Saroj Pandey vs. State (Govt. Of Nct Of Delhi

Case Type: Special Leave To Petition Criminal

Date of Judgment: 07-04-2026

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Full Judgment Text

2026 INSC 324
NON-REPORTABLE

IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO._________OF 2026
(@ Special Leave Petition (Crl.) No. 21322 of 2025)

SAROJ PANDEY ...APPELLANT(S)


VERSUS

GOVT. OF NCT OF DELHI
AND ORS ...RESPONDENT(S)

J U D G M E N T
SANJAY KAROL, J.
Leave Granted.
2. The appellant is aggrieved by the High Court of Delhi’s
refusal to exercise its inherent powers under Section 482, Code
th
of Criminal Procedure, 1973, in terms of order dated 7 August
Signature Not Verified
2025 passed and Criminal MC No.8110/2023 and Criminal M.A.
Digitally signed by
SOURAV PAL
Date: 2026.04.07
14:22:29 IST
Reason:
No.30210/2023 to quash the summoning order issued by the
Metropolitan Magistrate, in connection with complaint CC NI
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Act 12597/2021 under Sections 138 and 142 of the Negotiable
1
Instruments Act, 1881 , as confirmed as a consequence of the
dismissal of CR No. 115/2023 by the Additional Sessions Judge,
Dwarka Courts .
3. The facts of the matter are that the appellant is one of the
Directors of the accused Company namely Projtech Engineering
Private Limited. The accused Company issued cheques, three in
th
number, all dated 20 April 2021worth 15 lacs, 20 lacs and 15
lacs each, as payment for supply of iron and steel. Despite
confirmation from the accused Company of availability of funds
at the time of deposit of cheques, the same were returned unpaid.
The reason therefor was:
“DRAWERS SIGNATURES DIFFERS
AND ALTERNATIONS/CORRECTIONS
ON INSTRUMENTS OTHER THAN
DATE”
th
Legal notice in this connection was sent on 12 May 2021
th
through counsel and on 18 May 2021, through ‘ speed post ’. The
th
proceedings under the N.I. Act were initiated on 25 June 2021.
rd
By order dated 23 September 2021, MM(NI-Act) Dwarka
Courts, New Delhi, issued summons and put up the matter for
th
appearance of the accused on 15 December 2021.
4. In revision proceedings, the present appellant was the
second revisionist. The ground for rejecting the revision was that
she was the Director of the Company and she had also signed a

1
‘NI Act’
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Board Resolution which, as per the Court, ipso facto evidenced a
fact that she was involved in the day-to-day management of the
affairs of the Company.
5. In the High Court, similar reasoning was adopted.
Moreover, it was observed that when revision has been preferred
a petition under Section 482 CrPC on the same grounds, is
circumscribed to a much narrower jurisdiction. The petition was
as such dismissed.
6. The law with regard to prosecutions under Section 138 of
the N.I. Act is generally well settled. This Court has, on numerous
occasions considered the scope of prosecutions thereunder as
also under Section 141 of the N.I. Act. ( See : N. Vijay Kumar v.
2
Vishwanath Rao N. ) The only aspect that we have to consider
is whether the appellant is indeed conversant with the day-to-day
management of the Company, thereby justifying the issuance of
summons to her. Section 141 of N.I. Act reads as under:
”141. Offences by companies.—(1) If the person
committing an offence under section 138 is a
company, every person who, at the time the offence
was committed, was in charge of, and was
responsible to, the company for the conduct of the
business of the company, as well as the company,
shall be deemed to be guilty of the offence and shall
be liable to be proceeded against and punished
accordingly:

Provided that nothing contained in this sub-section
shall render any person liable to punishment if he
proves that the offence was committed without his

2
2025 SCC OnLine SC 873
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knowledge, or that he had exercised all due diligence
to prevent the commission of such offence:

Provided further that where a person is nominated as
a Director of a company by virtue of his holding any
office or employment in the Central Government or
State Government or a financialcorporation owned
or controlled by the Central Government or the State
Government, as the case may be, he shall not be
liable for prosecution under this Chapter.

(2) Notwithstanding anything contained in sub-
section (1), where any offence under this Act has
been committed by a company and it is proved that
the offence has been committed with the consent or
connivance of, or is attributable to, any neglect on
the part of, any director, manager, secretary or other
officer of the company, such director, manager,
secretary or other officer shall also be deemed to be
guilty of that offence and shall be liable to be
proceeded against and punished accordingly.

