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TMI Blog2021 (8) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... both passed by the learned Judicial Magistrate, 1st Class, Ranchi. The essential details in connection with the impugned judgements are as under: - Criminal Revision No. 830 of 2012 arises out of Criminal Appeal No.142 of 2011 and Complaint Case No. 87/2006 and T.R. No. 1629/2011. -Conviction of petitioner under section 138 of Negotiable Instruments Act, 1881. -simple imprisonment for one year with fine of Rs. 1,000/- -compensation amounting to Rs. 7,19,739/- -Cheque No. 969458 dated 14.12.2005 drawn on Punjab and Sindh Bank, Ranchi. Criminal Revision No. 833of 2012 arises out of Criminal Appeal No.144 of 2011 and Complaint Case No. 86/2006 and T.R. No. 438/2011. -Conviction of petitioner under section 138 of Negotiable Instruments Act, 1881. -simple imprisonment for one year with fine of Rs. 2,000/- -compensation amounting to Rs. 7,15,164/- -Cheque No. 969457 dated 14.12.2005 drawn on Punjab and Sindh Bank, Ranchi. Arguments of the Petitioner 6. The learned counsel for the petitioner has submitted that both the cases arise out of two different loans extended by the opposite party no. 2 to the partnership firm namely, Mehta Transport Company in which the petitioner was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proving the said authorization letter and not beyond that. In spite of this opportunity to prove the authorization letter, the complainant did not avail the opportunity to produce and examine P.W-1 in Complaint Case No. 86/2006 but examined P.W-1 in Complaint Case No. 87/2006 where the authorization letter dated 03.01.2005 was marked as Exhibit 6 (with objection) and the witness was thoroughly cross examined by the defence on the point of authorization letter as the same was issued by the Regional Manager of the complainant company though in favour of the P.W-1 (Field Officer of the complainant company), but there was no authority letter from the Board of Directors of the complainant company or flowing from the Articles of Association of the company. He also referred to the judgement passed by the Hon'ble Supreme Court reported in (2015) 1 SCC 527 (Vinita S. Rao versus Essen Corporate services Private Limited and another) to submit that otherwise also the power of attorney must have knowledge about the relevant transaction otherwise he cannot depose as a witness on behalf of the complainant. He submits that the P.W-1 was cross examined in the Complaint Case No. 87/2006 on the po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tinizing the materials on record found that P.W-1 was duly authorized and competent to file the complaint case on behalf of the complainant company. He submits that there is no scope for reappreciation of evidences on record to come to a different finding in revisional jurisdiction. 10. So far as Complaint Case No. 86/2006 is concerned, he submits that the learned appellate court has rightly considered the fact that the letter of authorization to file the complaint case was duly exhibited in the connected records of Complaint Case No. 87/2006, between the same parties and accordingly the learned appellate court has rightly taken judicial notice of the authorization letter exhibited as Exhibit - 6 in Complaint Case No. 87/2006 and read it in the Complaint Case No. 86/2006 also. He also submits that P.W-1 while filing the Complaint Case No. 86/2006 had stated on affidavit accompanied with the complaint petition that he was the authorized representative of the complainant company. He submits that there is no illegality of perversity in the aforesaid approach of the learned appellate court and accordingly no interference is called for on this point. 11. The learned counsel has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld officer)? Criminal Revision No. 830/2012 and Criminal Revision No. 833/2012 (b) Whether it was imperative on the part of the complainant company to make the partnership firm of the accused as a co-accused in the complaint cases? If the answer is in affirmative, then what are the consequence? 15. In Cr. Revision No. 830 of 2012, the case of the complainant- Ashok Leyland Finance, in brief, was that the complainant company was dealing with the financing of vehicles to different individuals on hire purchase basis. The accused, a partner of Mehta Transport Company, on behalf of his partnership firm, entered into an agreement of hire purchase dated 06.05.2003 for purchase of Tipper vehicle, in which, it was agreed that a loan of Rs. 12,00,000/- (Rs. Twelve Lakhs Only) for purchase of Tipper vehicle of Tata Motors bearing Registration No. JH-02C-2103 was to be handed over to the accused and it was decided that liability incurred upon the accused shall be discharged by him through payment made in installments. However, the accused defaulted in making payment and upon pressurized by the complainant company, the accused entered into a settlement for payment of Rs. 7,19,739/-. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid cheque. The complainant after receipt of the aforesaid cheque deposited the same with its banker M/s IndusInd Bank at Ranchi on 14.12.2005 for its encashment, but the same was returned unpaid by the banker of the accused with return memo dated 15.12.2005 issued by Punjab and Sindh Bank, Ranchi due to 'insufficient fund'. The complainant thereafter issued a demand notice which was dated 13.12.2005 to the complainant, wherein it was requested that the accused was liable to pay the cheque amount within 15 days from the date of receipt of notice, failing which the accused would be liable for the consequences as provided under the law. It was the further the case of the complainant that the accused, even after receipt of the aforesaid notice on 28.12.2005, failed to discharge the liability for a sum of Rs. 7,15,164/- and accordingly, the complainant filed the complaint case. Issue no. (a) - On the point of the authorization letter to file Complaint Cases. 17. So far as the first point argued by the learned Senior counsel for the petitioner is concerned, the same relates to the authorization of the P.W-1, the Field Officer of the complainant company, to file the case on behalf of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record. P.W.-1 was also permitted to be further examined to establish this fact. The complainant did not got himself examined on fresh oath, however on 6.03.2010, the complaint filed original copy of letter of authorisation dated 3.01.2005 on record. The same was exhibited as exhibit- 6 in complaint case number 87 of 2007, between the same party and on same issue. It is matter of fact that the same has not been exhibited in this case. An exhibited document of same other case between the same parties on the same issue cannot be neglected by this court, this Court is bound to take judicial noting of the document on record. The court has already relied on the said document in other case. 18. In view of these facts and circumstances above discussed above I find that all the basic ingredients necessary to establish offence u/s 138 of N.I. Act has been duly established by the complainant. However, the basic difference is that the case has been instituted by the company and PW-I is authorized representative. However, the whole complaint petition does not disclose the fact that PW - 1 was authorized representative and authority letter was in his favour to institute the case on behalf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owledge about the relevant transactions. 23. Thus, it has been held in the aforesaid judgement by the Hon'ble Supreme Court that both the tests are required to be satisfied, there should be a power of attorney or authorization letter to represent the complainant company and that the authorized person should have the knowledge of the relevant transactions involved in the case. 24. This Court finds that in order to ascertain as to whether the P.W-1 in Complaint Case No. 86/2006 had the knowledge about the transactions involved in the said case, he was required to depose before the learned court below, exhibit the authorization letter and offer himself to cross examination so that it could be disclosed as to whether he had the knowledge about the transactions involved in the said Complaint Case No. 86/2006. This opportunity was not availed by the complainant company in Complaint Case No. 86/2006 in spite of the fact that such opportunity to appear on recall and produce the authorization letter to conduct the case on behalf of the complainant company was granted to the complainant company. This Court is of the considered view that non-availment of such opportunity by the complainant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... W-1, the Field Officer of the complainant company, is held to have been filed without proper authorization from the complainant company and accordingly point no. (a) is decided in favour of the accused/petitioner in the Cr. Revision No. 833 of 2012. 28. So far as the Complaint Case No. 87/2006, which is subject matter in Cr. Revision No. 830 of 2012 is concerned, this Court finds that the authorization letter in favour of the P.W- 1 to file the complaint case was duly exhibited on recall of the P.W-1, though marked with objection as Exhibit -6 and the P.W-1 was also cross-examined on the point of authorization. Upon perusal of the judgements passed by the learned courts below, this Court finds that both the courts have given concurrent findings on the point after considering the materials on record and the points raised by the parties and held that the P.W-1 was duly authorized to file the case on behalf of the complainant company and the complaint was maintainable. The mode and manner of authorization to file a complaint case on behalf of a company is essentially a matter of appreciation of evidence led by the parties and merely because the authorization letter was issued by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere handed over by the accused which had his signature. During the course of arguments and by referring to the records of the two cases, the learned counsel for the petitioner has pointed out that though the cheques were signed by the accused, but the same was signed as a partner of the partnership firm under its seal and cheques were from the account of the partnership firm as the dues were of the partnership firm and not the individual dues of the accused. 