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2018 Supreme(HP) 277
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
SANDEEP SHARMA, J.
M/s Mohan Meakin Limited - Appellant
Versus
M/s Spirit and Beverages L-1 - Respondent
Cr. Appeal No. 592 of 2017
Decided on : 22-06-2018
Advocate Appeared:
For the Appellant :Mr. K.D. Sood, Senior Advocate with Mr. Rajnish K. Lal, Advocate.
For the Respondent:Mr. Sudhir Thakur, Advocate.
A complaint under Section 138 of the Negotiable Instruments Act can be filed through a Power of Attorney holder, if he is aware of the transaction and an explicit assertion is made about his knowledge of the transaction in the complaint.
Headnote:
NEGOTIABLE INSTRUMENTS ACT - SECTION 138 - COMPLAINT - AUTHORIZATION - POWER OF ATTORNEY - GENERAL POWER OF ATTORNEY - SPECIAL POWER OF ATTORNEY - DELEGATION OF POWER - REPRESENTATION - JURISDICTION - PROCEDURE - IRREGULARITIES - SUBSTANTIVE RIGHTS - INJUSTICE - PRESUMPTION - REBUTTAL - BURDEN OF PROOF - DISHONOURED CHEQUE - CONSIDERATION - DEBT OR LIABILITY - SECURITY - PENAL LIABILITY - CRIMINAL LIABILITY - ADVANCE PAYMENT - EXISTING LIABILITY - INTENT OF THE LEGISLATURE - OBJECT OF THE STATUTE.
Fact of the Case:
The complainant, a company, filed a complaint under Section 138 of the Negotiable Instruments Act (NI Act) against the accused, alleging that the accused had issued a cheque for Rs. 8,03,248/- in favour of the complainant, which was dishonoured on presentation. The accused contended that the complainant was not authorized to file the complaint, as the Special Power of Attorney executed in favour of the complainant's representative was not valid. The accused also claimed that the cheque in question was issued as a security cheque and not towards discharge of any debt or liability.
Finding of the Court:
The Court held that the complainant was authorized to file the complaint, as the Special Power of Attorney executed in favour of the complainant's representative was valid. The Court further held that the accused had failed to rebut the presumption that the cheque in question was issued towards discharge of a debt or liability. The Court also held that the accused's contention that the cheque was issued as a security cheque was not tenable, as the accused had not adduced any evidence to support this claim.
Issues: 1. Whether the complainant was authorized to file the complaint under Section 138 of the NI Act? 2. Whether the cheque in question was issued towards discharge of a debt or liability? 3. Whether the accused's contention that the cheque was issued as a security cheque was tenable?
Ratio Decidendi: 1. The Court held that the complainant was authorized to file the complaint, as the Special Power of Attorney executed in favour of the complainant's representative was valid. The Court relied on the following principles: * A complaint under Section 138 of the NI Act can be filed through a Power of Attorney holder, if he is aware of the transaction and an explicit assertion is made about his knowledge of the transaction in the complaint. * A Power of Attorney holder can initiate criminal proceedings on behalf of the principal and not in his own name. * Though, Power of Attorney can not delegate his functions in the absence of specific clause permitting same in the Power of Attorney but Power of Attorney can file, appear and oppose on behalf of the principal in the complaint. 2. The Court held that the accused had failed to rebut the presumption that the cheque in question was issued towards discharge of a debt or liability. The Court relied on the following principles: * Once issuance of a cheque and signatures thereupon are admitted, presumption of a legally enforceable debt in favour of the holder of the cheque arises. * It is for the accused to rebut the said presumption, though accused need not adduce his own evidence and can rely upon the material submitted by the complainant. * However, mere statement of the accused may not be sufficient to rebut the said presumption. 3. The Court held that the accused's contention that the cheque was issued as a security cheque was not tenable, as the accused had not adduced any evidence to support this claim. The Court relied on the following principles: * Security cheques would fall within the purview of Section 138 of the NI Act and a person can not escape his liability. * When there is existing liability on the date of presentation of cheque and security cheques issued are dishonoured, accused shall be liable under Section 138 of the NI Act.
