ORDER
K.C. Bhanu, J.
1. The petition is filed under Section 482 of the Code of Criminal Procedure by A3 and A4 in C.C. No. 1067/2001 on the file of the learned IV Metropolitan Magistrate, Hyderabad, to quash the proceedings therein.
2. The brief facts that are necessary for disposal of the petition are that the 2nd respondent filed a private complaint under Section 200 of the Code of Criminal Procedure before the learned IV Metropolitan Magistrate, Hyderabad, against five accused alleging that they were carrying on business in Kirana Goods in the name and style of Oban Home Needs Limited, that they used to purchase kirana goods on credit basis from the complainant, that the complainant had a running ledger account in the name of A1, that A2 to A5, who were Directors of A1-company, took active part in the day-to-day business of A1-company, and they managed the whole business affairs of A1-company, that they being aware of their liability issued cheques in the discharge of their debt to the complainant, that the cheques were returned unpaid with an endorsement that funds were insufficient, that thereupon the complainant got issued a demand notice on 29.6.2001 to the accused, that A1, A2 and A4 with mala fide intention got returned the postal covers, that A5 received the notice, that A3 sent a reply to the notice disowning his liability, and that the accused did not pay the amount covered by the cheques. The complaint was registered as C.C. No. 1067/2001. A3 and A4 therein filed the present petition to quash the proceedings.
3. Learned Counsel for the petitioners raised several contentions. I shall specify each of her contentions and my answer thereto in the subsequent paragraphs of this order.
4. Learned Counsel for the petitioners firstly contended that the complaint as filed is not maintainable, as Hansraj Bhati filed it in his individual capacity. On this aspect, learned Counsel for the 2nd respondent contended that Hansraj Bhati is the sole proprietor carrying on business in the name and style of Rampal Rajaram Bhati and it was specifically so mentioned in the cause-title of the complaint and hence there is no illegality in the 2nd respondent filing the complaint.
5. A cursory glance at the cause title of the complaint shows that Hansraj Bhati is the complainant. But when the entire cause-title is read carefully, it certainly reveals that the complaint was filed by M/s. Rampal Rajaram Bhati represented by Hansraj Bhati. Even in the very opening paragraph of the complaint, it was specifically stated that the complainant was the proprietor of his business concern carrying on business under the name and style of M/s. Rampal Rajaram Bhati, In view of those clear allegations, there is no illegality in the description of the complainant in the cause-title of the complaint, which per se warrants the proceedings to be quashed. Therefore, the contention of the learned Counsel for the petitioner in this regard is rejected.
6. The next contention of the learned Counsel for the petitioners is that the petitioners were not looking after the day-to-day affairs of A1-company, and that there was no allegation in the complaint that the offence alleged against the accused was committed with the consent or connivance of the petitioners. In support of her contention that a person could be proceeded against only if that person was in charge of and responsible to the company for the conduct of its business, she placed reliance upon K.P.G. Nair v. Jindal Menthol India Ltd., . and Kata Sujatha v. Fertilisers and Chemicals Travancore Ltd., , wherein it was held that the partner of a firm was liable to be convicted for an offence committed by the firm if he was in charge of and responsible to the firm for the conduct of the business of the firm or if it was proved that the offence was committed with the consent or connivance of, or was attributable to any neglect on the part of the partner concerned.
7. The above decisions make it clear that there should be an allegation in the complaint that at the time of commission of the offence, the accused-partner was in charge of and responsible to the company for the conduct of its business, or that the offence was committed with his consent or connivance of or attributable to any neglect on his part.
8. At this stage it is pertinent to refer to Section 141(1) of the Negotiable Instruments Act, which reads as under:
“14(1) If the person committing an offence under Section 138 is a company, every person 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 and shall be liable to be proceeded against and punished accordingly.”
9. A perusal of the above provision and the decisions referred to above makes it clear that every person who at the time of the commission of the offence was in charge of and responsible to the conduct of the business of the company shall be deemed to be guilty of the offence.
