Jharkhand High Court
Binay Prasad vs The State Of Jharkhand on 26 July, 2021
IN THE HIGH COURT OF JHARKHAND AT RANCHI
Cr. Rev. No. 830 of 2012
Binay Prasad, Son of Late Baijnath Prasad, resident of village
Shashtri Chowk, P.O. and P.S. Bhurkunda, District: -
Hazaribagh. ... ... Petitioner
-Versus-
1. The State of Jharkhand
2. Ashok Leyland Finance, a division of IndusInd bank Ltd, a
company under the companies Act 1956, having its
Registered Office at 2401 Gen Jhimnayya Road (East Street)
Cantonment, Pune-411001 (Maharashtra), having its branch
at Arjun Place, 5 Main Road Ranchi Through Its Field Officer
Sri Ramchandran Anand, Son of Sri T.A. Ramchandran,
Resident of 3rd Floor, Arjun Place Main Road, P.O. and P.S.
Chutiya, District: - Ranchi.... ... Opposite Parties
With
Cr. Rev. No. 833 of 2012
Binay Prasad, Son of Late Baijnath Prasad, resident of village
Shashtri Chowk, P.O. and P.S. Bhurkunda, District: -
Hazaribagh. ... ... Petitioner
-Versus-
1. Ashok Leyland Finance, a division of IndusInd bank Ltd, a
company under the companies Act 1956, having its
Registered Office at 2401 Gen Jhimnayya Road (East Street)
Cantonment, Pune-41101 and branch office among other
places at Arjun Place, 5 Main Road Ranchi Through Its Field
Officer Sri Ramchandran Anand, Son of Sri T.A.
Ramchandran, Resident of 3rd Floor, Arjun Place Main Road,
P.O. and P.S. Chutiya, District: - Ranchi.
2. The State of Jharkhand ... ... Opposite Parties
---
CORAM: HON'BLE MRS. JUSTICE ANUBHA RAWAT CHOUDHARY
---
Through Video Conferencing
---
18/26.07.2021
1. Heard Mr. A.K. Kashyap, the learned Senior Counsel
appearing on behalf of the petitioner in both the cases.
2. Heard Mr. Ashish Kumar, the learned counsel appearing on
behalf of the Opposite Party -complainant in both the cases.
3. Heard Mr. Sanjay Kumar Srivastava, learned counsel
appearing on behalf of the opposite party State in Cr.
Revision No. 830 of 2012.
4. Heard Mr. Shiv Shankar Kumar, learned counsel appearing
on behalf of the opposite party State in Cr. Revision No. 833
of 2012.
5. The complainant and the accused in both the cases are same
persons. The appellate court judgements in both the cases are
dated 29.06.2012 and have been passed by the learned District
and Additional Sessions Judge-III, Ranchi and the appeals
have been dismissed. The trial court judgement in Cr.
Revision No. 830 /2012 is dated 05.08.2011 and in Cr.
Revision No. 833 /2012 is dated 18.08.2011 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 Criminal Revision No.833 of
2012 arises out of Criminal 2012 arises out of Criminal
Appeal No.142 of 2011 and Appeal No.144 of 2011 and
Complaint Case No. 87/2006 Complaint Case No. 86/2006
and T.R. No. 1629/2011. and T.R. No. 438/2011.
-Conviction of petitioner -Conviction of petitioner
under section 138 of under section 138 of
Negotiable Instruments Act, Negotiable Instruments Act,
1881. 1881.
-simple imprisonment for one -simple imprisonment for one
year with fine of Rs. 1,000/- year with fine of Rs. 2,000/-
-compensation amounting to -compensation amounting to
Rs. 7,19,739/- Rs. 7,15,164/-
-Cheque No. 969458 dated -Cheque No. 969457 dated
14.12.2005 drawn on Punjab 14.12.2005 drawn on Punjab
and Sindh Bank, Ranchi. 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 a partner.
