Madras High Court
Anandan And Another vs Arivazhagan on 8 July, 1997
Equivalent citations: [1999]96COMPCAS503(MAD), 1997(2)CTC293
JUDGMENT V. Rengasamy, J.
1. This revision is filed against the order of the learned judicial Magistrate, Neyveli, in Crl. M.P. No. 2170 of 1996 in C.C. No. 567 of 1995, dated August 7, 1996, dismissing the petition filed under section 251 of the Code of Criminal Procedure to discharge the petitioners/accused.
2. The petitioners are the accused before the learned judicial Magistrate for the offence under section 138 of the Negotiable Instruments Act, 1881. They contended that the second petitioner/second accused did not issue any cheque to the respondent/complainant and he was not a partner of K. S. Muthu Constructions and the respondent had not issued any notice to the second petitioner before the proceedings was initiated under section 138 of the Negotiable Instruments Act. Therefore, they contended that the court below ought not to have taken cognizance of the offence and the complainant contended that the second petitioner is a partner of K. S. Muthu Constructions and the cheque was issued by the first petitioner, that as the second petitioner is a partner of the company for which the cheque was issued, there is no need to send the notice to the second petitioner individually. The first petitioner had sent a reply notice alleging that there was collusion between the second petitioner and the respondent and with the connivance of the second petitioner, the cheque was presented for collection. It is further alleged that the petitioners moved for transfer of the case, but as they could not succeed, now they have filed this petition to drag on the proceedings and there are no materials to discharge the petitioners.
3. The learned judicial Magistrate, Neyveli, after considering the averments in the petition, has dismissed the petition. Hence, this revision.
4. The only averment in the petition filed before the lower court is that the second petitioner is not a partner of K. S. Muthu Constructions, that the second petitioner had not issued any cheque and, therefore, the cognizance taken by the court below is illegal and the petitioners are entitled to be discharged. When it is the allegation in the complaint that the first petitioner, as managing partner of K. S. Muthu Constructions, issued the cheque in favour of the complainant/respondent herein, the question whether the second petitioner was a partner or not is a matter of evidence that could be considered only at the time of the trial. Therefore, the petitioners are not entitled to raise this point for discharging them. Further, the first petitioner has not given any reason to exonerate him from the offence alleged. Therefore. the court below was perfectly right in not accepting the reasons given in the petition to discharge the petitioners.
5. However, one other legal plea has been taken by the revision petitioners in this court for the first time with regard to the maintainability of the complaint without impleading the partnership itself. Learned counsel for the revision petitioner, Mr. Parthiban, would contend that section 141 of the Negotiable Instruments Act is very specific that when the offence was committed by a company, every person responsible for the conduct of the business of the company as well as the company, shall be proceeded against for the offence committed by them and, therefore, the partnership, viz., K. S. Muthu Constructions, for which the cheque was issued, ought to have been impleaded in this case and as the provision of section 141 of the Negotiable Instruments Act was not complied with, there is defect even at the time of the initiation of the proceedings itself and, therefore, the revision petitioners are entitled to be discharged.
6. But this argument was repelled by learned counsel for the complainant, Mr. Dhanyakumar, submitting that even if the company or the partnership is a necessary party to the proceedings, section 319 of the Code of Criminal Procedure can always be invoked to implied the necessary party to the proceedings, and, therefore, the complainant has the right to move before the lower court to implied K. S. Muthu Constructions also as an accused and when section 319 of the Code of Criminal Procedure enables to cure such defect, the revision petitioners, who are the partners cannot escape by contending that the necessary party has been impleaded and, therefore, they are entitled to be discharged.
7. It is not in dispute that the cheque was issued by the first petitioner as managing partner of K. S. Muthu Constructions for the liability to the complainant. Learned counsel, Mr. Dhanyakumar, relying upon certain decisions of the Kerala High Court, would contend that when the court has taken cognizance of the offence against a partner, it will not affect the proceedings for the failure to implied the other accused including the company. In Alex v. Vijayan [1994] 81 Comp Cas 910 (Ker); [1993] MWN 192, the Kerala High Court has held that when the managing partner of a firm was prosecuted under section 138 of the Negotiable Instruments Act for the dishonour of the cheque issued by the managing partner and without impleading the partnership, the partners alone were prosecuted, the complaint is maintainable against the partners alone. Following this decision, the same court in M. O. H. Iqbal v. Uthaman (M.) [1995] 82 Comp Cas 726; [1993] MWN 146, also repeated the same view that the complaint against the partners is maintainable without impleading the company under section 138 of the Negotiable Instruments Act. In Plywood House v. Wooderaft Products Ltd. [1993] MWN 140; [1997] 88 Comp Cas 565 the Kerala High Court has again held that when the managing partner was prosecuted for the offence under section 138 of the Negotiable Instruments Act without impleading the partnership, the partnership can be impleaded subsequently also as when once the cognizance of the offence was taken by the court, the subsequent impleadment of another person as accused, would not affect the judicial process as it has already commenced by taking cognizance. But these views of the Kerala High Court have not been accepted by this court in a series of decisions and this court has taken a consistent view that a complaint under section 138 of the Negotiable Instruments Act is not sustainable without complying with the mandatory provision, viz., section 141 of the Negotiable Instruments Act, without impleading the company or the partnership and when there was defect even in the initial stage in the initiation of the proceedings itself, that cannot be cured by impleading the company or partnership subsequently.
8. This court in Suryanarayanan v. Anchor Marine Service [1998] 94 Comp Cas 874 (Mad); [1995] 1 LW (Crl.) 132, following the previous decisions of this court, has held that the prosecution is not sustainable against the directors of a company without impleading the company itself. As a matter of fact, this court has considered the views taken by the Kerala High Court in Alex v. Vijayan [1994] 81 Comp Cas 910; [1993] MWN 192, which were followed in the later decision in M. O. H. Iqbal v. Utharnan (M.) [1995] 82 Comp Cas 726 and this court has not followed the view of the Kerala High Court. Therefore, the respondent is not entitled to contend that the complaint is maintainable even without the partnership K. S. Muthu Constructions.
9. Then coming to the &text point with regard to the curable aspect of the defect in the complaint, by invoking section 319 of the Code of Criminal Procedure, this court, in the above decision, following the view taken by the apex court in Delhi Municipality v. Ramkishan, , has held that when the complaint has the initial defect in its sustainability, the defect cannot be cure by amending the proceedings and section 319 of the Code of Criminal. Procedure will not come to the rescue for such defects. Learned counsel for the respondent cited the decision of the apex court in U.P. Pollution Control Board v. Modi Distillery , to support his argument for the right to amend the complaint. This decision also has been distinguished in the above decision of this court and this court has held that the amendment to implied the company cannot be ordered. Therefore, as the view of this court is that the company or partnership cannot be subsequently impleaded to set right the defect in the proceedings, the respondent/complainant is not entitled to seek for amendment of the complaint. So, as on today, the proceedings under section 138 of the Negotiable Instruments Act against the petitioners is defective for the non-prosecution of K. S. Muthu Constructions. Hence, the petitioners alone cannot be prosecuted for the alleged offence and for this non-compliance with the provision, the petitioners are certainly entitled to be discharged. Though the grounds raised before the lower court do not confer a right for discharge of the petitioners, the point raised in this court by the revision petitioners certainly enables them to be discharged from the proceedings.
10. In the result, the revision petitioners are discharged from the proceedings C.C. No. 567 of 1995 on the file of the judicial Magistrate, Neyveli. The revision is allowed. Consequently, Cri. M.P. No. 3064 of 1996 is dismissed.