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2014 Supreme(SC) 280

SUPREME COURT OF INDIA
P. Sathasivam, CJI., Ranjan Gogoi, N.V. Ramana, JJ.
M/s. Haryana State Coop. Supply and Marketing Federation Ltd. – Appellant
Vs.
M/s. Jayam Textiles & ANR. – Respondents
[Criminal Appeal No. 833 of 2014 arising out of Special Leave Petition (Criminal) No. 7700 of 2007]
M/s. Haryana State Coop. Supply and Marketing Federation Ltd. – Appellant
Vs.
M/s. Jayam Textiles & ANR. – Respondents
[Criminal Appeal No. 834 of 2014 arising out of Special Leave Petition (Criminal) No. 20 of 2008]
Decided On : 07-04-2014

IMPORTANT POINT
Complaint should not be dismissed for a defect which is curable.

Headnote:Negotiable Instruments Act, 1881 – Section 138 – Locus standi of complainant-power of attorney holder challenged – Contended that power of attorney was not granted by proper authority – Power of attorney granted by Managing Director – Board of Directors authorizing MD to grant power of attorney – Said authorization not produced before court – Defect being curable, opportunity ought to have been given to the appellants to produce the authorization of Board of Directors instead of dismissing the complaint – Matter remitted back. (Para 12, 13)

       (2006) 1 SCC 75 – Relied upon

       Facts of the case:

       The appellant-Federation supplied cotton bales to the respondents of the value of Rs.30,45,602/-. The respondents, to discharge their liability, issued in total four cheques.

       On presentation, all the said four cheques were returned unpaid by the bank with an endorsement 'for want of sufficient funds'.

       The appellant-Federation sent legal notice(s) under Section 138 of the Negotiable Instruments Act, 1881. On failure of the respondents to pay the amount within the stipulated time of 15 days from the date of receipt of the notice, the appellant-Federation filed complaints under Section 138 and 140 of the N.I. Act read with Section 420 of the Indian Penal Code, 1860 against the respondents. The said complaints were dismissed by the Judicial Magistrate and the appeals filed against the said order were dismissed vide impugned judgment, solely on the ground that the 'authorisation' was not produced by the complainant-appellant.

       Finding of the Court:

       The defect in the complaint being curable, it should not have been dismissed.

       Result: Appeal disposed of.

JUDGMENT

N.V. RAMANA, J.

1. Leave granted.

2. The present appeals have been filed against the judgment dated 18.06.2007 passed by the High Court of Judicature at Madras in Crl. A. Nos. 348 and 410 of 2001 thereby dismissing the said appeals on the ground that Mr. Davinder Kumar Lal, claiming to be the power of attorney holder of the appellant-Federation, has no locus standi to file the complaints/appeals as he has failed to prove that the Appellant-Federation had authorised him to file the same.

3. The facts of the two appeals are - the appellant-Federation supplied cotton bales to the respondents of the value of Rs.30,45,602/- vide three invoices dated 19.12.1994, 21.12.1994 and 20.01.1995. The respondents, to discharge their liability, issued in total four cheques - two cheques for Rs.5 lakhs each dated 16.01.1995 and 20.01.1995 respectively and two -

4. cheques for Rs. 11 lakhs each dated 20.01.1995 and 25.01.1995 respectively. However, on presentation, all the said four cheques were returned unpaid by the bank with an endorsement 'for want of sufficient funds'. The appellant-Federation sent legal notice(s) dated 19.04.1995 and 27.04.1995 under Section 138 of the Negotiable Instruments Act, 1881 (for short, 'the N.I. Act'), which were duly received by the respondents. On failure of the respondents to pay the amount within the stipulated time of 15 days from the date of receipt of the notice, the appellant-Federation filed complaints under Section 138 and 140 of the N.I. Act read with Section 420 of the Indian Penal Code, 1860 (for short, 'the I.P.C.') against the respondents. The said complaints were dismissed by the Judicial Magistrate vide order dated 07.02.2001 and the appeals filed against the said order were dismissed vide impugned judgment dated 18.06.2007, solely on the ground that the 'authorisation' was not produced by the complainant-appellant.

5. -

6. It is submitted by the counsel for the appellant-Federation that in fact there was an authorisation from the Board of Directors of the Federation, but unfortunately, the same was not filed along with the complaint and on account of this reason only, the complaint was dismissed, and as a matter of record, the said authorisation delegating powers was passed in the meeting of the Federation on 15th April, 1976 and an opportunity to the appellant-Federation could have been afforded by the Courts below to furnish the authorisation, particularly when the appellant-Federation is a Public Sector Undertaking and money which has to be paid by the respondents is public money. In support of his submission, learned counsel has drawn our attention to Annexure-P/7, the extracts of the meeting of the Board of Directors of the Federation held on 15.04.1976, which are in the following terms:

"14 DELEGATION OF POWERS 

Sr. No.

Nature of Powers

Authority to whom

Extent of powers delegated

A) Administration

1 to 23

xx

xx

Xx

24.

Institution and defence of legal proceeding etc.

i) To institute, conduct, defend, compromise, refer to arbitration and abandon legal or other proceedings and claims and also to file appeals, revisions, review petitions and executing by and against the Federation and also to engage lawyers for that purpose from time to time.

M.D.

Full Power

ii) To give general power of attorney to any person / officer for conducting the cases in Courts etc.

M.D.

Full Power

B) Financial Administration

25

Category B

xx

xx

xx

 7. Learned counsel for the appellant-Federation further submitted that it is in pursuance of the above-said delegation of powers to the Managing -

8. Director, the general power of attorney in question was executed by him authorising Mr. Davinder Kumar Lal to take civil and criminal action against the defaulters including the respondents herein. He, therefore, prayed to remit back t







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