Gujarat High Court
Rajesh Arjun Mali vs Rbl Bank Ltd,(Formerly Known As ... on 2 September, 2022
Author: Vaibhavi D. Nanavati
Bench: Vaibhavi D. Nanavati
R/SCR.A/1018/2020 ORDER DATED: 02/09/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CRIMINAL APPLICATION NO. 1018 of 2020
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RAJESH ARJUN MALI
Versus
RBL BANK LTD,(FORMERLY KNOWN AS RATNAKAR BANK LTD) THRO
MOHAMMED SAHEJAD QURESHI
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Appearance:
MR BHARAT BHAVSAR(5548) for the Applicant(s) No. 1
MR NAHUH H PATEL(10530) for the Respondent(s) No. 1
MR. MAHITOSH U SINGH(7015) for the Respondent(s) No. 1
MR. MH SHEKHAWAT(7194) for the Respondent(s) No. 1
MS MAITHILI MEHTA, APP for the Respondent(s) No. 2
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CORAM:HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
Date : 02/09/2022
ORAL ORDER
1. By way of present writ-application the applicant herein (original accused No.2) being aggrieved and dissatisfied by the order dated 5.4.2019 passed by the Metropolitan Magistrate Court No.30, Ahmedabad in Criminal Case No.30875 of 2019 issuing process against all the accused including the Company on 5.4.2019 filed Criminal Revision Application No.277 of 2019 challenging the aforesaid order passed by the Chief Metropolitan Magistrate in Criminal Case No.30875 of 2019 whereby the revision application filed by the applicant herein Page 1 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 came to be rejected by the City Civil & Sessions Court No.17, Ahmedabad by order dated 20.11.2019.
2. Brief facts giving rise to the present writ-application are stated thus :-
2.1 It is the case of the respondent No.1 (original complainant) that the applicant herein is Director of M/s. Resu Infratech India Pvt. Ltd., (original accused No.1). The original accused No.1 Company approached the respondent No.1 for business facilities and the respondent No.1 disbursed business loan for business expansion and original accused No.1 and respondent No.1 entered into an agreement pursuant to the grant of business loan facilities No.BLPUN003100015209 in favour of the original accused No.1 for an amount of Rs.20,15,780/- (Rs. Twenty Lakhs Fifteen Thousands Seven Hundred and Eighty Only) dated 30.09.2018 at 17% interest p.a. to be paid in EMI of Rs.71,869/- in 36 installments.
2.2 The said agreement was duly signed and executed by all Page 2 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the accused and the respondent No.1 granted business loan facilities to the accused No.1 Company accordingly. It is also the case of the respondent No.1 that the outstanding amount due and payable by all the accused in the account under business loan facilities has given by the cheque. An amount of Rs.20,15,780/- is due and payable by all the original accused jointly and severally to the respondent No.1. The respondent No. 1 (original accused No.1) issued cheque bearing No.435029 dated 29.01.2019 drawn on Yes Bank, for Rs.20,15,780/- (Rs. Twenty Lakhs Fifteen Thousands Seven Hundred and Eighty Only) duly signed by the original accused No.3 (Mr. Sushilkumar Ram Singh) against the dues. The said cheque came to be deposited by the respondent No.1 in their bank on 01.02.2019. The said cheque came to be dishonoured and returned with the remark/endorsement "Exceed Arrangements" on 02.02.2019.
2.3 The respondent No.1 issued statutory notice under Section 138 and 141 read with 142 of Negotiable Instrument Act, 1881 Page 3 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 dated 28.02.2019. The same was received by the accused on 05.03.2019. Though the said notice was received by the accused, the same was unresponded. Therefore, the said notice can be said to be admitted by the accused.
2.4 The original accused No.1 Company failed to make the payment which was due and payable to the respondent No.1 which resulted in the cause of action qua the respondent No.1 to file a Criminal Complaint U/S 138 of the Negotiable Instrument Act against the original accused No.1 Company and of its Directors.
2.5 After hearing the respondent No.1 and recording the verification of respondent No.1, the Learned Magistrate was pleased to pass an order of issuance of process against all the original accused persons including Company on 05.04.2019.
2.6 It is the case of the applicant herein i.e. original accused No.2 that the respondent No.1 issued a Loan Recall Notice on 26.12.2018 to the present applicant herein which was received Page 4 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 by the present applicant on 31.12.2018. The applicant herein replied to the said Recall Notice through the applicant's advocate on 23.1.2019 and clarified to the respondent no.1 that the applicant herein has resigned from the post of directorship from the company i.e. accused no.1 on 20.08.2018 and hence the applicant herein is not liable for the alleged offence committed by the accused No.1 company as on the date of disbursement of the alleged loan the applicant was not Director of the company i.e. accused No.1. Copy of the said reply to the notice issued by the respondent No.1 were also delivered to the respondent No.1 on 31.1.2019 and the applicant herein also provided copies of Police Complaint lodged by the applicant herein on 21.1.2019, the resignation letter of the applicant herein dated 20.8.2018, Board Resolution dated 20.08.2018 and Form No.DIR-12.
2.7 Further it is also the case of the applicant herein that in spite of aforesaid reply by the applicant herein the respondent No.1 issued Demand Notice under Section 25 of the Payment Page 5 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 and Settlement Systems Act read with Section 138, 141 & 142 of Negotiable Instrument Act to the applicant herein on 21.1.2019 which was received by the applicant on 25.1.2019.
