JUDGMENT V.S. Aggarwal, J.

1. By this common judgment, Criminal Revision Nos.441/2002, 442/2002, 443/2002 and444/2002 can conveniently be disposed together. Since it was not disputed that question involved in all the petitions is identical, therefore, for sake of convenience, the facts are being taken from Crl.R.441/2002 - Bhupinder Tandon versus Vikas Mangla.

2. The revision petitions have been directed against the order passed by the Metropolitan Magistrate, Karkardooma Courts, Shahdara, Delhi dated 1.3.2002. The learned trial Court dismissed the application filed by the petitioners praying for their discharge.

3. The relevant facts are that the respondent had filed a complaint under Section 138 read with Section 142 of the Negotiable Instruments Act, 1881 (for short "the Act"). It had been alleged that M/s. Pavilion Telematics India Limited is a limited company. Narender Tandon is the Director besides the petitioners. The petitioners were stated to be taking active part in running the business of the company and are in charge of the affairs and responsible for the conduct of the business of the company. Certain goods are stated to have been purchased by the company. Narender Tandon had issued two cheques, which were dishonoured on presenting the same. The said cheques were issued with the knowledge and consent of the petitioners. After due notice and other legal formalities, the complaint, as such, had been filed.

4. The petitioners filed an application for dropping the proceedings against them. They pleaded that the complaint, as against them, is not maintainable because they ceased to be the Directors of the company from 30.10.1999 and 30.6.1997 respectively. Furthermore, it was alleged that there is nothing to show that at the relevant time, both these petitioners were in-charge and were responsible for the conduct of the business of the company. Consequently, the rigours of Section 141 of the Act are not attracted.

5. Needless to state that the application was opposed and the learned trial Court held that so far as the question as to whether the petitioner had ceased to be the directors of the company is concerned, the matter will be decided after recording of evidence. So far as the fact that the petitioners were not alleged to be connected with the affairs of the company or that they were not responsible for the conduct of business of the company is concerned, the trial Court found that necessary averments existed in the complaint. Hence the present revision petitions.

6. Section 141 of the Act deals with the situation when the offence is purported to have been committed by the companies. It unfolds itself in the following words:

141. Offences by companies.-- (1) If the person committing an offence under Section 138 is a company, every person who, at the time of 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 with out 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 of the company, such 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 corporated and includes a firm or other association of individuals; and

(b) "director", in relation to a firm, means a partner in the firm.

7. Perusal of the aforesaid would clearly show that if the offence is purported to have been committed by the company, at that time a person who was in charge of and responsible to the company for conduct of the business of the company as well as the company, shall be deemed to be guilty of the said offence also. There is a proviso to sub-Section (1) of Section 141 that he can prove his innocence if he establishes that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

8. The attention of the Court was drawn to the fact that the petitioners had resigned from the company before the alleged cheques had been issued and, therefore, they can not be held responsible in this regard. But, so far as this Form-32 in pursuant to Section 303 of the Companies Act is concerned, indeed, it is to be established during the course of trial if the said persons ceased to be directors before the said offence is stated to have been committed. At this stage, expressing of any opinion would embarrass either party because final finding in this regard can not be given.

9. The main contention in this regard, however, was that there is no averment in the complaint that at the relevant time,when the offence was committed, the petitioners were in charge or were responsible to the company for conduct of the business of the company. It was asserted that in the absence of any specific averment, indeed, the company qua the petitioners is liable to be dismissed.

10. To appreciate the said controversy, reference can well be made to some of the precedents cited at the Bar in the case of MAHENDRA PRATAP SINGH RATRA & ANR. versus M/S. N.K. METALS & amp; ANR, 1999 (1) CRIMES 181. In the cited case, this Court found that cheques in question had been issued by one Shri Ajit Singh Ratra. There was no averment or allegation that the other persons, who were Petitioners before this Court were directly or indirectly in charge of and responsible to the company for conduct of its day-to-day business. Their contention, therefore, that the complaint could not proceed against them, was accepted. This Court held :

....."There is no averment or allegation in the complaint or pre-summoning evidence even to obliquely suggest that the petitioners/ Directors were at any point of time directly or indirectly in charge of and responsible to the company for the conduct of its day-to-day business or any material on record which may even remotely suggest that the alleged offence was committed with the consent or connivance of, or was attributable to any neglect on the part of the petitioners. In the absence of such an averment/evidence, in my view the petitioners cannot be roped in under Section 141 of the Act."

