Thursday, May 22, 2008

SC: Who is to blame for cheque bounce, firm or director?

Who is to blame for cheque bounce, firm or director?

J.Venkatesan

New Delhi: A larger Bench of the Supreme Court will examine whether a director of a company is liable to face trial in his/her individual capacity in a cheque bounce case under Section 138 of the Negotiable Instruments Act even if the cheque is drawn in the name of the firm and signed by the director as an authorised signatory.

A two-judge Bench gave a split verdict on this issue and referred it to Chief Justice K.G. Balakrishnan for posting it before a larger Bench.

While Justice S.B. Sinha held that only a drawer of the cheque, i.e. the company, could be prosecuted, Justice V.S. Sirpurkar said the director, being an authorised person to sign the cheque, could be prosecuted in the individual capacity.

Disagreeing with some of the earlier decisions of this court that the firm need not be proceeded against, Justice Sinha said: “Prosecution of the company is a sine qua non for prosecution of the other persons [directors and others], viz. everyone who was in charge and was responsible for the business of the company [and] with whose connivance or due to whose neglect the company had committed the offence.”

Separate entity

He said the trial court, in a given case, would have to arrive at a finding that the company was guilty although it was not an accused.

“Company, although a juristic person, is a separate entity. Directors may come and go. The company remains. It has its own reputation and standing in the market which is required to be maintained. Nobody, without any authority of law, can sentence it or find it guilty of commission of an offence.”

He pointed out that a director who was in charge of the company at one point of time might have no interest in the firm.

He might not even defend it. He need not even continue to be its director. In such a situation, the company would to all intents and purposes stand convicted, although, it was not an accused and thus had no opportunity to defend itself.

“Deemed guilty”

Justice Sirpurkar said if the director was authorised to use the company’s cheque and if it bounced, it would have to be presumed that the signatory should also be deemed guilty of the offence. Section 141 (2) of the NI Act would suggest that the director, the manager, the secretary or other officer would be deemed guilty of cheque bounce.

The judge said even if the director’s liability was vicarious on account of the offence having been committed by the company, it would have to be presumed that the director had also committed it. That the company was not cited as an accused would be of no consequence.

In the instant case, Anneta Hada, director, Intel Travels Ltd., issued a cheque on behalf of the company to Godfather Travels and Tours Pvt. Ltd. and it bounced.

A complaint under Section 138 of the Act was registered against her without making the company an accused. A magistrate took cognisance of the complaint.

The Delhi High Court rejected Ms. Hada’s plea to quash the proceedings. Her appeal is against that judgment.

While Justice Sinha set it aside, Justice Sirpurkar dismissed the appeal.

© Copyright 2000 - 2008 The Hindu

Courtesy_
http://www.thehindu.com

No comments:

Post a Comment

Related Posts Plugin for WordPress, Blogger...

Search our Blog here

Google
 

Compiled by

Disclaimer


This Blog Spot is meant for publishing landmark judgments pronounced by the Court of law as we collected from the renowned Dailies, Magazines, etc., so as to create an awareness to the general public and also to keep it as a ready reckoner by them. As such the readers may extend their gratitude towards the Original Author as we quoted at the bottom of each Post under the title "Courtesy/Sources". Furthermore, the Blog Authors are no way responsible for the correctness of the materials published herein and the readers may verify the concerned valuable sources.