The loan was extended for purchase of the tipper vehicles for
which an agreement of hire purchase dated 06.05.2003 in both
the cases were executed by the petitioner in capacity of a
partner of the said partnership firm namely Mehta Transport
Company on behalf of the partnership firm. The vehicle
involved are -
In Cr. Revision No. 830 of 2012 - Vehicle No. JH-02C-2103-
corresponding complaint case is Complaint Case No.
87/2006
In Cr. Revision No. 833 of 2012 - Vehicle No. JH-02C-2102-
corresponding complaint case is Complaint Case No.
86/2006
7. Broadly two points have been argued by the learned Senior
counsel for the petitioner in both the cases: -
(a) The authorization letter to file Complaint Case No.
86/2006 was not exhibited before the trial court and the
authorization letter exhibited in another Complaint Case
No. 87/2006 marked as Exhibit 6 (with objection) could
not have been considered in Complaint Case No. 86/2006
to hold that the Field Officer of the complainant (P.W-1)
was duly authorized by the complainant company to file
the complaint case. Otherwise also the so-called
authorization letter to file the complaint case (exhibited in
Complaint Case No. 87/2006 and not exhibited in
Complaint Case No. 86/2006) cannot be said to be an
authorization letter issued by the complainant company to
file the cases as the same was issued by another employee
of the complainant company being its Regional Manager
and was not supported by the any Board's resolution/
Articles of Association of the complainant company.
The learned counsel has also submitted that the letter of
authorization was never produced along with the
complaint petition, but was sought to be introduced by
filing a petition for recall of the witness (P.W-1) in both the
cases under Section 311 of Cr.P.C and such petition in both
the cases were rejected vide separate orders both dated
05.04.2008. These two orders were challenged in Criminal
Revision No. 61 of 2008 and Criminal Revision No. 62 of
2008 before the learned Judicial Commissioner, Ranchi
which was allowed vide common order dated 13.08.2008
by observing that the complainant shall produce the
witness (P.W-1) to prove the authorization letter dated
03.01.2005 within the earliest opportunity provided to him
by the learned trial court and the complainant shall be
restricted to examine the said witness only to the extent of
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
point of authorization letter marked as Exhibit 6 (with
objection) and it reflects that the P.W-1 had no knowledge
of the transactions involved in the case.
Admittedly the authorization letter was not exhibited in
Complaint Case No. 86/2006 in spite of several
opportunities granted to the complainant company but the
same was simply filed in the case.
He has also submitted that so far as Criminal Revision No.
833 of 2012 is concerned, this point is sufficient to dispose
of the matter as the Complaint Case No. 86/2006 was filed
without any authorization of the complainant company in
favour of the P.W-1 to file the case as the so-called
authorization letter was not brought on record in
Complaint Case No. 86/2006.
(b) In the present cases, the hire purchase agreement was with
the partnership firm in which the accused was a partner
and had signed the agreement in the capacity of the
partner of the firm and upon settlement of dues with the
partnership firm, the cheque was issued in discharge of
the dues vide cheques involved in the two cases under the
signature of the accused though the cheques were issued
from the account of the partnership firm and the accused
had signed the cheques as a partner.
He submits that the partnership firm was not made
accused in the case. In the complaint petitions, the accused
was described as the partner of the partnership firm and
even the legal notice was sent in the name of the accused
describing him as the partner of the partnership firm. The
learned counsel has referred to Section 141 of the
Negotiable Instruments Act, 1881 and the judgement
passed by the Hon'ble Supreme Court reported in (2014)
10 SCC 373 [Anil Gupta versus Star India (P) Ltd.] to
submit that the petitioner could not have been convicted
as the partnership firm was not made co-accused in the
complaint cases.
8. The learned counsel submits that the aforesaid two legal
points were not considered by the learned courts below and
accordingly the impugned judgements in both the cases are
perverse and fit to be set-aside in revisional jurisdiction to
meet the ends of justice.