34. During the course of argument, it is not in dispute that on the face of each cheque itself, the cheque was issued by the accused signing it as partner of the firm namely Mehta Transport Company and also the fact that the complaint was filed against the petitioner by describing him as a partner of the firm namely Mehta Transport Company. It is further not in dispute that the loan was taken by the partnership firm in which the petitioner had signed as a partner in the hire purchase agreement and the loan was to be returned by the partnership firm by virtue of some settlement arrived at between the parties and consequently, the cheques involved in the present cases were issued for clearing the dues of the partnership firm wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late court reflects that the appellate court has completely lost sight of the status of the accused, who was merely a partner of the firm and that the loan was extended to the partnership firm and not the accused in his individual capacity. The learned appellate court in both the cases virtually substituted the accused in place of the partnership firm and in both the cases has given aforesaid findings which is contrary to the specific case and grievance of the complainant company against the partnership firm in connection with the two loans/hire purchase agreements. 38. In order to consider the aforesaid aspect of the matter and to consider the aforesaid ex-facie perverse findings in both the cases, it is required to be considered that even the cheques involved in the two cases were issued by the partnership firm in discharge of the two debts and was signed by the accused in the capacity of the partner of the partnership firm. This aspect of the matter has a serious bearing as failure to implead the partnership firm as co-accused in the complaint cases has serious legal consequences as argued by the learned counsel for the petitioner by referring to Section 141 of the Negotiable I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make a person vicariously liable has been dealt with in S.M.S. Pharmaceuticals Ltd. In the said case, it has been opined that the criminal liability on account of dishonour of cheque primarily falls on the drawee (sic drawer) company and is extended to the officers of the company and as there is a specific provision extending the liability to the officers, the conditions incorporated in Section 141 are to be satisfied. 51. We have already opined that the decision in Sheoratan Agarwal runs counter to the ratio laid down in C.V. Parekh which is by a larger Bench and hence, is a binding precedent. On the aforesaid ratiocination, the decision in Anil Hada has to be treated as not laying down the correct law as far as it states that the Director or any other officer can be prosecuted without impleadment of the company. Needless to emphasise, the matter would stand on a different footing where there is some legal impediment and the doctrine of lex non cogit ad impossibilia gets attracted. 59. In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Himanshu v. B. Shivamurthy reported in (2019) 3 SCC 797 the appellant submitted that the cheque was issued by a Director of a public limited company and not issued by the signatory in his personal capacity. Hence, it was urged that the complaint ought to have been instituted against the company and its directors and not against the appellant. However, the records indicated that the cheque was drawn by the appellant for the company as its director and the notice of demand was served only on the appellant. The complaint was lodged only against the appellant without arraigning the company as an accused. In the said background it was held as under: - "12. The provisions of Section 141 postulate that if the person committing an offence under Section 138 is a company, every person, who at the time when the offence was committed was in charge of or was responsible to the company for the conduct of the business of the company as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished. 13. In the absence of the company being arraigned as an accused, a complaint against the appellant was therefore not maintainable. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the petitioner in both the cases. It is held that it was imperative on the part of the complainant company to make the partnership firm of the accused as a co-accused in the complaint cases and on account of failure to do so, the petitioner could not be convicted for offence under Section 138 of Negotiable Instruments Act, 1881 as complaint only against the petitioner in both the cases was itself not maintainable. 49. Summary Issue no.(a) in Criminal Revision No. 830/2012 (arising out of Complaint Case No. 87/2006) is decided in favour of the opposite party complainant; Issue no.(a) in Criminal Revision No. 833/2012 (arising out of Complaint Case No. 86/2006) is decided in favour of the accused-petitioner; Issue no.(b) in Criminal Revision No. 830/2012 and Criminal Revision No. 833/2012 is decided in favour of the accused-petitioner. 50. As a cumulative effect of the aforesaid findings, the impugned judgements of conviction and sentence of the petitioner in both the cases are hereby set-aside. 51. Both the Criminal Revision petitions are allowed. 52. The petitioner is discharged from his liabilities under the bail bonds furnished by him. 53. The office is dire ..... X X X X Extracts X X X X X X X X Extracts X X X X
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