Power of attorney holder with direct knowledge can testify; cheque endorsement for collection not transfer, upholding Section 138 NI Act prosecution.

O R D E R

The concurrent verdicts of the Judicial First Class Magistrate Court-II, Kannur, and the Additional Sessions Court, Adhoc-II, Thalassery, in C.C.No.212/2003 & Crl.A.No.515/2004 respectively, convicting and sentencing the petitioner for the commission of offence under Section 138 of the Negotiable Instruments Act,1881(in short, ‘ NI Act’), are under challenge in this revision petition.

2. The prosecution case is that a cheque dated 09.07.2001 for an amount of Rs.2,00,000/- which the petitioner had issued to the first respondent in discharge of the debt of the said amount, which he incurred with the first respondent, was dishonoured due to the stop payment instruction given by the petitioner, and that it was revealed on enquiry that there was no sufficient funds in the account of the petitioner at the time when the cheque was presented for collection. It is the further case of the complainant that the petitioner did not care to make payment of the cheque amount, despite statutory notice having been issued to him.

3. Before the Trial Court, the wife of the complainant, in her capacity as power of attorney holder of the complainant, tendered evidence as PW1. The Senior Manager of the drawee bank was examined as PW2. Six documents were brought on record as Exts P1 to P6. After analysing the aforesaid evidence, the learned Magistrate came to the conclusion that the petitioner committed the offence under Section 138 of the NI Act. Accordingly, he was convicted and sentenced to simple imprisonment for six months with a further direction to pay compensation of Rs.2,00,000/- to the complainant under Section 357 (3) of the Code of Criminal Procedure Code, 1973 (in short, ‘Cr.PC). Though the petitioner challenged the aforesaid verdict in appeal, the learned Additional Sessions Judge, who considered the appeal, refused to interfere with the findings of the learned magistrate. Accordingly, the appeal was dismissed, confirming the conviction and sentence. Aggrieved by the above concurrent verdicts of the courts below, the petitioner is here before this Court with this revision petition.

4. Heard the learned counsel for the revision petitioner, the learned counsel for the first respondent/complainant and the learned Public Prosecutor representing the State of Kerala.

5. The impugned judgments of the courts below are assailed by the petitioner on two grounds. Firstly, it is contended that the power of attorney holder of the complainant had not stated that she was having direct knowledge regarding the transactions which resulted in the execution of the impugned cheque, and hence the evidence adduced by PW1 ought not have been relied on by the courts below. Secondly, it is argued that Ext P1 cheque would reveal that it was transferred to a person by name ‘Chandrabhanu’, and hence the criminal prosecution initiated by the complainant herein is prima facie not maintainable. Both the above contentions of the revision petitioner are totally unsustainable.

6. It could be seen from the evidence tendered by PW1 that she had stated in unequivocal terms about her direct personal presence near to her husband, the complainant in this case, when the transactions leading to the execution and issue of Ext P1 cheque took place. According to PW1, the petitioner had arrived at the quarters where the complainant and herself were residing, and borrowed an amount of Rs.2,00,000/- from the complainant. She also stated about the execution of the cheque by the petitioner in her presence, and also the assurance made by the petitioner that the aforesaid cheque could be encashed on presentation before the bank on the date stated in that cheque. PW