Himachal Pradesh High Court
Reserved On: 23.04.2025 vs Dhian Singh & Another on 7 May, 2025
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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Cr. Appeal No. 117 of 2011
Reserved on: 23.04.2025
Date of Decision:07.05.2025
Nand Lal
.... Appellant
Versus
Dhian Singh & another
.... Respondents
Coram
Hon'ble Mr Justice Rakesh Kainthla, Judge.
Whether approved for reporting? Yes
For the Appellant : Mr. G.R. Palsra,
Advocate.
For the Respondents : Mr. Raj Thakur, Advocate,
vice Ms. Gurmeet
Bhardwaj, Advocate for
respondent No.1
Mr. Ajit Sharma, Deputy
Advocate General for
respondent No.2/State.
Rakesh Kainthla, Judge.
The present appeal is directed against the judgment
dated 22.11.2010, passed by learned Sessions Judge, Kullu,
District Kullu, H.P. (learned Appellate Court), vide which the
judgment of conviction and order of sentence dated
30.03.2009 passed by learned Judicial Magistrate, First Class,
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Manali (learned Trial Court) were set aside. (Parties shall
hereinafter be referred to in the same manner as they were arrayed
before the learned Trial Court for convenience)
2. Briefly stated, the facts giving rise to the present
appeal are that the complainant filed a complaint before the
learned Trial Court against the accused for the commission of
an offence punishable under Section 138 of the Negotiable
Instruments Act (NI Act). It was asserted that the complainant
is an agent of M/s A.M. Fruit Commission Agent, Delhi. He
used to pay advance money to the fruit growers who used to
send the fruits to M/s A.M. Fruit Commission Agent for sale.
The accused is a fruit grower and has an orchard under the
name and style of Shringi Orchard. The accused approached
the complainant and demanded ₹1,00,000/- as an advance,
consisting of ₹60,000/- in cash and packing material worth
₹40,000/-. The accused assured the complainant that he
would send the fruits to M/s A.M. Fruit Commission Agent,
Delhi. The complainant paid ₹60,000/- in cash and supplied
the packing material worth ₹40,000/- to the accused. The
accused failed to send the fruits from his orchard to M/s A.M.
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Fruit Commission Agent, Delhi. The complainant
subsequently demanded ₹1,00,000/- from the accused. The
accused handed over a cheque for ₹1,00,000/- to the
complainant to return the amount. The complainant
presented the cheque before the Kangra Cooperative Bank,
Banjar, for encashment; however, the cheque was
dishonoured with an endorsement of 'insufficient funds'. The
complainant sent a legal notice to the accused, requesting him
to pay the amount within 15 days of receipt of the notice. The
accused failed to make the payment despite receiving the
notice. Hence, the complaint was filed against the accused.
3. The learned Trial Court found sufficient reasons to
summon the accused. When the accused appeared, notice of
accusation was put to him for the commission of an offence
punishable under Section 138 of the NI Act, to which he
pleaded not guilty and claimed to be tried.
4. The complainant examined himself (CW-1), Jai
Chand Thakur (CW-1 wrongly mentioned), and Harish Thakur
(CW-2).
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5. The accused in his statement recorded under
Section 313 of Cr.P.C. admitted that he had taken the advance
of ₹60,000/- in cash and packing material worth ₹40,000/-
from the complainant. He stated that he had sent the fruit
from his orchard to the fruit company as per the agreement.
He admitted that he had handed over a cheque to the
complainant, which was dishonoured. He admitted that a
notice was issued to him. He examined Jeet Ram (DW-1), Bali
Ram (DW-2) and himself (DW-3) in his defence.
6. Learned Trial Court held that the accused had
admitted the case of the complainant in his statement
recorded under Section 313 of Cr.PC. It was proved that the
accused had taken the advance from the complainant and
issued a cheque in his favour. The cheque was dishonoured
due to 'insufficient funds', and the accused had failed to pay
money despite receipt of a valid legal notice of the demand.
The plea of the accused that he had sent the fruit to M/s A.M.
