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Indian Laws - Case Laws
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2024 (7) TMI 296
Dishonour of Cheque - complete service of notice - whether service of notice of demand under Section 138 of the NI Act will be deemed to be complete if the said notice of demand was served only on the director of the accused company and not on the accused company itself? - HELD THAT:- A reading of proviso (b) to Section 138 of the NI Act shows that issuing a notice of demand to the drawer of the cheque is a pre-requisite for filing a complaint under Section 138 of the NI Act. However, the objective of issuing a notice of demand under proviso (b) is to give an opportunity to the drawer to pay the cheque amount within 15 days of service of notice and thereby free himself from the penal consequences of Section 138 of the NI Act.
The discussion in C.C. Alavi Haji [2007 (5) TMI 335 - SUPREME COURT] makes it abundantly clear that the objective of serving a demand notice to the person accused of an offence under Section 138 of the NI Act is to give an opportunity to the drawer to pay the cheque amount within 15 days of service of notice and thereby free himself from the penal consequences of Section 138 of the NI Act. In fact, the Supreme Court goes on to hold that a person who does not pay within 15 days of receipt of the summons from the court along with the copy of the complaint under Section 138 of the NI Act, cannot contend that there was no proper service of notice as required under Section 138 of the NI Act.
The cheques in question are signed by the petitioner no. 2 for and on behalf of the petitioner no. 1. Petitioner no. 2 is stated to be the Chairman of not only the petitioner no. 1-Company, but also of the Group of Companies, including IBooks. The cheques in question are claimed to have been issued in discharge of one common liability, where not only the cheques of petitioner no. 1 but also IBooks were issued by the petitioner no. 2 - In spite of service of the notice, the petitioner no. 2, instead of making the payment of the cheque amount, raised a dispute on the liability to pay the same and also stated that the cheques were not issued by IBooks, the addressee no. 1 in the notice. The defence that the notice was wrongly addressed to IBooks instead of the petitioner no. 1, therefore, cannot come to the aid of the petitioners, especially where the complaints in question are rightly filed making the petitioner no. 1-company as an accused.
In ANEETA HADA VERSUS GODFATHER TRAVELS & TOURS (P.) LTD. [2012 (5) TMI 83 - SUPREME COURT]), the Supreme Court has held that an authorised signatory of a company becomes a drawer as he has been authorised to do so in respect of the account maintained by the Company. Therefore, even testing on this standard, the notice was duly addressed to the drawer of the cheques in question.
There are no merit in the present petitions. The same are, accordingly, dismissed.
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2024 (7) TMI 295
Dishonour of Cheque - entitled to file the complaint for the commission of an offence punishable under Section 138 of the NI Act - not legally wedded wife of the deceased - evidence of testamentary disposition - HELD THAT:- It is apparent from the order passed by this Court that this Court had directed the learned Magistrate to receive the evidence of testamentary disposition executed by Shobha Ram vis-à-vis Kiran Thakur, permit the accused to adduce evidence in rebuttal thereto and thereafter make a fresh decision on the complaint. Thus, the learned Magistrate was only required to take evidence regarding the testamentary disposition from the complainant and any rebuttal evidence from the accused.
It was laid down by the Rajasthan High Court in Chote Lal [1986 (4) TMI 371 - RAJASTHAN HIGH COURT] that where the Court had ordered that the sale deed would be taken in evidence and parties would be permitted to lead evidence in support and rebuttal thereof, it was not a case of open remand but a limited remand. It is not permissible for the learned Trial Court to allow the parties to reopen other matters and accept another document.
A similar view was taken by the Madhya Pradesh High Court in Ramabai [1996 (1) TMI 486 - MADHYA PRADESH HIGH COURT], wherein it was held that the learned Trial Court had limited jurisdiction in terms of the remand order. It can decide the matter only as per the directions issued by the Appellate Court.
The jurisdiction of the Trial Court in case of remand depends upon the order of the remand. The Trial Court cannot enlarge its jurisdiction by allowing the parties to reopen the matters which are not remanded to it. In the present case, the question whether the cheque was issued in discharge of the legal liability or not was never remanded to the learned Trial Court and no evidence could have been admitted on this aspect - the scope of Section 311 of Cr.P.C. is misplaced because the Court is not concerned with the scope of Section 311 Cr.P.C. but the jurisdiction of the Trial Court after the order of the remand. Once the jurisdiction was restricted by the remand order it could not have been enlarged by referring to the provisions of Section 311 of Cr.P.C.
The learned Trial Court exercised the jurisdiction not vested in it under the law by going beyond the scope of the remand order. Hence, the present petition is allowed and the order dated 11.9.2023, passed by learned Judicial Magistrate First Class (JMFC) is set aside. The application filed under Section 311 of Cr.P.C. shall stand dismissed.
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2024 (7) TMI 294
Challenge to Arbitral Award - challenge to the impugned Award passed by the Arbitral Tribunal is primarily on the ground that the Arbitral Tribunal has rewritten the contract by awarding tax component even though the contract were inclusive of tax - HELD THAT:- The Hon'ble Supreme Court in Ssangyong Engineering and Construction Co. Ltd. Vs. National Highway Authority of India [2019 (5) TMI 1879 - SUPREME COURT], has held that an Award can be set aside on the ground of patent illegality under Section 34(2-A) of the Arbitration And Conciliation Act, 1996 only where the illegality in the Award goes to the root of the matter. It is further held that finding of erroneous application of law by an Arbitral Tribunal or the re-appreciation of evidence by the Court under Section 34(2-A) of the Arbitration and Conciliation Act, 1996 is not available.
