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TMI Blog2023 (10) TMI 1399X X X X Extracts X X X X X X X X Extracts X X X X ..... tion from the bank regarding the return of the cheque and the Court cannot legislate by prescribing a particular form and cannot require that the nature of the transaction leading to the issuance of cheque be disclosed in the notice when the statute does not provide for it. In the present case, at the risk of repetition, it is reiterated that the complainant had instituted the complaint through PW1, who is authorised to file the complaint. In the trial, the complainant examined PWs1 and 2 and marked Exts.P1 to P12. PW2, in clear terms, testified that he is aware of the transactions between the complainant firm and the accused - the complainant has discharged its initial onus of proof by satisfying the concomitants constituting the ingredients under Section 138 of the Act and has shifted the reverse onus of proof onto the shoulders of the accused. Admittedly, the accused had not sent a reply notice. Instead, the accused has marked Ext.D1 receipts in evidence to substantiate his payments to the complainant. Ext.D1 receipts corroborate the testimonies of PWs. 1 and 2 and Ext.P11 statement that the accused had business transactions with the complainant. On a comprehensive re-appreciati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n its favour for Rs. 1,60,000/-and Rs. 20,000/-respectively, in discharge of a legally enforceable liability. However, the cheques were dishonoured due to 'insufficiency of funds' in the accused's bank account. Although the complainant issued a statutory notice demanding the above amounts, the accused failed to pay the same. Hence, the accused committed the offence. 4. The learned Magistrate took cognizance of the offence. The accused pleaded not guilty to the accusation. In the trial, the complainant examined its Branch Manager and Accountant (PWs 1 and 2) and marked in evidence Exts.P1 to P12 documents. The accused denied the incriminating questions in the examination under Section 313 of the Code of Criminal Procedure ('Code', for brevity). The accused produced and marked in evidence Ext.D1 series receipts. 5. After analysing the materials on record, the learned Magistrate found the accused not guilty, predominantly on the finding that there is no averment in the complaint regarding the status of the complainant and, therefore, PW1 is not competent to file and prosecute the complaint. 6. Heard; Sri. Lal K.Joseph, the learned Counsel appearing for the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by companies/firms. 10. Is there any error in the impugned judgment? 11. The complainant is M/s.Popular Motor Corporation . A scrutiny of the complaint reveals that it is clearly stated that the complainant is a firm represented by its Branch Manager, who is competent to represent the complainant. 12. To corroborate the above statement, the complainant has marked Ext.P9 deed of partnership and Ext.P12 acknowledgement of registration of firms in evidence. 13. In M/s.Shankar Finance Investments v. State of Andhra Pradesh and others [2008 (4) KHC 352] 2023/KER/64839, the Honourable Supreme Court held as under: 7. The payee of the cheque is M/s. Shankar Finance Investments. The complaint is filed by M/s. Shankar Finance Investments, a proprietary concern of Sri. Atmakuri Sankara Rao, represented by its Power of Attorney Holder Sri. Thamada Satyanarayana'. It is therefore evident that the complaint is in the name of and on behalf of the payee. S. 142(a) of the Act requires that no Court shall take cognizance of any offence punishable under S.138 except upon a complaint made in writing by the payee. Thus the two requirements are that (a) the complaint should be made in writing (in co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assertion in the complaint that the power of attorney holder has knowledge about the transaction. 17. The above questions have been succinctly answered by the Honourable Supreme Court in TRL Krosaki Refractories Ltd. [2022 (2) KHC 157], by distinguishing Narayanan.A.C [2013 (3) KHC885] and after referring to National Small Industries Corporation Ltd. v. State (NCT of Delhi) and others [2008 KHC 6997], in the following lines: 16. Further, in National Small Industries Corporation Ltd. v. State (NCT of Delhi) and Ors: (2009) 1 SCC 407, this Court, though was essentially considering the issue relating to the exemption available against examining a public servant keeping in view the scope Under Section 200(a) of Code of Criminal Procedure, has exhaustively considered the validity of a complaint Under Section 138 of N.I. Act and the satisfaction of the requirement Under Section 142 thereof. In the said context this Court has held as hereunder: 14. The term complainant is not defined under the Code. Section 142 of the NI Act requires a complaint Under Section 138 of that Act to be made by the payee (or by the holder in due course). It is thus evident that in a complaint relating to dishon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, the exemption under Clause (a) of the first proviso to Section 200 of the Code will be available. 19. Resultantly, when in a complaint in regard to dishonour of a cheque issued in favor of a company or corporation, for the purpose of Section 142 of the NI Act, the company will be the complainant, and for purposes of Section 200 of the Code, its employee who represents the company or corporation, will be the de facto complainant. In such a complaint, the de jure complainant, namely, the company or corporation will remain the same but the de facto complainant (employee) representing such de jure complainant can change, from time to time. And if the de facto complainant is a public servant, the benefit of exemption under Clause (a) of the proviso to Section 200 of the Code will be available, even though the complaint is made in the name of a company or corporation. 17. In that view, the position that would emerge is that when a company is the payee of the cheque based on which a complaint is filed Under Section 138 of N.I. Act, the complainant necessarily should be the Company which would be represented by and employee who is authorized. Prima-facie, in such a situation the indica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee can represent the company. Therefore, the ratio decidendi in Narayanan.A.C1 broadly applies to complaints filed by individual complainants and not companies/firms. 19. In Basheer K. V. C.K.Usman Koya and another 4[2021 (2) KHC 432], this Court has held that no particular form is prescribed under the Act concerning a notice under Section 138(b) of the Act, except that the payee or holder in due course should make a demand for the payment of the amount of money within 30 days from the receipt of intimation from the bank regarding the return of the cheque and the Court cannot legislate by prescribing a particular form and cannot require that the nature of the transaction leading to the issuance of cheque be disclosed in the notice when the statute does not provide for it. It is also observed that a complaint filed under Section 138 of the Act should contain the factual allegations about the five ingredients, namely, (i) the cheque drawn in a valid account by the holder, (ii) its presentation within six months or validity period; whichever is earlier, (iii) dishonour, (iv) demand by the payee or holder in due course, (v) which demand is within 30 days of dishonour. 20. In the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to the dishonour of cheques, the rebuttable presumption under S.139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by S.138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under S.139, the standard of proof for doing so is that of 'preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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