LexSTANDARD CHARTERED BANK versus STATE OF MAHARASHTRA AND OTHERS ETC.
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A B c D E F G H [2016] 4 S.C.R. 288 STANDARD CHARTERED BANK v. STATE OF MAHARASHTRA AND OTHERS ETC. (Criminal Appeal Nos. 271-273of2016) APRIL 06, 2016 [DIPAK MISRA AND SHIVA KIRTI SINGH, JJ.] Negotiable Instruments Act, 1881 - ss. 138 and 141 - Complaint under - Against a company and its executive Director and Directors - Summons issued - Quashed by High Court in exercise of its power u/s 482 Cr.P.C. - Held: s.141 creates a constructive liability on the person responsible for the conduct of the business of the accused-Company - In the present case, in view of the assertion in the complaint that the appellants-accused were in- charge of day to day affairs of the Company, the summons issued were wrongly set aside by High Court - Magistrate directed to proceed with the complaint - Code of Criminal Procedure, 1973 - s.482. Allowing the appeals, the Court HELD: On a perusal of s. 141 of Negotiable Instruments Act, 1881, it is clear that if the person who commits an offence u/ s. 138 of the Act is a company, the company as well as other person in charge of or responsible to the company for the conduct of the business of the company at the time of commission of the offence is deemed to be guilty of the offence. Thus, it creates a constructive liability on the persons responsible for the conduct of the business of the company. In the present case, the accused Nos.4 and 5 were whole-time Directors of accused-Company, and the assertion in the complaint is that they were in charge of day to day business of the Company and all the accused had with active connivance, mischievously and intentionally issued the cheques in question. Thus, considering the totality of assertions made in the complaint and also taking note of the averments put forth relating to accused Nos. 4 and 5 that they are whole-time Director and Executive Director and they were in charge of day to day affairs of the Company, the High Court has fallen into grave 288 STANDARD CHARTERED BANK v. STATE OF 289 MAHARASHTRA error by coming to the conclusion that there arc no specific averments in the complaint for issuance of summons against the said accused persons. [Paras 12, 33 and 34) [295-B; 305-G-H; 306-A-B) Gunma/a Sales Pvt. Ltd. v. Ami Mehta and Ors. (2015) 1 SCC 103: 2014 (Hi) SCR 1117 - relied on. S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla and another (2005) 8 SCC 89: 2005 (3) Suppl. SCR 371; National Small Industries Corpn. Ltd. v. Harmeet Singh Paintal & Am: (2010) 3 SCC 330: 2010 (2) SCR 805; Tamil Nadu News Print & Papers Ltd. v. D. Karunakar & Ors. (2015) 8 SCALE 733; A.K. Singhania v. Gujarat State Fertilizer Company Ltd. & Am: (2013) 16 SCC 630: 2013 (9) SCR 1069; Aneeta Hada v. Godfather Travels and Tours Private Limited (2012) 5 SCC 661:2012 (5) SCR 503; Secunderabad Health Care Ltd. v. Secunderabad Hospitals (P) Ltd. (1999) 96 Comp Cas 106 (AP); V. Sudheer Reddy v. State of A.P. (2000) 107 Comp Cas 107 (AP); R. Kanan v. Kotak Mahindra Finance Ltd. (2003) 115 Comp Cas 321 (Mad); Lok Housing ad Constructions Ltd. v. Raghupali Leasing and Finance Ltd. (2003) 115 Comp Cas 957 (Del); Sunil Kumar Chhaparia v. Dakka Eshwaraiah (2002) 108 Comp Cas 687 (AP); Stale of Hmyana v. Brij Lal Mittal (1998) 5 sec 343: 1998 (3) SCR 104; K.P.G Nair v. Jindal Menthol India Ltd. (2001) 10 SCC 218; Kaua Sujatha v. Fertilizers & Chemicals Travancore Ltd. (2002) 7 SCC 655; S.M.S. Pharmaceuticals Ltd. v. Nee/a Bhalla and another (2007) 4 SCC 70: 2007 (2) SCR 862; Sabitha Ra111a111urthy v. R.B.S. Channabasavaradhya (2006) 10 SCC 581: 2006 (6) Suppl. SCR 126; Saro} Ku111ar Poddar v. State (NCT of Delhi) and another (2007) 3 SCC 693: 2007 (1) SCR 907; Everest Advertising (P) Ltd. v. State. Govt. of NCT of Delhi and others (2007) 5 SCC 54: 2007 (4) SCR 1055; K.K. Ahuja i~ V.K. Vora and Anr (2009) 10 SCC 48; Ta111il Nadu News Print & Papers Ltd. v. D. Karunakar and Others (2015) 8 SCALE 733 - referred to. A B c D E F G H 290 SUPREME COURT REPORTS [2016] 4 S.C.R. A Case Law Reference 2005 (3) Suppl. SCR371 referred to Paras 2014 (10) SCR 1117 relied on Paras 2010 (2) SCR S05 referred to Paras B (2015) S SCALE 733 referred to Paras 2013 (9) SCR 1069 referred to Paras 2012 (5) SCR 503 referred to Para 13 (1999) 96 Comp Cas 106 (AP) referred to Para 17 (2000) 107 Comp Cas 107 (AP) referred to Para 17 c (2003) 115 Comp Cas 321 (Mad) referred to Para 17 (20
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