Allowed

Harish Bagla v. Sharma Exports

Calcutta HC9 Sept 2026CRR/2500/2017

Case brief

AI extract

What is this about?

In a revisional application under Section 482 CrPC, the Court quashed proceedings under Section 138 of the N.I. Act against a Managing Director. The Bench held that since the underlying corporate body was not impleaded as an accused, vicarious liability under Section 141 could not be fastened on the individual, rendering the proceedings unsustainable.

What did the court decide?

Complaint Case No. 49-C/2017, orders of cognizance and warrant of arrest, and CRAN 3 of 2018 were quashed and set aside.

Harish Bagla Vs Sharma Exports — Money Laundering | Calcutta HC (2026)

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D/L – 5 09/09/2026 Court No.42 S.Kundu

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CRR 2500 of 2017 With CRAN 3 of 2018

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Harish Bagla Vs. Sharma Exports

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Mr. Moyukh Mukherjee Mr. Anurag Modi

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Ms. Ankita Sikdar

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…for the petitioner.

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Despite service of notice and sufficient opportunity granted to the opposite party, none appears on behalf of the opposite party.

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Accordingly, the matter is being taken up for final disposal on merit based on the materials on record and the position of law.

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The instant revisional application has been filed by the petitioner under Section 482 of the Code of Criminal Procedure seeking for quashing of the entire proceeding relating to Complainant Case No. 49-C/2017(TR 61/17) under Section 138 of the N.I. Act including order dated 12^th January, 2017 passed by the learned Chief Judicial Magistrate, Malda whereby he has taken cognizance of the offence and the order dated 29^th March, 2017 passed by the Judicial Magistrate, 3^rd Court, Malda whereby he directed to issue process and warrant of arrest against the petitioner.

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Learned counsel for the petitioner, relying upon the settled position of law on this point as expressed by the Hon’ble Supreme Court in Himanshu vs. B. Shivamurthy and Anr. [(2019) 3 SCC 797] submits that the impugned criminal proceeding is not maintainable in law since the petitioner was impleaded qua Managing Director of the M/s. Amrit Feeds Limited when the company itself is not being arrayed as an accused rendering prosecution against the individual petitioner legally unsustainable.

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The factual matrix culled out from the revisional application is that the opposite party initiated a complaint case under Section 138 of the N.I. Act alleging that the cheque issued towards discharge of debt or liability had bounced upon presentation. Pursuant thereof, the learned Chief Judicial Magistrate, Malda took cognizance of the offence by the order dated 12^th January, 2017 and subsequently, the learned Chief Judicial Magistrate, 3^rd Court, Malda issued a process of warrant of arrest against the petitioner who was prosecuted in his capacity as the Managing Director of the Company.

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The primary fundamental ground urged by the petitioner is that the cheque in dispute was neither drawn by the petitioner in his individual or his personal capacity nor from any personal account but was issued by the corporate body i.e. M/s. Amrit Feeds

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Limited drawn upon its current account maintained with the State Bank of India, Salt Lake Branch. However, perusal of the application of complaint reveals that the company itself has not been implicated as an accused in this complaint case.

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This Court must examine whether a criminal prosecution under Section 138 read with Section 141 of the N.I. Act can legally be sustained against the Director of the company on whose account the cheque was drawn especially where the said company has been omitted as an accused.

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The legal position on this issue is no longer res integra . A three Judge Bench of the Hon’ble Apex Court in the landmark judgment of Aneeta Hada versus Godfather Travels & Tours (P) Limited reported in (2012) 5 SCC 661, has categorically held that for maintaining a prosecution under Section 141 of the N.I. Act, arraigning the company as an accused is a sine qua non .

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The criminal liability of the Director, Managing Director or any other Officer under Section 141 is strictly vicarious, arising by way of statutory remedy which can only be invoked when the principle offender, the company is first prosecuted. The ratio of Aneeta Hada has been subsequently adopted by the Hon’ble Apex Court in Himanshu (supra). The relevant extract from the rule establishes that Section 141(1) of the N.I. Act

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extends vicariously criminal liability to the Officer of the company by deeming fiction which arises only when the offence is committed by the company itself and not otherwise. Without the company being arrayed as a party accused, no foundational finding of an offence committed by the company can be recorded thereby making it legally impossible to fasten criminal liability onto an individual Officer or Director.

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Applying the aforesaid settled principle of law to the facts of the present case, it is evident that the cheque in question belongs to corporate account of M/s. Amrit Feeds Limited, that the statutory notice under Section 138 of the N.I. Act was addressed to the company as well as the petitioner, and that despite corporate nature of transaction and being the drawer of the cheque in-question, the company has not been arrayed as an accused in Complaint Case No. 49-C/2017.

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In the absolute absence of the principal accused namely, the company in the array of parties, the continuation of criminal proceeding against the petitioner under Section 138 read with Section 141 of the N.I. Act is completely contrary to the settled tenets of criminal jurisprudence and amounts to an abuse of process of Court.

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Consequently, the application succeeds, the impugned Complaint Case No. 49-C/2017 pending before the learned Chief Judicial Magistrate, Malda along with all

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orders passed therein including order of cognizance dated 12^th January, 2017 and the order issuing warrant of arrest dated 29^th March, 2017 are hereby quashed and set aside.

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