The present applicant replied to the said notice to the respondent No.1. The applicant herein received the legal notice regarding the cheque in question of the said complaint and he immediately replied to the said notice through his advocate wherein it was clarified by the applicant herein to the respondent No.1 that he has resigned from the post of directorship from the company i.e. accused no.1 and hence the applicant herein is not liable for the alleged act done by the company.
2.8 On 28.02.2019, the respondent No.1 again sent a notice under Sections 138 & 141 of Negotiable Instrument Act to all the accused and demanded amount of Rs.20,15,780/- towards dishonour of cheque issued by original accused No.3 from the account of original accused No.1, on 29.01.2019. The said notice dated 28.02.2019 sent by respondent No.1 was received Page 6 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 by the applicant on 05.03.2019 and the applicant herein replied to the said notice immediately on 09.03.2019 and once again reiterated the factual position and demanded certain documents for inspection of the applicant herein.
2.9 Though the respondent was aware that present applicant had resigned as director of original Accused No.1 Company as on 20.8.2018, the disputed cheque was drawn by the accused No.2 on behalf of the accused No.1 on 29.1.2019, the respondent No.1 (orig. complainant) arraigned the applicant herein as accused by filing criminal complaint being Criminal Case No.30875 of 2019 against the present applicant under Section 138 of the Negotiable Instrument Act, 1881 by suppressing the material facts. Process came to be issued by the Court below on 5.4.2019. The said order of issuance of process passed by the learned Magistrate reads thus :-
"Heard, Perused the entire record of the present case. Considering the facts of the present complaint, in chief of the complainant U/Sec. 145 of N.I.Act and documentary evidence Page 7 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 produced record, prima facie case appears against the accused No.1 to 3 for an offence U/Sec.138 read with Sec.141 of N.I.Act. It is therefore present complaint is hereby order to be registered and order to issue summons against the accused No.1 to 3 U/Sec. 204 of Cr.P.C for an offence U/Sec. 138 read with Sec. 141 of N.I.Act returnable on10/06/19.
Moreover, in view of guideline issued by the Honb'le Supreme Court of India in 2014 STPL(web) 291 SC Indian Bank Association & Others V/S Union of India (writ petition (Civil) No.18/2013 date of decision 21/04/2014) accused No.1 to 3 are hereby order to furnish a surety U/Sec.88 of Cr.P.C before this court for the purpose of securing his presence during the trial of the present complaint. Registry of this court is hereby directed to put a specific note in the summons with regard to the guideline issued by the Honb'le Supreme Court of India in AIR 2010 SC 1907 Damodardas S. Prabhu V/S Sahid Babalal H. Registry of this court is also hereby directed to issue a summons in view of Circular No. C.2619/2018 of the Honb'le High Court of Gujarat, in the form as prescribed therein. Moreover in view of the same circular complainant herein is also hereby order to submit a presentation form in prescribed performa."
2.10 Being aggrieved and dissatisfied by issuance of process the applicant herein challenged the same before the City Civil Page 8 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 & Sessions Court, Ahmedabad by filing Criminal Revision Application No.277 of 2019 under Section 397 of the Criminal Procedure Code, 1973 which came to be rejected by the City Civil & Sessions Court, Ahmedabad by order dated 20.11.2019.
The order dated 20.11.2019 reads thus :-
"10. Heard, perused revision application and considered the submissions made by both the parties. On perusing the record, it is an undisputed fact on record that, the revisionist along with other director of the accused no.-1 company applied for business loan facility and the revisionist has signed the loan application form, loan agreement and demand promissory note and he has also produced his passport copy as a proof to the Respondent bank at the time of sanctioning of the loan. Thus, as a borrower, he has signed in all the documents for obtaining loan from the respondent bank as a co-borrower for the said loan amount. That, Ld. Counsel for the revisionist contended that, the revisionist resigned from the accused no.-1 company as a Director on 20-8-2018 but admittedly same was communicated to the Ministry of Corporate Affairs belatedly by his company but it also transpires on record that, the the revisionist has allegedly signed all the loan papers on 31-12- 2018 that is even after resignation. It also transpires that the revisionist has signed in the loan papers , i.e. the loan application form, Business loan facility agreement, demand Page 9 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 promissory note and personal guarantee form as a Director of accused No.-1 Company M/s. Resu Infratech India Pvt. Ltd. for sanctioning of the loan and revisionist has signed the loan agreement form as a director. So, the plea of revisionist that he is not liable for the dues of the Bank as he resigned from the post being a triable issue is not tenable in the eye of law at this stage of proceedings, as a result of which I do not find any illegality, impropriety or infirmity in the impugned order passed by the Ld. Trial Court after considering facts and circumstances of the present revision application thus, I hereby decide Point No.-1 in the Negative and also decide the Point no-2 by passing the following order.
O R D E R
1. The present revision application is hereby rejected.
2. The impugned order passed by the Learned Additional Chief Metropolitan Magistrate, N. I. Act, Court No.30 dated 05.04.2019 in Criminal Case No.30875/2019 for offence under Section 138 of Negotiable Instruments Act, is hereby made confirmed.
Signed and Pronounced in the Open Court today on this 20th day of November, 2019"
2.11 being aggrieved by the impugned order dated 20.11.2019 passed by the Courts below the applicant herein has filed the Page 10 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 present writ-application under Article 226 and 227 of the Constitution of India seeking the following reliefs :-
"(a) Your Lordship may please to allow the preset Special Criminal Application in the interest of justice by set-a-side the order passed by the Hon'ble City Civil and Sessions Court, in Cri. Revision Application No. 277/2019 dated 20"" November 2019.
