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2020 Supreme(P&H) 197

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Arvind Singh Sangwan, J.
Punjab Small Industries And Export Corporation Ltd. - Appellant
Versus
Gurinder Singh & Anr. - Respondents
CRM-A-1548-MA-2015 (O&M)
Decided On : 12-02-2020

Advocates Appeared:
Mr. Suvir Kumar, Advocate, for the Applicant; Mr. Kanwaljit Singh, Sr. Advocate with Mr. Ajaivir Singh, Advocate, for the Respondents

Headnote:

N.I. Act - Complaint under Section 138 - Acts and Sections: Negotiable Instruments Act, 1881 (N.I. Act) - Section 138 - Summary: The court discussed the admissibility of evidence, liability of the accused, service of legal notice, and authorization of the complainant. Key legal provisions such as the admissibility of photocopies as secondary evidence, liability of directors, and the necessity of proper authorization were interpreted and influenced the court's decision.

Fact of the Case:

The complainant filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (N.I. Act) against the respondents-accused for dishonouring a cheque. The trial Court convicted the accused, but the lower appellate Court acquitted them.

Finding of the Court:

The court found that the lower appellate Court's findings on admissibility of evidence, liability of the accused, service of legal notice, and authorization of the complainant were incorrect. The court also discussed the liability of the accused and the necessity of proper authorization.

Issues: Admissibility of evidence, liability of the accused, service of legal notice, authorization of the complainant

Ratio Decidendi: The court held that the complainant failed to prove its case due to the inadmissibility of photocopies as secondary evidence, defective prosecution of the accused company, and lack of proper authorization. The court also emphasized the necessity of proper authorization and the liability of directors.

Final Decision: The court dismissed the application seeking leave to file appeal against the judgment of acquittal passed by the lower appellate Court.

JUDGMENT

Arvind Singh Sangwan, J. - This application has been filed seeking leave to file appeal against the judgment of acquittal dated 24.12.2014 passed by the lower appellate Court, vide which, while acquitting the respondents-accused, the judgment of conviction and order of sentence of even date i.e. 20.03.2013 passed by the trial Court, were set aside.

2. Brief facts of the case are that the applicant-complainant had filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (for short N.I. Act) against the respondents-accused with the allegations that a cheque dated 30.03.2001 amounting to Rs.11.00 lacs, on presentation before the bank, was dishonoured. It is further stated in the complaint that the complainant has supplied HR Coils to accused No.1-Company through various invoices Ex.C1 to Ex.C13 and in partial discharge of the liability, accused No.2 issued a cheque in question Ex.C3 under his signatures on behalf of accused No.1-Company.

3. The trial Court, vide its judgment of conviction dated 20.03.2013, held the respondents guilty of offence punishable under Section 138 of N.I. Act and vide order of sentence of even date i.e. 20.03.2013, sentenced accused No.2 to undergo R.I. for a period of two years and to pay a compensation to the tune of Rs.22.00 lacs to the complainant. Thereafter, the respondents filed an appeal before the lower appellate Court and while reversing the judgment of conviction passed by the trial Court, the lower appellate Court allowed the appeal. The operative part of the judgment passed by the lower appellate Court reads as under: -

'First of all argument has been advanced from both the sides and findings have also been returned by learned trial Court on the ground of non joinder of Managing Director of company. The trial Court has given the finding that Managing Director was not arrayed and summoned as an accused in his individual capacity but only to represent the accused No.1 and same has been represented by accused No.2 Gurinder Singh. The trial Court has further given finding on this point that 'accused No.2 has neither disputed the fact that cheque in question was issued under his signatures nor has disputed the fact that he was no more a director of the company, thus, to my mind he has also been representing the accused No.1 company. After considering this finding, this Court is of view that it is also supposition and such finding by trial Court is not based on any material on record. Nowhere it is established from the evidence as led by complainant that appellant is in any way acting as Managing Director of the company-respondent No.1 before trial Court. In this regard the authority is relied upon by learned counsel for appellant cited as 2012 (2) RCR (Criminal) 854 titled Aneeta Hada v. M/s Godfather Travels and Tours Pvt. Ltd. wherein it is held by Hon'ble Supreme Court of India that prosecution of director of company without arraying the company as accused and in such situation the proceedings have been quashed by holding that Directors could not be executed without company being arrayed as an accused. In the case in hand although company-respondent No.1 has been impleaded as accused but during the proceedings of this case company has never been summoned through MD nor service has been effected through MD. The Court itself has conceded one Gurvinder Singh, Director to represent the company. Once the accused No.1 has never been served nor any notice of accusation has been given by the Court to the said company nor such notice of accusation has been given to appellant to represent the company then it is strange enough that how trial Court has returned the findings itself by holding that accused No.2 hereby appellant represent company accused No.1. These findings are against the spirit of settled principles of law by the Hon'ble Supreme Court of India ibid authority. So, such findings are not sustainable. The director of company is only vicariously liable when company i

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