Reportable         IN THE SUPREME COURT OF INDIA

CRIMINAL  APPELLATE JURISDICTION

CRIMINAL  APPEAL NO.1310  OF 2008 (Arising out of S.L.P. (Crl) No.618/2007)

   M/s Green Earth Asphalt &  ...Appellant             Power P. Ltd.

Versus

   State of Maharashtra Tr.     ...Respondents             P.S.O. & Ors.   

O  R  D  E  R

Leave granted.

This appeal is directed against the judgment and order dated

12.7.2006 passed by the High court of Judicature at Bombay, Nagpur Bench, Nagpur

in Criminal Application No. 873 of 2006 whereby and whereunder the application

filed by the respondents herein under Section 482 of the Code of Criminal Procedure

and Articles  226 and 227 of  the Constitution of  India  for quashing the Summary

Criminal Case No. 72/2005 pending before the Court of  Judicial  Magistrate,  First

Class, Acjhalpur was allowed.

The High Court in its judgment opined that in terms of Section

141  of  the  Negotiable  Instruments  Act  only  those  partners  of  a  Firm  can  be

proceeded, who were in-charge of the affairs of the Company and responsible to it. No

exception can be taken to the aforesaid proposition of law. No exception can also be

taken to the observations of the High Court that every partner of the Firm cannot

automatically be roped in.  

But then the High Court despite the aforesaid observations has

quashed the entire criminal proceeding,  

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inter alia, on the premise that no averment in terms of Section 141 of the Negotiable

Instruments Act has been made in the complaint petition.

Section  141  of  the  Negotiable  Instruments  Act  raises  a  legal

fiction  in  terms  whereof  the  Directors  of  a  Company  which  would  include  the

partners of a Firm would be deemed to have committed an offence along with the

Company if they are in-charge of the affairs of the Company and responsible to it.

It is not in dispute that the respondent No.3 was the authorised

signatory of the Company and in that capacity he has signed the cheque. Respondent

No.2 is the Firm.  

In that view of the matter the averments which were necessary

to be made to rope in respondent Nos. 4 and 5 herein having not been made, the

criminal  proceeding  could  have  been  quashed  against  them  but  not  against  the

respondent Nos. 2 and 3. This aspect of the matter is squarely covered by a decision of

this Court in  S M S Pharmaceuticals Ltd. Vs. Neeta Bhalla and Anr. -(2005) 8 SCC

89.

For the aforesaid reasons,  the  appeal  is  allowed in part.  The

judgment of the High Court is set aside so far as involvement of respondent Nos. 2

and 3 is concerned. However, the judgment of the High Court is  upheld so far as

respondent Nos. 4 and 5 are concerned.

......................J.       [S.B. SINHA]

......................J.       [AFTAB ALAM]

New Delhi, August 13, 2008.

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