Procedure For Service Of Summons On Corporate Bodies/Firms | Allahabad HC Explains Difference Between S. 63 CrPC & S. 65 BNSS
In light of the provision contained under Section 65 of the recently introduced Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023, the Allahabad High Court earlier this month observed that summons of a company or corporation could now also be served through the Director, apart from the Manager, Secretary, and other Officers of the company, including the firm's partner. A bench of...
In light of the provision contained under Section 65 of the recently introduced Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023, the Allahabad High Court earlier this month observed that summons of a company or corporation could now also be served through the Director, apart from the Manager, Secretary, and other Officers of the company, including the firm's partner.
A bench of Justice Arun Kumar Singh Deshwal observed thus while comparing Section 63 (service of summons on corporate bodies and societies) of CrPC with its corresponding provision in the BNSS 2023 (Section 65/service of summons on corporate bodies, firms and societies).
It may be noted that, as per Section 63 CrPC, a summons for a corporation could be served on the secretary, local manager, or other principal officer of the corporation.
The Court further noted that Section 65 of the BNSS also provides that if the letter containing the summons for the company is sent through registered post and addressed to the Director, Manager, or other Officer of the company or corporation in India, it will also be deemed to have been served.
However, the Court noted that Section 63 of the CrPC summons sent through a letter by registered post addressed to the Chief Officer of the Corporation in India only was deemed to be served.
“Therefore, in place of the Officer of the Corporation in India as mentioned in Section 63 CrPC, Director, Manager, Secretary or other Officer of the company or corporation in India has been replaced by Section 65 of the BNSS,” the Court observed.
The Court added that under Section 63 of CrPC, only the company or other corporate body, including registered society, was mentioned, but in the corresponding Section of the BNSS, the firm or other associations of individuals are also mentioned.
The case in brief
The Court made these observations while dealing with a petition filed by M/S Parthas Textiles and a partner of the company challenging the entire proceedings initiated under the Negotiable Instrument Act and Section 420 IPC
It was argued that, as per the complaint itself, the cheque was issued on behalf of M/s Partha Textiles, and applicant No.2 is one of its partners, but only the firm was impleaded as accused in the complaint.
It was further contended that in the complaint, all the allegations were made against applicant no.1 (firm) itself, and no allegations were made against the present applicant; however, despite this, the Magistrate issued a summons to the present applicant personally instead of issuing a summons to the accused firm.
It was further submitted that once applicant no.2 was not impleaded as accused to make him vicariously liable as a firm partner (applicant no.1), then the issuance of summons against him in a personal capacity was erroneous.
On the other hand, the AGA submitted that, as per Section 63 CrPC, if the summons was served on the Principal or Chief Executive Officer of the company or corporate body, then it would be deemed as sufficient service.
High Court's observations
Against the backdrop of these submissions, the Court noted that only the firm, represented by its partner Praveen Raj Rajendran, was named as the accused in the complaint. The demand notice after the cheque bounced was also sent to the firm.
The Court further noted that as the cheque was issued on behalf of a registered firm, the firm holds the primary liability. While the partner can also be held vicariously liable, in this case, the Court noted that the partner (applicant no.2) was not named as an accused along with the firm.
Further, the Court conjointly read Section 141 NI Act, Section 63 of CrPC, and Section 305 CrPC to note that whenever a company is accused under Section 138 NI Act, a summons has to be issued in its name and service of the same can be effected by serving it on the Principal Officer or Local Manager of the Company.
However, given the newly introduced provisions under Section 65 of BNSS (which came into force on July 1), which replaces Section 63 CrPC, the Court noted that if the letter containing the summons for the company is sent through the registered post addressed to the Director, Manager or other Officer of the company or corporation in India that will also be deemed to be served.
“From the perusal of above Section 65 of the BNSS, it is clear that service of summons upon a company, corporation registered society, firm or other association of other individuals may be effected by serving on Director, Manager, Secretary or other Officer of the company or corporation in India or partner of the firm or association,” the Court remarked.
However, the Court noted that the proceeding, trial or application pending before the date of commencement of the BNSS will continue as per the provision of CrPC, and hence, in the instant case, the court below will have to proceed as per procedure of CrPC as mentioned under Sections 63 and 305 CrPC.
In conclusion, the Court said in the proceedings initiated before the commencement of BNSS, if a company has been named as an accused in a complaint, then a summons ought to be issued to it through its principal officer or local manager as mentioned under Section 63 CrPC.
However, the Court added that after the service of summons upon the company, the company can appoint any of its representatives as per Section 305 CrPC. When the representative of the company appears before the court, the proceeding before him will be deemed to be the proceeding in the presence of the accused, and the representative will be examined on behalf of the company.
“Representative of the company is not required to seek bail on behalf of the company as the company can change its representative at any stage of proceeding with the permission of the Court concerned,” the Court clarified.
In view of this, though the Firm (M/S Partha Textiles) was arrayed as an accused, but a summons was issued to its partner (applicant no.2) personally, which is not a proper service for the firm because the partner was not impleaded as accused in the impugned complaint, the Court quashed the summoning order as well as a non-bailable warrant.
Further, the Court below was directed to pass a fresh order within one month in light of the observation made hereinabove.
Case title - M/S Parthas Textiles And Another vs. State of U.P. and Another 2024 LiveLaw (AB) 443
Case citation : 2024 LiveLaw (AB) 443