Case Note & Summary
The petitioner, Sidharth Chauhan, filed a writ petition under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973, seeking quashing of the order dated 11.12.2018 passed by the 33rd Metropolitan Magistrate, Ballardpier, Mumbai, in C.C. No. 8349/SS/2018, which issued process against him under Section 138 of the Negotiable Instruments Act, 1881. The complaint was filed by Aditya Birla Real Estate Fund (Respondent No. 1) alleging that the petitioner, along with Sidhartha Buildhome Private Limited and CSN Estates Private Limited, had issued a cheque that was dishonoured. The petitioner contended that he was not a director or signatory of the cheque and that the complaint lacked specific averments regarding his role and responsibility in the company. The Court examined the complaint and found that it did not contain any specific allegations that the petitioner was in charge of and responsible for the conduct of the business of the company at the time of the offence, as required under Section 141 of the NI Act. The Court relied on the principle that vicarious liability under Section 141 requires strict compliance with the statutory requirements. Since the complaint failed to make out a prima facie case against the petitioner, the Court quashed the complaint and the summons against him. The petition was allowed, and the rule was made absolute.
Headnote
A) Criminal Law - Negotiable Instruments Act - Quashing of Complaint - Section 138 read with Section 141 of Negotiable Instruments Act, 1881 - The petitioner, an individual accused in a complaint under Section 138 NI Act, sought quashing of the complaint and summons on the ground that he was not a director or signatory of the cheque and the complaint lacked specific averments regarding his role and consent. The Court held that for vicarious liability under Section 141, there must be specific allegations that the accused was in charge of and responsible for the conduct of the business at the time of the offence. Since the complaint did not contain such averments, the proceedings were quashed. (Paras 1-15) B) Criminal Procedure - Quashing of Criminal Proceedings - Inherent Powers - Section 482 of Code of Criminal Procedure, 1973 - The Court exercised its inherent powers to quash the complaint and summons against the petitioner as the continuation of proceedings would be an abuse of process of law. The Court found that the complaint did not make out a prima facie case against the petitioner. (Paras 12-15)
Issue of Consideration
Whether the criminal proceedings against the petitioner under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881 can be quashed when the petitioner is not a director or signatory of the cheque and the complaint lacks specific averments regarding his role.
Final Decision
The Court allowed the petition, quashed the impugned order dated 11.12.2018 and the complaint C.C. No. 8349/SS/2018 against the petitioner. Rule made absolute.
Law Points
- Vicarious liability under Section 141 NI Act requires specific averments of role and consent
- Quashing of criminal proceedings when no prima facie case
- Strict compliance with Section 138 NI Act requirements