The Hon'ble Supreme Court further held that the above ground is available only where the view taken by the Arbitral Tribunal is plausible while construing the Contract between the parties or where the Award of the Tribunal lacks justifiable reasons. The Hon'ble Supreme Court further held that an Award can be set aside only if an Arbitrator/Arbitral Tribunal decides the question beyond the Contract or beyond the terms of reference or if the finding arrived by the Arbitral Tribunal is based on no evidence or ignoring vital evidence or is based on documents taken as evidence without notice to the other side. This view is applicable to the facts of the case.
In South East Asia Marine Engineering and Constructions Limited (SEAMEC Limited) Vs. Oil India Limited [2020 (5) TMI 242 - SUPREME COURT], the Hon'ble Supreme Court has reiterated that if the interpretation of Contract by Arbitral Tribunal is perverse and is not a possible interpretation, the Award passed by the Arbitral Tribunal, is liable to be set aside.
The facts on record indicate that the total value of contract inclusive of other miscellaneous expenses incurred by the respondent-claimant was Rs. 21,74,95,091/-. Out of the aforesaid amount, the petitioner had earlier paid a sum of Rs. 6,94,36,884/- to the respondent-claimant - The respondent-claimant claimed the balance Rs. 14,80,58,207/- [Rs. 11,19,22,870/- +Rs. 3,61,35,337/-]. An amount of Rs. 3,61,35,337/- allegedly borne by the respondent-claimant towards miscellaneous expenses incurred by the respondent-claimant during supply and execution of the contracts signed between the petitioner and the respondent-claimant - The Arbitral Tribunal after considering the overall facts and circumstances of the case allowed only a sum of Rs. 11,19,22,870/- to the respondent-claimant and has rejected the counter-claim of the petitioner for a sum of Rs. 2,61,35,337/-. The counter-claim of the petitioner was towards the amount paid by the petitioner to the respondent's subcontractor( s)/vendors and towards alleged damage suffered by the petitioner.
It cannot be stated that there was any error committed by the learned Arbitrator while awarding the amounts claimed. Therefore, on this account it cannot be stated that the Award passed by the learned Arbitrator was perverse or amounts to any patent illegality to warrant interference.
This Arbitration Original Petition is dismissed.
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2024 (7) TMI 263
Dishonour of Cheque - mainatinability of petition - delay and laches as also for the failure of the petitioners to avail of their alternate efficacious remedy in form of Revision Petitions under Section 397 of the Cr.P.C. - HELD THAT:- There are merit in the submission made by the learned counsel for the Complainant that the present set of petitions is liable to be dismissed on the ground of delay and laches as also for the failure of the petitioners to avail of their alternate efficacious remedy in form of Revision Petitions under Section 397 of the Cr.P.C.
It need not be emphasized that powers under Section 482 of the Cr.P.C. are discretionary in nature and though there may not be a total ban on the exercise of such power where the situation so warrants, at the same time, there are limitations of self-restraint that are recognized and followed by the Courts in exercising this jurisdiction. One such limitation is where the petitioner had an alternate efficacious remedy, however, did not avail of the same within the period of limitation and thereafter filed the petition under Section 482 of the Cr.P.C. to overcome the objection of limitation.
In Prabhu Chawla [2016 (9) TMI 1595 - SUPREME COURT], the Supreme Court quoted with approval its earlier judgment in Madhu Limaye [1977 (10) TMI 111 - SUPREME COURT], wherein it had been held that though availability of an alternate efficacious remedy of a Revision under Section 397 of the Cr.P.C. does not affect the amplitude of the inherent power under Section 482 of the Cr.P.C. that the High Court possesses, at the same time, easy resort to inherent power is not to be allowed except under compelling circumstances; it should not invade areas set apart for specific power under the Cr.P.C. itself. It was held that while it is true that Section 482 of the Cr.P.C. is pervasive, it should not subvert legal interdicts written into the same Code, such, for instance, in Section 397 (2) of the Cr.P.C.
Clearly, the petitioners have let the water flow and the proceedings to continue and it is only when the complaint cases have reached the stage of recording of the Complainant’s evidence that they woke up from their slumber to file the present petitions and challenge the maintainability of the same.
The petitions are, therefore, liable to be dismissed not only on account of inordinate delay and laches, but also on account of the petitioners not availing of their alternate efficacious remedy in the form of Revision Petition, but instead filing these petitions much beyond the period of limitation and with delay that would have haunted them had they filed the Revision Petitions.
There are no reason to interfere in the complaint cases in exercise of powers under Section 482 Cr.P.C - there are no merit in the challenge of the petitioners to the Complaints or to the Impugned Orders - petition dismissed.
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2024 (7) TMI 180
Dishonour of Cheque - continuation of proceedings under the Negotiable Instruments Act, 1881 - disutes of parties settled before the Mediation Centre - HELD THAT:- The Mediation Report dated 16.05.2016 categorically indicates that Respondent No. 2 has amicably settled the two matters, that is, the complaints which were filed by Respondent No. 2 under Section 138 of the NI Act. Respondent No. 2 also agreed to withdraw the complaints and to make necessary statement before the learned Trial Court. The proceedings further record that the statement is made on his own free will and without any force, pressure or coercion.