11. In another decision, rendered by this Court in the case of SMT. SARASWATHY AMMA & ANR. versus M/S.SWIL LIMITED & ANOTHER, 2000 (1) JOURNAL OF CRIMINAL CASES 42, a similar question had come up for consideration. It was held that merely because a person is a director of the company will not make him liable. There should be specific averment against him pertaining to ingredients of Section 141 of the Act. It was held:

....."Simply because a person is a director of the company or a partner of a firm, it does not necessarily mean that he fulfills both the above requirements such to make him vicariously liable. There must be specific accusation against each of the persons arraigned an accused that such person was in charge of and responsible for the conduct of the business of the company or the firm at the relevant time when the alleged offence was committed by the company or the firm. The said requirement cannot be left to the wild imagination of the complainant."

12. It has to be remembered that in the case of Smt.Saraswathy Amma (supra), this Court even noted that the petitioners before the Court had executed General Power of Attorney in favor of another and inference further was drawn that therefore, they would not be the persons in charge of and responsible for the conduct of business of the company. Herein too there is no specific averment that has been made.

13. Similar findings had been arrived at in the case of SMT.K.JANAKI MANOHARAN AND ANOTHER versus M/S.GAYATRI SUGAR COMPLEX LTD. AND ANOTHER, 2001 CRI.L.J.52. The Andhra Pradesh High Court the same view that every director is not liable for the offence committed by a company and specific and clear assertions should be made.

14. Similar view prevailed with the Kerala High Court in the case of P.K.KURIAN versus R.SANKARA RAMAN AND ANOTHER, 2002 CRI.L.J.478 that there should be specific averments in this regard.

15. Two decisions of the Supreme Court on the subject can also be taken note of. In the case of U.P.POLLUTION CONTROL BOARD versus M/S.MOHAN MEAKINS LTD. & ORS, 2000 III AD (SC)

254.The Supreme Court was dealing with Water (Prevention and Control of Pollution) Act, 1974 with respect to the offences by the companies. The provisions are para-materia with the present Act. The Supreme Court held that for issuing of process only the allegations in the complaint have to be looked into. The averments made were that Chairman and Directors were responsible for the acts of the company. The Supreme Court held that the complaint can continue as the necessary ingredients in this regard were satisfied.

16. Similarly, in the case of K.P.G. NAIR versus M/S.JINDAL MENTHOL INDIA LTD., 2001 (2) CRIMES 132, the Supreme Court reiterated that averments must indicate that when the crime was committed the person, who is being arrayed as an accused, was in charge of and responsible to the company for conduct of business of the company. In paragraph 8, the following conclusions have been recorded : "8.From a perusal of Section 141, it is evident that in a case where a Company committed offence under Section 138, then not only the Company but also every person who at the time when the offence was committed, was in charge of and was responsible to the Company for the conduct of the business of the Company shall be deemed to be guilty of the offence and liable to be proceeded against and punished accordingly. It follows that a person other than the Company can be proceeded against under those provisions, only if that person was in charge of and was responsible to the Company for the conduct of its business."

17. From the aforesaid facts, certain conclusions can conveniently be drawn, namely, that the complaint must contain averments to attract the rigour of Section 141. It is not necessary that precise words of Section 141(1) of the Act should be reproduced. The court has to see the averments and thereafter conclude as to whether necessary ingredients have been averred to prompt the court to proceed in this regard. It will all depend upon the facts and circumstances of each case. If the conclusion is that there is no averment and a person is unnecessarily being harassed, the court would certainly not permit the abuse of process of law but if the necessary averments exist, which are mandatory, in that event, as had been noted by the Supreme Court in the case of U.P. Pollution Control Board (supra), the complaint can continue.

18. Reverting back to the facts of the case. It is clear that complainant had specifically pleaded that the petitioners are the directors of the company. They are taking active part in the running of the business of the company and are in charge of the affairs and are equally responsible for the conduct of business of the company. Furthermore, it was averred that the cheques have been issued by the company during the course of business and this had been done with the knowledge of the present petitioners, who are the directors for discharge of their liability. In other words, the necessary ingredients had been pleaded, which promoted the court to issue the notice. It is not one of those cases where it could be inferred that the averments lacked clarity or suffers from ambiguity or necessary ingredients pertaining to the offence are missing. Therefore, there is no ground to interfere.

19. For these reasons, the petitions must fail and are dismissed in liming.