Company as accused...

Complaints against companies under Section NI-138 have been filed and such cases are tenable.

Complaint against company is maintainable as drawer of cheque is company and the cheque has been signed by its directors who have been also impleaded accused.company is juristic person can't be ordered for imprisonment but can be fined.

if a cheque has been issued by company and it is dishonoured, company is required to be made party and if company is not made party and only directors, signatory are made as accused. as per latest judgement of Supreme Court, accused shall be acquitted. i do not recollect the name of parties

Opinion given be above legal experts is the current law. Another point mentioned by Moxit shah is also correct. These are technicalities in cheque cases and should be minutely observed.

 

In this context we also draw attention of accused and their advocates in matter of issue of notice prior to filing of complaint.

Most of the time notice is not recieved and so defense is taken that for want of notice complaint is not maintainable.  But it is half defense and hence instead of helping the accused it is proved cointer productive.

Please read following portion of recent MADRAS HIGH COURT  judgment in this matter.

 

6. In C.C. Alavi Haji, a three-Judge Bench of this Court was dealing with the question referred by a two-Judge Bench for consideration. The referring Bench was of the view that in D. Vinod Shivappa v. Nanda Belliappa[3], this Court did not take note of Section 114 of the Evidence Act in its proper perspective. It felt that presumption under Section 114 of the Evidence Act being a rebuttable presumption, the complainant should make certain necessary averments to raise the presumption of service of notice; that it was not sufficient for a complainant to state that a notice was sent by registered post and that the notice was returned with the endorsement out of station and that there should be a further averment that the addressee-drawer had deliberately avoided receiving the notice or that the addressee had knowledge of the notice, for raising a presumption under Section 114 of the Evidence Act. The following question was, therefore, referred to the larger Bench for consideration.

Whether in absence of any averments in the complaint to the effect that the accused had a role to play in the matter of non-receipt of legal notice; or that the accused deliberately avoided service of notice, the same could have been entertained keeping in view the decision of this Court in Vinod Shivappas case?

7. Dealing with the above question, this Court referred to K. Bhaskaran v. Sankaran Vaidhyan Balan[4], where this Court referred to Section 27 of the General Clauses Act, 1897 (the GC Act) and observed that since the NI Act does not require that notice should only be given by post in a case where the sender has despatched the notice by post with correct address written on it, Section 27 of the GC Act could be profitably imported and in such a situation service of notice is deemed to have been effected on the sender unless he proves that it was really not served and that he was not responsible for such non-service.

8. This Court then referred to Vinod Shivappas case, where the above aspects have been highlighted. This Court quoted the following paragraph from Vinod Shivappa with approval....

9. This Court then explained the nature of presumptions under Section 114 of the Evidence Act and under Section 27 of the GC Act and pointed out how these two presumptions are to be employed while considering the question of service of notice under Section 138 of the NI Act.

14. Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement refused or not available in the house or house locked or shop closed or addressee not in station, due service has to be presumed. [Vide Jagdish Singh Vs. Natthu Singh (1992) 1 SCC 647; State of M.P. Vs. Hiralal & Ors. (1996) 7 SCC 523 and V.Raja Kumari Vs. P.Subbarama Naidu & Anr. (2004) 8 SCC 74] It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved.

10. It is thus clear that Section 114 of the Evidence Act enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. Section 27 of the GC Act gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business.

It is our effort to educate the accused in cheque bounce cases to take proper legal defense. you can win the case if it is done.