The Supreme Court (SC) in Bijoy Kumar Moni v Paresh Manna & Anr [2024 INSC 1024], reiterated that the authorised signatory of a company cannot be held liable under Section 138 of the Negotiable Instruments Act, 1881 for dishonour of a cheque drawn on the company’s account, unless the company is arraigned as the principal accused.
Under Section 138 of the NI Act, only the drawer of the cheque can be made liable. It relied on various precedents which clarified that a cheque must be drawn on an account maintained by the accused to attract liability under Section 138.
The expression “on an account maintained by him with a banker” in Section 138 of the NI Act establishes a specific relationship between the account holder and the banker, and delegating authority to manage or transact from an account does not alter the fact that the account is maintained by the account holder,
It is the drawer Company which must be first held to be the principal offender under Section 138 of the NI Act before culpability can be extended, through a deeming fiction, to the persons in-charge of and responsible to the Company for the conduct of its business.
In the absence of the liability of the drawer Company, there would naturally be no requirement to hold the other persons vicariously liable for the offence committed under Section 138 of the NI Act.
The Section 138 of the NI Act clearly postulates that the cheque returned for insufficiency of funds should have been drawn by a person on an account maintained by him.
Illegal Constructions Won’t Be Regularised Despite Long Occupancy & Investments: Supreme Court
Dec 19, 2024
The Supreme Court on Tuesday declared that unauthorized constructions cannot be legitimized by administrative delays, passage of time, or financial investments, and laid down measures to curb illegal constructions.
The Supreme Court dismissed an appeal against the Allahabad High Court’s order to demolish structures purchased by the appellants. The shops and commercial spaces were illegally built by Respondents 5 and 6 on land allotted by Respondent 1, the U.P. Housing and Development Board, without necessary approvals.
The bench comprising Justice JB Pardiwala and Justice R. Mahadevan observed, “we are of the opinion that construction(s) put up in violation of or deviation from the building plan approved by the local authority and the constructions which are audaciously put up without any building planning approval, cannot be encouraged. Each and every construction must be made scrupulously following and strictly adhering to the Rules. In the event of any violation being brought to the notice of the Courts, it has to be curtailed with iron hands and any lenience afforded to them would amount to showing misplaced sympathy. “
Further the Court added, “Delay in directing rectification of illegalities, administrative failure, regulatory inefficiency, cost of construction and investment, negligence and laxity on the part of the authorities concerned in performing their obligation(s) under the Act, cannot be used as a shield to defend action taken against the illegal/unauthorized constructions.”
The court mandated that any deviation or violation of planning permission, even after a completion certificate is issued, must be promptly addressed by the authority in accordance with the law. Additionally, officials responsible for issuing wrongful completion or occupation certificates are to face immediate departmental action
RAJENDRA KUMAR BARJATYA AND ANOTHER
APPELLANT(S)
VERSUS
U.P. AVAS EVAM VIKAS PARISHAD & ORS.
RESPONDENT(S). Supreme court 17-12-2024
The Supreme Court has made it clear that illegal constructions cannot be regularized, regardless of how long they’ve been occupied or how much has been invested in them ¹. This decision aims to prevent unauthorized constructions and ensure accountability among authorities.
The court emphasized that constructions carried out in violation of approved building plans or without planning permission cannot be encouraged ². It’s essential to strictly enforce building regulations to prevent such illegal constructions.
To address unauthorized constructions, the Supreme Court has issued 12 comprehensive directives, including:
– *Builder’s Undertaking*: Builders must provide an undertaking to hand over possession only after obtaining completion/occupation certificates.
– *Display of Approved Plans*: Approved building plans must be displayed at construction sites throughout construction.
– *Prompt Issuance of Completion Certificates*: Completion/occupation certificates must be issued promptly after inspection, provided there are no deviations from approved plans.
– *No Essential Services for Unauthorized Constructions*: Essential services like electricity, water, and sewerage connections should only be provided upon submission of completion/occupation certificates.
– *Action Against Erring Officials*: Erring officials must face departmental proceedings for delaying or failing to take action against unauthorized constructions.
These directives aim to prevent unauthorized constructions, ensure accountability among authorities, and protect the rights of legitimate property owners
Finally, the Bench then concludes by holding in para 23 that, “With the aforesaid observations and directions, these appeals stand dismissed. There is no order as to costs. Pending application(s), if any, shall stand disposed of.” In a nutshell, we thus see that the top court has made it abundantly clear that the illegal constructions can’t be regularised irrespective of the long occupancy and investments. In addition, the Apex Court has also made it pretty clear in no uncertain terms that the officers who issue wrong completion/occupancy certificates to unauthorized constructions must face departmental action. Absolutely right! No denying or disputing it!