STANDARD CHARTERED BANK versus STATE OF MAHARASHTRA AND OTHERS ETC.

STANDARD CHARTERED BANK versus STATE OF MAHARASHTRA AND OTHERS ETC.

Complaint contained sufficient assertions about accused directors being responsible for day-to-day affairs of the company and actively participating in issuance of dishonoured cheques; High Court erred in quashing the summons as averments met the legal test laid down in precedents; Magistrate to proceed with complaint.

Parties
Appellant: Standard Chartered Bank; Respondents: State of Maharashtra and Others
Jurisdiction
India
Judgment Date
06 April 2016
Procedural Posture
Criminal Appeal / Appeal Against High Court's Order Quashing Summons
Outcome
Appeals allowed
Legal Topics
Negotiable Instruments, Offences by Companies, Dishonoured Cheques, Vicarious Liability
Criminal Law Banking Law Negotiable Instruments Offences by Companies Dishonoured Cheques Vicarious Liability

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Parties

Standard Chartered Bank

Appellant

State of Maharashtra and Others

Respondents

Procedural Posture

Criminal Appeal / Appeal Against High Court's Order Quashing Summons

Legal Issues

  1. 1 Whether summons against whole-time directors and executive director of accused company under Section 138 and 141 of Negotiable Instruments Act were justified
  2. 2 Whether complaint contained sufficient averments to attract constructive liability under Section 141

Ratio Decidendi

Complaint contained sufficient assertions about accused directors being responsible for day-to-day affairs of the company and actively participating in issuance of dishonoured cheques; High Court erred in quashing the summons as averments met the legal test laid down in precedents; Magistrate to proceed with complaint.

Court Disposition

Appeals allowed

Orders

  • Order of High Court set aside
  • Learned Magistrate directed to proceed with complaint cases according to law