Prior to the recording of the statement by the learned Mediator, the parties had entered into a settlement agreement dated 01.04.2016. The agreement is duly signed by Respondent No. 2 as well as the other parties. The terms of the settlement mention that the parties have settled their disputes, which includes the two complaints which are the subject matter of the present proceedings under Section 138 of the NI Act. In terms of the said settlement, Respondent No. 2 had agreed that on payment of a sum of ₹30,00,000/- against the entire outstanding amount, the claims towards Respondent No. 2 would be settled.
Once it is an admitted position that an agreement was signed by the parties and the payment in terms of the settlement has already been paid by the petitioner, Respondent No. 2 cannot be allowed to wriggle away by taking such arguments - It is not denied by Respondent No. 2 that he was present before the learned Mediator and his statement was recorded of his own free will and without any force, pressure or coercion.
If the settlements are discarded and rejected on such grounds, the parties would be wary of entering into any settlement agreement and make payments thereof. It is apparent that Respondent No. 2 after having pocketed the amount received pursuant to the settlement, is trying to reagitate the dispute. Such tendency ought not to be encouraged.
The High Court, while exercising power under Section 482 of the CrPC, can definitely look into the record and pass such orders that may be necessary to prevent the abuse of the process of the Court or otherwise to secure the ends of justice. It is apparent that the petitioner, despite having paid the amount has been made to suffer and litigate for the last more than eight years due to dishonest attitude of the complainant.
The Criminal Complaints are quashed - petition allowed.
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2024 (7) TMI 179
Challenge to final award - Section 34 of the Arbitration and Conciliation Act, 1996 - disputes between the parties - deductions made on account of welcome drink - Service Charges - Service tax - GST - Interest - Costs.
Inclusion/Exclusion of Wet Tissues - HELD THAT:- The learned Arbitrator has noted the admission of the petitioner’s witness in his cross-examination that: a) Rs. 37,47,824 was deducted by the petitioner towards the amounts paid to the respondent (Rs. 7.23 per unit for tetra pack and Rs. 1.35 per unit towards wet tissue); and b) welcome drinks and wet tissues were supplied by the respondent w.e.f. 05.03.2017. Based on this, the learned Arbirator has awarded a sum of Rs. 37,47,824/- (for deductions made by IRCTC towards supplies made by them from 19.12.2016 to 04.03.2017) and Rs. 41,81,583/- (for production charges of welcome drink, including tetra pack, from 05.03.2017 to 18.06.2017). Hence, the learned Arbitrator has correctly awarded the amount to the respondent and find no infirmity with his reasoning.
Service Charges - HELD THAT:- There are no infirmity with the findings of the learned Arbitrator. Since there was no contract between the parties for providing the welcome drink (including the wet tissues) to the passengers for the initial period of 6 months as held in the Interim Award (and upheld by the Hon’ble Supreme Court), the learned Arbitrator’s view that the petitioner was liable to pay production charges, service charges as well as service tax on the same is the correct view. No perversity can be attributed to the conclusion drawn by the learned Arbitrator in holding that in the letters, the respondent had explicitly mentioned that it would be claiming charges for the welcome drink (and wet tissues) in due time, and the same was not objected to by the petitioner in as much as it continued with the contract and kept extending. The service charges claimed by the respondent (under or about 17%) are much less than the charges stipulated in the contract, which ranged from 20-30%, which is duly noted by the learned Arbitrator - the findings of the learned Arbitrator are neither unreasonable nor perverse in this regard and take into account the agreement between the parties as well as their conduct.
Service tax - HELD THAT:- There was no specific issue framed (or subsequently dropped) on the inclusion of service tax as far as the welcome drink was concerned. Since the dues on welcome drink were yet to be decided at the passing of the Interim Award, it is not unreasonable of the learned Arbitrator to hold that service tax was also payable by the petitioner on the welcome drink since there was no contract between the parties regarding the said services for the initial period of 6 months, and post that, the petitioner had impliedly agreed to being charged for the said services. Merely because a few issues were dropped regarding service tax on specific items/services, the learned Arbitrator is not unreasonable in holding that no general issue on payment of service tax has been dropped by the respondent. Hence, the finding of the learned Arbitrator does not warrant interference by this Court.
GST - HELD THAT:- It was settled in the Interim Award itself that GST was payable to the respondent over and above the production charges, and the same has attained finality. The petitioner cannot now urge an argument before this Court that production charges, since were inclusive of taxes (VAT), were to be bifurcated before payment of GST. Further, RW-1 has categorically stated in its cross- examination that GST on production charges and extra meal charges have been claimed by the respondent and correctly reflected in Annexure-1 of the affidavit dated 02.01.2021 .The petitioner’s argument that GST on production charges were never claimed is thus untenable, as the learned Arbitrator has duly recorded a finding to the contrary. There are no grounds to interfere with the findings of the learned Arbitrator to this extent.
Interest - HELD THAT:- Referencing to Section 31 (7) of the Act, as well as Section 2(b) of the Interest Act, 1978, it held that since the maximum rate of interest being paid by banks is about 7% per annum, the respondent is entitled to 9% per annum interest on the award amount from 01.11.2018, when the arbitration was initiated, till the date of payment appeared to be reasonable. There are no infirmity with the findings of the learned Arbitrator.
Costs - HELD THAT:- Imposition of costs is a discretionary power vested with the arbitral tribunal. The learned Arbitrator held that in the present matter, the respondent tried to settle the matter, however, since negotiations failed, hearings had to be conducted - The costs granted by the learned Arbitrator are reasonable and granted after due consideration of different factors and in consonance with Section 31A of the Act, as discussed in the Final Award. There are no infirmity with the findings of the learned Arbitrator. The same is sound and credible.