(b) Your Lordship may please to set-a-side the issue process order passed by Learned Metropolitan Magistrate Court, Ahmedabad in CC No. 30875/2019 on 05/04/2019 vide Exh.1 against the present applicant i.e. Original Accused No. 2.
(c) Your Lordship may please to pass an appropriate order to call upon, the record and proceeding pending before the Learned Metropolitan Magistrate Court - 30, Ahmedabad being Criminal Case 30875/2019.
(d) Your Lordship may please to pass an appropriate order of stay of proceeding against the Applicant i.e. Original Accused No. 2 before Learned Metropolitan Magistrate Court -
30, Ahmedabad in CC No. 30875/2019.
(e) Any other just and equitable order thinks fit by this Hon'ble Court may kindly be passed in the interest of Page 11 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 justice."
3. Heard Mr. Bharat Bhavsar, the learned advocate appearing for the writ-applicant. Mr. Bhavsar, the learned advocate submitted that the impugned orders passed by the Courts below are erroneous in view of the fact that the same are passed without considering the documents produced by the writ-applicant i.e. accused No.2 and have wrongly come to the conclusion that the writ-applicant herein has signed the business loan paper after his resignation from the directorship of the accused No.1.
3.1 Mr. Bhavsar, the learned advocate further submitted that the Courts below have failed to consider that the writ-applicant herein has not signed as Director of accused No.1 and in the disputed cheque also the sign of the writ-applicant is not there and hence the Courts below have erred in passing the impugned order.
3.2 Mr. Bhavsar, the learned advocate submitted that the Page 12 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 Court below i.e. Sessions Court has failed to consider Section 141 and 142 of the Negotiable Instruments Act, 1881 and has not been complied with by the respondent No.1 and complaint against the present writ-applicant under Sections 141 and 142 of the Negotiable Instruments Act, 1881 is not maintainable.
The Courts below have failed to consider several case law cited by the writ-applicant herein with regard to the non-
maintainability of the application against the writ-applicant under the Sections 141 and 142 of the Negotiable Instruments Act, 1881.
3.3 Mr. Bhavsar, the learned advocate submitted that the respondent No.1 purposefully suppressed certain facts from the trial Court about issuance of three notices from the respondent No.1 to the writ-applicant herein and the writ-applicant had replied to all the three notices issued by the respondent No.1.
The trial Court and the Sessions Court failed to consciously and cautiously read the averments of the complaint wherein there is no mentioned of specific allegation against the present Page 13 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 writ-applicant about his alleged role in issuance of cheque in question.
3.4 Mr. Bhavsar, the learned advocate submitted that the Courts below failed to understand that taking into consideration that the writ-applicant was Director of the accused No.1 (M/s. Resu Infratech India Pvt. Ltd.,) and on 20.8.2018 the writ-applicant, resigned from the directorship, his resignation was accepted and approved by the Board of Directors of the accused No.1 ( M/s. Resu Infratech India Pvt.
Ltd., ) on the very same day. The original accused No.1 ( M/s.
Resu Infratech India Pvt. Ltd., ) has also submitted Form No.DIR-12 in respect of the writ-applicant's resignation. Hence, the liability of the writ-applicant towards original accused No.1 ceased with effect from 20.8.2018 and the writ-applicant is not liable for the affairs of the original accused No.1 after 20.8.2018, therefore criminal prosecution under Section 138 of the Negotiable Instruments Act, 1881 against the present writ-
applicant is not maintainable.
Page 14 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 3.5 Mr. Bhavsar, the learned advocate submitted that the orders passed by the Courts below can be said to be non-
speaking orders. Mr. Bhavsar, the learned advocate submitted that the Court below has erred in coming to the conclusion that the learned Magistrate ought to have observed that the cheque was not signed by the writ-applicant nor has he signed any other document in respect of sanction and disbursement of loan. It is also submitted by Mr. Bhavsar, the learned advocate appearing for the writ-applicant that the role of all the accused persons attracting liability towards the payment of dishonoured cheque in question as the present writ-applicant never signed the cheque in question. It was by the original accused No.3 as alleged by the respondent No.1.
3.6 Mr. Bhavsar, the learned advocate submitted that the Court below i.e. learned Magistrate failed to consider the cardinal principle and criteria to pass an order of issuance of process against the present writ-applicant. It was submitted Page 15 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 that it is mandatory and obligatory to consider that while the cheque in question was signed by the accused No.3 only. It is further to be looked into whether the cheque in question was signed by the writ-applicant and whether there are any specific allegation or averment in the complaint against the writ-
applicant satisfying to establish prima facie case against the writ-applicant and prima facie role played by the writ-
applicant attracting the liability so as to satisfy in that regard for passing the order of issuance of process. In view of the aforesaid submissions, the impugned orders be quashed and set aside and the writ-application be allowed.
4. Mr. Mahitosh Singh, the learned advocate appearing for the respondent No.1 submitted that the present writ-application filed by the writ-applicant herein is with a view to harass the present respondent - original complainant. It is submitted that the aforesaid writ-application is filed with malafide intention and, therefore, the writ-application is liable to be dismissed.
