 1822 of 2013
6. On this ground, Ld. Counsel for revisionist again submitted that order dated 09.01.2013 is liable to be set aside.
7. Controverting the contention of Ld. Counsel of revisionist, Ld. Counsel for respondent submitted that revision petition has been moved against two persons i.e. Vishal Satinder Sood and Mukul Singhal, therefore the order at the most can be set aside against them.
8. I have perused the impugned order dated 09.01.2013 , wherein it has been observed that :-
"09.01.2013 Present : AR of the complainant with counsel. Evidence affidavit (pre summoning) of CW-1 has been tendered and documents exhibited. Arguments on summoning heard. Counsel for complainant has submitted that all accused nos. 1 to 7 are responsible for running and managing the affairs of accused no. 1 company and therefore are liable for offence U/s 138 N I Act.
I have perused the complaint, evidence affidavit and the documents on record.
The cheque in question was issued in favour of the complainant by the accused towards discharge of their liability. The said cheque was dishonoured/returned unpaid on presentation. Legal Notice was issued and served upon the accused in the ordinary course. The grievance of the complainant is that the accused have not made the payment against the aforesaid cheque within the stipulated period despite service of legal notice.
A prima facie case punishable under Section 138 of Negotiable Instruments Act is made out and at this stage, there are sufficient grounds for proceeding against the accused.
All accused be summoned on filing of PF/RC/Regd. AD/approved courier for 10/04/2013. The accused may also be served by way of affixation in terms of Section 65 Cr.P.C."
9. I have given careful consideration to the submissions of ld. Counsel for the revisionist and ld. Counsel for the respondent. Before reaching at any conclusion let the relevant sections be re-produced verbatim which are as under:-
"Section 138 - Dishonour of cheque for insufficiency, etc., of funds in the account Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless--
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation -- For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability."
141. Offences by companies (1) If the person committing an offence under 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 be 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 committed 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.
Explanation.--For the purposes of this section,--
(a) "company" means any body corporate and includes a firm or other association of individuals; and
(b) "director", in relation to a firm, means a partner in the firm." "
10.I have gone through the above said judgments too. In the case of National Small Industries Corporation Limited vs. The National Capital Territory of Delhi ((2010) 3 SCC 330), the Hon'ble Apex Court held:
"It is very clear from the above provision that what is required is that the persons who are sought to be made vicariously liable for a criminal offence under Section 141 should be, 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. Every person connected with the company shall not fall within the ambit of the provision. Only those persons who were in-charge of and responsible for the conduct of the business of the company at the time of commission of an offence will be liable for criminal action. It follows from the fact that if a Director of a Company who was not in- charge of and was not responsible for the conduct of the business of the company at the relevant time, will not be liable for a criminal offence under the provisions. The liability arises from being in-charge of and responsible for the conduct of the business of the company at the relevant time when the offence was committed and not on the basis of merely holding a designation or office in a company."
11.In a catena of judgments, it has been held that for making 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. However, this court has limited jurisdiction to enter into the area of discretion of Ld. M.M. on the ground of propriety and correctness. In view of the submissions of ld. Counsel for the revisionists that in this case Ashwani Kumar Chawla who has signed the cheque in question can only be summoned in this case and in light of the observations made in judgment 'National Small Industries Corporation Limited vs. The National Capital' discussed (supra), the impugned order dated 09.01.2013 is set aside qua the revisionists Mukul Singhal and Vishal Satinder Sood and case is remanded back to the ld. Trial Court with the directions to pass a reasoned and speaking order. Accordingly, the revision petitions are disposed of. Trial Court record, if any, be sent back with a copy of the order. Revision petitions/ proceedings be consigned to record room. ANNOUNCED IN THE OPEN COURT ON THIS 24.02.2014 (RAJ KAPOOR) ADDITIONAL SESSIONS JUDGE-03 PATIALA HOUSE COURTS NEW DELHI