Shiv Raj Singh v. Allied Blenders & Distillers Pvt. Ltd.

1. These two petitions involve similar issue, therefore, the same are being decided by this common order. The facts are taken from CRL.M.C. 5248/2022.

2. Learned counsel appearing on behalf of the petitioners submits that the impugned order of summoning is in ignorance of the settled legal position, inasmuch as, the court below has failed to consider that no specific averments have been made with respect to the present petitioners as to how they are responsible for the day-to-day functioning of the partnership firm. While placing reliance on various - 3 –Neutral Citation Number 2022/DHC/004644 pleadings and documents, it has been submitted that the present petitioners are not responsible for the day-to-day functioning of the accused firm and, therefore, the order of summoning suffers from legal infirmity. According to her, the cheque in question had been drawn and issued by partners, namely, Basant Bhandari and Rajeev Pratap and was not issued by the petitioners. The ingredients of Section 138 of the Negotiable Instruments Act, 1881 (in short, „the NI Act‟) are therefore not fulfilled. Section 138 of the NI Act does not speak about the joint liability. Section 141 of NI Act does not make all partners liable for the offence. Criminal liability would fasten on those who, at the time of commission of offence, were in charge and were responsible for the day-to-day conduct of the business of the firm. It is further stated that it is very much in the knowledge of the respondent that no liability can be fastened upon the petitioners in view of the supplementary partnership deed dated 01.05.2018 and agreement dated 28.06.2018. The present petitioners have been unnecessarily arrayed in the complaint. The reliance is placed on the decisions of the Hon‟ble Supreme Court in the matters of Monaben Ketanbhai Shah and Ors. v. State of Gujarat and Ors.[1] and Dilip Hariramani v. Bank of Baroda 2.

3. I have heard the learned counsel appearing on behalf of the petitioners and perused the record.

4. The petitioners are arrayed as respondents in the compliant as accused Nos.15 and 16, respectively. A perusal of complaint indicates that the complainant in paragraph No.2, thereof, had stated that the accused No.1 is a partnership firm and accused Nos.[2] to 16 are its partners. The averments made in the complaint further goes on to state that the accused approached the complainant inter alia representing

- 4 –Neutral Citation Number 2022/DHC/004644 that they are partners and carrying out business of sale of IMFL, under the name and style of M/s Trimurti Associates & Ors. It is also stated that the accused, further represented that the Excise Department, Government of Uttrakhand had issued license in favour of accused No.10, 11, 12, 14, 15 and 16 to deal in the sale of IMFL products in the State of Uttrakhand. It is thus seen that with respect to the present petitioners, specific averments have been made in the complaint not only with respect to the fact that they are partners of the accused firm but with respect to holding of license that was issued by the State of Uttarakhand in their name. Paragraph No.11 of the complaint reiterates the same allegation and it states that the accused are jointly and severely dealing with the complainant from time to time and amongst the accused, two of the partners are the signatories of the cheque in question. Learned Metropolitan Magistrate vide impugned order has taken into consideration various pronouncements of the Hon‟ble Supreme Court.

5. Having considered the material available on record, learned Metropolitan Magistrate found that accused No.5 and 12 were the signatories of the cheque and the accused No.10, 11, 12, 14, 15 and 16 are the license holder on behalf of the accused firm. The learned Metropolitan Magistrate did not find any specific role, so far as, other accused are concerned and, accordingly, he dropped the complaint against the remaining accused except to direct for issuance of summon against accused No.1, 5, 10, 11, 12, 14, 15 and 16.

6. It is settled that in terms of explanation of Section 141 of the NI Act, the expression “company” would mean any body corporate and includes a firm or other association of individuals. Sub-section 1 of Section 141 postulates that where an offence is committed under Section 138 by a company, the company as well as every person who, - 5 –Neutral Citation Number 2022/DHC/004644 at the time when the offence was committed, was in charge of and was responsible to the company for the conduct of the business shall be deemed to be guilty of the offence. It is also necessary in terms of Section 141 of the NI Act to specifically state in the complaint that the accused was in charge of and responsible for the conduct of the business of the company. The aforesaid legal position is not doubted. In the instant case specific averments have been made with respect to the present petitioners which have been considered by the concerned Metropolitan Magistrate. So far as the arguments advanced by the learned counsel appearing on behalf of the petitioners are concerned, the same would not require to be considered at the stage of summoning the petitioners.

7. The Hon‟ble Supreme Court in the matter of S. P. Mani and Mohan Dairy v. Dr. Snehalatha Elangovan[3] in criminal Appeal No.1586/2022 dated 16.09.2022 has dealt with the issue extensively, where, the High Court of Madras in exercise of its power under Section 482 of Cr.P.C allowed the petition and quashed the complaint under Section 138 of the NI Act on the ground of non-fulfillment of the requirement of Section 141 of the NI Act. The high court in that case held that merely by reciting the words used under Section 141 of the NI Act in the complaint, no vicarious liability can be fastened on the partners of the firm.

8. The Hon‟ble Supreme Court in paragraph No.47 summarized its conclusion which reads as under:-

9. Having considered the submissions made by the learned counsel appearing on behalf of the petitioners and on the premise of the specific averments made in the compliant and in the absence of any sterling circumstances/evidence being produced by the petitioners, this court does not find it appropriate to exercise its power under Section 482 of the Cr.P.C. to quash the instant complaint.

10. So far as the decision in the case of Dilip Hiraramani (supra) relied upon by the learned counsel appearing on behalf of the petitioners is concerned, primarily the same does not relate to the scope of exercise of power under Section 482 of the Cr.P.C. and, therefore, does not have any application at the present stage. Similarly, another decision in the case of Monaben Ketanbhai Shah (supra) is concerned, a perusal of paragraph No.7 thereof would clearly indicates that in the complaint there were no averments against the accused in that case. In the instant case, this court has noted that there are specific allegations not only with respect to the fact that petitioners are the partners of the firm but it is also stated that they were holding the license in their name on behalf of the firm.

11. In view of the aforesaid, this court does not find any substance in Crl.M.C.5248/2022, the same is, therefore, dismissed.

12. So far as other case i.e. Crl.M.C.5249/2022 is concerned, the complaint in the said case has also been carefully perused. Paragraph - 9 –Neutral Citation Number 2022/DHC/004644 No.2, 11 and 13 thereof would clearly demonstrate that specific averments with respect to the petitioners in that case have been made. Since the legal issue has been dealt with and the facts in this case are also similar, therefore, for the reasons mentioned in order passed, Crl.M.C.5249/2022 also deserves to be dismissed and the same is hereby dismissed.