Explanation.—For the purposes of this section, —
(a) “company” means any body corporate and
includes a firm or other association of individuals;
and
(b) “director”, in relation to a firm, means a partner
in the firm.”

7. A bench of three judges in S.M.S. Pharmaceuticals Ltd. v.
3
Neeta Bhalla , crystallised the law on the point. The relevant
extract is as follows:
19. In view of the above discussion, our answers to
the questions posed in the reference are as under:

( a ) It is necessary to specifically aver in a complaint
under Section 141 that at the time the offence was
committed, the person accused was in charge of, and
responsible for the conduct of business of the
company. This averment is an essential requirement
of Section 141 and has to be made in a complaint.
Without this averment being made in a complaint,

3
(2005) 8 SCC 89
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the requirements of Section 141 cannot be said to be
satisfied.

( b ) The answer to the question posed in sub-para ( b )
has to be in the negative. Merely being a director of
a company is not sufficient to make the person liable
under Section 141 of the Act. A director in a
company cannot be deemed to be in charge of and
responsible to the company for the conduct of its
business. The requirement of Section 141 is that the
person sought to be made liable should be in charge
of and responsible for the conduct of the business of
the company at the relevant time. This has to be
averred as a fact as there is no deemed liability of a
director in such cases.

... … …”

4
In Gunmala Sales (P) Ltd. v. Anu Mehta , the Court concluded
as follows regarding proceedings under Section 138 NI Act:
“34. We may summarise our conclusions as follows:
34.1. Once in a complaint filed under Section 138
read with Section 141 of the NI Act the basic
averment is made that the Director was in charge of
and responsible for the conduct of the business of the
company at the relevant time when the offence was
committed, the Magistrate can issue process against
such Director.
… … …

34.3. In the facts of a given case, on an overall
reading of the complaint, the High Court may,
despite the presence of the basic averment, quash the
complaint because of the absence of more particulars
about the role of the Director in the complaint. It
may do so having come across some unimpeachable,
incontrovertible evidence which is beyond suspicion
or doubt or totally acceptable circumstances which
may clearly indicate that the Director could not have
been concerned with the issuance of cheques and
asking him to stand the trial would be abuse of
process of court. Despite the presence of basic

4
(2015) 1 SCC 103

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averment, it may come to a conclusion that no case
is made out against the Director. Take for instance a
case of a Director suffering from a terminal illness
who was bedridden at the relevant time or a Director
who had resigned long before issuance of cheques.
In such cases, if the High Court is convinced that
prosecuting such a Director is merely an arm-
twisting tactics, the High Court may quash the
proceedings. It bears repetition to state that to
establish such case unimpeachable, incontrovertible
evidence which is beyond suspicion or doubt or
some totally acceptable circumstances will have to
be brought to the notice of the High Court. Such
cases may be few and far between but the possibility
of such a case being there cannot be ruled out. In the
absence of such evidence or circumstances,
complaint cannot be quashed.

34.4. No restriction can be placed on the High
Court's powers under Section 482 of the Code. The
High Court always uses and must use this power
sparingly and with great circumspection to prevent
inter alia the abuse of the process of the court. There
are no fixed formulae to be followed by the High
Court in this regard and the exercise of this power
depends upon the facts and circumstances of each
case. The High Court at that stage does not conduct
a mini trial or roving inquiry, but nothing prevents it
from taking unimpeachable evidence or totally
acceptable circumstances into account which may
lead it to conclude that no trial is necessary qua a
particular Director.”

[See also: Hitesh Verma v. Health Care at Home (India) (P)
5 6
Ltd . ,; K.S. Mehta v. Morgan Securities & Credits (P) Ltd. ]
8. In the instant case the substance of establishing the
appellant’s day-to-day involvement in the affairs of the Company
is that she had signed the Board Resolutions. To say the least, the