Fruit Commission Agent, Delhi, was not established by his
testimony. Therefore, the accused was convicted of the
commission of an offence punishable under Section 138 of the
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NI Act, and he was sentenced to undergo simple
imprisonment for one year and pay a compensation of
₹1,40,000/- for the commission of the aforesaid offence.
7. Being aggrieved by the judgment and order passed
by the learned Trial Court, the accused filed an appeal, which
was decided by the learned Appellate Court on 05.06.2008.,
Learned Appellate Court noticed that the complainant was not
examined after the appearance of the accused, and he was
only cross-examined. His examination-in-chief was
recorded in the absence of the accused and could not have
been read in evidence. The procedure adopted by the learned
Trial Court was not proper. Hence, judgment of conviction
dated 23.08.2007 and order of sentence dated 27.08.2007 were
set aside and the matter was remanded to the learned Trial
Court for deciding the matter afresh.
8. After the matter was remanded to the learned Trial
Court, the complainant examined himself (CW-3).
9. The accused, in his statement recorded under
Section 313 of Cr.P.C., denied the complainant's case. He
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asserted that he had sent the fruits to Om Prakash and Ashok
worth ₹1,68,000/-. He had to settle the accounts with Om
Parkash and Ashok Kumar. He examined Jeet Ram (DW-1),
Krishan Chand (DW-2), Dolma Devi (DW-3), Kamle Ram
(DW-4) and Sanjeev Kumar (DW-5) in his defence.
10. Learned Trial Court held that the complainant had
proved his case beyond a reasonable doubt. The defence of the
accused was not proved. Hence, the learned Trial Court
convicted the accused for the commission of an offence
punishable under Section 138 of N I Act and sentenced him to
undergo simple imprisonment for six months and pay a
compensation of ₹1,50,000/- to the complainant for the
commission of the aforesaid offence.
11. Being aggrieved by the judgment and order passed
by the learned Trial Court, the accused preferred an appeal,
which was decided by the learned Appellate Court on
22.12.2010. Learned Appellate Court held that the complainant
claimed himself to be an agent of M/s A.M. Fruit Commission
Agent Delhi. He had advanced an amount of ₹1,00,000/- with
an assurance that the accused would send his fruit to M/s A.M.
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Fruit Commission Agent, Delhi. The complainant was merely
an agent, and the accused owed no liability to him. The
liability, if any, was towards M/s A.M. Fruit Company, which
could have filed a complaint before the Court. The
complainant was a stranger to the transaction, and he could
not have filed any complaint. Therefore, the judgment and
order passed by the learned Trial Court on 30.03.2009 were set
aside.
12. Feeling aggrieved and dissatisfied with the
judgment dated 22.12.2010, passed by the learned Appellate
Court, the complainant has filed the present appeal asserting
that the learned Appellant Court erred in acquitting the
accused. The complainant had specifically mentioned that he
had advanced ₹1,00,000/- in the form of cash and packing
material to the accused. The cheque was issued to the
complainant in his name. Learned Appellate Court erred in
holding that the accused owed no liability to the complainant.
The accused initially admitted the case of the complainant,
but he made a different statement after the case was
remanded to the learned Trial Court. This aspect was ignored
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by the learned Appellate Court. Therefore, it was prayed that
the present appeal be allowed and the judgment passed by the
learned Appellate Court be set aside.
13. I have heard Mr. G.R. Palsra, learned counsel for the
appellant/complainant and Mr. Raj Thakur, vice Mr. Gurmeet
Bhardwaj, learned counsel for respondent No.1/accused and
Mr. Ajit Sharma, learned Deputy Advocate General for the
respondent No. 2/State.
14. Mr. G.R. Palsra, learned counsel for the appellant,
submitted that the learned Appellate Court erred in acquitting
the accused. It was wrongly held that the accused owed no
liability to the complainant. The complainant had advanced
₹60,000/- in cash and packing material worth ₹40,000/- to
the accused. The accused issued the cheque to discharge his
legal liability. The accused had initially admitted all the
ingredients of the commission of an offence punishable under
Section 138 of the NI Act. The learned Appellate Court erred in
holding that the ingredients of Section 138 NI Act were not
satisfied. Therefore, he prayed that the present appeal be
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allowed and the judgment passed by the learned Appellate
Court be set aside.
