The Senior General Manager vs Joseph D Souza
2022 Latest Caselaw 3824 Kant

                            1



       IN THE HIGH COURT OF KARNATAKA AT BENGALURU

           DATED THIS THE 07TH DAY OF MARCH, 2022

                          BEFORE

         THE HON'BLE MR. JUSTICE M. NAGAPRASANNA

              CRIMINAL PETITION No.2155 OF 2021

BETWEEN:

THE SENIOR GENERAL MANAGER
COFFEE DAY GLOBAL LIMITED
(FORMERLY AMALGAMATED BEEN
COFFEE TRADING COMPANY LTD.,)
BELUR ROAD, J.H.KERE POST
HASSAN - 573 217.
                                                  ... PETITIONER
(BY SRI S.G.BHAGAVAN, ADVOCATE)

AND:

JOSEPH D'SOUZA
S/O LATE ISHANTHI D'SOUZA
AGED ABOUT 62 YEARS
COFFEE PLANTER
RESIDING AT LAVITHA ESTATE
ITTIGE-MAKKIMANE
B.KANABUR VILLAGE
BALEHONNUR HOBLI
N.R.PURA TALUK
CHIKKAMANGALURU DISTRICT - 577 112.
                                             ... RESPONDENT
(BY SRI B.S.PRASAD, ADVOCATE)


     THIS CRIMINAL PETITION IS FILED UNDER SECTION 482 OF
CR.P.C., PRAYING TO QUASH THE ENTIRE PROCEEDINGS IN
C.C.NO.269/2020 PENDING IN THE COURT OF THE CIVIL JUDGE
                                2



AND, JMFC, N.R PURA (NARASIMHARAJAPURA) CHIKKAMAGALURU
DISTRICT FOR AN ALLEGED OFFENCE P/U/S 138 OF N.I ACT.


     THIS CRIMINAL PETITION COMING ON FOR ADMISSION THIS
DAY, THE COURT MADE THE FOLLOWING:

                               ORDER

The petitioner is before this Court calling in question

proceedings in C.C.No.269 of 2020 pending before the Civil

Judge & JMFC, N.R.Pura, Chikmagalur District registered for

offence punishable under Section 138 of the Negotiable

Instruments Act, 1881 ('the Act').

2. Heard learned counsel Sri S.G.Bhagavan appearing for

the petitioner and Sri B.S.Prasad, learned counsel appearing for

the respondent.

3. Brief facts leading to the filing of the present petition, as

borne out from the pleadings, are as follows:-

An Amalgamated Bean Coffee Trading Company Limited

which later came to be known as Coffee Day Global Limited

('Company' for short) had a transaction with the respondent/

complainant and in furtherance of which, cheques were allegedly

issued by the Company in favour of the respondent. The cheques

were for varied amounts of varied dates. The cheques were

presented to the bank for realization but were returned for want

of sufficient funds. Legal proceedings were taken up by the

respondent against the petitioner as required in law as a prelude

to initiation of criminal proceedings. After the said procedure,

the respondent/complainant registers a complaint invoking

Section 200 of the Cr.P.C. for offences punishable under the Act.

In the said complaint, the petitioner, a senior General Manager

was the accused and not the Company which had issued the

cheques. Taking cognizance of the offence by the learned

Magistrate has driven the petitioner to this Court in the subject

petition.

4. The learned counsel Sri S.G.Bhagavan appearing for the

petitioner would raise a solitary submission that cheques were

issued by the Company, but the Company is not made a party.

Without making the Company a party, the complaint itself was

not maintainable.

5. On the other hand, the learned counsel representing the

respondent/complainant would though admit that the Company

is not made a party as accused, but nonetheless, the petitioner

is well aware of all the affairs of the Company and therefore, the

petitioner being the accused would suffice in law and would seek

that the petitioner has to come out clean in the trial.

6. I have given my anxious consideration to the

submissions made by the respective learned counsel and

perused the material on record.

7. The solitary issue that requires consideration at the

hands of this Court in the subject petition is, 'whether the

complaint would be maintainable in the light of the Company not

being made a party and the proceedings being in violation of

Section 141 of the Act which deals with offences of companies?'

8. The issue need not detain this Court for long or delve

deep in to the matter, as the issue stands covered by plethora of

judgments beginning from ANEETA HADA V. GOD FATHER

TRAVELS AND TOURS PVT. LTD.,1 wherein the Apex Court

holds as follows:

"53. It is to be borne in mind that Section 141 of the Act is concerned with the offences by the company. It makes the other persons vicariously liable for commission of an offence on the part of the company. As has been stated by us earlier, the vicarious liability gets attracted when the condition precedent laid down in Section 141 of the Act stands satisfied. There can be no dispute that as the liability is penal in nature, a strict construction of the provision would be necessitous and, in a way, the warrant.

... ... ... ...

56. We have referred to the aforesaid passages only to highlight that there has to be strict observance of the provisions regard being had to the legislative intendment because it deals with penal provisions and a penalty is not to be imposed affecting the rights of persons, whether juristic entities or individuals, unless they are arrayed as accused. It is to be kept in mind that the power of punishment is vested in the legislature and that is absolute in Section 141 of the Act which clearly speaks of commission of offence by the company. The learned counsel for the respondents have vehemently urged that the use of the term "as well as" in the section is of immense significance and, in its tentacle, it brings in the company as well as the Director and/or other officers who are responsible for the acts of the company and, therefore, a prosecution against the Directors or other officers is tenable even if the company is not arraigned as an accused. The words "as well as" have to be understood in the context.

... ... ... ...

59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is

(2012) 5 SCC 661

imperative. The other categories of offenders can only be brought in the drag-net on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V. Parekh [(1970) 3 SCC 491: 1971 SCC (Cri) 97] which is a three-Judge Bench decision. Thus, the view expressed in Sheoratan Agarwal [(1984) 4 SCC 352: 1984 SCC (Cri) 620] does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada [(2000) 1 SCC 1: 2001 SCC (Cri) 174] is overruled with the qualifier as stated in para 51. The decision in Modi Distillery [(1987) 3 SCC 684: 1987 SCC (Cri) 632] has to be treated to be restricted to its own facts as has been explained by us hereinabove."

In the light of the admitted position that the Company is not

made an accused in the complaint, the further proceedings

against the petitioner who is only a Senior General Manager

cannot be permitted to continue, with reference to the provisions

of the Act and its interpretation by the Apex Court in the

judgment (supra).

9. For the aforesaid reasons, I pass the following:

ORDER

(i) The Criminal Petition is allowed.

(ii) The proceedings in C.C.No.269 of 2020 pending before the Civil Judge & JMFC, N.R.Pura, Chikkamagalur District stand quashed.

Sd/-

JUDGE

bkp CT:MJ