Page 16 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 4.1 Mr. Singh, the learned advocate submitted that the orders passed by the Courts below are speaking order and, therefore, there is no requirement for interference with the impugned orders and this Court may confirm the orders passed by the Courts below and dismiss the present writ-application.
4.2 Mr. Singh, the learned advocate submitted that the writ-
applicant and other original accused approached the Bank for business loan. The business loan was sanctioned for an amount of Rs.20,15,780/- (Rs. Twenty Lakhs Fifteen Thousands Seven Hundred and Eighty Only) on the basis of representation made and the documents executed by the present writ-applicant and other original accused in September, 2018 and thereafter the original accused have utilized the loan amount.
4.3 Mr. Singh, the learned advocate has placed reliance on the loan facility agreement, draft promissory note and personal guarantee, all the three dated 30.09.2018. Mr. Singh, the learned advocate submitted that the respondent Bank issued Page 17 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 loan recall notice on 26.12.2018. Thereafter towards the outstanding amount due and payable by the original accused in the account under the business loan facility the accused gave cheque which was presented for payment by the complainant.
The cheque in question dated 29.1.2019 bearing No.435029 drawn on Yes Bank Account for Rs.20,15,780/- was signed by the original accused No.3 Mr. Sushilkumar Ram Singh and was issued from the account of M/s. Resu Infratech India Pvt.
Ltd., the original accused No.1. This cheque was presented for payment on 1.2.2019 and the same came to be dishonoured for the reason "Exceed Arrangements" vide return memo dated 2.2.2019. The complainant issued notices on 28.2.2019 and the same were received by the accused on 5.3.2019.
4.4 Mr. Singh, the learned advocate submitted that though notices were issued no positive response came from the accused and, therefore, the complainant present respondent No.1 was constrained to file complaint under Section 138 of the Negotiable Instruments Act, 1881 before the trial Court Page 18 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 which came to be registered as Criminal Case No.30875 of 2019 on 5.4.2019.
4.5 Mr. Singh, the learned advocate submitted that the complainant has specifically averred in the aforesaid complaint that the original accused No.1 is Company and accused No.2 and 3 are Directors of the accused No.1 Company and involved in the day-today affairs of the Company.
4.6 Mr. Singh, the learned advocate submitted that the present writ-applicant resigned as Director from the original accused No.1 Company on 20.08.2018 and the resignation came to be accepted on the same date by the original accused No.1 Company. The contention of the writ-applicant that Form No.DIR-12 was submitted to ROC on 30.12.2018 is disputed by the respondent - original complainant because the present writ-applicant - accused signed the loan papers on 30.9.2018.
4.7 Mr. Singh, the learned advocate submitted that the writ-
applicant lodged police complaint on 21.1.2019 appears to be Page 19 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 an afterthought and with an intention to circumvent the liability. Mr. Singh, the learned advocate also submitted that the replies of the present writ-applicant filed to the notices issued by the respondent Bank produced on record by the writ-
applicant are all given after filing the police complaint and, therefore, they are required to view in above mentioned factual matrix and the same is only with an intention to evade the liability. Relying on the aforesaid submissions, Mr. Singh, the learned advocate appearing for the respondent Bank -
original complainant submitted that the writ-application deserves to be dismissed and the same be dismissed.
5. Section 138 of the Negotiable Instruments Act, 1881 reads thus :-
"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, Page 20 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 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 55 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 56 notice in writing, to the drawer of the cheque, [within thirty days] 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, Page 21 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 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.]"
6. Reliance is placed by the respondent on the documents wherein the applicant herein appears to be the guarantor of the loan which was taken by the accused No.1 Company on 21.1.2019.
Position of law :-
7. In the aforesaid facts of present case this Court deems it fit to refer to the following decisions :-
(a) In the case of Mrs. Aparna A. Shah vs. M/s. Sheth Developers Pvt. Ltd., and Anr, reported in 2013 AIR SCW 4161, paragraph 23 "(8.) In order to constitute an offence under Section 138 of Page 22 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the N.I. Act, this Court, in Jugesh Sehgal V/s. Shamsher Singh Gogi, (2009) 14 SCC 683, noted the following ingredients which are required to be fulfilled:
"(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account;
(ii) the cheque should have been issued for the discharge, in whole or in part, of any debt or other liability;
(iii) that 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;
(iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the 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 the bank;
(v) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(vi) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice.Page 23 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022
R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 Being cumulative, it is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the Act." Considering the language used in Section 138 and taking note of background agreement pursuant to which a cheque is issued by more than one person, we are of the view that it is only the "drawer" of the cheque who can be made liable for the penal action under the provisions of the N.I. Act. It is settled law that strict interpretation is required to be given to penal statutes.
(9.) In Jugesh Sehgal (supra), after noting the ingredients for attracting Section 138 on the facts of the case, this Court concluded that there is no case to proceed under Section 138 of the Act. In that case, on 20.01.2001, the complainant filed an FIR against all the accused for the offence under Sections 420, 467, 468, 471 and 406 of the Indian Penal Code, 1860 (hereinafter referred to as "IPC) and there was hardly any dispute that the cheque, subject-matter of the complaint under Section 138 of the N.I. Act, had not been drawn by the appellant on an account maintained by him in Indian Bank, Sonepat Branch. In the light of the ingredients required to be fulfilled to attract the provisions of Section 138, this Court, after finding that there is little doubt that the very first ingredient of Section 138 of the N.I. Act enumerated above is not satisfied and concluded that the case against the appellant for having committed an offence under Section 138 cannot be proved.
