Pooja Ravinder Devidasani vs State Of Maharashtra & Ors

3. The brief facts of these appeals are that Respondent No. 2, a finance Company, filed seven complaints under the N.I. Act against the appellant and others viz., (1) Complaint No. 3370/SS/2008 claiming Rs.1,64,69,801-14 (2) Complaint No. 3641/SS/2008 claiming Rs.1,06,55,289-91 (3) Complaint No. 3368/SS/2008 claiming Rs. 1,41,95,806-40 (4) 3640/SS/2008 claiming Rs. 85,21,294/- (5) 3369/SS/2008 claiming Rs. 1,88,12,292/- (6) 3642/SS/2008 claiming Rs. 1,69,95,353-50 and (7) Complaint No. 4086/SS/2009 for a claim of Rs. 8,08,973-25. In all the complaints the allegation was that the Respondent No. 2 Company had extended trade finance facility to M/S Elite International Pvt. Ltd. to which the appellant was a Director at the relevant time and several Cheques (119 in number) issued by M/S Elite International Pvt. Ltd. aggregating to Rs.8,64,58,810-16, in discharge of its liability towards part payment, stood dishonoured with the banker's remarks "insufficient funds". According to the complainant, at the material time, the accused (appellant) was in charge and at the helm of affairs of M/S Elite International Pvt. Ltd. and therefore she is vicariously liable for the default of the Company as she is responsible for the conduct of its business. Metropolitan Magistrate, 12th Court, Bandra, Mumbai took cognizance of the complaints and issued process against the accused (appellant) for the offence punishable under Section 138 of the N.I. Act.

4. The aggrieved appellant filed Criminal Writ Petitions before the High Court under Section 482, Cr.P.C. seeking quashing of the criminal proceedings pending before the Metropolitan Magistrate. The High Court initially by an interim order dated 28th July, 2010 granted stay of the criminal proceedings qua the appellant and directed the trial to be proceeded against the other accused. Finally, by the impugned order, the High Court dismissed the writ petitions filed by the appellant. Challenging the said order of dismissal, the appellant has preferred these appeals before this Court.

6. After resignation of the appellant as a Director, Form 32 under the Companies Act, 1956, pursuant to Section 303(2), was filed by M/S Elite International Pvt. Ltd. on 20th December, 2005 with the Registrar of Companies indicating the appointments and changes among Directors. In the said Form 32, the names of two Directors who were newly appointed were shown with remarks "appointed as a Director-Operations" and against the name of the appellant the remarks "resigned as a Director" were shown. Taking note of this Form 32, Respondent No. 2 arrayed the newly appointed Directors as accused Nos. 4 & 5 in the complaints. It is thus clear that the Respondent No. 2 is well aware of the fact that the appellant was no longer a part of M/S Elite International Pvt. Ltd, yet initiated criminal proceedings fastening vicarious liability on the appellant.

(ii) Form 32 submitted to the Registrar of Companies in pursuance of requirements of provisions of the Companies Act, 1956 in which against the name of appellant, it was shown as "resigned as a Director". Whereas against the names of Mr. Hitesh Haria and Mr. Parag Tejani, the words "appointed as a Director-Operations" were shown. Against the column "Date of appointment or change" the dates against all the above three persons were shown as 17th December, 2005. Taking note of these changes, Respondent No. 2 arrayed the newly added Directors as defaulters, but not omitted the appellant who has resigned as a Director which is specified in the very Form 32.

(iii) The Annual Return filed by the Company for the year ending 31st March, 2006 which also showed that the appellant was no longer a Director of the Company. In Column IV of the Annual Return against the name of appellant, it was clearly mentioned as "Date of ceasing : 17-12-2005". A letter dated 5th February, 2009 issued by the default Company in favour of Respondent No. 2. In the said letter, while forwarding certain details/information, a list of Directors was also sent. The said list did not contain name of the appellant.

13. Learned counsel further submitted that apart from the averments made in the complaint, the appellant has also executed an irrevocable Letter of Guarantee on 19th January, 2005 in favour of Respondent No. 2-Complainant, for availing trade finance facility. In the said Letter of Guarantee, the appellant categorically undertook that in the event of the Company failing or neglecting or refusing to pay the amount remaining unpaid, the same would be payable by her. She further agreed that her liability and obligation under the Guarantee shall be continuing, absolute, unconditional and irrevocable until the borrower is fully discharged from all liabilities, irrespective of any disputes or differences between the parties. The binding clause of the guarantee reads:

31. For all the foregoing reasons, we are of the view that this is a fit case for quashing the complaint, and accordingly allow these appeals by setting aside the impugned judgment passed by the High Court and quash the criminal proceedings pending against the appellant before the Trial Court.