Delhi High Court
Vijay Mallya vs Delhi International Airport ... on 29 July, 2016
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CRL.M.C. 5479/2014
Date of Decision : July 29th, 2016
VIJAY MALLYA ..... Petitioner
Through: Mr. Ramesh Gupta, Senior Advocate
with Mr. Ajay Bhargava, Mr.Rajiv
Bhatnagar, Mr Aseem Chaturvedi, Mr.
Vipul Joshi, Advocates
versus
DELHI INTERNATIONAL AIRPORT PRIVATE LIMITED
..... Respondent
Through: Ms. Geeta Luthra, Senior Advocate
with Mr. L.K. Singh, Mr. S.K. Singh,
Mr. Aayush Chandra, Advocates for
respondent.
WITH
+ CRL.M.C. 5480/2014
VIJAY MALLYA ..... Petitioner
Through: Mr. Ramesh Gupta, Senior Advocate
with Mr. Ajay Bhargava, Mr.Rajiv
Bhatnagar, Mr Aseem Chaturvedi, Mr.
Vipul Joshi, Advocates
versus
DELHI INTERNATIONAL AIRPORT PRIVATE LIMITED
..... Respondent
Through: Ms. Geeta Luthra, Senior Advocate
with Mr. L.K. Singh, Mr. S.K. Singh,
Mr. Aayush Chandra, Advocates for
respondent
Crl.M.C. 5479-5482/2016 Page 1 of 11
WITH
+ CRL.M.C. 5481/2014
VIJAY MALLYA ..... Petitioner
Through: Mr. Ramesh Gupta, Senior Advocate
with Mr. Ajay Bhargava, Mr.Rajiv
Bhatnagar, Mr Aseem Chaturvedi, Mr.
Vipul Joshi, Advocates
versus
DELHI INTERNATIONAL AIRPORT PRIVATE LIMITED
..... Respondent
Through: Ms. Geeta Luthra, Senior Advocate
with Mr. L.K. Singh, Mr. S.K. Singh,
Mr. Aayush Chandra, Advocates for
respondent
AND
+ CRL.M.C. 5482/2014
VIJAY MALLYA ..... Petitioner
Through: Mr. Ramesh Gupta, Senior Advocate
with Mr. Ajay Bhargava, Mr.Rajiv
Bhatnagar, Mr Aseem Chaturvedi, Mr.
Vipul Joshi, Advocates
versus
DELHI INTERNATIONAL AIRPORT PRIVATE LIMITED
..... Respondent
Through: Ms. Geeta Luthra, Senior Advocate
with Mr. L.K. Singh, Mr. S.K. Singh,
Mr. Aayush Chandra, Advocates for
respondent
Crl.M.C. 5479-5482/2016 Page 2 of 11
CORAM:
HON'BLE MR. JUSTICE P.S.TEJI
P.S.TEJI, J.
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 pre-
summoning evidence. Summons against the above accused
persons were issued on 22.06.2012. On 12.08.2015, notice under
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 cross-
examination of said witness. Adducing evidence during pre-
summoning 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 :
"15. If the requirement that such individual
notices to the directors must additionally be
given is read into the concerned provisions,
it will not only be against the plain meaning
and construction of the provision but will
make the remedy under Section 138 wholly
cumbersome. In a given case the ordinary
lapse or negligence on part of the Company
could easily be rectified and amends could
be made upon receipt of a notice under
Section 138 by the Company. It would be
unnecessary at that point to issue notices to
all the directors, whose names the payee
may not even be aware of at that stage.
Under Second proviso to Section 138, the
notice of demand has to be made within 30
days of the dishonour of cheque and the
third proviso gives 15 days time to the
drawer to make the payment of the amount
and escape the penal consequences. Under
clause (a) of Section 142, the complaint
must be filed within one month of the date
on which the cause of action arises under the
third proviso to Section 138. Thus a
complaint can be filed within the aggregate
period of seventy five days from the
dishonour, by which time a complainant can
gather requisite information as regards
names and other details as to who were in
charge of and how they were responsible for
the affairs of the Company. But if we accept
the logic that has weighed with the High
Court in the present case, such period gets
reduced to 30 days only. Furthermore,
unlike proviso to clause (b) of Section 142
of the Act, such period is non-extendable.
The summary remedy created for the benefit
of a drawee of a dishonoured cheque will
thus be rendered completely cumbersome
and capable of getting frustrated.
16. In our view, Section 138 of the Act does
not admit of any necessity or scope for
reading into it the requirement that the
directors of the Company in question must
also be issued individual notices under
Section 138 of the Act. Such directors who
are in charge of affairs of the Company and
responsible for the affairs of the Company
would be aware of the receipt of notice by
the Company under Section 138. Therefore
neither on literal construction nor on the
touch stone of purposive construction such
requirement could or ought to be read into
Section 138 of the Act...."
In National Small Industries Corp. Ltd. v. Harmeet Singh
Paintal and Anr. MANU/SC/0112/2010, the Hon'ble Apex Court
observed that as per Section 141 of the Negotiable Instruments Act
what is required is that the persons who are sought to be
made vicariously liable for a criminal offence under
Section 141 should be, at the time the offence was committed, in-
charge of and responsible for the conduct of the business of the
company. Only those persons who were incharge of and
responsible for the conduct of the business of the company at the
time of commission of an offence will be liable for criminal action.
The liability arises from being in-charge of and responsible for the
conduct of the business of the company at the relevant time when
the offence was committed.
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 non-
mentioning 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.
13. The only part left is that the name of Mr.Vijay Mallya as
Chairman and Managing Director of the company was not added in
the original complaint filed under Section 138 of the Negotiable
Instruments Act. Adding the name of Mr.Vijay Mallya during the
proceedings brought forth before the Court below that he was the
Chairman and Managing Director of the company which is guilty
for dishonouring the cheques in question, would be covered under
Section 141 of the Negotiable Instruments Act and cannot be
termed as abuse to the process of law as envisaged in Section 482
Cr.P.C.
14. In view of the above facts and circumstances, this Court is
of the considered opinion that the order passed by the learned Trial
Judge cannot be termed as unsustainable or illegal or abuse to the
process of law and no ground is made out to set aside the same.
15. Consequently, all the four petitions and applications, if any,
are hereby dismissed.
(P.S.TEJI)
JUDGE
JULY 29, 2016
dd
