Code of Criminal Procedure, 1973 – s.482 – Negotiable Instrument Act, 1881 – s.138 – Penal Code, 1860 – s.420 – The appellant’s company filed a complaint u/s.138 of the NI Act against ID Packaging and respondent no.2 in relation to the 07 dishonored cheques – The trial Court convicted respondent no.2 – Respondent no.2 preferred criminal revision – The High Court disposed of criminal revision as well as two other proceedings between the parties basis compromise between them – When 138 NI Act proceedings were pending between the parties, respondent no.2 had moved an application u/s.156 (3) CrPC seeking registration of an FIR against appellant and company inter alia alleging that despite payment of amount involved in 07 dishonoured cheques, by way of separate demand drafts, appellant again presented 11 cheques and fraudulently realised the amount from 04 out of 11 cheques thereby cheating respondent no.2 – FIR was registered against the appellant and not his company – Cognizance was taken – Appellant preferred a petition u/s.482 CrPC for quashing of the chargesheet and the summoning order, which was dismissed by the High Court – Correctness:
Held: Respondent no.2 cannot maintain a prosecution on the basis of allegations which were precisely his defence in the earlier proceedings wherein he was an accused – Thus, the present criminal proceedings deserve to be quashed on this ground alone – It is also to be seen that the business relation was between the two companies – The cheques and the demand drafts, as the case may be, were issued by one company to the other company and no payment was made by respondent no.2 to appellant individually – It is settled that s.141(1) of the Negotiable Instruments Act, extends vicarious criminal liability to the officers of a company by deeming fiction, which arises only when the offence is committed by the company itself and not otherwise – It is also settled that a person cannot be vicariously prosecuted, especially for offences under the IPC, merely on account of the fact that he holds a managerial position in a company without there being specific allegations regarding his involvement in the offence – Besides that, it will not be just enough for the court to look into the averments made in the FIR/complaint alone for the purpose of ascertaining whether the necessary ingredients to constitute the alleged offence are disclosed or not – In frivolous or vexatious proceedings, the court owes a duty to look into many other attending circumstances emerging from the record of the case over and above the averments and, if need be, with due care and circumspection try to read in between the lines – The Court while exercising its jurisdiction u/s.482 CrPC or Article 226 of the Constitution need not restrict itself only to the stage of a case but is empowered to take into account the overall circumstances leading to the initiation/registration of the case as well as the materials collected in the course of investigation – The present is a fit case for allowing the appeal to quash the impugned criminal proceedings instituted against the appellant for offences u/s.420 of the IPC. [Paras 20, 21, 22, 23, 24, 25]
Principle of res judicata – Applicability of principle of res judicata in a criminal proceeding – Discussed. [Paras 13-19]
As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Ankit Gyan. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.