The petitioner has failed to make out any ground for interference with the award under Section 34 of the Act - petition dismissed.
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2024 (7) TMI 178
Dishonour of Cheque - criminal liability if company - issuance of summons to accused - complainant failed to mention the name of the authorized signatory of the Company and the person, who was looking after the daily affairs of the Company - HELD THAT:- The Hon’ble Supreme Court dealt with the liability of the Company and its Directors in PAWAN KUMAR GOEL VERSUS STATE OF U.P. & ANOTHER [2022 (11) TMI 855 - SUPREME COURT] and held that a person, who is in charge of and responsible to the Company for its affairs can be summoned and punished under Section 138 read with Section 141 of NI Act.
In the present case, the complainant had specifically stated in para No.2 of the complaint that accused No.4 to 8 are its Managing Directors and Directors of accused No.1 to 3 and are fully responsible for all assets, liabilities and daily business affairs of accused No.1 to 3 - It was laid down in N. RANGACHARI VERSUS BHARAT SANCHAR NIGAM LTD [2007 (4) TMI 621 - SUPREME COURT] that once it is established that a Director is in charge and responsible for the affairs of the Company, the burden shifts upon the accused to show that there was some restriction on his power. A person dealing with the Company is entitled to presume that he is the Director and in charge for the affairs of the Company and the burden shifts upon the person to prove any restriction.
In the present case, the necessary averments that the accused were in charge and responsible for the affairs of the Company have been made and the burden will shift to the accused to show any restriction on their power.
There is no infirmity in the order summoning the accused and the same cannot be quashed. Hence, the present petition fails and the same is dismissed - Petition dismissed.
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2024 (7) TMI 177
Determination of the compensation on death of the deceased in a motor vehicular accident - determination of the monthly income/annual income of the deceased - as argued Tribunal instead of taking average of previous three years of Income Tax Return (ITR) considered four years as it was available on record and hence, a wrong approach was adopted - HELD THAT:- It is not in dispute that in normal course, preceding three years ITRs are considered while assessing the annual income but in the instant case, one more assessment year of 2011-2012 was included. Adopting the normal course for the previous three consecutive financial years before the death, the Court is of the view that the annual income with such tax deduction should be accepted at Rs. 1,76,496/-. The Court is inclined to accept the plea of Mr. Mohanty, learned counsel for the claimants and fix the annual income of the deceased at Rs. 1,76,496/- allowing the tax deductions for the years 2012-13, 2013-14 and 2014-15.
With respect to the income towards the heavy goods vehicles, an amount of Rs. 60,000/- has been added to the annual income - When a presumptive income is assessed at, for the purpose of tax as per Section 44-AE of the Income Tax Act, it may not be incorrect to demand a sum of Rs. 7,500/- a month in respect of the hypothecated goods vehicles, the said amount being the presumptive monthly income previous year whereupon tax was payable but the irony is that both the vehicles were purchased barely few months before the death of the deceased. As regards the periodical increment at the rate of 10% vis-à-vis general damages in every three years, there is no quarrel over the legal position as held by the Apex Court in Pranay Sethi (supra), however, it shall be in respect of an amount of Rs. 70,000/- instead of Rs. 1,20,000/- which has been allowed by the learned Tribunal on the heads of consortium @ Rs. 40,000/- for each for the claimants.
As regards the plea of Insurance Company that there was violation of policy conditions, as pleaded that the tanker was involved in transporting hazardous substance, which was not in terms of the DL of the driver, who had no such authorization to ply the alleged vehicle. In fact, there has been no specific evidence brought on record from the side of the Insurance Company challenging the DL of the driver of the offending tanker to claim that any such policy condition is violated -absence of any such endorsement in the DL, without any specific evidence on record, the plea as to violation of policy condition is not to be accepted. In any case, Exts. D and E proved such claim to be incorrect. Hence, it is held that the contention of Mr. Dasmohapatra with such a plea is liable to be rejected. But, as already held, the plea that the amount on conventional heads for an amount of Rs. 1,20,000/- should be Rs. 70,000/- is acceptable and to which, the Court is in complete agreement.
The annual income of the deceased is to be reassessed at Rs. 1,76,496/- taking into account average income of previous three years, such as, 2012-13, 2013-14 and 2014-15. Over and above, the said amount, assuming the income from the heavy goods vehicles of the deceased, the Court is inclined to add an amount of Rs. 22,500/- only (not counting for the entire year) since the hypothecated TATA ACE and JCB had been purchased shortly before the accident. No evidence is on record either to ascertain, if both the vehicles are still with the claimants or in the meantime, disposed of after the death of the deceased.
Anyways, the income with an additional sum of Rs. 22,500/- becomes Rs. 1,99,996/-. Since the deceased died living behind the dependants, deduction towards personal and living expenses should be 1/3rd and hence, loss of dependency is calculated at Rs. 1,33,330/- and with a multiplier of 16 (as the deceased was aged about 31 years) applicable in view of the decision of Smt. Sarla Verma and others Vrs. Delhi Transport Corporation and Another [2009 (4) TMI 1030 - SUPREME COURT] the amount is arrived at Rs. 21,33,280/-. Besides the above, the claimants are also entitled to 40% on the said sum towards loss of future prospects as the deceased was below 40 years at the time of death, hence, the amount becomes Rs. 29,86,592/-. With the addition of Rs. 77,000/- on general damages inclusive of periodical increment every three years and other additional expenses allowed by learned Tribunal on the heads of transportation of dead body for Rs. 5,000/-, funeral and obsequies expenses at the rate of Rs. 20,000/-, the amount of compensation is reached at Rs. 30,88,592/- (instead of Rs. 33,58,657/-) which is payable along with interest @ 7% per annum usually being the lending rate. Hence, the Court is not in favour of enhancing the interest to 9% per annum so claimed by the appellants.The Court is also not in favour of any penal interest @ 9% per annum allowed by the learned Tribunal as the same is unwarranted.
