2018 (8) TMI 1219 - HC - Indian Laws

Offences punishable u/s 138 of Negotiable Instruments Act - cheques were dishonoured for the reasons Exceeds Arrangement and out of date - notices were returned unserved with an endorsement left - Held that - A perusal of the records shows that out of 16 cheques, 11 cheques were presented beyond the period of 6 months. However, there are 5 more cheques, which were returned for the reason Exceeds Arrangement . Therefore, the learned Metropolitan Magistrate, Fast Track Court No.II, Egmore, Chennai can proceed further against the petitioners herein with regard to those 5 cheques - Since the 2nd petitioner has issued the cheques in favour of the respondent/complainant, there is no necessity to aver specifically in the complaint that the 2nd petitioner was in charge of day to day affairs of the company and therefore, he can be prosecuted for the alleged offence punishable under Section 138 of the Negotiable Instruments Act. Authority to represent the respondent/complainant M/s SEW Eurodrive India Private Ltd. - Held that - Along with the complaint, the authorization issued to Mr.C.V.Shivakumar is filed as document No.25 and in the facts and circumstances, it cannot be said that the complaint filed by the respondent/ complainant is not maintainable - There is no reason to quash the proceedings in C.C.No.106 of 2012 on the file of the Metropolitan Magistrate, Fast Track Court No.II, Egmore, Chennai and hence the petition is liable to be dismissed. Petition dismissed.

Summary

Issues:
1. Authorization of representative to file complaint under Sections 138 and 141 of the Negotiable Instruments Act.
2. Presentation of cheques beyond the statutory period.
3. Service of statutory notices to the accused.
4. Authority of the complainant's representative to file the complaint.

Issue 1: Authorization of representative to file complaint under Sections 138 and 141 of the Negotiable Instruments Act:
The respondent/complainant filed a private complaint against the petitioners for offenses under Sections 138 and 141 of the Negotiable Instruments Act. The petitioners contended that Mr. C.V. Shivakumar had no authority to represent the respondent company, as only Mr. James, the branch manager, was authorized. However, it was argued that Mr. Shivakumar was authorized at the time of filing the complaint in 2009, and a subsequent resolution authorized Mr. James. The court found the complaint maintainable, as Mr. Shivakumar was authorized when the complaint was filed, and the subsequent resolution was passed due to his resignation. The proceedings were not quashed based on this issue.

Issue 2: Presentation of cheques beyond the statutory period:
Out of the 16 cheques issued, 11 were presented beyond the statutory period of 6 months. However, 5 cheques were returned for "Exceeds Arrangement." The court held that the magistrate could proceed against the petitioners for the 5 cheques that were returned within the statutory period, despite the delay in presenting the other 11 cheques. This issue did not impede the continuation of the case.

Issue 3: Service of statutory notices to the accused:
The petitioners claimed that statutory notices were not served on them, challenging the validity of the complaint under Section 138 of the Negotiable Instruments Act. The respondent argued that notices were sent to the correct addresses of the petitioners. The court noted that the notices were dispatched to the correct addresses as mentioned in the complaint, and the petitioners did not dispute the correctness of these addresses. The court emphasized that the sufficiency of notice could only be determined after evidence is presented, not at the initial stage, and thus, this issue did not warrant dismissal of the case.

Issue 4: Authority of the complainant's representative to file the complaint:
The petitioners raised concerns regarding the authority of Mr. C.V. Shivakumar to represent the respondent company. They pointed to a Board Resolution authorizing Mr. James as the authorized representative. However, the court found that Mr. Shivakumar was authorized when the complaint was filed in 2009, and the subsequent resolution was passed due to his resignation. The court held that the complaint was maintainable and dismissed the petition, directing the expeditious disposal of the case pending for over 6 years.

In conclusion, the High Court of Madras upheld the validity of the complaint filed under Sections 138 and 141 of the Negotiable Instruments Act, rejecting the petitioners' challenges regarding the authorization of the complainant's representative, presentation of cheques, service of statutory notices, and the authority of the authorized representative. The court directed the expeditious disposal of the pending case within three months.