JUDGMENT
J.D. Kapoor, J.
1. Petitioner is a Government Teacher in the school
of Delhi Vidyut Board while her husband who has been
arrayed as respondent No. 1 is in the business of
advertisement under the name of Vikalp Advertising.
2. Admittedly the petitioner is the wife of the main
accused who took a loan of Rs. 50,000/- which was given by
way of cheque and he gave the blank cheque as security.
3. The petitioner’s application for recall of the
summoning order was dismissed by the learned ASJ vide
order dated 7th May, 2002 on the ground that the averments
being made by the petitioner cannot be looked into at this
stage because it is yet to be proved by the complaint
himself that the cheque was returned for insufficient
funds and the cheque was given to them in discharge of the
liability by the accused persons.
4. I am afraid the observations and the view of the
learned ASJ suffers from enormous erroneousness. Section
138 of the Negotiable Instruments Act holds those
individuals liable who are drawer of the cheque and no
other person. In order to appreciate the contention of
the learned counsel Sections 138 & 141 need to be
reproduced. These are as under:-
138. Dishonour of cheque for
insufficiency etc. of funds in the account –
Where any cheque drawn by a person on an
account maintained by him with a banker for
payment of any amount of money to another
person from out of that account for the
discharge, in whole or in part, of any debt or
other liability, is returned by the bank
unpaid, either because of the amount of money
standing to the credit of that account is
insufficient to honour the cheque or that it
exceeds the amount arranged to be paid from
that account by an agreement made with that
bank, such person shall be deemed to have
committed an offence and shall, without
prejudice to any other provision of this Act,
be punished with imprisonment for a term which
may extend to one year, or with fine which may
extend to twice the amount of the cheque, or
with both:
Provided that nothing contained in this
section shall apply unless –
(a) the cheque has been presented to the
bank within a period of six months from the
date on which it is drawn or within the period
of its validity, whichever is earlier.
(b) the payee or the holder in due
course of the cheque, as the case may be,
makes a demand for the payment of the said
amount of money by giving a notice, in
writing, to the drawer of the cheque, within
fifteen days of the receipt of information by
him from the bank regarding the return of the
cheque as unpaid, and
(c) the drawer of such cheque fails to
make the payment of the said amount of money
to the payee or, as the case may be, to the
holder in due course of the cheque, within
fifteen days of the receipt of the said
notice.
Explanation – For the purposes of this
section, “debt or other liability” means a
legally enforceable debt or other liability.
” 141. Offences by companies – (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.
Provided that nothing contained in this
sub-section shall render any person liable to
punishment if he proves that the offence was
committed without his knowledge, or that he
had exercised all due diligence to prevent the
commission of such offence.
(2) Notwithstanding anything contained
in Sub-section (1), where any offence under
this Act has been committed by a company and
it is proved that the offence has been
committed with the consent or connivance of,
or is attributable to, any neglect on the part
of, any director, manager, secretary or other
officer shall also be deemed to be guilty of
that offence and shall be liable to be
proceeded against and punished accordingly.
Explanation – For the purposes of this
section. –
(a) “company” means any body corporate
and includes a firm or other association of
individuals; and
(b) “director”, in relation to a firm,
means a partner in the firm.”
5. However, the explanation to Section 141 defines
the Company as a body Corporate, the firm or other
association of individuals. The learned counsel for the
respondent has laid great emphasis on the words “other
association of individuals” in order to bring the
petitioner in the net of the offence committed under
Section 138. Bare reading of these provisions show that
offence under Section 138 is offence committed by an
individual if he draws the cheque individual capacity
and if the Company happens to be the drawer of the cheque
then those persons who were at the relevant time in charge
of and responsible to the day-to-day affairs of the
Company are liable to be prosecuted under Section 138.
6. Definition of Company shows that the contention
of the learned counsel that husband and wife should be
deemed as “Association of individuals” is wholly
misconceived as words “other association of individuals”
pertain to only individuals who are engaged in the
same business as a group and not the likes of the
petitioner and her husband. Petitioner is not engaged in
the business of her husband. She is a Government Teacher.
The loan was taken by her husband by way of cheque and it
was her husband who is the drawer of the cheque which on
presentation was dishonoured. Merely because the
petitioner accompanied her husband when he took the loan
as the complainant happened to be her friend would in no
way saddle the petitioner with the liability of the
offence under Section 138 of the Act.
7. If the concept propounded by the learned counsel
for the respondent is accepted then every member of the
family of a person who is engaged in a particular business
can be roped in being “Association of individuals”.
8. It appears that the learned ASJ did not
appreciate the contention and the arguments of the
petitioner in the right perspective and lost track of the
ingredients of the offence under Section 138 while
dismissing the application of the petitioner for recall of
the summoning order vis-a-vis her.
9. The foregoing reasons persuade me to allow the
petition and set aside the impugned order. The order
summoning the petitioner is hereby recalled. However any
observation made in this order shall not be used by the
co-accused nor will it tantamount to expression of opinion
on the merits of the complaint. This confines to the
petitioner alone.