Page 24 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 (10.) In S.K. Alagh V/s. State of Uttar Pradesh and Others, (2008) 5 SCC 662, this Court held:
19. . If and when a statute contemplates creation of such a legal fiction, it provides specifically therefor. In absence of any provision laid down under the statute, a Director of a Company or an employee cannot be held to be vicariously liable for any offence committed by the Company itself. (See Sabitha Ramamurthy v. R.B.S. Channabasavaradhya, (2006) 10 SCC 581)"
(11.) In Sham Sunder and Others V/s. State of Haryana, (1989) 4 SCC 630, this Court held as under:
"9. The penal provision must be strictly construed in the first place. Secondly, there is no vicarious liability in criminal law unless the statute takes that also within its fold. Section 10 does not provide for such liability. It does not make all the partners liable for the offence whether they do business or not."
(12.) As rightly pointed out by learned senior counsel for the appellant, the interpretation sought to be advanced by the respondents would add words to Section 141 and extend the principle of vicarious liability to persons who are not named in it.
(13.) In the case on hand, we are concerned with criminal liability on account of dishonour of a cheque. It primarily falls on the drawer, if it is a Company, then Drawer Company and is extended to the officers of the company. The normal rule in Page 25 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the cases involving criminal liability is against vicarious liability. To put it clear, no one is to be held criminally liable for an act of another. This normal rule is, however, subject to exception on account of specific provision being made in statutes extending liability to others. For example, Section 141 of the N.I. Act is an instance of specific provision that in case an offence under Section 138 is committed by a company, the criminal liability for dishonour of a cheque will extend to the officers of the company. As a matter of fact, Section 141 contains conditions which have to be satisfied before the liability can be extended. Inasmuch as the provision creates a criminal liability, the conditions have to be strictly complied with. In other words, the persons who had nothing to do with the matter, need not be roped in. A company being a juristic person, all its deeds and functions are the result of acts of others. Therefore, the officers of the company, who are responsible for the acts done in the name of the company, are sought to be made personally liable for the acts which result in criminal action being taken against the company. In other words, it makes 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, liable for the offence. It is true that the proviso to sub- section enables certain persons to prove that the offence was committed without their knowledge or that they had exercised all due diligence to prevent commission of the offence. The liability under Section 141 of the N.I. Act is Page 26 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 sought to be fastened vicariously on a person connected with the company, the principal accused being the company itself. It is a departure from the rule in criminal law against vicarious liability.
(16.) The above discussion with reference to Section 138 and the materials culled out from the statutory notice, reply, copy of the complaint, order, issuance of process etc., clearly show that only the drawer of the cheque being responsible for the same.
(22.) In the light of the above discussion, we hold that under Section 138 of the Act, it is only the drawer of the cheque who can be prosecuted. In the case on hand, admittedly, the appellant is not a drawer of the cheque and she has not signed the same. A copy of the cheque was brought to our notice, though it contains name of the appellant and her husband, the fact remains that her husband alone put his signature. In addition to the same, a bare reading of the complaint as also the affidavit of examination-in- chief of the complainant and a bare look at the cheque would show that the appellant has not signed the cheque.
(23.) We also hold that under Section 138 of the N.I. Act, in case of issuance of cheque from joint accounts, a joint account holder cannot be prosecuted unless the cheque has been signed by each and every person who is a joint account holder. The said principle is an exception to Section 141 of Page 27 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the N.I. Act which would have no application in the case on hand. The proceedings filed under Section 138 cannot be used as an arm twisting tactics to recover the amount allegedly due from the appellant. It cannot be said that the complainant has no remedy against the appellant but certainly not under Section 138. The culpability attached to dishonour of a cheque can, in no case "except in case of Section 141 of the N.I. Act"
be extended to those on whose behalf the cheque is issued. This Court reiterates that it is only the drawer of the cheque who can be made an accused in any proceeding under Section 138 of the Act. Even the High Court has specifically recorded the stand of the appellant that she was not the signatory of the cheque but rejected the contention that the amount was not due and payable by her solely on the ground that the trial is in progress. It is to be noted that only after issuance of process, a person can approach the High Court seeking quashing of the same on various grounds available to him. Accordingly, the High Court was clearly wrong in holding that the prayer of the appellant cannot even be considered. Further, the High Court itself has directed the Magistrate to carry out the process of admission/denial of documents. In such circumstances, it cannot be concluded that the trial is in advanced stage."
(b) In the case of Gunmala Sales Pvt. Ltd., vs. Anu Mehta & Ors., order dated 17.10.2014 delivered in Criminal Appeal Page 28 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 No.2228 of 2014 and allied matters, paragraphs 33 and 34 read thus :-
"33. We may summarize our conclusions as follows:
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 responsible 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 Director;
b) If a petition is filed under Section 482 of the Code for quashing of such a complaint by the Director, the High Court may, in the facts of a particular case, on an overall reading of the complaint, refuse to quash the complaint because the complaint contains the basic averment which is sufficient to make out a case against the Director.
