2018 (8) TMI 497 - HC - Indian Laws

Reversal of Order of Conviction - Offence under Section 138 of the Negotiable Instruments Act, 1881 - Held that - P.W.1 P.Venkatesan , who is the Power of Attorney admitted in his cross examination that he did not know the particulars about the lending of money to the respondent. In this regard, in his cross-examination, he specifically stated that he did not know the transaction happened between his wife and the respondent - The said circumstances shows that P.W.1 is not having due knowledge with regard to the loan transaction happened between the complainant and the accused - the said lapse on the part of the appellant will shake the very root of her case. Promissory note - case of respondent is that the recitals of the promissory note clearly proves that it has not been executed in favour of the appellant - Held that - As per the recitals found in the promissory note, it is clearly proved that the loan amount of ₹ 75,000/- was received by the respondent only on 05.02.2007. But, P.W.1 to P.W.3 categorically mentioned in the proof affidavit that only ₹ 25,000/- was paid as a loan on 05.02.2007. Hence, the existing liability of the respondent has not been proved by the appellant through the cogent and convincing evidence - interference is not necessary in the findings of the First Appellate Court. Appeal dismissed.

Summary

Issues:
Appeal against order of acquittal, liability under Section 138 of Negotiable Instruments Act, 1881, execution of promissory note, role of Power of Attorney in filing complaint, sufficiency of evidence.

Analysis:
1. The appellant appealed against the order of acquittal, challenging the reversal of conviction under Section 138 of the Negotiable Instruments Act, 1881. The case involved a loan transaction where the respondent received amounts on different occasions, leading to a dispute over repayment.

2. The appellant contended that the liability of the respondent was established through evidence, including a promissory note executed for a loan amount. The respondent's failure to repay the loan led to the legal action under Section 138 of the Act. The trial court convicted the respondent, but the appellate court reversed the decision citing lack of proof of liability.

3. The crucial aspect was the role of the Power of Attorney (P.W.1) in filing the complaint on behalf of the appellant. The respondent argued that P.W.1 lacked sufficient knowledge about the transaction, which undermined the case. The respondent relied on legal principles regarding the competence of a Power of Attorney in such matters.

4. The judgment referred to the Apex Court's decision emphasizing the necessity for the Power of Attorney to have witnessed the transaction or possess relevant knowledge. The respondent highlighted discrepancies in P.W.1's testimony, indicating a lack of awareness about the loan details, which weakened the appellant's case.

5. Another contention was the execution date of the promissory note, which the respondent argued did not align with the appellant's claim. Discrepancies in the evidence regarding the loan amount and dates raised doubts about the liability of the respondent, as per the recitals in the promissory note.

6. Ultimately, the court upheld the appellate court's decision, stating that the findings were legally sound and did not warrant interference. The judgment dismissed the Criminal Appeal, affirming the acquittal of the respondent based on insufficiency of evidence to establish liability under Section 138 of the Negotiable Instruments Act, 1881.