Pravin Kumar Agarwal & Ors. v. Bihani Manufacturing Company Private Limited

1. Heard learned counsel appearing for the petitioners who contends that the petitioners, namely, Pravin Kumar Agarwal, accused no.2, Jitendra Mohan Gupta, accused no.4 and Abhishek Gupta, accused no.5 have been arrayed as accused in the complaint under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881 [NI Act] and cognizance thereto has been taken by the competent Court on 13.03.2024 without realizing the fact that the present applicants are not responsible for day to day business and regular affairs of the accused company.

KUMAR KAURAV

2. Learned counsel, therefore, places reliance on a decision of the Supreme Court in the case of Sunita Palita and Ors. v. Panchami Stone Quarry[1] and submits that the order of taking cognizance deserves to be set aside.

3. The Court has considered the submissions made by learned counsel appearing for the petitioners and has perused the averments made by the complainant in paragraph no.4 of the complaint. Paragraph no.4 of the complaint is extracted as under:

6. In Sunita Palita and Ors. v. Panchami Stone Quarry, the Supreme Court further observed in paragraphs 41, 42 and 43 as under:

connected with the issuance of a cheque or dishonour thereof, such as Director (Personnel), Director (Human Resources Development), etc. into criminal proceedings under the NI Act, only because of their designation.

42. Liability depends on the role one plays in the affairs of a company and not on designation or status alone as held by this Court in S.M.S. Pharmaceuticals. The materials on record clearly show that these appellants were independent, non-executive Directors of the company. As held by this Court in Pooja Ravinder Devidasani v. State of Maharashtra a non-executive Director is not involved in the day-to-day affairs of the company or in the running of its business. Such Director is in no way responsible for the day-to-day running of the accused Company. Moreover, when a complaint is filed against a Director of the company, who is not the signatory of the dishonoured cheque, specific averments have to be made in the pleadings to substantiate the contention in the complaint, that such Director was in charge of and responsible for conduct of the business of the Company or the Company, unless such Director is the designated Managing Director or Joint Managing Director who would obviously be responsible for the company and/or its business and affairs.

43. The High Court correctly observed that three categories of persons were covered by Section 141 of the NI Act — the company who committed the offence as alleged; everyone who was in charge of or was responsible for the business of the company and any other person who was a Director or a Manager or a Secretary or Officer of the Company with whose connivance or due to whose neglect the company had committed the offence."

7. The complainant has sufficiently and clearly stated that the present accused are responsible for the day to day business and regular affairs of the accused company at the relevant point of time when the offence was committed. The complainant has also stated that accused Nos. 2 - 5 enjoyed overall control over the management of the accused Company during all material times and also they are the alter ego and key managerial persons of the accused company who have jointly and severally transacted with the Complainant Company representing the management of the Accused Company during the entire material time.

8. It is seen that the nature of the submissions made by the present applicants will have to be examined during the course of the trial. The parties will have adequate opportunity to prove their case. At the stage of invoking jurisdiction under Section 482 of the Code of Criminal Procedure, 1973, which at present is Section 528 of Bharatiya Nagarik Suraksha Sanhita (BNSS), the Court has to bear in mind that the plausible object of preventing bouncing of cheques and sustaining the credibility of commercial transactions resulting in enacting the said Sections, there cannot be a roving enquiry with respect to the aforesaid aspect at this stage.