c) In the facts of a given case, on an overall reading of the complaint, the High Court may, despite the presence of the basic averment, quash the complaint because of the absence of more particulars about role of the Director in the complaint. It may do so having come across some unimpeachable, uncontrovertible evidence which is beyond suspicion or doubt or totally acceptable circumstances which may clearly indicate that the Director could not have been concerned with the issuance of cheques and asking him to stand the trial would be abuse of the process of the court. Despite the presence of basic averment, it may come to a conclusion that no case is Page 29 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 made out against the Director. Take for instance a case of a Director suffering from a terminal illness who was bedridden at the relevant time or a Director who had resigned long before issuance of cheques. In such cases, if the High Court is convinced that prosecuting such a Director is merely an arm-
twisting tactics, the High Court may quash the proceedings. It bears repetition to state that to establish such case unimpeachable, uncontrovertible evidence which is beyond suspicion or doubt or some totally acceptable circumstances will have to be brought to the notice of the High Court. Such cases may be few and far between but the possibility of such a case being there cannot be ruled out. In the absence of such evidence or circumstances, complaint cannot be quashed;
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 regard 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 inquiry, but, nothing prevents it from taking unimpeachable evidence or totally acceptable circumstances into account which may lead it to conclude that no trial is necessary qua a particular Director.
34. We will examine the facts of the present case in light of the above discussion. In this case, the High Court answered Page 30 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the first question raised before it in favour of the respondents. The High Court held that "in the complaint except the averments that the Directors were in charge of and responsible to the company at the relevant time, nothing has been stated as to what part was played by them and how they were responsible regarding the finances of the company, issuance of cheque and control over the funds of the company". After so observing, the High Court quashed the proceedings as against the respondents. In view of this conclusion, the High Court did not go into the second question raised before it as to whether the Director, who has resigned can be prosecuted after his resignation has been accepted by the Board of Directors of the company. Pertinently, in the application filed by the respondents, no clear case was made out that at the material time, the Directors were not in charge of and were not responsible for the conduct of the business of the company by referring to or producing any uncontrovertible or unimpeachable evidence which is beyond suspicion or doubt or any totally acceptable circumstances. It is merely stated that Sidharth Mehta had resigned from the Directorship of the company on 30/9/2010 but no uncontrovertible or unimpeachable evidence was produced before the High Court as was done in Anita Malhotra to show that he had, in fact, resigned long before the cheques in question were issued. Similar is the case with Kanhaiya Lal Mehta and Anu Mehta. Nothing was produced to substantiate the contention that they were not in charge of and not responsible for the conduct of Page 31 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the business of the company at the relevant time. In the circumstances, we are of the opinion that the matter deserves to be remitted to the High Court for fresh hearing. However, we are inclined to confirm the order passed by the High Court quashing the process as against Shobha Mehta. Shobha Mehta is stated to be an old lady who is over 70 years of age. Considering this fact and on an overall reading of the complaint in the peculiar facts and circumstances of the case, we feel that making her stand the trial would be an abuse of process of the court. It is however, necessary for the High Court to consider the cases of other Directors in light of the decisions considered by us and the conclusions drawn by us in this judgment. In the circumstances, we confirm the impugned order to the extent it quashes the process issued against Shobha Mehta, an accused in C.C. No.24035 of 2011. We set aside the impugned order to the extent it quashes the process issued against other Directors viz. Kanhaiya Lal Mehta, Anu Mehta and Siddharth Mehta. We remit the matter to the High Court. We request the High Court to hear the parties and consider the matter afresh. We are making it clear that we have not expressed any opinion on the merits of the case and nothing said by us in this order should be interpreted as our expression of opinion on the merits of the case. The High Court is requested to consider the matter independently. Considering the fact that the complaints are of 2011, we request the High Court to dispose of the matter as expeditiously as possible and preferably within six months."
Page 32 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 In the facts of the present case, applicant resigned as director of the accused company on 20.8.2018 and the cheque in question came to be drawn and signed by original accused No.3 on 29.1.2019. The applicant herein was not a Director of the company when the accused no3 issued the cheque in favour of the complainant herein.
(c) In the case of S. M. S. Pharmaceuitcals Ltd., vs. Neeta Bhalla, reported in 2005 CJ (SC) 1142, paragraphs 12, 15 and 20 read thus :-
"12. While analysing Section 141 of the Act, it will be seen that it operates in cases where an offence under Section 138 is committed by a company. The key words which occur in the Section are "every person". These are general words and take every person connected with a company within their sweep. Therefore, these words have been rightly qualified by use of the words " 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 etc." What is required is that the persons who are Page 33 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 sought to be made criminally liable under Section 141 should be at the time the offence was committed, in charge of and 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. It is only those persons who were in charge of and responsible for conduct of business of the company at the time of commission of an offence, who will be liable for criminal action. It follows from this 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 under the provision. The liability arises from being in charge of and responsible for conduct of 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. Conversely, a person not holding any office or designation in a Company may be liable if he satisfies the main requirement of being in charge of and responsible for conduct of business of a Company at the relevant time. Liability depends on the role one plays in the affairs of a Company and not on designation or status. If being a Director or Manager or Secretary was enough to cast criminal liability, the Section would have said so. Instead of "every person" the section would have said "every Director, Manager or Secretary in a Company is liable"..etc. The legislature is aware that it is a case of criminal liability which means serious consequences so far as the person sought to be made liable is concerned.Page 34 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022
R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 Therefore, only persons who can be said to be connected with the commission of a crime at the relevant time have been subjected to action.