15. Mr. Raj Thakur, learned vice counsel for respondent
No.1/accused, submitted that the complainant claimed
himself to be an agent of M/s A.M. Fruit Commission Agent.
He had advanced the money on behalf of M/s A.M Fruit
Commission Agent, Delhi. Learned Trial Court had rightly
held that the accused owed no liability to the complainant,
and there is no infirmity in the finding recorded by the
learned Trial Court. This was a reasonable view which could
have been taken based on evidence led before the learned Trial
Court. Therefore, he prayed that the present appeal be
dismissed.
16. Mr. Ajit Sharma, learned Deputy Advocate General
for respondent No.2/State, supported the arguments
advanced by Mr. G.R. Palsra, learned counsel for the
appellant/complainant.
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17. I have given considerable thought to the
submissions made at the bar and have gone through the
records carefully.
18. The present appeal has been filed against a judgment
of acquittal. It was laid down by the Hon'ble Supreme Court in
Surendra Singh v. State of Uttarakhand, 2025 SCC OnLine SC 176 :
(2025) 5 SCC 433 that the Court can interfere with a judgment of
acquittal if it is patently perverse, is based on
misreading/omission to consider the material evidence and
reached at a conclusion which no reasonable person could have
reached. It was observed:
"11. Recently, in the case of Babu Sahebagouda
Rudragoudar v. State of Karnataka 2024 SCC OnLine SC
4035, a Bench of this Court to which one of us was a
Member (B.R. Gavai, J.) had an occasion to consider the
legal position with regard to the scope of interference in
an appeal against acquittal. It was observed thus:
"38. First of all, we would like to reiterate the
principles laid down by this Court governing the scope
of interference by the High Court in an appeal filed by
the State for challenging the acquittal of the accused
recorded by the trial court.
39. This Court in Rajesh Prasad v. State of Bihar [Rajesh
Prasad v. State of Bihar, (2022) 3 SCC 471: (2022) 2 SCC
(Cri) 31] encapsulated the legal position covering the
field after considering various earlier judgments and
held as below : (SCC pp. 482-83, para 29)
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"29. After referring to a catena of judgments, this
Court culled out the following general principles
regarding the powers of the appellate court while
dealing with an appeal against an order of acquittal
in the following words: (Chandrappa
case [Chandrappa v. State of Karnataka, (2007) 4 SCC
415: (2007) 2 SCC (Cri) 325], SCC p. 432, para 42)
'42. From the above decisions, in our considered
view, the following general principles regarding
the powers of the appellate court while dealing
with an appeal against an order of acquittal
emerge:
(1) An appellate court has full power to
review, reappreciate and reconsider the
evidence upon which the order of acquittal is
founded.
(2) The Criminal Procedure Code, 1973 puts
no limitation, restriction or condition on the
exercise of such power and an appellate
court, on the evidence before it, may reach its
own conclusion, both on questions of fact and
law.
(3) Various expressions, such as "substantial
and compelling reasons", "good and
sufficient grounds", "very strong
circumstances", "distorted conclusions",
"glaring mistakes", etc., are not intended to
curtail the extensive powers of an appellate
court in an appeal against acquittal. Such
phraseologies are more in the nature of
"flourishes of language" to emphasise the
reluctance of an appellate court to interfere
with an acquittal than to curtail the power of
the court to review the evidence and to come
to its own conclusion.
(4) An appellate court, however, must bear in
mind that in case of acquittal, there is a
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double presumption in favour of the
accused. Firstly, the presumption of
innocence is available to him under the
fundamental principle of criminal
jurisprudence that every person shall be
presumed to be innocent unless he is proved
guilty by a competent court of law. Secondly,
the accused having secured his acquittal, the
presumption of his innocence is further
reinforced, reaffirmed and strengthened by
the trial court.