As a logical sequitur, the impugned award passed in M.A.C Case is hereby modified to the extent as aforesaid with a direction to the Insurance Company to deposit a sum of Rs. 30,88,592/- along with interest at the rate of 7% per annum from the date of claim application filed till its realization within eight weeks from today, whereafter, it shall immediately be disbursed in favour of the claimants.
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2024 (7) TMI 100
Non-empanellment of Chartered Accountant's Firm (CA Firm) as per a Notice Inviting Tender (NIT) - prescription of 5 year certificate is present or not - specific ground on which the petitioner’s firm has been disqualified is the fact that they have not proved that they had a Branch Office within the State of Bihar for the last 5 years - HELD THAT:- The petitioner refers to Annexure-P2 to establish that the petitioner was working for 5 years within the State of Bihar. Annexure-P2 indicates the name of the firm and also its Head Office address which is at Guwahati. The year of establishment is said to be on 13.03.1961 and the same is continuing as a partnership firm. The constitution of the firm under GST IAN is said to be 01.01.2019 but specifically with respect to the Head Office. The address of the Branch Office at Patna is also shown in the order but, however, there is nothing to indicate that as per ICAI Records the Branch Office was situated continuously in Bihar since more than 5 years.
Annexure-D produced along with Supplementary Counter Affidavit dated 29.11.2023 indicates the specific reason for disqualification of the petitioner who figures at Serial No. 94. The reason stated is “Proposal has been not evaluated due to last five year FCC has been not attached.” The petitioner obviously had produced a Firm Constitution Certificate evidencing their presence in Bihar for only the past one year.
There are no reason to entertain the writ petition and the same is dismissed.
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2024 (7) TMI 1
Proceedings against retired Sales Tax Officer post superannuation - GST default by the company in which he was appointed post retirement - Dismissal of writ petition as premature - Single Judge has proceeded to non-suit the relief - no opportunity given for preliminary enquiry - violation of principles of natural justice - HELD THAT:- It is not in dispute that the appellant-petitioner had already retired in the year 2016 and during his service tenure, no departmental proceeding was initiated against him. After more than six years, the respondent authority had proceeded against the appellant and held the preliminary enquiry on 21.12.2023 that to an ex-parte even without taking any comment from a retired employee. In administrative action, which also entails civil consequences for a person, the principles of natural justice should be adhered to. Admittedly, no opportunity was given to the appellant before holding the preliminary enquiry and such a decision taken in violation of the principle of natural justice would be void.
In the interest of justice, the matter is to be heard on merit before learned Single Judge and accordingly, the order impugned dated 13.3.2024 is set aside - the matter is relegated to the learned Single Judge to consider the matter on merits.
The Special Appeal stands partly allowed.
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2024 (6) TMI 1388
Dishonour of Cheque - Violation of principles of natural justice - opportunity of cross-examination was not afforded to the accused - applicability of section 145(2) of the NI Act for cross-examining the witnesses - HELD THAT:- It is undisputed that the accused was not allowed to cross-examine the witnesses. The complainant appeared as (CW1) on 25.1.2022 and tendered his affidavit and documents in the evidence. There is nothing on record to show that an opportunity for cross-examination was afforded to the accused. Thus, the learned Appellate Court had rightly held that the opportunity of cross-examination was not afforded to the accused.
In the United States of America, the right of confrontation of a witness is part of the fundamental right guaranteed by the Sixth Amendment. This is in recognition of the principle of natural justice incorporating the right of cross- examination given to a person.
The Hon'ble Supreme Court also held in Noor Mohammed v. Khurram Pasha, [2022 (8) TMI 924 - SUPREME COURT] that the right of cross-examination cannot be denied because the accused had failed to deposit the interim compensation and if such a right is denied, it will constitute an inherent infirmity.
In the present case, the complainant relied upon an affidavit prepared by him out of the Court in the absence of the complainant. He tendered the affidavit without allowing the accused to cross-examine him. This amounted to the admission of the evidence recorded outside the Court not tested by the cross-examination reminding one of Sir Walter Raleigh's trial and the accusations at Star Chambers - the learned First Appellate Court had rightly held that the trial suffered from inherent infirmity and remanded the matter to the learned Trial Court to correct the infirmity. No fault can be found with the approach of the learned First Appellate Court.
The present petition fails and the same is dismissed.
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2024 (6) TMI 1316
Dishonour of cheque - Funds Insufficient - existence of legal liability or not - cheques were issued during the pendency of Insolvency Resolution Professional proceeding - vicarious liability of Director (Ex-Director) or not - liability without pointing out actual role and knowledge of issuing the cheque for the alleged liability to pay the amount of dishonoured cheque.
The first ground of objection of this application is that under Section 14 of the IBC Act there is order of the NCLT Chandigarh and therefore no criminal liability of the applicants arise - HELD THAT:- In view of the law laid down in P. Mohanraj and others Vs. M/s. Shah Brohters Ispat Pvt. Ltd. [2021 (3) TMI 94 - SUPREME COURT] Section 14 of the IBC applies to the corporate debtor and it is not applicable to the natural person. From the proceeding under Section 138 of the N.I. Act they are not exonerated from criminal liability. Thus, these applicants, who are natural persons cannot be benefited by the said order of NCLT. and Section 14 of the IBC. The argument of learned Senior Counsel Shri R.N. Dhorde for applicants is not acceptable in this regard.