5
(2025) 7 SCC 623

6
(2025) 7 SCC 615

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same is not inspiring in confidence because a Board Resolution is
a document that is signed by the members of the Board of
Directors for decisions taken or conclusions arrived at for matters
placed before the Board for consideration and decision. This may
be inter alia regarding hiring of personnel at management levels,
acquisition or liquidation of assets affecting the overall position
of the assets and liabilities of the Company or any other such
major directional issue. This, however, does not in any manner
mean that each and every member of the Board of Directors is
aware of all decisions taken in the everyday transactions that are
involved in running a business concern. That apart, there is not
even as much as a whisper of direct allegation against the present
appellant in the complaint made which, as per the judgment
referred to immediately hereinabove is the sine qua non for
Section 141 N.I. Act to be attracted – “ accused was in charge of, and
responsible for the conduct of business of the company.
9. As an aside, we consider the statement of law expressed by
the High Court to the effect that once a petition under Section 397
Cr.PC has been entertained, irrespective of its end result, a
subsequent petition under Section 482 Cr.PC on the same grounds
limits the jurisdiction of the latter and in ordinary course matters,
such as the present one, are liable to be dismissed on this short
ground alone.
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10. This question was determined by a bench of three judges
7
in Krishnan & Anr. v. Krishnaveni & Anr with reference to
earlier decision of this Court in Madhu Limaye v. State of
8 9
Maharashtra and V.C Shukla v. State through CBI as follows:
14. In view of the above discussion, we hold that
though the revision before the High Court under sub-
section (1) of Section 397 is prohibited by sub-
section (3) thereof, inherent power of the High Court
is still available under Section 482 of the Code and
as it is paramount power of continuous
superintendence of the High Court under Section
483, the High Court is justified in interfering with
the order leading to miscarriage of justice and in
setting aside the order of the courts below…”
Holding to a similar effect has been given in Dhariwal Tobacco
10
Products Ltd. v. State of Maharashtra , which has been
11
followed and affirmed in Prabhu Chawla v. State of Rajasthan .
The relevant extract of the former is as follows:
“6. Indisputably issuance of summons is not an
interlocutory order within the meaning of Section
397 of the Code. This Court in a large number of
decisions beginning from R.P. Kapur v. State of
Punjab [AIR 1960 SC 866] to Som Mittal v. Govt. of
Karnataka [(2008) 3 SCC 574 : (2008) 2 SCC (Cri)
1 : (2008) 1 SCC (L&S) 910] has laid down the
criterion for entertaining an application under
Section 482. Only because a revision petition is
maintainable, the same by itself, in our considered
opinion, would not constitute a bar for entertaining
an application under Section 482 of the Code. Even
where a revision application is barred, as for
example the remedy by way of Section 115 of the
Code of Civil Procedure, 1908, this Court has held

7
(1997) 4 SCC 241
8
(1977) 5 SCC 551
9
1980 Supp. SCC 92
10
(2009) 2 SCC 370

11
(2016) 16 SCC 30

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that the remedies under Articles 226/227 of the
Constitution of India would be available. (See Surya
Dev Rai v. Ram Chander Rai [(2003) 6 SCC 675] .)
Even in cases where a second revision before the
High Court after dismissal of the first one by the
Court of Session is barred under Section 397(2)
[ Ed. : The intended provision seems to be Section
397(3). In this
regard See (1) Krishnan v. Krishnaveni , (1997) 4
SCC 241 : 1997 SCC (Cri) 544;
(2) Puran v. Rambilas , (2001) 6 SCC 338 : 2001
SCC (Cri) 1124; (3) Kailash Verma v. Punjab State
Civil Supplies Corpn. , (2005) 2 SCC 571 : 2005 SCC
(Cri) 538.] of the Code, the inherent power of the
Court has been held to be available.
7. …The inherent power of the High Court is not
conferred by statute but has merely been saved
thereunder. It is, thus, difficult to conceive that the
jurisdiction of the High Court would be held to be
barred only because the revisional jurisdiction could
also be availed of.
(See Krishnan v. Krishnaveni [(1997) 4 SCC 241 :
1997 SCC (Cri) 544] .)”

11. In that view of the matter, we also find fault with the
statement of law as stated by the High Court in the impugned
judgment and set aside the same on both the counts. The
proceedings against the instant appellant namely Saroj Pandey,
shall stand quashed and set aside. It is clarified that any
observation made herein is for the limited purpose of
consideration of her case only and have no bearing or impact on
the trial of the co-accused persons. The appeal is allowed to
aforesaid extent.


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Pending application(s), if any, shall stand disposed of.



……………………………………..J.
(SANJAY KAROL)



……………………………………..J.
(AUGUSTINE GEORGE MASIH)

New Delhi;
April 7, 2026
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