V.K. Jain vs State of U.P. and Another

Amar Saran, J.—Heard Sri R. P. Dwivedi, learned Counsel for the applicant and Sri G. S. Chaturvedi, senior counsel for opposite party No. 2.

The applicant has sought quashing or criminal proceedings u/s 138 read with Section 142 of the Negotiable Instruments Act pending as Complaint Case No. 14 of 2000, Sri Ram Piston and Rings Ltd. v. Yamuna Diesel and Electricals, Agra Complaint Case No. 14 of 2000 Complaint Case No. 14 of 2000.

The contention of the learned Counsel for the applicant is that signature on the impugned cheque is not that of the applicant V. K. Jain at all, but is that of A. K. Jain. This averment is made in paragraph 10 of the affidavit in support of his application. There is no denial of this averment in paragraph 9 of the counter-affidavit, which only states that Ajay Kumar Jain was also a partner of M/s. Yamuna Diesel and Electricals and another partner was V. K. Jain. A bare perusal of the cheque also shows that it does not appear to have been signed by V. K. Jain. For launching a prosecution u/s 138 with the aid of Section 141 there has to be an allegation in the complaint itself against every accused, that at the time when the offence was committed, he was in charge of, and was responsible for the company for the conduct of the business of the company. This averment is absent in the complaint or in the statement of the witnesses u/s 202, Cr. P.C. This legal proposition has been enunciated by the Apex Court in various decisions namely Smt. Katta Sujatha Vs. Fertilizers and Chem. Travancore Ltd. and Another, ; K. P. G. Nair v. Jindal Menthol India Ltd., 2000 (3) ARC 2616 (SC) ; JT 2000 1 SC 519 and Anil Hada v. Indian Acrylic Ltd., (III) 1999 ACC 2845 (SC): JT 1999 (9) SC 233.

In this view of the matter the applicant cannot be prosecuted u/s 138 of the Negotiable Instruments Act and the prosecution against him in the aforesaid case is quashed. However, the learned Counsel for opposite party No. 2 contends that so far as the firm is concerned, it can always be prosecuted in view of Section 141 of Negotiable Instruments Act, which permits the prosecution of the company, although the company can only be awarded a fine and there cannot be a sentence of imprisonment against it. As in this case, only the applicant V. K. Jain is seeking quashing of the criminal complaint against him, it will be open for the complainant to raise his contentions about the maintainability of the prosecution of the firm before the trial court.

With these observations, this application is allowed.