2017 Supreme(Bom) 656

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
Anuja Prabhudessai, J.
Jaimin Jewelery Exports Pvt. Ltd. and Ors. - Appellants
Vs.
The State of Maharashtra and Ors. - Respondents
Criminal Revision Application No. 432 of 2015
Decided On : 14-03-2017`

Headnote:Netogiable Instruments Act, 1881 - Sections 20 and 87-Alteration in cheque.-Filling up of date and amount in blank signed cheques by payee not constitutes alteration in cheque within meaning of Section 87 of Act.

       It is to be noted that Section 20 of the N.I. Act permits the payee to filling the amount as well as the date in blank signed cheques and thus complete the inchoate instrument delivered to him. Such filling up of the date and the amount does not constitute alternation within the meaning of Section 87 of the N.I. Act. There is absolutely no dispute about this proposition. It is also not in dispute that a mere statement that the cheque was issued towards security does not absolve liability under Section 138, N.I. Act. The question in the present case is not about the applicability of Section 20 of N.I. Act or the liability of the partnership firm after the incorporation of the Company or the liability of the accused No. 1 Company in respect of the cheque issued by the partnership firm as security.

       The question is about the genuineness of the case put forth by the complainant-company. As stated earlier, in the instant case, the complainant- company had come with a specific case that the accused No. 2 had issued the subject cheques on behalf of the complainant-company towards payment of outstanding dues. Whereas the accused had questioned the genuineness of the claim and raised a probable defence that the complainant-company had filled in the amount and the date in the blank signed cheques which were given as security. Though the complainant-company had specifically denied the defence raised by the accused, a perusal of the subject cheques reveals that the same were issued by the accused No. 2 not as a director of the Company but as a partner of the Partnership firm. This fact not only negates the case of the complainant-company but leads to an inference that the said cheques were issued when the partnership firm was in existence and thus probabilises the defence that the same were given as security. The accused having proved their defence by preponderance of probability, the onus was on the complainant- company to prove that the amount quantified in the cheque was the existing and subsisting liability.

       Evidence Act, 1872 - Section 65-B-Electronic records.-Computer printout admissible on complying with requirements of Section 65- B of Act.

       Section 65-B of Evidence Act relates to the admissibility of electronic records. It authenticates the genuineness of the copy/computer printout and thus absolves the parties from producing the original. This section only makes the computer output admissible on complying with the requirements of the section.

       It does not prove the actual correctness of the entries and does not dispense with the proof or genuineness of entries made in such electronic records. Furthermore, there is no presumption regarding the genuineness of the entries in electronic records. Hence, it was necessary for the party to prove the correctness of the entries. In the instant case, the witnesses examined by the complainant did not have any personal knowledge regarding the entries made in the statement hence they were therefore not competent to depose about the correctness of the entries.

       Evidence Act, 1872 - Section 65-B-Electronic records. - Section 65-B of Act authenticates genuineness of copy/computer printout absolving parties from producing original.

       Section 65-B of Evidence Act relates to the admissibility of electronic records. It authenticates the genuineness of the copy/computer printout and thus absolves the parties from producing the original. This section only makes the computer output admissible on complying with the requirements of the section.

       It does not prove the actual correctness of the entries and does not dispense with the proof or genuineness of entries made in such electronic records. Furthermore, there is no presumption regarding the genuineness of the entries in electronic records. Hence, it was necessary for the party to prove the correctness of the entries. In the instant case, the witnesses examined by `the complainant did not have any personal knowledge regarding the entries made in the statement hence they were therefore not competent to depose about the correctness of the entries.

       Evidence Act, 1872 - Sections 34 and 65-B-Negotiable Instruments Act, 1881, Section 138-Entries in books of accounts.-Entries in books of accounts, regularly kept in course of business, admissible in evidence.

       Section 34 of the Evidence Act stipulates that the entries in account books regularly kept in course of business are relevant piece of evidence and admissible. The section further states that such entries cannot be the sole basis of fixing liability on any person.

       In the instant case, apart from statement of the complainant, company had not produced any other material to prove that the liability of the accused in respect of the amount specified in the subject cheques. Hence, the accused could not have been held guilty of the offence solely on the basis of the said statement.

       Netogiable Instruments Act, 1881 - Section 138-Dishonour of cheque.-Accused making bald statement that cheque was issued towards security, cannot be absolved from liability under Section 138 of Act.

       Netogiable Instruments Act, 1881 - Section 138-Liability for-Dishonour of cheque.-Accused, making mere statement that cheque was issued towards security, cannot escape from his liability under Section 138 of Act.