Final Decision: The Court set aside the judgment of the lower court and convicted the accused under Section 138 of the NI Act.
Sandeep Sharma, J.
Instant criminal appeal is directed against judgment dated 18.5.2015, passed by the learned Judicial Magistrate 1st Class, Solan in Criminal Complaint No. 863/3 of 2011/05, whereby complaint under Section 138 of the Negotiable Instruments Act (hereinafter, ‘Act’) having been filed by the appellant-complainant (hereinafter, ‘complainant’), came to be dismissed.
2. Necessary facts, shorn of unnecessary details as emerge from record are that the complainant filed a complaint under Section 138 of the Act, averring therein that the complainant is a Company duly incorporated and registered under the Companies Act, 1956 with the Registrar of Companies vide Registration No. 06-00135 dated 2.10.1934. Complainant further averred that the Board of Directors of the Company in its meeting held on 29.9.1979, passed a Resolution No. 9, resolving therein to execute Power of Attorney in favour of Shri H.N. Handa, Secretary of the Company to perform and execute all the acts, deeds, things and matters with regard to the business of the company. A General Power of Attorney was executed on 25.3.1980 in favour of Shri H.N. Handa, who was further authorized vide clause No. 22 of the General Power of Attorney to delegate such powers from time to time and at any time specifically any of the powers given therein except the power under the said Clause No. 7 to any person from time to time or at any time to enlarge, modify or revoke any such delegation and for the purpose to sign, execute, and/or register for and /or on behalf of the Company any power(s) of attorney. Mr. H.N. Handa, in terms of Clause 22 of the General Power of Attorney, authorized one Shri Sudesh Kumar on behalf of the Company to act on his behalf to prosecute the complaint on behalf of the Company. Complainant further averred that it deals in the business of manufacture and sale of Indian made foreign spirit and beer. It is further averred in the complaint that the respondent-accused (hereinafter, ‘accused’) also deals in liquor trade in the name and style of M/s Spirit and Beverages, holding L-1 licence and had been purchasing different brands of liquor from the complainant for the last four-five years. Since accused had to pay a sum of Rs.8,03,248/- to the complainant as per accounts with regard to purchase of liquor, he issued a duly signed cheque No. 361413 dated 26.2.2005 in the sum of Rs.8,03,248/- drawn on Punjab National Bank, Sector 22-D, Chandigarh of his account No. CC-4 in favour of the complainant, however, fact remains that on presentation, said cheque was returned with the remarks “account closed”. After having received memo with regard to aforesaid information furnished by the Bank, complainant sent a registered A.D. notice dated 7.4.2005 on 8.4.2005, which was duly delivered to the accused on 11.4.2005 but despite that he failed to make payment within stipulated period of 15 days, as a consequence of which, complaint under Section 138 of the Act came to be filed.
3. Learned court below, on the basis of evidence led on record by the complainant came to the conclusion that the complainant has failed to prove its case beyond reasonable doubt and accordingly acquitted the accused by extending him benefit of doubt. In the aforesaid background, complainant has approached this Court in the instant proceedings, praying therein to allow the complaint filed by it under Section 138 of the Act, after setting aside impugned judgment of acquittal recorded by the learned Court below.
4. Mr. K.D. Sood, learned Senior Advocate duly assisted by Mr. Rajnish K. Lal, Advocate, appearing for the complainant, while referring to the impugned judgment passed by the court below, vehemently argued that same is not sustainable in the eye of law as the same is not based upon proper appreciation of evidence as well as law and as such same deserves to be set aside. Mr. Sood, while inviting attention of this Court to the Special Power of Attorney exhibit CW-2/G dated 24.5.200
