Vijay Mallya v. Delhi International Airport Private Limited

1. These four petitions have been filed by the petitioner under Section 482 & 483 of the Code of Criminal Procedure, 1973 (hereinafter shall be referred to as the “Cr.P.C.”) for quashing of order dated 02.09.2014, passed by the learned Sessions Judge, Patiala House Courts, New Delhi whereby the revision petition moved by the petitioner was dismissed, which was filed against the order dated 13.01.2014 passed by the learned Metropolitan Magistrate summoning the petitioner as an accused under Section 319 of the Cr.P.C. Since the present petitions have been preferred against common impugned orders dated 13.01.2014 and 02.09.2014, all the petitions are being decided together.

2. The factual matrix, as per record, is that the respondent/ complainant had filed four complaints under Section 138, 139, 141 and 142 of the Negotiable Instruments Act, 1881 read with Sections 406, 415 and 420 of the IPC against the accused persons, namely, M/s Kingfisher Airlines Limited, Mr.Sanjay Aggarwal (Chief Executive Officer), Mr.A. Raghunathan (Chief Financial Officer), Mr.Inder Singh (Authorized Signatory) and Mr.G. Visweswaran (Authorized Signatory). The Court below had taken the cognizance on 22.06.2012. The complainant had adduced presummoning evidence. Summons against the above accused persons were issued on 22.06.2012. On 12.08.2015, notice under 2016:DHC:5360 Crl.M.C. 5479-5482/2016 Section 251 of the Cr.P.C. was framed against the accused persons.

3. During the pendency of the complaints, application under Section 319 Cr.P.C. was filed by the complainant for summoning the petitioner as an accused. The learned Magistrate vide common order dated 13.01.2014, allowed the said application and summoned the petitioner as accused. Thereafter, the petitioner filed four revision petitions which were dismissed by the Court of Session vide common order dated 02.09.2014. Feeling aggrieved by the same, the present petitions have been preferred by the petitioner.

4. Arguments advanced by Mr.Ramesh Gupta, Senior Advocate for the petitioner as well as of Ms.Geeta Luthra, Senior Advocate for the respondent were heard.

5. Arguments advanced by the learned Senior Counsel for the petitioner that power to summon an accused under Section 319 Cr.P.C. can be exercised only once some additional evidence has been recorded before the Court, but in the present case there was nothing against the petitioner in the pre-summoning evidence and the Court below has proceeded only on the basis of averments made in the application. It was further argued that both the Courts below have overlooked the applicability of Sections 138(1)(b), 141 and 142(1) of the Negotiable Instruments Act. It was further argued that issuance of legal notice under Section 138(1)(b) of the Act is a mandatory requirement, but in the present case no such notice was ever issued to the petitioner. The complainant deliberately chose to exclude the petitioner from the array of parties as an accused as the complainant was well aware that the petitioner was not involved in day to day operations of Kingfisher Airlines. It was further argued that the application under Section 319 Cr.P.C. filed by the complainant was barred by limitation as it was moved after 18 months of issuance of legal notice.

6. On the other hand, learned Senior Counsel for the respondent argued that it is not in dispute that the petitioner was the Chairman and Managing Director of the Kingfisher Airlines and thus was fully responsible for the day to day affairs of the company and thus was liable to be prosecuted. It was further argued that as per Section 141 of the Negotiable Instruments Act, every person who at the time of commission of offence was the incharge or was responsible for the conduct of the business of the company, shall be liable to be proceeded against. Initially due to inadvertence, the petitioner could not be impleaded but the same cannot absolve the responsibility of the petitioner who being C&MD of the company had failed to comply with the requirement of the legal notice.

7. The contention of the petitioner is that there was no evidence against the petitioner in the pre-summoning evidence led by the complainant and thus, there was no question to summon the petitioner under Section 319 Cr.P.C. It has been contended that the term ‘evidence’ referred in Section 319 includes cross-examination of witness and in the present case only examination in chief was recorded. In the absence of cross-examination of the complainant witness, it cannot be construed as evidence and therefore, there was no stage to summon the petitioner under Section 319 Cr.P.C.

8. In similar situation, the Hon’ble Apex Court in the case of Hardeep Singh v. State of Punjab & Ors. (ILC-2014-SC-CRL- Jan-5) observed that: “Thus, in view of the above, we hold that power under Section 319 Cr.P.C. can be exercised at the stage of completion of examination in chief and court does not need to wait till the said evidence is tested on cross-examination for it is the satisfaction of the court which can be gathered from the reasons recorded by the court, in respect of complicity of some other person(s), not facing the trial in the offence.”

9. In view of the above law laid down by the Hon’ble Apex Court in the case of Hardeep Singh (supra), the examination in chief of a witness is sufficient to term it as an ‘evidence’, as mentioned in Section 319 Cr.P.C. to summon accused. In the present case, it is matter of record that the pre-summoning evidence by the witness of the complainant was tendered by way of affidavit. Tendering of evidence by way of affidavit was the examination in chief of the witness and as the accused persons were not summoned till then, there was no question of any crossexamination of said witness. Adducing evidence during presummoning evidence clearly covers the case of the complainant for summoning the petitioner as an accused under Section 319 Cr.P.C.

10. The other contention on behalf of the petitioner is that his name was not mentioned in the complaint, therefore, he could not have been impleaded as accused in the complaint case. The Hon’ble Apex Court in the case of S.M.S. Pharmaceuticals Ltd. vs. Neeta Bhalla and Anr. MANU/SC/0622/2005 held that: “The answer to Question (c) has to be in the 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 the 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, these persons are in charge of an responsible for the conduct of business of the company. Therefore, they get covered under Section 141.” In Kirshna Texport & Capital markets Ltd. v. Ila A. Agrawal & Ors. (Criminal Appeal No.1220 of 2009), the Hon’ble Apex Court held that:

11. It is not in dispute that the petitioner was the Chairman and Managing Director of Kingfisher Airlines Limited and thus was the incharge and fully responsible for the day to day business of the said company. It is also not in dispute that the cheques in question were issued by the said company and the petitioner being its Chairman and Managing Director was responsible for the conduct of the business of the company. Therefore, mere nonmentioning of the name of the petitioner in the complaint cannot absolve him of the responsibility of the company which issued the cheques in question. Thus, there was no need to issue notice by the complainant in the name of the petitioner as the cheques in question were issued by the company and the petitioner being its incharge was equally liable to be prosecuted.

12. Undisputedly, the petitioner was the Chairman and Managing Director of the company and as per the judgment in the case of S.M.S. Pharmaceuticals (supra), the Managing Director would be responsible for day to day affairs of the company. The argument advanced by the learned Senior Counsel for the petitioner that the petitioner was not intervening in the day to day proceedings of the company, is of no consequence when the cheques in question were issued during the course of day to day business transactions for the benefit of the company. More the reason that in the complaint filed before the Trial Court the company had already been impleaded as one of the respondents.