       Netogiable Instruments Act, 1881 - Sections 118(a), 138 and 139-Dishonour of cheque.-Power of attorney not competent to depose in respect of transaction of which he has no knowledge.

       It would also be advantageous to refer to the provisions under Sections 118(a) and 139 of the N.I. Act. Section 118(a) of the N.I. Act raises a presumption that until contrary is proved; every negotiable instrument was made or drawn for consideration, whereas Section 139 of the N.I. Act raises a presumption that unless the contrary is proved, the holder of the cheque received the cheque for the discharge of whole or part of any debt or liability. The presumptions under Sections 118(a) and 139 of the N.I. Act are reruale in nature.

       The presumption under these provisions need not be rebutted only by adducing direct evidence but can be rebutted on the basis of the facts elicited in the cross-examination. Suffice it to say that the power of attorney will not be competent to depose in respect of a transaction of which he has no knowledge. As a result thereof, the accused will be precluded from effectively cross-examining the power of attorney and eliciting the required material to dislodge the statutory presumption. It is therefore imperative that the power of attorney authorised by an individual or juristic person has knowledge of the transaction. In the light of above, that the power of attorney appointed by a juristic person need not have personal knowledge of the transaction needs to be rejected.

       Netogiable Instruments Act, 1881 - Sections 118(a), 138 and 139-Presumption for dishonour of cheque.-Accused cannot cross-examine power of attorney who has no knowledge of transaction and elicit required material to dislodge statutory presumption.

       Netogiable Instruments Act, 1881 - Sections 138 and 141-Complaint for dishonour of cheque.-If payee is company, complaint under Section 138 of Act must be filed in name of Company.

       It is thus, evident that the payee/holder in due course of the cheque is alone competent to file a complaint under Section 138 of the N.I. Act. In case the payee is a company, the complaint should necessarily be filed in the name of the company. However, company being a juristic person it can act only through a representative authorised by the Board of Directors either by a resolution or by executing a power of attorney.

       Netogiable Instruments Act, 1881 - Sections 138 and 141-Criminal Procedure Code, 1973, Section 401-Conviction of company under Section 138 of Act.-Since liability of accused regarding amount mentioned in cheque is not proved hence conviction of accused for offence under Sections 138 and 141 of Act cannot be sustained.

       The impugned orders have resulted in miscarriage of justice and this necessitates exercise of revisional powers. Hence, the Revision Application is allowed. The judgment and order dated 13.3.2012 passed by the Metropolitan Magistrate 12th Court, Bandra at Mumbai in C.C. No. 821/SS/2010 and the judgment and order dated 28.8.2015 passed by the Sessions Court, Greater Bombay in Criminal Appeal No. 338 of 2012 are hereby set aside. Consequently, the accused are acquitted of offence under Section 138 read with 141 of the N.I. Act. Their Bail bonds stand discharged.

       Netogiable Instruments Act, 1881 - Sections 138 and 141-Criminal Procedure Code, 1973, Section 481-Criminal Procedure Code, 1973, Section 401-Dishonour of cheque.-Failure of complainant to discharge its burden show that cheques were issued in discharge of existing debt or liability, entitled accused to be acquitted.

       Under the circumstances and in view of discussion supra, the impugned orders have resulted in miscarriage of justice and this necessitates exercise of revisional powers. Hence, the Revision Application is allowed. The judgment and order dated 13.3.2012 passed by the Metropolitan Magistrate 12th Court, Bandra at Mumbai in C.C. No. 821/SS/2010 and the judgment and order dated 28.8.2015 passed by the Sessions Court, Greater Bombay in Criminal Appeal No. 338 of 2012 are hereby set aside. Consequently, the accused are acquitted of offence under Section 138 read with 141 of the N.I. Act. Their Bail bonds stand discharged.

       Netogiable Instruments Act, 1881 - Sections 138 and 141-Dishonour of cheque issued by company.- Since payee is company hence complaint under Section 138 of Act to be filed in name of company.

       It is thus, evident that the payee/holder in due course of the cheque is alone competent to file a complaint under Section 138 of the N.I. Act. In case the payee is a company, the complaint should necessarily be filed in the name of the company. However, company being a juristic person it can act only through a representative authorised by the Board of Directors either by a resolution or by executing a power of attorney.

       Netogiable Instruments Act, 1881 - Sections 28 and 87-Alteration in cheque.-Filling up of date and amount by payee in blank signed cheque not constitutes alteration in cheque within meaning of Section 87 of Act.