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Anil Agrawal (Retired)     27 April 2009

Cheque bouncing

 I would like to post the following for the information of lawyer friends.

6. In Sabitha Ramamurthy and Anr. v. R.S.S. Channabasavaradhya, reported in [2006] 10 SCC 581, this Court opined:-

"7. A bare  of the complaint petitions demonstrates that the statutory requirements contained in Section 141 of the Negotiable Instrument Act had not been complied with. It may be true that it is not necessary for the complainant to specifically reproduce the wordings of the section but what is required is a clear statement of fact so as to enable the court to arrive at a prima facie opinion that the accused are vicariously liable. Section 141 raises a legal fiction. By reason of the said provision, a person although is not personally liable for commission of such an offence would be vicariously liable therefor. Such vicarious liability can be inferred so far as a company registered or incorporated under the Companies Act, 1956 is concerned only if the requisite statements, which are required to be averred in the complaint petition, are made so as to make the accused therein vicariously liable for the offence committed by the company. Before a person can be made vicariously liable, strict compliance with the statutory requirements would be insisted. Not only the averments made in para 7 of the complaint petitions do not meet the said statutory requirements, the sworn statement of the witness made by the son of the respondent herein, does not contain any statement that the appellants were in. charge of the business of the Company. In a case where the court is required to issue summons which would put the accused to some sort of harassment, the court should insist strict compliance with the statutory requirements. In terms of Section 200 of the Code of Criminal procedure, the complainant is bound to make statements on oath as to how the offence has been committed and how the accused persons are responsible therefor. In the event, ultimately, the prosecution is found to be frivolous or otherwise mala fide, the court may direct registration of case against the complainant for male fide prosecution of the accused. The accused would also be entitled to file a suit for damages. The relevant provisions of the code of Criminal Procedure are required to be construed from the aforementioned point of view." (See also: Everest Advertising Pvt. Ltd. v. State Govt. of NCT of Delhi & Ors., reported in JT (2007) 5 SC 529 and Raghu Lakshminarayanan v. M/S. Fines Tubes reported in JT (2007) 5 SC 552. 



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