Arguments of the Opposite Party -Complainant company and
State
9. The learned counsel for the opposite party no. 2 submits that
so far as the authorization letter is concerned, the same was
duly exhibited in Complaint Case No. 87/2006 as Exhibit -6
and the learned courts below after scrutinizing 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 also relied upon the judgement
passed in the case reported (2015) 1 SCC 527 (Vinita S. Rao
versus Essen Corporate services Private Limited and
another) (supra) and submits that the letter of authority to file
a case on behalf of the company can be filed at any stage and
it is not necessary to be accompanied at the stage of filing of
the complaint itself.
12. So far as the other point regarding omission to make the
partnership firm as accused is concerned, the learned counsel
submits that the point that the partnership firm has not been
made accused in the complaint cases were raised by the
accused for the first time before this Court and the same may
not be entertained at this stage. However, during the course
of arguments, it has not been disputed that the cheques were
issued under the signature of the accused in the capacity of
the partner of the partnership firm with its seal. It is
submitted that neither the partnership deed nor the hire-
purchase agreements have been exhibited from the side of the
defence to take a plea that the hire purchase agreements were
entered with partnership firms and not with the accused. He
submits that such point is devoid of any merits and fit to be
rejected under the facts and circumstances of the two cases.
13. The learned counsels appearing for the State have supported
the arguments of the opposite party -complainant.
Findings of this Court
14. Upon considering the arguments of the parties, this Court
finds that following two questions arise for consideration by
this Court: -
Criminal Revision No. 833/2012
(a) Whether the letter of authorization to file the
complaint case, which was exhibited as exhibit-6 (with
objection) in Complaint Case No. 87/2006, could have
been considered in Complaint Case No. 86/2006 to hold
that P.W-1 was duly authorized to file the complaint
case, merely because the cases were between the same
parties?
If the answer is in negative, what is the consequence?
Criminal Revision No. 830/2012
Whether P.W-1 could have been held to be duly
authorized by the complainant company to file
Complaint Case No. 87/2006 when the authorization
letter to file the case was neither issued by a Resolution
of the Board of Directors of the company nor by virtue of
Articles of Association of the company and the letter of
authorization was issued by the Zonal Manager of the
Company in favour of the P.W-1(field 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/-. Against the said payment of balance amount, the
accused issued a cheque bearing Cheque No. 969458 dated
14.12.2005 for Rs. 7,19,739/- drawn on Punjab and Sindh
Bank, Ranchi in favour of the complainant. The accused has
also put his signature on the said 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 accused, 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.
7,19,739/- and accordingly, the complainant filed the
complaint case.
16. In Cr. Revision No. 833 of 2012 also similar case has been
made out in relation to another hire purchase agreement of
the same date with respect to another vehicle. The case of the
complainant-Ashok Leyland Finance, in brief, was that the
complainant company deals 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-2102 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.
7,15,164/-. Against the said payment of balance amount, the
accused issued a cheque bearing Cheque No. 969457 dated
14.12.2005 for Rs. 7,15,164/- drawn on Punjab and Sindh
Bank, Ranchi in favour of the complainant. The accused has
also put his signature on the said 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 the
complainant company. It is not in dispute that the so called
authorization letter dated 03.01.2005 was not filed along with
the complaint petitions and the same was sought to be
brought on record by recalling P.W-1 under Section 311 of
Cr.P.C. and the said petition was initially rejected by the
learned trial court in both the cases and two separate
criminal revisions were filed before the learned Judicial
Commissioner, Ranchi against the order rejecting the
petitions filed under Section 311 Cr.P.C which were allowed
giving liberty to the complainant to produce P.W-1 in both
the cases to bring on record the letter of authorization to file
the cases on behalf of the complainant company.
