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TMI Blog2012 (6) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... AL APPEAL NOS. 1413 & 1414 OF 2011 (Arising from order of High Court of Punjab & Haryana in Criminal Appeal Nos. 379-MA of 2007 and 381–MA of 2007, dated 16-12-2008.) - - - Dated:- 19-7-2011 - DR. MUKUNDAKAM SHARMA AND ANIL R. DAVE, JJ. JUDGMENT Anil R. Dave, J. - Leave granted. 2. Being aggrieved by the common Judgment delivered in Criminal Appeal Nos. 379-MA of 2007 and 381-MA of 2007, dated 16-12-2008 by the High Court of Punjab and Haryana at Chandigarh, the original complainants have filed these appeals. By virtue of the aforestated judgment and order, the High Court has confirmed the Orders dated 4-5-2007 passed in Criminal Complaint Nos. 46 and 99 of 1999 by the Judicial Magistrate, First Class, Ludhiana whereby the accused in the aforestated complaints had been acquitted of the charges levelled against them. 3. The facts leading to the present litigation in a nut shell are as under: 4. On 23-2-1999, Respondent No. 4 - Munish Jain, a Director of M/s. A.T. Overseas Ltd. had given in all four cheques for different amounts to Anil Sachar, partner of M/s. Rati Woolen Mills who are appellant Nos. 1 and 2 respectively. According to the case of the comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udicial Magistrate, First Class, Ludhiana, dated 4-5-2007, criminal appeals were filed before the High Court of Punjab and Haryana at Chandigarh, but the said appeals have been dismissed and, therefore, the original complainants have approached this Court by way of these appeals. 9. It may be noted here that during the pendency of the proceedings, Mohinder Jain, accused/respondent No. 3 expired and, therefore, deleted from the array of parties. 10. Mr. Nidhesh Gupta, learned Senior Counsel appearing for the complainants mainly submitted that the learned Judicial Magistrate as well as the High Court committed an error by acquitting the accused simply because the goods had been supplied to M/s. Shree Nath Spinners (P.) Ltd. whereas the cheques were given by M/s. A.T. Overseas Ltd. He submitted that both the concerns, referred to hereinabove, are sister concerns having common Directors and, therefore, the courts below ought to have lifted the corporate veil so as to find out the realities. He also submitted that Munish Jain, who had signed the aforesaid cheques was Director in both the sister concerns viz. M/s. Shree Nath Spinners (P.) Ltd. and M/s. A.T. Overseas Ltd. Moreov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts that both the companies are sister concerns and, therefore, one company should be made liable for the dues of another company cannot be sustained. He further submitted that there was nothing to substantiate the submission that M/s. A.T. Overseas Ltd. had made payment in consideration of goods supplied to M/s. Shree Nath Spinners (P.) Ltd. He, therefore, submitted that the appeals be dismissed. 13. Upon hearing the learned counsel appearing for the parties and upon perusal of the record pertaining to the cases and the impugned judgment delivered by the High Court confirming the order passed by the trial court and upon considering the judgments cited by the learned counsel, we are of the view that the decision rendered by the courts below cannot be sustained. 14. Upon perusal of the record, we find that the complainants had established before the trial court that there was an understanding among the complainants and the accused that in consideration of supply of goods to M/s. Shree Nath Spinners (P.) Ltd., M/s. A.T. Overseas Ltd. was to make the payment. The aforestated understanding was on account of the fact that directors in both the aforestated companies were common a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used to pay on behalf of each other to other parties or their creditors. The above fact strengthens the presumption to the effect that M/s. A.T. Overseas Ltd. had paid the cheques to the complainants, which had been signed by Munish Jain, in consideration of goods supplies to M/s. Shree Nath Spinners (P.) Ltd. Of course, the presumption referred to in section 139 is rebuttable. In the instant case, no effort was made by Munish Jain or any of the Directors of M/s. A.T. Overseas Ltd. for rebuttal of the aforestated presumption and, therefore, the presumption must go in favour of the holder of the cheques. Unfortunately, the trial court did not consider the above facts and came to the conclusion that there was no consideration for the cheques which had been given by M/s. A.T. Overseas Ltd. to the complainants. 17. It is true that a limited company is a separate legal entity and its directors are different legal persons. In spite of the aforestated legal position, in view of the provisions of section 139 of the Act and the understanding which had been arrived at among the complainants and the accused, one can safely come to a conclusion that the cheques signed by Munish Jain had b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case and law on the subject, we are of the view that all the four cheques referred to in both the complaints are presumed to have been given for consideration. The presumption under section 139 of the Act has not been rebutted by the accused and, therefore, we are of the view that the trial court wrongly acquitted the accused by taking a view that there was no consideration for which the cheques were given by Munish Jain to the complainants. The aforesaid incorrect view was wrongly confirmed by the High Court. We, therefore, set aside the acquittal order and convict accused Munish Jain under section 138 of the Act. 20. In view of the aforestated facts and legal position, in our opinion, the accused ought to have been held guilty, especially accused No. 4, Munish Jain who had signed all the cheques for M/s. A.T. Overseas Ltd. We, therefore, hold Munish Jain, accused No. 4 and respondent No. 4 herein, in both the cases guilty of the offence under section 138 of the Act. 21. Accused Munish Jain was acquitted by the trial court and the High Court has confirmed the acquittal, which is being set aside by this Court by allowing these appeals. In the circumstances, as per the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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