IMPORTANT POINT
Where consideration for passing of cheque was not satisfactorily proved and no evidence was adduced to prove endorsement, then in absence of endorsement in compliance of Section 50 of N.1. Act, presumption that holder of cheque was holder in due course could not be drawn in favour of complainant.

Mrs. R. Banumathi, J.: This criminal appeal is directed against the Judgment of acquittal dated 10.7.1997 in C.C.No.6 of 1997 on the file of Judicial Magistrate No.1, Erode.

2. The appellant/complainant is the proprietor of Shiv Agencies dealing with textile business situated at Easwaran Koil Street, Erode. The respondent/accused has been a customer of the complainant. The accused had borrowed a sum of Rs.91,000 from one Dilip Shivani on 14.8.1996 and for the abovesaid liability, the respondent/ accused had issued three post dated cheques—one cheque dated 2.10.1996 for Rs.35,000, the second cheque dated 3.10.1996 for Rs.35,000, the third cheque dated 7.10.1996 for Rs.21,000. The said Dilip Shivani endorsed the cheques to Maya Shivani—Proprietor of Shiv Agencies. When the cheques were presented for collection on 24.10.1996. through UCO Bank, Erode Branch, it were returned as “Insufficiency of Funds” on 24.10.1996. Notice was sent to the respondent/accused, which was returned “party left...without any instruction”. Thereafter a rejoinder was sent on 7.11.1996 and the same was received by the accused on 8.11.1996. The accused had issued the cheques without sufficient funds in his bank account and hence, committed the offence under Sec. 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as “N. I. Act”). The complainant, authorised by Maya Shivani under Ex.P.1—Power of Attorney, has filed the complaint against the respondent/ accused.

3. In the trial Court, PWs. 1 and 2 were examined. Exs P. 1 to P. 15 were marked. In consideration of the evidence, learned Trial Magistrate inter alia found that the Appellant/Complainant has no proper locus standi to file the complaint and that only Dilip Shivani ought to have filed the Complaint. The Trial Magistrate was of the view that in the absence of proof of passing of the consideration and when Dilip Shivani was not examined as witness, the complainant Ashok Kumar was found to be not entitled to file the complaint. Learned Trial Magistrate also found that there is absolutely no evidence as to the passing of consideration for endorsing the cheques.

4. Aggrieved over the Order of acquittal, the appellant/complainant has preferred this appeal. Learned counsel for the appellant has submitted that as per Section 139 of the N. I. Act, the trial Court ought to have drawn the conclusion that every holder is the holder in due course and ought not to have insisted on the further proof of passing of consideration. The finding of the trial Court that Maya Shivani ought to have filed the complaint is assailed as erroneous. Learned counsel for the appellant has placed reliance upon the decision reported in Punjab and Sindh Bank v. Vinkar Sahakari Bank Ltd.1, in support of his contention that every holder of a promissory note is a holder in due course unless rebutted and that the appeal is to be allowed.

5. Countering the arguments, learned counsel for the respondent/accused has submitted that the endorsements on the reverse of Exts. P. 2 to P 4—Cheques are blank endorsements and cryptic and no details of endorsement are stated. It is further submitted that the proper endorsement in favour of Maya Shivani is not proved to be for consideration. The trial Court rightly dismissed the complaint, acquitting the accused and that the reasonings do not suffer from any infirmity warranting interference.

6. In consideration of the submissions of both sides, Judgment and other materials on record, the following points arise for consideration:

(i)Whether the Trial Magistrate was right in finding that Maya Shivani is not holder in due course and that the complainant has no locus standi to file the complaint?;

(ii)In the facts and circumstances of the case, whether the contention of the complainant that he is the holder in due course and properly authorised to file the complaint is acceptable?

7. The dispute between the parties relate to totally six cheques (cheques bearing Nos. 227922, 227947, 227