LexRALLIS INDIA LTD. versus PODURU VIDYA BHUSAN & ORS.
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[2011] 5 S.C.R. 289 RALLIS INDIA LTD. v. PODURU VIDYA BHUSAN & ORS. (Criminal Appeal No. 924 of 2011) · APRIL 13, 2011 . tt • [DALVEER,BHANDARI AND DEEPAK VERMA, JJ.] A B Negotiable Instruments Act, 1881: s. 141 - Offence by companies/firms· - Dishonour of cheque issued by partnership firm - Complaint u/s. 138 against firm and partners C including respondents - Averment in the complaint that all partners were looking .after day to day affairs of the accused firm and their liability was joint as we// as several - Quashing of complaint sought by respondents on the ground that they had severed their connections with the firm much prior to the D issuance of dishonoured cheques - High Court discharged the respondents ..:. On appeal, held: Specific averments were made against the respondents that they were the partners of the firm, at the relevant point of time and were looking after day to day affairs of the partnership firm - Burden of proof that E at the relevant point of time they were not partners, lay specifically on them - The question as to whether or not tliey were partners in the firm during the relevant period is one of fact, which has to be established in trial - High Court should not have interfered with the cognizance of the complaints F having been taken by the trial court a.nd discharged the respondents of the said liability at the threshold - Code of Criminal Procedure, 1973 - s.482. Code of Criminal Procedure, 1973: s.482 - Manner in which High Courts ought to exercise their power to quash G criminal proceeding when such proceeding is related to offences committed by companies - Discussed. The appellant filed criminal complaints under 289 H , , ____ I 290 SUPREME COURT REPORTS [2011) 5 S.C.R. A Sections 138 and 141 of the Negotiable Instruments Act, 1881 against the accused. In the complaint, the plea was raised by the appellant that the accused No. 1 was a partnership firm and accused No. 2 to 7 were partners thereof and accused No. 3 was signatory of the B impugned cheques and all partners were looking after day to day affairs of the accused firm and thus the liability as raised by them was joint as well as several. The respondents arrayed as accused nos.4, 6 and 7 C in the said complaints filed applications in the High Court under Section 482, Cr.P.C. for their discharge on the ground that they had severed their connections with the accused-firm much prior to the issuance of the dishonoured cheques. The High Court discharged the 0 respondents. Aggrieved, the appellant filed the instant appeal. Allowing the appeal, the Court HELD: 1. Sufficient avermentS were made against the E respondents that they were the partners of the firm, at the relevant point of time and were looking after day to day affairs of the partnership firm. These averments were specifically mentioned by the appellant in the complaint even though denied by the respondents but the burden F of proof that at the relevant point of time they were not the partners, lay specifically on them. This onus was required to be discharged by them by leading evidence and unless it was so proved, in accordance with law, they could be discharged of their liability. Consequently, High G Court committed an error in discharging them. Also, by virtue of their own submissions before the High Court, the respondents had admitted the fact that the appellant had referred to them in their capacity as partners who were in-charge of the affairs of the firm in the initial H RALLIS INDIA LTD. v. PODURU VIDYA BHUSAN & 291 ORS . . complaintS. The question as to whether or not they were A partners in the firm as on 31.03.2004, is one of fact, which was to be established in trial. Thus, the primary responsibility of .the complainant is to make specific avermentS in the' complaint so as to"make the accused 'vicarioushi liable~ For fastening the criminal liabilify, there B is no legal requirement for the complainant to show that 1 , • ~ •' • : .• I , • , ' 'r f the accused partner of the firm· was aware about each 1 •fl,· .• . . .- ' • ' •. and· ~very 'transaction., On the other hand, proviso to Section 141 of-the Act clearly lays' down that if the accused is able to 'prove to the ·s·a'tisfaction of the Court C that tne offence was 'committed without his 'knowledge' or he ·ha Cl ·exercised due 1 diligence to ·prevent the commission "of such offence, he' wil
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