18. Admittedly, the opportunity was availed by the complainant
company in Complaint Case No. 87/2006 and the P.W-1
appeared and deposed and exhibited the letter of
authorization issued in his favour by the Regional Manager
of the complainant company which was marked as Exhibit-6
(with objection) and the said witness was also thoroughly
cross examined by the defence.
19. So far as the Complaint Case No. 86/2006 is concerned , the
opportunity to produce the witness on recall under Section
311 Cr.P.C. was not availed by the complainant company in
spite of the liberty granted by the learned Judicial
Commissioner, Ranchi and accordingly, no letter to
authorization was exhibited in the records of Complaint Case
No. 86/2006. However, the letter of authorization was simply
filed in the records of Complaint Case No. 86/2006.
20. The point regarding the letter of authorization in Complaint
Case No. 86/2006 was dealt with by the learned trial court as
follows: -
"17. In the case on hand, the power-of-attorney who
was examined as P.W.- 1 is none other than the field officer of
the complainant company who instituted this case. The
complainant is this case did not produce any document on
record at the initial stage to establish that the P.W. - 1 was an
authorised agent to institute this case. The complainant
preferred an application seeking permission of the court to
produce document on record at a belated stage to show his
competence to institute this case on behalf of the company, the
application was rejected vide order dated 5.04.2008, however
Ld. Judicial Commissioner vide order dated 13.08.2008
permitted the complainant to place on record the authorisation
letter dated 3.01.2005 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 of the company. Subsequently at belated stage, an
authority letter has been filed before the Court to disclose the
fact that the complainant was authorized to represent the case.
After considering all the facts and circumstances above
discussed and on the basis of settled law as decided by the apex
court in several judgments that valid document can be filed at
any stage of trial proceedings. Under this background, I find
and hold that contention of the defence that the case of the
prosecution is liable to fail at this ground is not tenable under
law."
21.So far as appellate court is concerned, the said plea of
absence of letter of authorization was rejected in the
following manner: -
"...........I also find that the respondent / complainant has also
produced the letter of authority to institute the case on behalf of the
respondent / Complainant Company though it has been produced
before the court at belated stage but it cannot be ground to disbelieve
the case or wash out the entire case of the respondent / complainant.
There are catena of cases of Hon'ble Apex Court in this matter. The
Hon'ble Apex Court has held in a case of M.M.T.C. Ltd. and
Another versus Medehi Chemicals and Pharma (P) Ltd. and Another
reported in 2002 Cri.L.J. 266 that "Even if the complaint is signed
and presented by a person, who is neither authorized as an agent, nor
a person empowered under the Articles of Association or by any
resolution of the Board to do so will not be ground to quash the
complaint. It is open to the de-jure complainant to seek permission of
the court for sending any other person to represent the company in
the court. Thus, even presuming, that initially there was no
authority, still the company can at any stage rectify that defect."
In view of the said decision, I find that complaint petition cannot be
dismissed merely on this ground alone...................."
22.Both the counsels have relied upon the judgement passed by
the Hon'ble Supreme Court reported in (2015) 1 SCC 527
(supra). The Hon'ble Supreme Court in the aforesaid
judgement has relied upon the earlier judgement passed in
the case reported in (2014) 11 SCC 790 (A.C. Narayanan
versus State of Maharashtra) and ultimately held in para 17
of the report that a complaint under Section 138 of the
Negotiable Instruments Act, 1881 can be filed through the
power of attorney holder and the power of attorney must
have knowledge 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 company in Complaint Case No. 86/2006 could
not be rectified by referring to the authorization letter
exhibited in the Complaint Case No. 87/2006 upon recall of
P.W-1 in Complaint Case No. 87/2006 which was marked as
Exhibit -6, that too, with objection. Subsequent filing of the
authorization letter in the records of Complaint Case No.
86/2006 also does not serve any purpose as the P.W-1 was
required to depose and duly exhibit the authorization letter
and also demonstrate that he had knowledge about the
transactions involved in the Complaint Case No. 86/2006
and was also required to be cross examined on the point of
authorization letter as well as on the point of his knowledge
about the transactions involved in the Complaint Case No.