Followers

Dinamalar | Court News Feed

Dinakaran | Crime News Feed

Labels

Madras High Court (226) supreme court (157) Supreme Court (96) Madurai Bench (60) Advocate (44) High Court (44) tamil nadu (42) Indian Kanoon (41) Delhi High Court (37) Education (31) Divorce (30) Pondicherry (30) Husband (28) Wife (28) consumer forum (23) Lawyers (22) Cr.P.C. (20) Maintenance (20) police (20) Consumer (19) 2013 (16) Judges (16) article (16) the hindu (16) Matrimonial case (15) Hindu Marriage Act (14) Bank (13) Cruelty (13) IPC (13) karnataka high court (13) AIADMK (12) Compensation (12) Criminal cases (12) Jayalalithaa (12) dmk (12) Bar Council of India (11) CJI (11) School (11) Woman (11) election (11) Accident cases (10) Child (10) Kerala High Court (10) Marriage (10) dinamani (10) election commission (10) insurance (10) medical (10) Labour cases (9) MV ACT CASES (9) Madurai (9) Mobile Phone (9) doctors (9) evidence (9) pil (9) tamil nadu bar council (9) tax (9) taxation (9) Cell Phone (8) Examination (8) Frontline (8) Loans (8) Magistrate (8) Rent Control Act (8) State Consumer Disputes Redressal Commission (8) Allahabad high court (7) Bar Council (7) Constitution (7) Domestic Violence Act (7) Gujarat High Court (7) Negligence (7) Reservation Quota (7) Tenant Landlord (7) bombay high court (7) court (7) new delhi (7) 2012 (6) Andhra Pradesh High Court (6) Civil Judge (6) Complaint (6) Consumer National Commission (6) Dowry (6) Employee (6) Justice G. Rajasuria (6) Muslims (6) Negotiable Instruments Act (6) Notification (6) Railway (6) USA (6) arbitration (6) compassionate (6) madras (6) rape (6) rulings (6) sex (6) Airlines (5) Andhra Pradesh (5) College (5) Delay (5) Employer (5) FIR (5) Judgment (5) Karunanidhi (5) Labour Court (5) Madras Family Court (5) Mumbai High Court (5) President (5) Rajiv Gandhi (5) Recruitment (5) Sethusamudram ship canal (5) Student (5) TRAI (5) advertisement (5) appointment (5) deficiency of service (5) editorial (5) fined (5) 2014 (4) BSNL (4) Bigamy (4) CBI (4) Cheque Dishonour Cases (4) Chief Minister of Pondicherry (4) Chief Minister of Tamil Nadu (4) Civil Matters (4) Commissioner of Police (4) Corruption (4) Daughter (4) Death penalty (4) Father (4) Fees (4) Foreigners Act (4) Gazette (4) Hindu (4) Hindu Adoption and Maintenance Act (4) Hospitals (4) Judiciary (4) Justice G.Rajasuria (4) Life Imprisonment (4) Matrimonial House (4) Ministry of Law (4) Minor Child (4) Parents (4) Private Schools (4) RTI Act (4) Ram Sethu project (4) Sexual exploitation (4) Suspension (4) Teachers (4) Tenant (4) Transfer (4) contempt (4) delhi (4) hindustan times (4) karnataka (4) pmk (4) registration department (4) times of india (4) us (4) Actor (3) Adoption (3) Aircraft (3) Assassination (3) Ban (3) Bank Cases (3) CJ (3) Calcutta High Court (3) Cheque (3) Computer (3) Copyright (3) Court Fees (3) Dinakaran (3) Disqualification (3) Electricity (3) Encroachers (3) Eviction (3) Full Bench Decision (3) HC Advocate Karunanidhi.R (3) Human Rights (3) Human Rights Commission (3) IT Act (3) Income Tax (3) Justice Ashok Kumar (3) Landlord (3) Law Firms (3) Limitation Act (3) Medicos (3) Motor Vehicle (3) Murder case (3) Muslim (3) NDNC (3) Panchayats Act (3) Patent (3) Prisoner (3) Proterty Act (3) Public Property (3) Punishment (3) RTE Act (3) Ragging (3) Salaries (3) Selection (3) Smoking (3) Strikes (3) Subramanian Swamy (3) Telephone (3) Theft (3) Villupuram (3) Websites (3) Wikipedia (3) Witness (3) Woman Lawyers (3) Workman (3) Youtube (3) girl (3) helmet (3) parliament (3) software (3) stamp act (3) 2007 (2) 5-Judges Bench (2) 99th Constitutional Amendment (2) Aadhaar Card (2) Abortion (2) Absence (2) Acquittal (2) Agitating (2) Agriculture (2) Airport (2) Airtel (2) Amendments (2) Apple (2) Arrest (2) Assault (2) BCCI (2) BCI (2) Britain (2) CBSE (2) CIC (2) CNN IBN (2) CPC (2) CTC (2) Chenai Corporation (2) Child Marriage Act (2) Child Witness (2) Cigarette (2) Citizenship (2) Code of Civil procedure (2) Coimbatore (2) Collector (2) Collegium systems (2) Companies Act (2) Complainant (2) Congress (2) Constitution Bench (2) Cr.P.C (2) Credit Card (2) DNA Test (2) Damages (2) Date of Birth (2) Dayanidhi Maran (2) District Judges (2) Driving Licence (2) Drugs (2) EVMs (2) Enrolment (2) Evening Court (2) Exam Marks (2) Eye-witness (2) Family (2) Family Court (2) Foreign Law Firms (2) Freedom Fighters (2) Fundamental Rights (2) Google (2) Governors (2) Grave crimes (2) Habeas Corpus (2) Haldiram (2) Health Ministry (2) High Courts (2) Himachal Pradesh High Court (2) ICICI (2) ID Act (2) Impeachment (2) Inspector General of Registration (2) Inter-caste (2) Interest (2) Interim Injunction (2) Interim Orders (2) International Arbitration (2) International Court of Justice (2) Internet (2) Job (2) Justice (2) Justice A.K.Ganguly (2) Justice Dinakaran (2) LPG (2) LTTE (2) Law Commission (2) Law Department (2) Lok Adalat (2) MPs (2) Madhya Pradesh High Court (2) Maharashtra (2) Mark Sheets (2) Medi-claim (2) Men (2) Microsoft (2) Municipal Post (2) Municipal Waste (2) Municipality (2) NJAC (2) Nagapattinam (2) Nalini (2) National Highways (2) Nuke Deal (2) Obscenity (2) PTI (2) Patient (2) Patna High Court (2) Penalty (2) Pension (2) Police Reforms Committee (2) Poll freebies (2) Power of Attorney (2) Pregnant (2) Prevention of Corruption Act (2) Prime Minister (2) Property (2) Public Meetings (2) Punjab High Court (2) Punjab and Haryana High Court (2) RBI (2) Registrar (2) Registration Act (2) Release (2) Reserve Bank of India (2) Retired benefits (2) Review (2) Rigorous imprisonment (2) Road (2) SBI (2) SC/ST (2) SHRC (2) Sale (2) Samacheer Kalvi (2) Sanjay Dutt (2) Self-defence (2) Sikkim (2) Sonia Gandhi (2) State Bar Concil (2) State Govts. (2) TADA (2) TNEB (2) Tamil New Year Act (2) Temples (2) Tobacco firms (2) Trafficking (2) University (2) Video (2) Vigilance (2) Vodafone (2) Wages (2) Water (2) West Bengal (2) Woman Judges (2) backlog of cases (2) bail (2) customs duty (2) laptops (2) legislature (2) practitioners (2) service (2) service tax (2) sessions judge (2) tiruchi (2) 100 RUPEE (1) 11 weeks imprisonment (1) 18 Years (1) 2001 (1) 2006 (1) 2009 (1) 2011 (1) 2015 (1) 2016 (1) 5 Judges Bench (1) 6th Pay Scale (1) AIIMS (1) Aadal Paadal (1) Aadhar Card (1) Abuse (1) Accountable (1) Act (1) Adjournments (1) Adverse possession (1) Advocate Cyril Mathias Vincent (1) Advocate M.Kumaran (1) Advocate M.S.Maruthupandiyan (1) Advocate P.S.Amalraj (1) Advocates' Welfare Fund Act (1) Agreement (1) Air India (1) Alien Species (1) Allahabad (1) Allergy (1) Allopathy (1) Amusement parks (1) Anbumani Ramadoss (1) Answer Sheets (1) Apartments (1) Appearance (1) Arguments (1) Arrears (1) Arunachal Pradesh (1) Ashok Kumar (1) Assembly Speaker (1) Assets case (1) Association (1) Attendance (1) Attention Please (1) Auditors (1) Australia (1) Autopsy (1) Ayodhya (1) BJP (1) Babri Masjid (1) Baby (1) Baggage missing (1) Bank Account (1) Banners (1) Bar Association (1) Bar Council of Tamil Nadu (1) Batco Roadways' case (1) Bhavani Singh (1) Bhopal gas tragedy (1) Bhullar's mercy plea (1) Big TV (1) Bihar (1) Bihar Prohibition Act (1) Bill (1) Biscuits (1) Black Sea (1) Bofors case (1) Bonus (1) Boycott (1) Brain-mapping (1) Brothers (1) Burqa (1) Buses (1) Business Line (1) Bye-laws (1) CAT (1) CEC (1) CITY CIVIL COURT (1) CTV (1) Calcutta (1) Cambodian (1) Camera (1) Canada (1) Cargo Ship (1) Caste (1) Cauvery (1) Cauvery Tribunal Award (1) Censor Board (1) Central Crime Branch (1) Certificates (1) Chennai (South) Forum (1) Chhattisgarh State Bar Council (1) Chief