The second ground for quashing complaint is absence of knowledge of issuing of cheque - HELD THAT:- It is admitted fact that applicants have not signed any of cheques in question. The statutory notices were not send to them after dishonour of cheques - It is necessary to plead the knowledge of all these applicants which is require as per first proviso of Section 141 of the N.I. Act. Their specific status and role is not specified in the complaint. Their liability to pay that amount under dishonoured cheque is not establishing from the averments in the complaint. It is not established from any document or conduct that disputed cheques were signed with their knowledge. Therefore, all the applicants cannot be held liable and deemed to be guilty as per Section 141 of the N.I. Act.
This is a fit case to exercise inherent power under Section 482 of the Criminal Procedure Code to stop the abuse of the process of the Court and to secure ends of justice. Therefore, the argument of Senior Counsel for the respondent Shri R.S. Deshmukh is not acceptable in this regard.
The application for quashing of the said complaint deserves to be allowed - Application allowed.
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2024 (6) TMI 1259
Dishonour of Cheque - Jurisdiction of court - inquiry under Section 202 of the Cr.P.C. not conducted - maintainability of application under Section 239 of the Cr.P.C. - rejection of applications filed by the petitioner for production of statement of bank accounts of the respondent No. 2 - applications filed for comparison and verification of signature and Handwriting of the petitioner on disputed cheques and each of the page of agreement executed between the petitioner and respondent No. 2 rejected - cheques issued as security - merge of the charge and clubbing of all the cases.
Inquiry under Section 202 of the Cr.P.C. - HELD THAT:- The inquiry under Section 202 of the Cr.P.C. was not conducted. The remedy to file revision is available to the petitioner. However, revisions were not filed against said orders of issue process by the petitioner before Sessions Court. The applications for quashing of the complaints u/ s 482 of the Cr.P.C. are not filed. However, quashing is prayed in the writ petitions. Therefore, directly filing of writ petitions against the orders of issue process are not maintainable.
Maintainability of application under Section 239 of the Cr.P.C. - HELD THAT:- The applications filed for discharge of the petitioner are not maintainable. The said applications were rightly rejected by the Trial Court. No interference is warranted in these orders.
Application for production of statement of bank accounts of the respondent No. 2 were rejected - HELD THAT:- The petitioner has ample opportunity to lead that evidence. The Court can also compare signatures on it under Section 73 of the Indian Evidence Act. The Court expressed that it will compare signature. It is surprising to note that once issuance of cheques is admitted by the petitioner, how the signature on it can be challenged. There is no scope for interference in these well reasoned impugned orders.
Applications filed for comparison and verification of signature and Handwriting of the petitioner on disputed cheques and each of the page of agreement executed between the petitioner and respondent No. 2 rejected - HELD THAT:- It is admitted facts that cheques were issued as security. It means signatures are admitted. It is matter of evidence. Those applications were filed to support the applications filed for discharge. The discharge applications were held not maintainable as discussed above. The Trial Court held that petitioner - accused will have opportunity to lead evidence. Application is premature. Thus, petitioner can file the application of same nature after the evidence of respondent No. 2 is over, if necessary - The Trial Court has rightly exercised judicial discretion and interference is not warranted in the impugned orders. Therefore, well reasoned orders passed on those applications require no interference.
Applications filed for merge of the charge and clubbing of all the cases together rejected - HELD THAT:- The charges were not framed in those cases. In summary cases, charge cannot be framed. It is only statement of accusation to be confronted to the accused and not charge. Therefore, no question of merging of charge arises. Such applications are not maintainable. As per Section 408 of the Cr.P.C. the application must be moved before the Sessions Court for clubbing those cases. Those applications were also not maintainable before trial court.
Applications filed for dismissal of complaint for want of jurisdiction, rejected - HELD THAT:- The revisions before Sessions Court against the orders of Trial Court regarding issue of jurisdiction are to be filed. Those were not filed by the petitioner. In case of rejecting the application challenging the jurisdiction of the court to proceed with the trial, even though it may not be final in one sense, is surely not interlocutory order, substantially it is a final order - The writ petitions are not maintainable against the said orders. In case of Ahuja Dongre relied upon by the petitioner, the revision was filed before the Sessions Court and that Judgment was challenged. In this case, revision is not filed. Thus, it is not helpful to the petitioner. The revision is not filed. Therefore, case of Sayed Mohammed, cited supra by the petitioner is not relied upon.
The applications for interim compensation in each case were granted by the Trial Court. All these orders granting interim compensation passed u/s 143-A of the N.I. Act are well reasoned. There is no any illegality and perversity to interfere in it. The revisions were not preferred against those orders u/s 397 Cr.P.C. Therefore, the writ petitions are not maintainable against those orders.
The arguments of learned Advocate for petitioner are not accepted in all writs. All the writ petitions are dismissed.
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2024 (6) TMI 1100
Applicability of Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981 to the Corporation qua the employees and their Union - suggestion to institute an ‘Industrial Disputes Claim’ questioning non-employment was sustainable or not, given that the Inspector of Labour had already passed orders in that regard.
