IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE N.K.BALAKRISHNAN WEDNESDAY, THE 24TH AUGUST 2011 / 2ND BHADRA 1933 CRL.A.No. 2063 of 2003() ------------------------------------ AGAINST THE JUDGEMENT/ORDER IN CRLP.608/2003 Dated 16/10/2003 CC.NO.528/2002 of CHIEF JUDICIAL MAGISTRATE COURT, KOTTAYAM .................... APPELLANT(S)/ COMPLAINANT ---------------------------------------------- KAIPUZHA SERVICE CO-OPERATIVE BANK LTD NO.3793, KAIPUZHA.P.O., KOTTAYAM, REPRESENTED BY M.N.ANANDAVALLY, SECRETARY. BY ADV. SRI.T.A.SHAJI RESPONDENT(S)/ ACCUSED & STATE --------------------------------------------------------- 1. P.P.JOHNSON,MANAGING PARTNER, POONOLIL RICE AND PVT.LTD, POONOLIL HOUSE, OKKAL KARA, CHALAMATTAM VILLAGE, OKKAL.P.O., KUNNATHUNADU TALUK. 2. STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. R1 BY ADV. SRI.M.D.SASIKUMARAN SRI.GEORGE MATHEW R2 BY PUBLIC PROSECUTOR SRI.S.U.NAZAR THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 24/08/2011,ALONG WITH CRA NO.2096 OF 2003 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: sts N.K.BALAKRISHNAN, J. -------------------------------- Crl.A.Nos.2063 & 2096 of 2003 ------------------------------------------- Dated this the 24th day of August 2011 J U D G M E N T These two appeals were filed by the Kaipuzha Service Co-operative Bank who filed complaints before the Chief Judicial Magistrate Court, Kottayam against the first respondent alleging commission of offence punishable under Sec.138 of N.I.Act. It is alleged that the accused therein owed amounts to the complainant bank and to discharge that liability two cheques; one cheque for Rs.5,00,000/- and the other for Rs.6,97,406/- were issued to the complainant bank. When those cheques were presented for encashment both cheques were returned with the endorsement “insufficient fund”. On receipt of the intimation from the bank, statutory notices were sent to the accused. He sent reply denying the liability. Hence the two cases were filed. 2. The Secretary of the Co-operative Bank was Crl.A.Nos.2063 & 2096 of 2003 -: 2 :- examined as PW1 and Exts.P1 to P18 were marked. The accused got himself examined as DW1 and Exts.D1 to D4 were marked. 3. The court below found that the cheques were issued by the Private Limited Company by name Poonolil Rice & Foods Pvt. Ltd. and not in the individual capacity of the accused. It is seen that the accused was described in the cause title as “P.P.Johnson, Managing Partner, Poonolil Rice & Foods Pvt. Ltd”. If it is a private limited company, the accused cannot be described as Managing Partner. The learned counsel for the accused would submit that two cheques, Exts.P2 and P3 would also show that it was signed by 'Managing Director of Poonolil Rice & Foods Pvt.Ltd'. after affixing the seal. Therefore, it could leave no doubt that the cheques were issued by the Managing Director of the company for and on behalf of the company Sec.141(1) says that the company and every person, who at the time the offence was committed and was in charge of the company, that was responsible for the conduct of the company as well Crl.A.Nos.2063 & 2096 of 2003 -: 3 :- as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against. The learned counsel for the accused would submit that without the company on the party array, the complaint was filed in this case against the person whose signature appears on the cheques as Managing Director and hence the complaints are unsustainable. In other words, according to the learned counsel, the liability is of the company and the accused was, if at all, acting only on behalf of the company. It seems it was not at all taken note of by the learned counsel for the complainant. 4. It is the case of the complainant (the Co-operative Bank) that it was entrusted with the duty of procurement of paddy and the paddy so collected, for lack of space used to be immediately given to the rice mill owners and as usual, the complainant had given the paddy so procured to the accused company and the amount covered by the two cheques were to be paid to the complainant by the accused company towards the price of the paddy so delivered to them (to the company). Crl.A.Nos.2063 & 2096 of 2003 -: 4 :- It is not necessary to go into that question since the company has not been made a party to the two complaints. 5. The learned counsel for the accused would submit that admittedly no notice was sent to the company as provided under proviso (b) to Sec.138 of the N.I.Act. Even when this contention was raised by the learned counsel for the accused before the court below the complainant did not think of causing amendment to the complaint or to implead the company as an accused. What more, even the accused was not correctly described; whether he is the Managing Partner of a firm or the Managing Director of a company. The learned counsel for the complainant bank would submit that there was arbitration proceedings initiated under Sec.69 r/w Sec.100 of the Co-operative Societies Act and that an award was already passed. But the learned counsel submits that the award so passed was against the company and the Managing Director and other directors in their official capacity. However, it is not disputed that the amount due to the Co- operative Bank was hither to not paid. Taking note of all Crl.A.Nos.2063 & 2096 of 2003 -: 5 :- these facts, I find that an opportunity has to be given to the complainant bank to implead the company if necessary and to proceed with the matter. The judgment of acquittal is set aside. The question whether the company would be liable without notice under the proviso (b) to Sec.138 or whether the notice issued to the first respondent would be sufficient or binding on the company are matters to be considered by the court below untrammelled by any of the observations made by this Court. Parties will appear before the court below on 4.10.2011. N.K.BALAKRISHNAN, JUDGE. Jvt