(5) If two reasonable conclusions are possible
on the basis of the evidence on record, the
appellate court should not disturb the finding
of acquittal recorded by the trial court."
40. Further, in H.D. Sundara v. State of Karnataka [H.D.
Sundara v. State of Karnataka, (2023) 9 SCC 581: (2023) 3
SCC (Cri) 748] this Court summarised the principles
governing the exercise of appellate jurisdiction while
dealing with an appeal against acquittal under Section
378CrPC as follows: (SCC p. 584, para 8)
"8. ... 8.1. The acquittal of the accused further
strengthens the presumption of innocence.
8.2. The appellate court, while hearing an appeal
against acquittal, is entitled to reappreciate the oral
and documentary evidence;
8.3. The appellate court, while deciding an appeal
against acquittal, after reappreciating the evidence,
is required to consider whether the view taken by
the trial court is a possible view which could have
been taken on the basis of the evidence on record;
8.4. If the view taken is a possible view, the
appellate court cannot overturn the order of
acquittal on the ground that another view was also
possible; and
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8.5. The appellate court can interfere with the order
of acquittal only if it comes to a finding that the
only conclusion which can be recorded on the basis
of the evidence on record was that the guilt of the
accused was proved beyond a reasonable doubt and
no other conclusion was possible."
41. Thus, it is beyond the pale of doubt that the scope
of interference by an appellate court for reversing the
judgment of acquittal recorded by the trial court in
favour of the accused has to be exercised within the
four corners of the following principles:
41.1. That the judgment of acquittal suffers from
patent perversity;
41.2. That the same is based on a misreading/omission
to consider material evidence on record; and
41.3. That no two reasonable views are possible and
only the view consistent with the guilt of the accused
is possible from the evidence available on record."
12. It could thus be seen that it is a settled legal position
that the interference with the finding of acquittal
recorded by the learned trial judge would be warranted by
the High Court only if the judgment of acquittal suffers
from patent perversity; that the same is based on a
misreading/omission to consider material evidence on
record; and that no two reasonable views are possible and
only the view consistent with the guilt of the accused is
possible from the evidence available on record."
19. The present appeal is required to be decided as per
the parameters laid down by the Hon'ble Supreme Court.
20. The complainant specifically mentioned in para 2 of
the complaint that he is an agent of M/s A.M. Fruit Commission
Agent Delhi, and he used to pay advance money to the fruit
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growers who used to send the fruits for sale. He mentioned in
para 3 of the complaint that the accused approached the office of
the complainant and demanded a sum of ₹1,00,000/- in advance
and assured to send the fruit of his orchard to M/S A.M. Fruit
Commission Agent Dehil. The complainant paid ₹60,000/- in
cash and handed over packing material of ₹40,000/- to the
accused. He mentioned in para 4 of the complaint that the
accused failed to send fruits to M/S A.M. Fruit Commission
Agent, Delhi, or return ₹1,00,000/-.
21. It is apparent from these averments that the
transaction was entered into between the accused and the M/s
A.M. Fruit Commission Agent Delhi through the complainant as
an agent. The accused was to send the fruits to M/s A.M. Fruit
Commission Agent, Delhi. The advance was taken for the price
of the fruit from the complainant, who was acting as an agent of
M/s A.M. Fruit Commission Agent Delhi, therefore, the learned
Appellate Court had rightly held that the transaction was
between the accused and the principal, i.e. M/s A.M. Fruit
Commission Agent Delhi.