Whether the Corporation can be termed as an industrial establishment as per the provisions reproduced supra and whether the members of the Union would qualify as workmen and therefore would be eligible for permanent status under Section 3 of the Act? - HELD THAT:- For any establishment to be commercial, it has to be established that the activities undertaken by it are for making some monetary gain. Commercial in the most rudimentary sense means buying or selling of goods in exchange of money - this act shall not apply to those workmen who are engaged in the construction of buildings and the like or other construction work be it structural, mechanical, or electrical. Therefore, those establishments and their workmen shall be exempt, who are engaged exclusively, in the work of construction.
Both requirements, of the establishment being covered under the definition of industrial establishment as provided and that of the employee having uninterruptedly continued in service for 480 days or more for 24 months, having been met there are no hesitation in holding that the Act would apply to the parties to the present dispute.
Whether the High Court on remand, could have ignored the order of the Inspector of Labour and suggested that the employees raise an industrial dispute questioning their non-employment? - HELD THAT:- Since the High Court concluded that the Act would apply, there was no reason for it to disturb the finding of the Inspector of Labour and, therefore, it ought to have simply ordered that the order of Inspector of Labour which concluded that the members of the respondent-Union be given permanent employment, be complied with. When an issue stands already decided and such decision does not suffer from any vice of authority or jurisdiction then, putting those who enjoy an order in their favour through the wringer once more of having to re-establish their claim, this time before the authority under the Industrial Disputes Act, 1947, would be unjustified.
The appeal filed by the Corporation is dismissed.
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2024 (6) TMI 1099
Cognizance of the offences punishable under Sections 13 (1) (d), 13 (1) (e) read with 13 (2) of the PC Act and under Section 109 of IPC - challenge to charge sheet and taking cognizance of the offence - undeclared assets and income of the petitioner - no preliminary enquiry conducted to verify about the disproportionate assets said to be in possession of the petitioner - HELD THAT:- It is well settled by the Hon'ble Supreme Court in order to calculate the disproportionate asset, it is necessary to place the assets and liabilities held by the petitioner or a public servant during joining of the public service and subsequently what was the assets held by him and what was the income earned and expenditure, then only they should ascertain. After ascertaining the same, only then they should come to the conclusion regarding prima facie case or register the FIR and then schedule property is required to pass an order under Section 17 of the PC Act for investigation. Herein this case, the income tax authorities not concluded the investigation and sent letter to the Chief Secretary, in turn the Chief Secretary forwarded the letter to the ACB and ACB immediately registered FIR by preparing alleged source report, which does not contain any details of the property.
There is no basic foundation in this case to say that the petitioner was having so much assets and liabilities at the time of joining the service and Subsequently he has amassed the assets, absolutely there is no material place either in the source report or in the FIR or in the charge sheet. Totally blank regarding the assets and liabilities which were declared by the petitioner while joining the service. The prosecution blindly stated, he has amassed the property between 1987 to till date but there is no details in the case records. Therefore, continuing proceedings is nothing but abuse of process of law.
Such being the case absolutely there is no ground for framing of charge and proceeding the trial against the petitioner - this petition is allowed.
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2024 (6) TMI 1098
Dishonour of Cheque - service of notice - failure to produce an evidence that in fact the notice was served - non-fulfilment of essential condition for taking cognizance, as provided under Section 138 clause (c) read with section 142(1)(b) of the NI Act - whether non-filing of track report or acknowledgement due card would illegal to proceed with the case filed under Section 138 of the Negotiable Instruments Act, 1881 or not? - HELD THAT:- The complainant issued and sent a demand notice on 28.01.2021 to the address of the accused person in terms of Section 138(b) of the Negotiable Instruments Act, 1881 and amendment thereto asking the accused person to pay the said amount within a period of 15 days from the date of receipt of the said notice. But the accused person has failed and neglected to pay the said amount covered by the said cheques and when he failed to pay the payment of the same amount covered by the aforesaid cheques, the complainant filed this case on 16th March, 2021 - it appears from the complaint itself the requirements as provided under Section 138 of the Negotiable Instruments Act, 1881 have been fulfilled by the complainant.
In the instant case, the trial Court seems to have drawn a presumption of law with regards to service of demand notice. Furthermore, onus lies upon the claimant to prove his case at the time of trial. At the same time, accused person also gets opportunity to contest the same during trial.
This Court does not find any illegality or infirmity in taking cognizance by the learned Magistrate and issue summon upon the accused person. Accordingly, CRR 1708 of 2021 is devoid on merit and required to be dismissed - application dismissed.
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2024 (6) TMI 1037
Dishonour of Cheque - acquittal of accused - locus standi to file the criminal complaints being the Branch Manager of the complainant-federation - HELD THAT:- It transpires that the complaints were filed by Sh. A.N. Pillai in his capacity as the Branch Manager of the complainant government undertaking in the month of January, 1995 whereas the power of attorney was executed in his favour by the complainant federation on 28.06.1995, proved on record as Ex.P5. Vide the said power of attorney, the Managing Director of the complainant federation appointed the Branch Manager as the general attorney. However, there was no clause in the in the power of attorney dated 28.06.1995, executed in favour of the Branch Manager, ratifying the acts of Branch Manager retrospectively. It comes to the fore that on the date the complaints were filed by Sh. A.N. Pillai, Branch Manager, acting on behalf of the complainant federation, there was no such power of attorney duly authorizing the Branch Manager to file the said complaints.
The power of the Appellate Court to unsettle the order of acquittal on the basis of re-appreciation of the evidence is subject to the settled law that where two views are possible and out of the two, one points towards the innocence of the accused, the view which favours the accused should prevail over the other pointing towards his guilt. Furthermore, the trial Court has the additional advantage of closely observing the prosecution witnesses and their demeanour, while deciding about the reliability of the version of prosecution witnesses.
