This petition is filed by the third accused in S.T.C.No.637 of 2006 on the file of the District Munsif-cum-Judicial Magistrate, Paramathi seeking to quash the proceedings.
2. The respondent has filed the complaint against the petitioner and five other accused under Section 138 of the Negotiable Instruments Act, on the basis that the first accused firm has got a liability of Rs.7,67,885.60/- and issued a cheque on 16.04.2006 for a sum of Rs.3,14,032/- to the complainant drawn on Bank of Baroda, Karur Branch. The respondent has presented the above cheque for collection in his bank ( "Indian Overseas Bank", Karur Branch) on 04.10.2006 and the cheque was returned on the same day with an endorsement "Exceeds Arrangements" vide memo dated 04.10.2006. Intimation was sent to the respondent on the same day from the Bank and he had sent a statutory notice to the accused on 17.10.2006 through his Advocate by registered post. The accused Nos.1,3,5 and 6 have evaded the service of the notice and accused Nos.2 and 4 alone have received notices on 19.10.2006 and 23.10.2006 respectively. The petitioner/third accused have failed to collect the notices given by the complainant even though due intimation was given by the postal authorities to them and moreover, notice was sent to his correct address by registered post with acknowledgement due.
3. The learned counsel for the petitioner would submit that he has resigned from the firm on 30.03.2004 itself and Form-A filed under Rule 5 with the Registrar of firm would clearly indicate that the petitioner ceased to be a partner with effect from 30.03.2004 itself and therefore, he is not liable for the cheque issued on behalf of theb firm and he existing partners of the firm are only liable.
4 . On a perusal of Form-A filed under Rule 5 with the Registrar of firm, it is apparent that the petitioner has resigned from the firm on 30.03.2004 itself. The issuance of cheque is on 06.04.2006 whereas the petitioner has resigned from the firm on 30.03.2004 itself that is long before the issuance of the cheque by the firm.
5. In LACHHMAN P.UDHANI AND OTHERS vs. REDINGTON (INDIA) LTD. {2006 (4) CTC 43}, this Court has held as under:
"7. In a case in M.S.Rama Mohan Rao v. Mrs.S.Nagu Bai, 2003 Company Cases 403, where the resignation letter of one of the Directors of the Company was produced to establish the disassociation of one of the Directors from the Company, A.Packiaraj, J., has observed as follows:
" Though the petitioner produced the concerned letter addressed to the complainant in the Court, showing the resignation of the petitioner from the Company as director, the Court sitting in revisionary jurisdiction could not go into the preliminary issued, since these were matters that could be decided only by letting in evidence."
8. in a case in S.V.Mazumdar and Others v. Gujarat State Fertilizers Co. Ltd. and another, 2005 (3) CTC 380, where one of the Directors of the Company disputed the responsibility fixed on him with respect to the conduct of the business of the Company, the Hon'ble Supreme Court has observed as follows:
" Whether a person is in charge of or is responsible to the Company for the conduct of the business is to be adjudicated on the basis of materials to be placed by the parties. "
9. Form-32 filed with the Registrar of Companies is a public document as per
Section 74 of the Indian Evidence Act, 1872. When the certified extract of such a public document is filed, the Court shall presume as to the genuineness of such certified copies as per
Section 79 of the said Act.
10. The sanctity attached to such public documents and the presumption the Court is bound to raise as to the genuineness of such documents have not been brought to my notice at the time when the judgement in K.Umadevi v. V.Manikandan, Proprietor, Manisha Traders, 2006 (1) CTC 662, was pronounced by me. In view of the importance of the public document as detailed above, the ratio laid down by me in the aforesaid judgment cries for reconsideration and restatement. The march of law should be dynamic and it should never be static. If a Judge if afflicted with infallibility syndrome, the space for growth of law is unfortunately smothered stifled.
11. In a case where certified copy of Form-32 is filed by the accused Director to show that he had resigned prior to the issuance of the cheque and the challenge thereto is inasmuch as no counter credential is projected by the complainant, the Court has to necessarily accept the same and relieve such a Director from the ordeal of trial. It will be a misuse of process of abuse of law if such an accused- Director who had resigned long prior to the issuance of the cheque and severed his umbilical root in the Company is implicated in a case under section 138 of the Negotiable Instruments Act.
12. It is always safe to take the date of registration of Form-32 to determine the date of disassociation of the accused-Director from the conduct of the business of the Company as there is chance for antedating the date of resignation in order to save the accused-Director from prosecution.
13. In this case, the petitioner has resigned on 18.12.2001 from the Company and the same was registered with the Registrar of Companies through Form-32 as on 27.12.2001 long prior to the issuance of the cheque. Therefore, the petitioner cannot be fastened with criminal liability under Section 138 of the Negotiable Instruments Act."
7. In the present case, as the petitioner has resigned on 30.03.2004 from the partnership firm and the same was registered with the Registrar of firm long prior to the issuance of cheque, therefore he cannot be fastened with criminal liability under section 138 of the Negotiable Instruments Act and the criminal prosecution as against the petitioner is liable to be quashed.
8. In the result, the criminal proceedings as against the petitioner, who is the third accused in S.T.C.No.637 of 2006 pending on the file of the District Munsif-cum-Judicial Magistrate, Paramathi, Salem District, stand quashed. The Criminal Original Petition stands allowed. Consequently, connected miscellaneous petition is closed.
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