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Negotiable Instruments Act, 1881

Managing Director is responsible for acts done in the company name

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01st-Feb-2020       
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(From previous issue) :
17. We have considered the facts, relevant provisions of Section 138 and 141 of the Negotiable Instruments Act and the decisions cited above we are of the view that computation of 30 days for issuance of notice shall start running excluding the date of dishonoured cheque and in a similar way "within 30 days of the date of the receipt of the said notice" used in Section 138(1)(c) of the Negotiable Instruments Act, necessarily implies that the payment of money of the dishonoured cheque shall have to be paid within 30 days, and from the next following date of receipt of the legal notice, counting of days shall start. Because, the said 30 days is given to pay money and one month cannot be inclusive of next 30 days allowed for filing the case. The complaint case must have to be filed within one month next from the date of cause of action expiring the deadline. Otherwise, the complainant cannot get clear one month time for filing the case. It is clear that the accused-petitioner failed to make payment of demanded money, the last date of which was 28-10-2011 from the date of receipt of the notice on 29-9-2011. So cause of action arose on 28-10-2011 and counting of 30 days for filing the case started running on and from 28-10-2011 and accordingly, one month for filing the case ended on 28-11-2011.
18. The words "within 30 days of the receipt of as used in Section 138(b), 138(c) clearly give expression that computation of limitation period of 30 days shall from the following date, and last date cannot be included for such computation. Thus we rely on the decision reported in 1999 BLD (AD) 166 = 51 DLR (AD) 218 and Company Cases volume 77 page 248 of Indian jurisdiction which are equally applicable in the present case, for the purpose of computation of limitation period from the following day and not including the date of expiry at each of the stages.
19. It further appears that accused-petitioner was Managing Director of the Company, and the cheque was signed jointly with the Chairman of the company and that he received the notice on 29-9-2011 as such the petitioner cannot escape his liability and that he was incharge of and responsible to the company in the conduct of its business at the material time when the offence was committed by the company. We are of the opinion that the petition of complaint was filed within time prescribed under the aforesaid provision of law in view of Section 141 (b) of the Act.
20. The next question is whether the proceedings are legally maintainable in the absence of the companies which committed the offence punishable under Section 138 of the Negotiable Instruments Act.
21. The learned Advocate for the accused-petitioner argued that since the company is not made a party in the present proceedings, the impugned proceedings minus the company is not maintainable under Section 140 of the Negotiable Instruments Act.
22. It appears that admittedly the complainant did not make the company as party in the present proceedings, but it appears that admittedly the accused-petitioner, Managing Director of the company who along with the Chairman jointly signed the cheque on behalf of the company and that the alleged omission of impleading the company in the present proceedings is an irregularity and same is not fatal and that though the company is not made a party in the proceedings but the persons concerned representing the company, who are party in the issuances of the dishonoured cheque, having been made party in the proceedings, the proceedings cannot be said to be bad for defect of party in as much as the punishment if any on proof is to be inflicted upon the natural persons involved in the offence committed. A company being a juristic person, all its deeds and functions are the result of the acts of Managing Director. Therefore, a Managing Director of the company is responsible for acts done in the name of the company. Thus it is evident that the accused-petitioner was Managing Director of the company at the time of offence committed or done within his knowledge. He is responsible for the conduct of the business of the company and in such situation when the Managing Director of the company is made party, there is no necessity for making the company as party. In this respect we can place reliance on the decisions of our Apex Court, reported in 68 DLR (AD) 298 and 21 BLC (AD) 1.
23. A calendar month is strictly a complete month in the calendar that is the month of October, or the month of November. When the period is composed of two parts of different months, the term 'calendar month' is inappropriate and in computing time by calendar months the time must be reckoned by looking at the calendar and not by counting days. However, it is now the accepted view that a calendar month is said to end on the day of the next following month having the same number as that on which computation begins, viz., that October 28 to November 28.
24. The test of calendar month is that whatever the length of the month in which the time begins or is ended, it is enough when you begin with a date and get to it is the corresponding day in the next month.
25. As has been observed above, in this application under Section 561 A of the Code of Criminal Procedure, the petitioner failed to raise a legitimate ground to have the proceeding under Section 138 of the Negotiable Instruments Act, 1881 be quashed or to avoid repayment. Next it appears that the accused petitioner obtained the present rule and stay on 2-6-2014 without imp-leading the complainant as party. Rather for the last three years on the prayer of the learned Advocate for the petitioner the order of stay was further extended from time to time and ultimately by order dated 16-6-2015 the order of stay was extended till disposal of the rule. Thereafter, the complainant filed an application before this court for addition of party before this court on 1-2-2016 and same was allowed by order dated 15-2-2016.
26. In the situation, we cannot help but to conclude that the petitioner brought this case of quashment with an oblique motive, knowing fully well that they had no valid ground to get the proceeding quashed. It therefore, transpires that the petitioner initiated the instant proceeding, either with an intent to avoid repayment, or at least to procrastinate the proceeding initiated by the creditor complainant. But in this way the petitioner caused wasting of money and time of the complainant party, and also reached undesirable tax on the court's valuable but limited time. This being the situation, we feel it necessary to pay off the petitioner by their own coin. Hence, considering, the conduct of the petitioner as vexatious aimed at delaying the sessions case, the opposite-party No.2 should be awarded with cost for loss. Accordingly, we are inclined to award cost upon the accused-petitioner for a token sum of Taka 50,000 (Taka Fifty thousand) only in favour of the complainant-opposite-party No. 2 and the petitioners are directed to deposit the cost amount to the trial court within 3 (three) months from the date of receipt of the copy of the judgment. The complainant is at liberty to withdraw the cost amount from the trial court.
27. Having regard to the facts and circumstances of the case we do not find any merit in this rule.
28. In the result, the Rule is discharged.
29. The order of stay granted at the time of issuance of the rule is hereby vacated.
(Concluded)

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