Sunday, 15 May 2016

Whether prosecution for dishonour of cheque is tenable against partnership firm if firm is not made accused in said proceeding?

When as per Section 141(1) of the N.I. Act, the

company should be an accused, in cases wherein it is a

Company, going by the explanation, in the case of a

partnership firm, the firm should also be an accused in the


case. As per explanation(b) to Section 141(2) of the N.I. Act,

"'Director,' in relation to a firm, means a partner in the firm."

Over and above the partners, who are responsible for the

conduct of the business of the partnership firm, the

partnership firm should also be a party to the complaint.

When the partnership firm is not arraigned as an accused,

the complaint fails and therefore, Annexure 1 complaint in

C.C.No.290/13 on the file of the Judicial First Class

Magistrate's Court-I, Thiruvananthapuram as against the

petitioner, is liable to be quashed.
IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                                      PRESENT:

                         THE HONOURABLE MR. JUSTICE B.KEMAL PASHA

           WEDNESDAY, THE 28TH DAY OF OCTOBER 2015

                                           Crl.MC.No. 270 of 2014 
            SHEEJA MOL, 
Vs
         THE STATE OF KERALA
           
Citation; 2016 ALLMR(CRI)Journal 177


     In discharge of the liability of a partnership firm, its

Managing Director, who is the first accused and 3rd

respondent herein, has issued the cheque in question. The

2nd accused is another partner of the firm. Strangely enough,

the partnership firm is not arraigned as the accused.

     2.    Normally, in case of civil liability, for suing a

partnership firm, two or more partners can be sued within

the meaning of Order XXX Rule 1 of the Code of Civil

Procedure Code, 1908. At the same time, as far as the

offence under Section 138 of the N.I. Act is concerned, in

such a case, a complaint has to be filed under Section 142

of the N.I. Act, in conformity with Section 141(1) of the N.I.

Act. Section 141(1) of the N.I. Act says:


            "If the person committing an offence

            under Section 138 is a company, every

            person who, at the time the offence

            was committed, was in charge of, and

            was responsible to the company for

            the conduct of the business of the

            company, as well as the company, shall

            be deemed to be guilty of the offence and

            shall be liable to be proceeded against

            and      punished accordingly."(Emphasis

            Supplied)

      3.    Therefore, the persons responsible for the

conduct of the Company, as well as the Company, should be

the accused in the case. As per explanation(a) to Section

141(2) of the N.I.Act, "'Company' means any body corporate

and includes a firm or other association of individuals."

      4.    When as per Section 141(1) of the N.I. Act, the

company should be an accused, in cases wherein it is a

Company, going by the explanation, in the case of a

partnership firm, the firm should also be an accused in the


case. As per explanation(b) to Section 141(2) of the N.I. Act,

"'Director,' in relation to a firm, means a partner in the firm."

Over and above the partners, who are responsible for the

conduct of the business of the partnership firm, the

partnership firm should also be a party to the complaint.

When the partnership firm is not arraigned as an accused,

the complaint fails and therefore, Annexure 1 complaint in

C.C.No.290/13 on the file of the Judicial First Class

Magistrate's Court-I, Thiruvananthapuram as against the

petitioner, is liable to be quashed.

      In the result, this Crl.M.C. is allowed and all further

proceedings in Annexure 1 complaint in C.C.No.290/13 on

the file of the Judicial First Class Magistrate's Court-I,

Thiruvananthapuram, as against the petitioner, are hereby

quashed.



                               Sd/- B. KEMAL PASHA, JUDGE.

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