10. It has now to be seen whether there is any allegation in the complaint to show that the petitioners were in charge of and responsible to the conduct of the business of the company at the time of commission of the offence.
11. The allegations in the complaint would go to show that the petitioners and A2 and A5, the Directors of the company were taking active part in the conduct of the day-to-day affairs of A1-Company and were managing the whole business affairs of the company, that they were all being aware of their liability, issued the cheques and wilfully neglected to arrange for payment of the cheques. So, the above allegations would clearly go to show that A2 to A5 were taking active part in the conduct of the business of the company.
12. The contention of the learned Counsel for the petitioners is that A2 being the active Director and Incharge Director of the company was looking after the day-to-day affairs of the business transactions of the company and issued the cheques to the 2nd respondent, and, therefore, a alone is liable to be prosecuted and the present petitioners, who were appointed as Additional Directors on 7.2.2000, are not liable to be prosecuted, and to prove that they were appointed only from that date, Form No. 32 is filed. Form No. 32 shows that the petitioners were appointed as Additional Directors of the company on 7.2.2000. The questions as to whether the petitioners were taking active part in the company or not and as to what were their duties as Additional Directors of the Company, have to be decided at the time of trial only, since the allegations in the complaint would clearly go to show that the petitioner as Directors of the Company were taking active part in the conduct of the day-today business of A1-company.
13. On this aspect, it is pertinent to refer to a decision in M.M.T.C. Ltd. v. Medchl Chemicals and Pharma (P) Ltd., VIII (2001) SLT 83=IV (2001) CCR 316 (SC)=2002 CRL LJ 266 in paragraph 23 of which it is held as follows:
“In view of the specific averments made in the complaints that the petitioners were incharge of and were responsible to the affairs of the Company/Firm and the cheques were given with their consent and knowledge and in view of Section 141 of the Act, they are deemed to have committed the offence punishable under Section 138 of the Act along with the Company/Firm. However, it is open to them under the proviso of Section 141 of the Act to plead always that the offence was committed without his/her knowledge or that he/she had exercised with due diligence to prevent the commission of such offence, but such proof can be put forth only at the time of the trial. Inasmuch as specific averments have been made against the petitioners herein specifying the role played by them, it is not permissible to throw away the complains at the threshold by exercising the inherent jurisdiction of this Court under Section 482 of the Code.”
14. In view of the clear allegations in the complaint, it cannot be said that the petitioners were not incharge of and were not responsible to the conduct of the business of A1-Company.
15. The next contention of the learned Counsel for the petitioners is that filing a single complaint consequent to the dishonour of several cheques is bad in law.
16. This Court in E. Madhu, Krishnaveni Foods Pvt. Ltd. v. State, 2002(1) ALT (Crl.) 157 (A.P.) has held as follows:
“Apropos the second contention that separate complaints ought to have been filed in respect of the 20 dishonoured cheques, it is desirable as per the requirements of Sections 218 and 219 of the Code to file separate complaints but it is not a mandatory requirement under law as held by the Apex Court in Ranchood Lal v. State of Madhya Pradesh, “.
17. The facts of the case would go to show that the accused had a running ledger account with the 2nd respondent and the purchases and payments made by them were debited and credited in the account books which were maintained in the regular course of business. Thus, the accused-company had a single ledger account with the 2nd respondent in respect of all transactions made by the accused-company. Therefore, there is nothing wrong in filing a single complaint in respect of dishonour of several cheques. The contention of the learned Counsel for the petitioners on this aspect is thus devoid of merit.
18. The next contention of the learned Counsel for the petitioners is that the petitioners resigned from A1-company on 19.4.2001 and, therefore, by the date of the commission of the offence, they were not Directors of the Company.
