The holder of a Power of Attorney must have personal knowledge of the transaction to depose, but factual disputes regarding this knowledge should be resolved at trial, not pre-trial.

JUDGMENT

1. The present petitions are filed against the order dated 08.01.2019 (hereafter ‘impugned orders’) passed by the learned Metropolitan Magistrate, NI Act, Karkardooma Courts whereby notice under Section 251 of the Code of Criminal Procedure, 1973 (‘CrPC’) was framed against the petitioner in CC Nos. 47151/2016 and 47152/2016 under Section 138 of the Negotiable Instruments Act, 1881 (‘NI Act’).

2. Complaint under Section 138 of the NI Act was filed by the respondent alleging that he had advanced a friendly loan for a sum of ₹2 crores on the assurance of the petitioner that the same would be returned after the expiry of 6 months. It is alleged that post the expiry of 6 months, despite numerous requests and demands, the petitioner failed to return the said amount. It is alleged that thereafter the petitioner issued a duly signed cheque dated 04.10.2007 for a sum of ₹2 crores in discharge of the debt, and had also allegedly assured that the same would be honored on presentation. It is alleged that the said cheque on presentation was returned back with the remark “Insufficient funds.” It is alleged that thereafter, a legal notice was sent, and upon the subsequent non-payment of the loan amount, the respondent through a power of attorney, filed a complaint under Section 138 of the NI Act.

3. It is stated that after the receipt of summons, and during the pendency of that complaint being CC No. 2675/01/07 for the alleged dishonour of the cheque issued by the petitioner for a sum of ₹2 crores, a compromise deed dated 15.11.2008 was allegedly executed between the petitioner and respondent through his authorized representative, whereby the petitioner had allegedly undertaken to return ₹3 crores to the respondent as full and final settlement. Consequently, the respondent had withdrawn the earlier complaint being CC No. 2675/01/07 in view of the compromise deed entered into between the parties.

4. It is alleged that pursuant to the compromise deed, four cheques each for a sum of ₹75,00,000/- bearing nos. 200451, 200452, 200453, and 200454 were advanced by the petitioner. The proceedings qua the first cheque no. 200451 were quashed by this Court vide order dated 22.01.2015. This Court, on that occasion, noted that the learned Trial Court committed an error in proceeding with a private complaint filed by Power of Attorney on the strength of the Special Power of Attorney which was not attested by the Indian Embassy at Abu Dhabi, UAE.

5. It was noted that the Special Power of Attorney in the absence of valid attestation by the requisite authority lacked authentication. It was noted further that the learned Trial Court, framing notice under Section 251 of the CrPC, and asking the petitioner to face trial without valid authority, is contrary to the provision of Section 145 of the NI Act and Section 200 of the CrPC since there was no valid Power of Attorney before the court when the order dated 06.04.2010 framing notice was passed. It was noted that the learned Trial Court failed to consider that in the pre/post summoning evidence, the Power of Attorney did not claim that he had personal knowledge of the transaction in question. It was noted that the pre-summoning evidence of the complainant under Section 200 of the CrPC was given by the Power of Attorney by way of Affidavit on behalf of the complainant. It was noted that the complainant was not examined on oath in accordance with Section 145 of the NI Act. It was further noted that even at the post-summoning stage, the learned Trial Court had not considered that Power of Attorney holder is not entitled to give evidence on affidavit under Section 145 of the NI Act on behalf of the complainant, and that the complainant failed to take the permission of the Court under Section 302(2) of the CrPC for prosecuting the case through attorney.

6. It was noted that the learned Trial Court did not appreciate how the amount of ₹2 crore had been given to the petitioner in cash, since the petitioner claim