Judicial Magistrate (1) Chief Justices of India (1) Christian (1) Civic Election (1) Civic Elections (1) Common facilities Block (1) Commonwealth Games Panel (1) Communal harmony (1) Compounding Offences (1) Condoms (1) Contract labour (1) Conversion Formula (1) Cooperative Societies (1) Copying (1) Corporation (1) Cosmetic (1) Costumes (1) Court Buildings (1) Creche (1) Cricket (1) Criminalisation (1) Culcutta High Court (1) Current Tamil Nadu Cases (1) Custodial death (1) DGP (1) DK (1) DMDK (1) DRT (1) Dalits (1) Dasavatharam (1) Daughter-in-law (1) Death (1) Debarring (1) Deccan (1) Defamation (1) Defaulters (1) Degree (1) Departmental Enquiry (1) Derogatory remarks (1) Desertion (1) Designation (1) Destruction (1) Detergent Soap (1) Dharmapuri (1) Directory (1) Disabled person (1) Disconnection (1) Dispensary (1) Don Bosco Matriculation School (1) Don Bosco School (1) Download Links (1) Dozing (1) Dr.Ramadoss (1) Dress Code (1) Driver (1) Drunk driving (1) Dying Declaration (1) EPIC (1) ESI Act (1) EU (1) Education Department (1) Education Loan (1) Elevation (1) Emergency (1) Employment (1) Engineering College (1) Enquiry (1) Entertainment tax (1) Environment (1) European Court (1) Events to Remember (1) Exam Cheaters (1) Exit Polls (1) Experts Committee (1) Expulsion (1) Facebook (1) Fair Criticism (1) False (1) Fat (1) Father's identity (1) Father-in-law (1) Film (1) Fire (1) Flats (1) Flexi Boards (1) Food (1) Framing of Charges (1) France (1) French Civil Code (1) French Regime (1) Fringe Benefit Tax (1) Frivolous Petition (1) GOs (1) Garments (1) Gauhati HC (1) Gender Bias (1) Gingee Court (1) Gingee-TV Malai NH (1) Girlfriend (1) Goa (1) Gondas (1) Goods (1) Goons (1) Government Offices (1) Government Officials (1) Govt. Servants' Conduct Rules (1) Govt. sites (1) Grandchildren (1) Gratuity (1) Green Card (1) Guardian (1) Gubernatorial (1) Gudalur Janmam Estates (1) Guidelines (1) Guilty (1) HC Calendar (1) HIV Patient (1) HRCE Act (1) Hamam Soap (1) Handcuff (1) Haryana (1) Hawkers (1) Heroin (1) Hewlett Packard (1) High Court Bench for Pondicherry (1) Highways (1) Hindu Religious and Charitable Endowment (1) Hindu Succession Act (1) Hindus (1) Hindustan Lever Limited (1) Hindustan Unilever Limited (1) Hoardings (1) Holiday Court (1) Holidays (1) Hostel (1) Hutchison Essar (1) Hyderabad (1) ICJ (1) ICSE (1) IMDT Act (1) IPL (1) IT Tax Tribunal (1) Identity Cards (1) Illegitimate (1) Images (1) Immoral (1) Impotent (1) Imprisonment (1) Incest (1) Infiltrators (1) Interest rates (1) Interview (1) Invalid (1) Investigation (1) Invitation (1) Jammu and Kashmir (1) Jats Reservation (1) Jharkhand (1) Journal Section (1) Judicial Discretion (1) Judicial Officers (1) Judicial Staffs (1) Junction (1) Justice A.P.Shah (1) Justice Bhagwati (1) Justice F.M.Ibrahim Kalifulla (1) Justice G Rajasuriya (1) Justice P.Sathasivam (1) Justice Rajasuriya (1) Juvenile Justice Board (1) K.R.Narayanan (1) K.Veeramani (1) KFC (1) Kabil Sibal (1) Kachatheevu (1) Karaikal (1) Katchativu case (1) Kathi (1) Kerala (1) Kerla (1) Khushboo (1) Kidney (1) Kingfisher (1) Kodak (1) LIC (1) Lakes (1) Land Owners (1) Larger Bench (1) Laundry (1) Law College (1) Lawyer Notice (1) Leave (1) Legal Practitioners Act 2010 (1) Leprosy Patient (1) License Fees (1) Lift (1) Links (1) Live-in-relationship (1) Local Bodies (1) Lok Sabha (1) MCOCA (1) MLAs (1) MNC (1) Malaria (1) Malaysian Airlines (1) Malpractice (1) Mangalore Express (1) Manupatra (1) Marriage Registration Certificates (1) Married (1) Mediation (1) Medical College issue (1) Meghalaya (1) Mercy Petition (1) Mizoram (1) Mobile Court (1) Money Lending licence (1) Mosquito Bite (1) Mother (1) Movies (1) Mutual Consent (1) NDPS Act (1) NDTV (1) NH 31A (1) NHRCs (1) NI Act (1) NOTA (1) NPT (1) NRI (1) NSA Act (1) Nagaland (1) Nallathambi (1) Narco Analysis (1) National Taxation Tribunal (1) Natural Justice (1) Navarasu murder case (1) Negative Voting (1) Nepal (1) News Today (1) Nivedita Sharma (1) No-confidence motion (1) Non-Karnataka Vehicles (1) Non-signatory (1) None of the Above (1) Norms (1) North Carolina (1) Notary Public (1) Notifications (1) Nursing College (1) Office Bearers (1) Official Language (1) Oil Companies (1) Online (1) Oral (1) Ordinance (1) Origin (1) Orissa High Court (1) PBA (1) PD Act (1) PEC (1) PF (1) PHCs (1) PIB (1) PNDT Act (1) PTO (1) Panorama view (1) Parle Marie (1) Partnership (1) Paternity (1) Patta (1) Pending case (1) Pondicherry Code (1) Pondicherry Courts (1) Pondicherry Engineering College (1) Pondicherry University (1) Port (1) Possession (1) Post Office (1) Posters (1) Postmortem (1) Power (1) Prabha Sridevan (1) Preamble (1) Premarital sex (1) Press Trust of India (1) Prestige (1) Presumption of Death (1) Prisoners (1) Private (1) Private Defence (1) Prize Draw Contest (1) Profession (1) Profile (1) Promotion (1) Prosecution (1) Protest (1) Provident Fund (1) Public Prosecutor (1) Puducherry Code (1) Pulipaarvai (1) Quash (1) Quattrocchi (1) Quick Links (1) RCOP (1) RDBFI Act (1) RIM (1) RPF (1) Railway Budget (1) Railway Tribunal (1) Railways Act (1) Rajasthan High Court (1) Rajasuria (1) Rajeswari case (1) Rajya Sabha (1) Re-name (1) Recovery (1) Refund (1) Regional SC Bench (1) Registration (1) Regulations (1) Reinstatement (1) Relatives (1) Reliance (1) Religion (1) Religious Functions (1) Remanding (1) Removal (1) Rename (1) Repeal of Local Laws (1) Resident (1) Respondent (1) Retired Judges (1) Retired Staffs (1) Revaluation (1) Rexona Soap (1) Right to Information Act (1) Right to Sleep (1) Rin (1) Romania (1) Rural (1) SMS (1) SPP (1) Sachar Commission (1) Safai Karamchari Andolan case (1) Sanction (1) Saree (1) Satta Padhukappu (1) Scam (1) Secretary (1) Section 102 CPC (1) Section 125(3) (1) Section 66A (1) Sections 499 and 500 (1) Security (1) Senior Advocate (1) Septic Tank (1) Serials (1) Service matters (1) Settlement (1) Sewerage works (1) Shankaracharya case (1) Sheristadar (1) Ship (1) Shivaji Ganesan Statue (1) Sivaji Ganesan Statue (1) Sleeping (1) Soap (1) Son (1) Special Marriages Act (1) Sri Lanka (1) Sri Lanka Supreme Court (1) Sri Meenakshi Sundareswarar Temple (1) Suicide (1) Sukanya (1) Surgery (1) Syllabus (1) TNPSC (1) TV (1) Tamil Links (1) Telecom (1) Telegraph Act (1) Thanthai Periyar (1) Third Party (1) Thirukural (1) Thirunelveli (1) Ticket Bookings (1) Ticket less Journey (1) Tide (1) Time-barred matters (1) Title suit (1) Toronto (1) Trademarks (1) Traffic (1) Transfer Certificate (1) Transport Authority (1) Travels Agent (1) Trees (1) Tripurar (1) Turban law (1) USE Act (1) Ukraine (1) Unauthorised layouts (1) Unauthorised plots (1) Unconstitutional (1) Union Carbide Corporation (1) Union Minister (1) Universities (1) Unruly Advocates (1) Unwed mother (1) Uttarakhand (1) Uttaranchal (1) VAO (1) VRS (1) Vacuum Cleaner (1) Vakalat (1) Vaseline (1) Verbal (1) Video Poker (1) Video-conferencing (1) Vijayakant (1) Visa (1) Voters (1) Voting (1) Wakf (1) Watchman (1) Who's Who (1) Widow (1) Will (1) Word (1) Workmen Compensation Act (1) Wrong Provision (1) Yahoo (1) architects (1) azhagiri (1) british airways (1) churidar (1) deccan herald (1) delh (1) double taxation (1) e-Library (1) eBay (1) eCourt (1) ebc (1) farmers loan waiver (1) germany citizen (1) guideline value (1) guruvayur devaswom (1) hMatrimonial case (1) india (1) law and order (1) nawaz sharif (1) pakistan (1) pakistan supreme court (1) practical lawyer (1) pratiba (1) promise (1) rules (1) sand mining (1) southern districts (1) uk (1) warrants for cash scam (1) தி இந்து (1) தூக்கம் (1)