High Court of Delhi was dealing with the petition seeks quashing of Criminal Complaint filed under Section 138 of the Negotiable Instruments Act. The petitioner also seeks to quash order passed by the learned Trial Court issuing summons to the petitioner herein.
Brief Facts:
The respondent No.2 was appointed as the CFO of the India Ahead News Private Ltd. which is engaged in the business of running a TV news channel. The petitioner herein and the accused No.2, who is the son of the petitioner herein, are the directors of India Ahead News Pvt. Ltd. and they are responsible for the day-to-day affairs of the company and they are running the TV channel and actively controlling all the operations of the company. The complainant was taken in service by the respondent No.1 at a fixed salary of Rs.10,00,000/- per month plus GST less TDS along with monthly expenditure and reimbursement of Rs.1,50,000/- per month. In the year 2019, the salaries of staff including the complainant started getting delayed and even the statutory obligations like the PF, ESI etc. we’re not being fulfilled by the company. Since the dues and the arrears of salary were mounting up, at the request of son of the petitioner, the complainant herein offered to take a salary cut. It was decided that the company would be paying a sum of Rs.32,00,000/- plus GST from 01.01.2020 to 31.05.2020 and reimbursement of Rs.5,00,000/-. The cheques were for payment of arrears of salary. The cheques were presented for encashment through Bank and the cheques were returned with remark "insufficient fund". When the matter came up for hearing, this Court felt that an attempt can be made to settle the disputes between the parties and the matter was sent to mediation. Unfortunately, despite several sittings, no settlement could be arrived at.
Petitioner’s Contention:
Learned counsel for the petitioner submitted that the petitioner is over 80 years of age having several physical ailments and is no longer looking into day-to-day affairs of the company. He contended that the complainant being the ex-CFO of the company was well aware of the affairs of the company and he knew who was responsible for the conduct of the business of the company. He stated that the averments in the complaint do not reflect the role of each of the directors in the company and summons could not have been issued to the Petitioner.
Respondent’s Contention:
Learned Counsel for the respondent submitted that the petitioner herein and his son are together running the company. She stated that there are only two directors and both the directors are responsible for the conduct of the affairs of the company. She submitted that the question as to whether the company was being only run by the son of the petitioner herein or whether the Petitioner herein is also involved in the affairs of the company, is a matter of trial and the complaint cannot be quashed at this stage. She further stated that offence under Section 138 of the NI Act is made out and no interference is warranted from this Court at this stage.
HC’s Observations:
After hearing both the sides Court reiterates some factors which are necessary to be kept in mind before making a person vicariously liable for the offences committed by the company under Section 138 of the N.I. Act.
HC Held:
After evaluating submissions made by both the parties the Court held that “the observations made by this Court is limited to the issue as to whether the complaint should be quashed or not because of the fact that the complaint does not state the exact role of the petitioner in the conduct of the business of the company. Needless to state, it is always open for the petitioner to substantiate his assertion that he was not responsible for the conduct of the business of the company by leading evidence which should be considered on its own merits without being influenced by the observations made in this order.”
Bench: Hon'ble Mr. Justice Subramonium Prasad
Case Title: Gopala Krishna Mootha v. The State Govt. Of NCT Of Delhi & Anr.
Case Details: CRL.M.C. 2082/2021 & CRL.M.A. 14016/2021
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