A two Judge Bench of Hon'ble Supreme Court in case of Chandrappa [2007 (2) TMI 704 - SUPREME COURT] has laid down the parameters with regard to the power of appellate Court while dealing with an appeal against an order of acquittal and held that 'If two reasonable conclusions are possible on the basis of the evidence on record, the appellate court should not disturb the finding of acquittal recorded by the trial court.'
This Court finds that learned counsel for the appellant has been unable to point out any perversity in the impugned judgment of acquittal passed by learned Additional Sessions Judge, Jalandhar - Appeal dismissed.
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2024 (6) TMI 995
Dishonour of Cheque - acquittal of accused - rebuttal of presumption under Sections 118 and 139 of the Negotiable Instruments Act - HELD THAT:- The accused had not denied her signature on the cheque (Ex.P1). Once the signature is admitted there is a presumption under Sections 118 and 139 of the Negotiable Instruments Act unless the contrary is proved. The trial court judge had infact analysed this aspect and had convicted the accused for the offence punishable under Section 138 of the Negotiable Instruments Act.
It is seen from the records that the complainant examined himself as P.W.1 on 16.02.2015 and the accused cross examined P.W.1 only on 07.10.2015. In the meantime, the accused was also questioned under Section 313 Cr.P.C. Therefore, the complainant, in the absence of a specific averment in the reply notice with regard to his financial capacity cannot be expected to prove his means at the fag end of the trial.
The trial court Judge had analysed all the documents threadbare and had come to the conclusion that the accused is guilty of the offence punishable under Section 138 of NI Act. On the other hand the appellate court judge, even without a specific plea by the accused that the complainant did not have sufficient means to lend a sum of Rs.4,00,000/- to her, had rendered a finding that the complainant was not possessed of sufficient means. The other aspects of the case have not at all been properly analysed by the appellate court Judge and therefore the judgment and orders passed by the appellate court is liable to be set aside.
The judgment and orders passed by the appellate court judge is set aside and the judgment and orders passed by the trial court judge is restored. The conviction and sentence passed by the trial court judge against the accused is hereby confirmed.
Appeal allowed.
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2024 (6) TMI 994
Dishonour of cheque - insufficient funds - unambiguous notice - procedure under Sections 251 and 252 of the Cr. P.C. not followed - petitioner pleaded guilty and claimed no trial in the same - HELD THAT:- In Shri Mahant Kaushalya Das [1965 (5) TMI 52 - SUPREME COURT], the Supreme Court was confronted with the position where the admission of the accused therein had not been recorded by the Magistrate “as nearly as possible in the words used by him” as required by Section 243 of the Cr.P.C., 1898, which provision is pari materia to Section 252 of the Cr.P.C.
In JUPUDI ANAND GUPTA VERSUS STATE OF ANDHRA PRADESH AND ORS. [2017 (10) TMI 1654 - SUPREME COURT], the Court was again confronted with the position where only the contents of the Charge-sheet had been read over to the accused and it was stated that he had pleaded guilty. It was on those facts that the Court held that the conviction of the accused only on the basis of him pleading guilty cannot be sustained - In RASEEN BABU K.M. VERSUS THE STATE OF KERALA [2021 (6) TMI 1173 - KERALA HIGH COURT], the Kerala High Court held that the record of the plea of guilt should be recorded in words of the accused.
In the present case, not only the Notice that was put to the petitioner was unambiguous, but also his plea was clearly recorded in the words of the petitioner himself.
There are no merit in the present petition. The same is accordingly dismissed.
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2024 (6) TMI 840
Dishonour of Cheque - insufficiency of funds - presumption under Sections 118 and 139 of the N.I. Act - discharge of legally enforceable debt or not - failure to pay back the amount within 15 days of receipt of the demand notice - HELD THAT:- The learned trial court had found that the accused/petitioner had issued cheque No. 254228, dated 12.09.2009, drawn on UCO Bank, Silchar Branch, Cachar, for an amount of Rs. 5,00,000/- to the complainant/respondent No. 1 in discharge of his liability. The learned court below had also drawn presumption in favour of the holder of the cheque in due course, in view of the provision of Sections 118 and 139 of the N.I. Act.
It is to be noted here that Section 118 of the N.I. Act lays down that until the contrary is proved, it shall be presumed that every Negotiable Instrument was made or drawn for consideration. Section 139 of the N.I. Act contemplated that unless the contrary is proved, it shall be presumed that the holder of the cheque received the cheque of the nature referred to in Section 138 of the N.I. Act for the discharge, in whole or part of any debt or liability.
Admittedly, the petitioner had not lodged any information to Police about losing of his cheque. Such a plea was also not taken in his statement under Section 313 of the Cr.P.C. He had also not adduced any evidence in support of claim of the cheque being lost. On these counts a reasonable doubt arises about the veracity of the claim of the petitioner and as such the learned trial court and also the learned first appellate court had rightly disbelieved the version of the petitioner.
In the instant case, the petitioner had not disputed the cheque in question and his signature thereon and as such, the statutory presumption under Sections 118 and 139 of the N.I. Act is very much available in all its plenitude and amplitude. The petitioner had failed to rebut such a presumption. Neither he appeared in the witness box to adduce evidence to rebut the statutory presumption, nor could he show any material available on the record, to rebut the presumption.
This revision petition devoid of merit and accordingly, the same stands dismissed.
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