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Issues Involved:
1. Legally enforceable debt or liability. 2. Validity of the notice sent to the accused. 3. Authorization of the Assistant Manager to file the complaint. Issue-wise Detailed Analysis: 1. Legally enforceable debt or liability: The primary issue was whether the complainant proved a legally enforceable debt or liability. The Trial Court initially found that the complainant failed to prove this. However, the High Court emphasized the presumption under Section 139 of the N.I. Act, which mandates that the holder of the cheque is presumed to have received it for the discharge of any debt or liability unless proven otherwise. The Supreme Court's decisions in *Maruti Udyog Ltd. v. Narender* and *Hiten P. Dalai v. Bratindranath Banerjee* were cited to support this presumption. The accused attempted to rebut this presumption by presenting documents (Exs. D-1 to D-6) indicating payments made post-issuance of the cheque. However, the High Court noted that these documents were not substantiated by witness testimony and did not explicitly indicate that the payments were meant to discharge the cheque amount. The Court also referred to Section 60 of the Indian Contract Act, which allows the creditor to appropriate payments to any lawful debt unless specified otherwise by the debtor. The absence of a reply to the statutory notice (Ex. P-5) further strengthened the complainant's case. Consequently, the High Court concluded that the accused failed to rebut the presumption of a legally enforceable debt. 2. Validity of the notice sent to the accused: The second issue was whether the notice sent to the proprietary concern could be treated as notice sent to the proprietor. The High Court found that the notice (Ex. P-5) was addressed to "M/s. Butterfly Aquatech," and the accused was the sole proprietor of this entity. There was no dispute that the transactions were between the complainant company and the proprietary concern. The Court held that the notice was valid and effectively served to the accused. 3. Authorization of the Assistant Manager to file the complaint: The third issue was whether the Assistant Manager, Credit Control, had valid authorization to file the complaint. The Trial Court had found that the Assistant Manager lacked proper authorization. However, the High Court referred to several judgments, including *M.M.T.C. Ltd. v. Medchl Chemicals and Pharma (P) Ltd.* and *Associated Cement Co. Ltd. v. Keshvanand*, which established that a complaint could be filed by a person representing the company if they are connected with its affairs. The High Court noted that the Assistant Manager was dealing with the credit transactions of the company and had issued the statutory notice. Although there was no explicit resolution from the Board of Directors authorizing him, the Court inferred implied authorization from the circumstances and the company's conduct. The Court emphasized that the company's silence and lack of objection to the Assistant Manager's actions amounted to implied ratification. Consequently, the High Court concluded that the Assistant Manager had valid authorization to file the complaint. Conclusion: The High Court found the accused guilty of the offence punishable under Section 138 of the N.I. Act and convicted him. The impugned judgment of acquittal was set aside. Considering the pending civil suits between the parties, the accused was sentenced to pay a fine of Rs. 5,000, with a default sentence of three months' simple imprisonment. The criminal appeal was allowed.
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