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22. Section 230 of the Indian Contract Act provides that
an agent cannot personally enforce contracts entered into by
him on behalf of his principal, nor is he personally bound by
them in the absence of a contract to the contrary. It was laid
down by the Hon'ble Supreme Court in Marine Container Services
South (P) Ltd. v. Go Go Garments [(1998) 3 SCC 247 that an agent
acting on behalf of a disclosed principal cannot sue nor can he be
sued on the transactions entered by him. This judgment was
followed in Vivek Automobiles Ltd. v. Indian Inc., (2009) 17 SCC
657, wherein it was observed: -
8. Section 230 of the Contract Act categorically makes it
clear that an agent is not liable for the acts of a disclosed
principal subject to a contract to the contrary. No such
contract to the contrary has been pleaded. An identical
issue was considered by this Court in Marine Container
Services South (P) Ltd. v. Go Go Garments [(1998) 3 SCC
247: AIR 1999 SC 80], where a similar order passed under
the Consumer Protection Act was set aside by this Court.
It was held that by virtue of Section 230, the agent could
not be sued when the principal had been disclosed.
23. A similar view was taken in Prem Nath Motors Ltd. v.
Anurag Mittal, (2009) 16 SCC 274, wherein it was held: -
7. Section 230 of the Contract Act categorically makes it
clear that an agent is not liable for the acts of a disclosed
principal subject to a contract to the contrary. No such
contract to the contrary has been pleaded. An identical
issue was considered by this Court in Marine Container
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Services South (P)Ltd. v. Go Go Garments [(1998) 3 SCC
247: AIR 1999 SC 80], where a similar order passed under
the Consumer Protection Act was set aside by this Court.
It was held that by virtue of Section 230, the agent could
not be sued when the principal had been disclosed. A
similar view has been expressed by a three-judge Bench
of this Court in Civil Appeal No. 6653 of 2005 arising out of
SLP (C) No. 19562 of 2004 [Vivek Automobiles
Ltd. v. Indian Inc., (2009) 17 SCC 657].
24. This judgment was followed in Virender Khullar v.
American Consolidation Services Ltd., (2016) 15 SCC 308, and it was
observed: -
14. Since Respondent 1 was simply acting as an agent of
Coronet Group Inc., as such, in view of Section 230 of
the Indian Contract Act, 1872, it cannot be held
personally liable to enforce the contract entered into
between its principal and the appellants. This Court, in
its order dated 10-9-2009 [American Consolidation
Service Ltd. v. Virendra Khullar, Civil Appeal No. 2080 of
2004, order dated 10-9-2009 (SC)], has accepted the
plea of Respondent 1 that Respondent 1 is not a
consignee, but only an agent of the intermediate
consignee. That being so, Respondent 1 cannot be held
to be liable in respect of the claim made by the
appellants. We think it relevant to mention here that
in Marine Container Services South (P) Ltd. v. Go Go
Garments [Marine Container Services South (P) Ltd. v. Go
Go Garments, (1998) 3 SCC 247], this Court has already
made clear that defence under Section 230 of the Indian
Contract Act, 1872 is available in the cases under the
Consumer Protection Act, 1986 by the agents of the
principal with whom the complainant had the
agreement.
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25. In the present case, the complainant specifically
stated that he had disclosed the name of M/s A.M. Fruit
Commission Agent, Delhi and that the accused had assured to
send fruits to M/s A.M. Fruit Commission Agent. Thus, the
complainant was acting on behalf of a disclosed principal, and
he could not have enforced the contract entered into by him on
behalf of the principal.
26. It was submitted that the cheque was issued in the
name of the complainant, and the complainant was the payee
entitled to file the complaint based upon the cheque issued in his
name. This submission is not acceptable. The complainant was
acting on behalf of M/s A.M. Fruit Commission Agent Delhi, and
he was bound to pay money to the principal, had the cheque been
realised. Therefore, the mere fact that the cheque was issued in
his name does not show that it was issued in his favour in
discharge of any legal liability.
27. Therefore, the learned Appellate Court had taken a
reasonable view, which cannot be interfered with while deciding
an appeal against acquittal.
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28. Consequently, the present appeal fails, and the same
is dismissed.
29. The record of the learned Court below be sent back
with a copy of this judgment for the information of the learned
Trial Court.
30. Appeal stands disposed of along with pending
miscellaneous application(s), if any.
(Rakesh Kainthla)
Judge
07th May, 2025.
(ravinder)