19. The proviso to Section 138 of the Negotiable Instruments Act ordains that in order that section is applied, the cheque must be presented within a period of six months, the payee must make a demand for the payment of the said amount, and the drawer fails to make payment within 15 days of receipt of the notice. The main enacting clause of Section 138 of the Act comes into play only after those three conditions are fulfilled.
20. In the present case, the cheques were issued on 11.4.2002, 14.4.2001, 17.4.2001, 19.4.2001, 23.4.2001, 25.4,2001, 30.5.2001, 2.6.2001, and 5,6.2001. The 2nd respondent issued the statutory demand notice on 29.6.2001 to A1, A2 and A4. According to the 2nd respondent, A1 unclaimed the postal cover, the postal cover sent to A2 was returned with an endorsement that the party left, and that the endorsement on the cover sent to A4 is that the addressee did not claim it. A3 received the notice and sent a reply disowning his liability. The returned covers of A1, A2 and A4 were dated 2.7.2001, 3.7.2001 and 12.7.2001 respectively. The acknowledgement of A3 was dated 3.7.2001. The complaint was filed on 8.8.2001.
21. According to the learned Counsel for the petitioner, the alleged offence, if any, has been committed by A3 and A4 on 3.7.2001 and 12.7.2001 respectively, but by then the petitioners resigned as Additional Directors of the Company, which was accepted by the Registrar of Companies as evidenced by the Photostat copy of Form No. 32.
22. This Court sitting under Section 482, Cr.P.C., cannot decide the validity of the photostat copy of Form No. 32 issued by the Registrar of Companies. In Krishna Bhoopal v. Smt. K. Venkata Subamma, 2002(2) ALT (Crl.) 337 (A.P.), this Court has held that it is for the accused to establish, to the satisfaction of the Trial Court, that in fact he ceased to be the Director of the company by the date of issuance of cheques and so he is not liable to be prosecuted. In Asanammal Kasim v. Ceat Financial Services Ltd., 2002(1) ALT (Crl.) 530 (A.P.), this Court held as under:
“The question as to whether the 1st petitioner ceased to be the Director of the Company, by the date of the commission of the offence or not has to be gone into and decided only on the basis of the evidence adduced. Since the person claiming exemption from liability has to prove the necessary facts by leading evidence, petitioner has to establish that she tendered resignation and it was accepted and necessary intimation were given to the Registrar of Companies. On her assertion that she ceased to be a Director of the Company, the complaint cannot be quashed.”
23. Section 141 of the Negotiable Instruments Act makes it clear that every person who, at the time the offence was committed, was incharge of, and was responsible to, the company for the conduct of the business of the company, shall be guilty of the offence. If the accused takes a plea that he was not incharge of and responsible to the company for the conduct of its business, the burden of proving it would be on him. It is not necessary for the complainant to specifically allege in his complaints to the role the accused played in the preparation and issuance of the dishonoured cheque issued in the discharge of a legally recoverable debt.
24. In the present case, the specific allegation in the complaint that the petitioners and other Directors were responsible for the day-to-day affairs of the company is sufficient to show that the petitioners are liable for prosecution under Section 138 of the Negotiable Instruments Act. The validity and genuineness of Form No. 32 filed by the petitioners cannot be gone into at this stage. It is for the petitioners to prove before the Trial Court that they ceased to be the Directors of the Company by the date of the issuance of the cheque and by the date of the commission of the offence.
25. The case of M.P. Murthy v. Satyanarayana Reddy, 2002(2) Decisions Today (A.P.) 129, which the learned Counsel for the petitioners placed reliance upon in support of his contention that consent and connivance of a Director is necessary for charging him for the offence committed by the company, has no application to the facts of the case, since in that case, the name of the petitioner therein was not mentioned in the complaint.
26. In view of the above discussion, this Court has no hesitation in holding that the allegations in the complaint do make out a prima facie case against the petitioners for offence under Section 138 read with Section 141 of the Negotiable Instruments Act. There are absolutely no grounds to quash the proceedings. Hence, the petition is dismissed.