15. The question of what should be averments in a criminal complaint has come up for consideration before various High Courts in the country as also before this Court. Secunderabad Health Care Ltd. and others v. Secunderabad Hospitals Pvt. Ltd. and others [1999 (96) C.C.(AP) 106] was a case under the Negotiable Instruments Act specifically dealing with Sections 138 and 141 thereof. The Andhra Pradesh High Court held that every Director of a company is not automatically vicariously liable for the offence committed by the company. Only such Directors or Director who were in charge of or responsible to the company for the conduct of business of the company at the material time when the offence was committed alone shall be deemed to be guilty of the offence. Further it was observed that the requirement of law is that "there must be clear, unambiguous and specific allegations against the persons who are impleaded as accused that they were in charge of and responsible to the company in the conduct of its business in the material time when the offence was committed." the same High Court in v. Sudheer Reddy v. State of Andhra Pradesh and others [2000 (99) CC (AP)107] held that "the purpose of Section 141 of the Negotiable Instruments Act would appear to be that a person who appears to be merely a director of the Company cannot Page 35 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 be fastened with criminal liability for an offence under Section 138 of the Negotiable Instruments Act unless it is shown that he was involved in the day-today affairs of the company and was responsible to the company." Further, it was held that allegations in this behalf have to be made in a complaint before process can be issued against a person in a complaint. To same effect is the judgment of the Madras High Court in R. Kannan v. Kotak Mahindra Finance Ltd. 2003 (115) CC (Mad) 321. In Lok Housing and Constructions Ltd. v.
Raghupati Leasing and Finance Ltd. and another [2003 (115) CC (Del) 957], the Delhi High Court noticed that there were clear averments about the fact that accused No.2 to 12 were officers in charge of and responsible to the company in the conduct of day-to-day business at the time of commission of offence. Therefore, the Court refused to quash the complaint. In Sunil Kumar Chhaparia v. Dakka Eshwaraiah and another [2002 (108) CC (AP) 687, the Andhra Pradesh High Court noted that there was a consensus of judicial opinion that " a director of a company cannot be prosecuted for an offence under Section 138 of the Act in the absence of a specific allegation in the complaint that he was in charge of and responsible to the company in the conduct of its business at the relevant time or that the offence was committed with his consent or connivance." The Court has quoted several judgments of various High Courts in support of this proposition. We do not feel it necessary to recount them all.
Page 36 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022R/SCR.A/1018/2020 ORDER DATED: 02/09/2022
20. In view of the above discussion, our answers to the questions posed in the Reference are as under:
(a) It is necessary to specifically aver in a complaint under Section 141 that at the time the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential requirement 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) The answer to question posed in sub-para (b) has to be in negative. 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 responsible 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 answer to question (c ) has to be in affirmative. The question notes that the Managing Director or Joint Managing Director would be admittedly in charge of the company 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, Page 37 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 these persons are in charge of and responsible for the conduct of business 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."
In the facts of the present case the applicant herein was not incharge of the day-today activity of the Company. In fact, the applicant herein ceased to be the Director of the Company since 20.8.2018 having resigned as Director of the Company.
(d) In the case of Pepsi Foods Ltd., vs. Special Judicial Magistrate, reported in 1997 CJ (SC) 936, paragraph 2 read thus :-
"The appellants are aggrieved by the judgment dated September 23, 1996 of the Division Bench of the High Court of Judicature at Allahabad (Lucknow Bench) dismissing their writ petition filed under Articles 226 and 227 of the Constitution. The appellants sought quashing of the compliant filed against them under Section 7 read with Section 16 of the Prevention of Food Adulteration Act, 1954 (for short 'the Act'). The prayers in the writ petition were worded as under:Page 38 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022
R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 "(a) issue a writ of prohibition or a writ, order or direction in the nature of prohibition, prohibiting the Opposite Party Number-1 to proceed with case No.699 of 1994 (Anurag Narain vs. Nitin Sachdeva and others;
(b) issue a writ of certiorari or a writ, order or direction in the nature of certiorari quashing the proceedings in Case o.
699 of 1994 together with the consequential order dated 9.5.1994 and the complaint dated 6.5.1993 in so far as it pertains to the petitioners;
(c) issue a writ of mandamus or a writ, order or direction in the nature of mandamus commanding the Opposite Party Number-1 not to proceed with the Case No.699 or 1994 during the pendency of the aforesaid writ petition;
(d) issue any other appropriate writ, order or direction which this Hon'ble Court may deem just and necessary in the circumstances of the case may also be passed; and
(e) to allow the writ petition with costs".
(e) In the case of Dilip Hariramani vs. Bank of Baroda, reported in 2022 SCC OnLine SC 579, paragraph 13 reads thus:-
"13. In the present case, we have reproduced the contents of Page 39 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the complaint and the deposition of PW-1. It is an admitted case of the respondent Bank that the appellant had not issued any of the three cheques, which had been dishonoured, in his personal capacity or otherwise as a partner. In the absence of any evidence led by the prosecution to show and establish that the appellant was in charge of and responsible for the conduct of the affairs of the firm, an expression interpreted by this Court in Girdhari Lal Gupta v. D.H. Mehta and Another11 to mean 'a person in overall control of the day-to- day business of the company or the firm', the conviction of the appellant has to be set aside. 12 The appellant cannot be convicted merely because he was a partner of the firm which had taken the loan or that he stood as a guarantor for such a loan. The Partnership Act, 1932 creates civil liability. Further, the guarantor's liability under the Indian Contract Act, 1872 is a civil liability. The appellant may have civil liability and may also be liable under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. However, vicarious liability in the criminal law in terms of Section 141 of the NI Act cannot be fastened because of the civil liability. Vicarious liability under sub- section (1) to Section 141 of the NI Act can be pinned when the person is in overall control of the day- to-day business of the company or firm. Vicarious liability under sub-section (2) to Section 141 of the NI Act can arise because of 11 (1971) 3 SCC 189 12 State of Karnataka v. Pratap Chand and Others, Page 40 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 (1981) 2 SCC 335, the director, manager, secretary, or other officer's personal conduct, functional or transactional role, notwithstanding that the person was not in overall control of the day-to-day business of the company when the offence was committed. Vicarious liability under sub-section (2) is attracted when the offence is committed with the consent, connivance, or is attributable to the neglect on the part of a director, manager, secretary, or other officer of the company."
