NDLI: Siby Thomas Vs. M/s. Somany Ceramics Ltd

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	1881 Negotiable Instruments Act
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Case(s) Referred	Referred Case 0 Referred Case 1
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Allowed
Headnote	Issue for consideration:In the impugned order, the High Court declined to quash thecomplaint u/s.138 r/w. s.141 of the Negotiable Instruments Act,1881 qua the appellant-accused no.4 in exercise of the poweru/s. 482 of the Cr.P.C.Negotiable Instruments Act, 1881 – s. 138 r/w. s.141 –Respondent filed complaint u/s. 138 r/w. s.141 of the NI Act– Appellant set up twin grounds to seek quashment of thecomplaint against him; firstly, that he had resigned from thepartnership firm on 28.05.2013 whereas the cheque in questionwas issued on 21.08.2015 and secondly, that the complaint isdevoid of mandatory averments required to be made in termsof sub-Section 1 of s.141 of the NI Act.Held: It is not averred anywhere in the complaint that the appellant-accused no.4 was in charge of the conduct of the business of thecompany at the relevant time when the offence was committed– What is stated in the complaint is only that the accused Nos. 2to 6 being the partners are responsible for the day-to-day conductand business of the company – It is also relevant to note that anoverall reading of the complaint would not disclose any clear andspecific role of the appellant-accused no.4 – In the complaint, it wasalleged that accused No.1 through accused No.2 had purchasedthe goods from the complainant on credit basis through propersales invoices and, in paragraph 6 it was alleged that for liquidationof legal liability outstanding accused Nos. 2 and 3 issued chequein favour of the complainant from the account of accused No.1 –The averments in the complaint filed by the respondent are notsufficient to satisfy the mandatory requirements u/s. 141(1) of theNI Act – Since the averments in the complaint are insufficient toattract the provisions u/s. 141(1) of the NI Act, to create vicariousliability upon the appellant, he is entitled to succeed in this appeal.[Paras 12, 13, 17]Negotiable Instruments Act, 1881 – Ingredients of s.141 –Vicarious liability:Held: A vicarious liability would be attracted only when theingredients of s.141(1) of the NI Act, are satisfied – It would alsoreveal that merely because somebody is managing the affairsof the company, per se, he would not become in charge of theconduct of the business of the company or the person responsibleto the company for the conduct of the business of the company– A bare perusal of s.141(1) of the NI Act, would reveal that onlythat person who, at the time the offence was committed, was incharge of and was responsible to the company for the conduct ofthe business of the company, as well as the company alone shallbe deemed to be guilty of the offence and shall be liable to beproceeded against and punished. [Para 16]Negotiable Instruments Act, 1881 – Specific averments in thecomplaint to make the accused vicariously liable:Held: In the decision in S.P. Mani’s case in paragraph 47 (a) it washeld that the primary responsibility of the complainant is to makespecific averments in the complaint so as to make the accusedvicariously liable. [Para 11]
Judge	Hon'ble Mr. Justice C.T. Ravikumar
Neutral Citation	2023 INSC 890
Petitioner	Siby Thomas
Respondent	M/s. Somany Ceramics Ltd
SCR	[2023] 13 S.C.R. 821
Judgement Date	2023-10-10
Case Number	3139

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Siby Thomas Vs. M/s. Somany Ceramics Ltd

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