J.B.Pardiwala, J. - (1.) By this application under section 482 of the Cr.P.C., 1973, the applicants-original accused, seek to invoke the inherent powers of this Court praying for quashing of the proceedings of the Criminal Case No.633 of 2017 in the court of the 11th Judicial Magistrate, Rajkot arising from a criminal complaint filed by the respondent No.1-Bank under section 138 of the N.I. Act, 1881 (for short "the Act") .
(2.) The complaint filed by the respondent No.1-Bank is against the partnership firm (accused No.1) and eleven partners. The applicants herein are the original accused Nos.4,5,6,7,8,9,10 and 11 respectively. The compliant filed by the Bank reads as under; "1. The complainant Bank is registered and incorporated under the provisions of the Companies Act, 1956, having its Rajkot office at 2nd floor, Opp. Mahatma Gandhi High School, Rajkot. Complainant Bank is in business of providing various loans. The present complaint is filed bu the authorized officer who is authorized to file such complaint. 2. That the accused approached the complainant Bank for the purpose of procurement of finance by the way of Term Loan and at the request of the accused, financial assistance was provided to them under Agreement No. 81034097. At the time of procurement of finance, the accused accepted all the terms and conditions stipulated by the complainant Bank. 3. That, Accused No.1 is borrower of the Term Loan granted, through their partners who are engaged in the day to day activity of the firm, whom are mentioned as accused No.2 to 11. Moreover, Accused No.2 to 11 have also stood as the co-borrower of the financial assistance obtained by them. 4. The accused gave cheque as per following details, duly signed by the accused towards the legal debt which the accused had incurred on account of financial assistance provided to the accused by the complainant. Accused also gave assurance that, said cheque will be honored on presentation. JUDGEMENT_64_LAWS(GJH)7_2018_1.html 5. The complainant presented the said cheque with its Banker for realization and the same was dishonored by the accused's Banker as per above mentioned detail. The said cheque was presented in account maintained at Rajkot and the same was dishonored in Rajkot. 6. Upon receipt of the said memo, the accused was called upon by statutory demand notice dated 29/11/2016 within the prescribed limitation period, to make payment of the aforesaid amount within the stipulated time. The said notice has been served upon accused on or around 03/12/2016 and they have replied the same through their Advocate through email of our Advocate. However, the accused failed to make payment. Hence, the accused has committed offence as prescribed u/s 138 r/w sec. 142 of the NI Act,1881. 7. The complainant submits that as the complainant maintains their account in the Bank which is within the jurisdiction of this court, therefore Hon'ble Court has the jurisdiction to try the case and punish the accused if he is found guilty under the provisions of the said Act."
(3.) Mr. Aditya A. Gupta, the learned counsel appearing for the applicants has filed his written submissions. They are noted as under; "1. The case of the petitioners in a nutshell is that they had retired from the partnership firm before the issuance of the cheque and its presentation. The petitioners are accused No. 4 to 7 and 9 to 11 in the complaint. 2. The relevant list of dates and event along with important pages which may be referred to are as under: JUDGEMENT_64_LAWS(GJH)7_2018_2.html Alleged Procedure for Retirement not followed: 3. The Respondent has contended that the accused have not followed the procedure for retirement of partner under the Indian Partnership Act, 1932 which is as follows as per the Resp: JUDGEMENT_64_LAWS(GJH)7_2018_3.html Therefore, the respondent has contended that the petitioners cannot be treated to be retired in the facts of the case. 4. It is humbly submitted that the aforesaid contention is misconceived in law. Retirement is complete by any of the following modes provided in Section 32(1). the petitioners retired by express agreement as provided by section 32(1)(b). Thereafter, registrar of firms was intimated who has made an entry on 22.01.2016 in Form G which is a public document. Therefore, the retirement is complete in law. 5. The only effect of Section 32 (3) read with Section 72 of not giving public notice could not be that the retired partner continues to remain civilly liable to third parties. This subtle distinction is lost in the argument of the respondent. If the argument of the respondent is accepted then no person can be treated as retired until he published the retirement notice in Official Gazette. 6. The argument mixes civil liability with criminal liability. The test of section 138 and 141 is whether a person is charge of and responsible for the day to day affairs of the firm at the time of deposit of cheque. If the person is so involved then he becomes liable under section 141. This has nothing to do with his civil liability. 7. For example, a person may not be involved with day to day affairs of the firm at all but is a partner of the firm. He remains liable in civil law since all partners including sleeping partners are personally liable for the acts and liability of the firm. However, such person will not be liable under Section 141 of NI Act. Complaint does not even make bald averments against the Petitioner 8. the complaint does not even make the bald averment that the accused persons/petitioners are in charge of and responsible for the day to day affairs of the firm. Even if such averment is not reproduced as it, from the the totality of the allegations made in the complaint, such averment/allegation that the accused is in charge of and responsible for the day to day affairs of the firm must be brought out.( See Pravin Amrutlal Kiri v State of Gujarat CRMA No. 17681 of 2015; Para 16)." ;