8. It appears that the original accused No.1 Company approached the respondent No.1 to avail the business loan facility. The respondent No.1 disbursed the said loan in favour of the accused No.1 Company for an amount of Rs.20,15,780/-
at the rate of 17% interest. It is undisputed that the original accused No.3 issued the cheque on behalf of the accused No.1 Company on 29.1.2019 bearing No.435029 drawn on Yes Bank. The cheque came to be dishonoured on 1.2.2019 with the noting "Exceed Arrangements" and the same was communicated to the complainant on 2.2.2019. The applicant herein resigned as Director of the accused No.1 Company on 20.8.2018. Undisputedly the cheque was drawn in favour of Page 41 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022 R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 the respondent No.1 original complainant after the applicant herein resigned as Director of the accused No.1 Company. The resignation of the complainant was accepted by the Company by resolution dated 20.08.2018 which is duly produced at "RESU INFRATECH INDIA PRIVATE LIMITED REG OFFICE: G-23, SN 69/1A/C, SUPER MALL SALUNKE VIHAR ROAD, WANAWADI PUNE Pune MH 411040 IN CIN- U45400PN2014PTC153117 CERTIFIED TRUE COPY OF THE RESOLUTION PASSED IN MEETING BOARD OF MEMBERS OF RESU INFRATECH INDIA PRIVATE LIMITED HELD AT 11.00 A.M. ON MONDAY OF 20th AUGUST 2018 AT REGISTERED OFFICE OF THE COMPANY SITUATED AT G-23, SN 69/1A/C, SUPER MALL SALUNKE VIHAR ROAD, WANAWADI PUNE MH 411040 IN APPROVAL FOR RESIGNATION OF MR. RAJESH ARJUN MALI FROM THE POST OF DIRECTOR OF THE COMPANY "RESOLVED THAT the resignation of MR. RAJESH ARJUN MALI (DIN: 07621953) from the directorship of the Company be and is hereby accepted with immediate effect.
Page 42 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 RESOLVED FURTHER THAT the Board places on record its appreciation for the assistance and guidance provided by MR. RAJESH ARJUN MALI (DIN: 07621953) during his tenure as Director of the Company.
RESOLVED FURTHER THAT anyone of the Director of the Company be and is hereby severally authorized to do all the acts, deeds and things which are necessary to the resignation of aforesaid person from the directorship of the Company."
FOR BOARD OF DIRECTOR OF RESU INFRATECH INDIA PRIVATE LIMITED SUSHIL KUMAR SINGH DIRECTOR DIN : 06422786 DATE: 20/08/2018 PLACE: PUNE"
8.1 The accused No.1 Company also filed Form No.DIR-12 before the Registrar of Company which is duly produced at page-50 at 51 which shows that the applicant herein resigned as Director of the accused No.1 Company on 20.8.2018.Page 43 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022
R/SCR.A/1018/2020 ORDER DATED: 02/09/2022
9. In view of the aforesaid ratio as referred to above, the aforesaid issue is no longer res integra. Admittedly the writ-
applicant herein is not the drawer of the cheque. The original accused No.3 (Mr. Sushilkumar Ram Singh) has drawn cheque bearing No.435029 dated 29.01.2019 drawn on Yes Bank, for Rs.20,15,780/- (Rs. Twenty Lakhs Fifteen Thousands Seven Hundred and Eighty Only). On issuance of process the person aggrieved/accused can approach the Court for quashing of the complaint on the grounds available to him.
9.1 In view of the aforesaid discussions, the applicant herein not being drawer of the cheque and having resigned from the accused No.1 Company even before the disputed cheque was drawn which is also undisputed, the applicant herein could not have been arraigned as accused in the aforesaid proceedings instituted by the respondent - original complainant invoking the provisions of Section 138 of the Negotiable Instruments Act, 1881.Page 44 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022
R/SCR.A/1018/2020 ORDER DATED: 02/09/2022 9.2 In view of above, the impugned order dated 5.4.2019 passed by the Metropolitan Magistrate Court No.30, Ahmedabad in Criminal Case No.30875 of 2019 issuing process against present applicant and order dated 20.11.2019 passed by the City Civil & Sessions Court No.17, Ahmedabad in Criminal Revision Application No.277 of 2019 are hereby quashed and set aside.
9.3 It is, however, clarified that the adjudication is only with regard to the complaint which is initiated by the respondent under the provision of Negotiable Instruments Act, 1881. qua the writ-applicant herein.
10. For the aforesaid, reasons, the writ-application succeeds and the same allowed.
(VAIBHAVI D. NANAVATI,J) K.K. SAIYED Page 45 of 45 Downloaded on : Sun Dec 25 00:58:43 IST 2022