SHARAD KUMAR SANGHI versus SANGITA RANE

Citation: [2015] 2 S.C.R. 145 · Decided: 10-02-2015 · Supreme Court of India · Bench: DIPAK MISRA, ADARSH KUMAR GOEL · Disposal: Appeal(s) allowed

Cited by 6 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

[2015]2S.C.R.145 
SHARAD KUMAR SANGH I 
v. 
SANGITA RANE 
(Criminal Appeal No. 1584 of 2007) 
FEBRUARY 10, 2015 
[DIPAK MISRA AND ADARSH KUMAR GOEL, JJ.] 
A 
B 
Code of Criminal Procedure, 1973 - ss.482, 200 -
Complaint uls. 200 alleging case of cheating against the 
appellant-Managing Director of the Company- Cognizance 
taken and summons issued - Magistrate holding that prima C 
facie sufficient grounds exists for registration of complaint 
against the accused Company - Application seeking 
quashing of proceedings in criminal case, dismissed by High 
Court - On appeal, held: Allegations which find place against 
the Managing Director in his personal capacity are absolutely D 
vague and principally the allegations are against the 
company- When a complainant intends to proceed against 
the Managing Director of a company, it is essential to make 
requisite allegation to constitute the vicarious liability- When E 
a company has not been arrayed as a party, no proceeding 
can be initiated against it -
Thus, criminal proceedings 
initiated against the appellant quashed. 
Allowing the appeal, the Court 
F 
HELD: The complainant's initial statement would 
reflect, the allegations are against the company, but the 
company has not been made arrayed as a party. 
Therefore, the allegations have to be restricted to the 
Managing Director. The allegations which find place G 
against the Managing Director in his personal capacity 
are absolutely vague and in fact, principally the 
allegations are against the company. There is no specific 
145 
H 
146 
SUPREME COURT REPORTS 
[2015] 2 S.C.R. 
A allegation against the Managing Director. When a 
complainant intends to proceed against the Managing 
Director or any officer of a company, it is essential to 
make requisite allegation to constitute the vicarious 
liability. When a company has not been arrayed as a party, 
B no proceeding can be initiated against it even where 
vicarious liability )s fastened on certain statutes. Such 
an order could not have been passed. The order passed 
by the High Court is sensitively vulnerable and is set 
aside and the criminal proc:eedings initiated by the 
C respondent against the appellant are quashed. [Paras 
9, 11, 13] [149-G; 151-G; 152-A-B] 
Maksud Sajyad vs. State ofGujarat2007 (9) SCR 1113: 
(2008) 5 SCC 668; S.M.S. Pharmaceuticals Ltd. v. Neeta 
o Bhalla and Anr. 2005 (3) Suppl. SCR 371 : (2005) 8 SCC 
89; S.K. Alagh v. State of UP 2008 (2) SCR 1088: (2008) 5 
SCC 662; Maharashtra State Electricity Distribution 
Company Ltd. v. Datar Switchgear Ltd. 2010 (12) SCR 551: 
(2010) 10 SCC 479; GHCL Employees Stock Option Trust 
E 
v. India lnfoline Ltd. 2013 (5) SCR 276: (2013) 4 SCC 505; 
Aneeta Hada v. Godfather Travels and Tours Private Limited 
2012 (5) SCR 503: (2012) 5 SCC 661 - referred to. 
Case Law Reference 
F 
2007 (9) SCR 1113 
Referred to. 
Para 9 
2005 (3) Suppl. SCR 371 
Referred to. 
Para 9 
2008 (2) SCR 1088 
Referred to. 
Para 10 
G 
2010 (12) SCR 551 
Referred to. 
Para 10 
2013 (5) SCR 276 
Referred to. 
Para 10 
2012 (5) SCR 503 
Referred to. 
Para 11 
CRIMINAL APPELLATE JURISDICTION : Criminal 
H Appeal No. 1584 of 2007 
SHARAD KUMAR SANGH! v. SANGITARANE 
147 
From the Judgment and Order dated 30.11.2006 of the A 
High Court Madhya Pradesh, bench at Jabalpur in M. Cr. C. 
No.1922 of 2002 
Sidharth Luthra, Buddy A. Ranganna Dhan,A. V. Rangam, 
D. V. Raghu VamsyfortheAppellant. 
B 
Akshat Shrivastava, Manjeet Kirpal for the Respondent. 
The Judgment of the Court was delivered by 
DIPAK MISRA, J. 1. Calling in question the legal validity C 
of the order dated 30.11.2006 passed by the learned Single 
Judge of the High Court of Madhya Pradesh at Jabalpur in 
M.Cr.C.No.1922 of 2002 whereby the learned Judge had 
declined to exercise the power under Section 482 of the Code 
of Criminal Procedure (Cr.P.C.) for quashing of the D 
proceedings in Criminal Case No.895 of 2001 pending in the 
court of Judicial Magistrate First Class, Betul which has been 
registered under Section 420 of the Indian Penal Code against 
the appellant, the present appeal has been preferred by special 
leave. 
E 
2. Bereft of unnecessary details, the facts which are 
necessary to be stated are that the appellant is the Managing 
Director M/s. Sanghi Brothers (Indore) Ltd., Indore which is a 
registered company duly incorporated and registered under 
the Companies Act, 1956 and is engaged in the business of F 
automobile sale, finance and shipping etc. havin

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