86/2006. This Court also finds that no finding as such has
been recorded in the judgements of learned courts below
arising out of Complaint Case No. 87/2006 that the P.W-1
had authorization to file both the complaint cases and that he
had knowledge about the transactions involved in both the
Complaint Cases.
25.Accordingly, the finding of the learned trial court in
Complaint Case No. 86/2006 that P.W-1 was authorized to
file the complaint case on behalf of the complainant
company by referring to the authorization letter exhibited
and marked as Exhibit -6 (with objection) in the records of
Complaint Case No. 87/2006, cannot be sustained in the eyes
of law and the trial court judgement suffers from perversity
on this point.
26.So far as the appellate court is concerned, it has been held
that the authorization letter has been filed in the records of
Complaint Case No. 86/2006, but it failed to consider that
the same has not been exhibited and brought on record as
the complainant did not produce the P.W-1 on recall in
Complaint Case No. 86/2006 in spite of aforesaid
opportunity granted by the learned Judicial Commissioner,
Ranchi and the accused did not have any opportunity to
cross examine P.W-1 on the point of authorization to
represent the complainant company. This lacunae could not
be filled up by referring to the authorization letter simply
filed in the record of Complaint Case No. 86/2006.
Accordingly, the appellate court's judgement also cannot be
sustained in the eyes of law as the same suffers from
perversity on this point.
27.As a cumulative effect of the aforesaid findings, the
Complaint Case No. 86/2006 filed by P.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 Regional Manager of the complainant
company in favour of the field officer (P.W-1), the same by
itself is not fatal to the prosecution case. There may be
various delegations within the company to perform its
various functions from time to time, which is essentially a
matter of evidence. The finding of the learned courts below
on the point of authorization of P.W-1 is certainly based on
appreciation of material evidence on record. This Court is of
the considered view that the impugned judgements do not
suffer from any illegality or perversity on the point of
authorization of P.W-1 to file the complaint case calling for
any interference in revisional jurisdiction.
29.Accordingly, the issue of authorization to file the
Complaint Case No. 87/2006 which is subject matter of Cr.
Revision No. 830 of 2012, is decided against the petitioner
and in favour of the opposite party no. 2.
Issue no. (b) - On the point of non - impleading of the partnership
firm as accused in the complaint case
30. It is relevant to note that in both the complaint cases, the
accused has been described as "Binay Prasad, son of not
known, Partner of Mehta Transport Co, Shashtri Chowk , P.O and
P.S. Bhurkunda, District-Hazaribagh". Thus, the complaint
cases have been filed against the accused describing him as
the partner of the said partnership firm.
31.Admittedly, the partnership firm was not made an accused
in both the cases. The complaint cases were filed for offence
under Section 138 of the Negotiable Instruments Act, 1881 as
well as under Section 420 of Indian Penal Code.
32.Upon perusal of the complaint petitions as well as the
impugned judgements involved in both the cases, it is not in
dispute that it was specifically stated that the loan was
extended to the partnership firm for purchase of two
different vehicles involved in the two cases and the accused
had put his signature on the hire purchase agreements
involved in the respective cases as a partner of the
partnership firm namely, Mehta Transport Co. Thus, the
underlying transaction was with the partnership firm and
the accused was the partner of the firm.
33.It has been also alleged in the complaint petitions that upon
negotiation, the claim of the complainant company was
settled and accordingly, in discharge of the liability in
connection with each of the vehicles arising out of hire
purchase agreements, the two cheques were 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 with regards to purchase of two different
vehicles involved in each case. The aforesaid fact situation is
identical with respect to both the cases.
35.It is apparent from the impugned judgements that the point
that the cheque was issued by the partnership firm, though
under the signature of the accused was not the point of
contest before the learned court below from the side of the
accused, but the fact remains that it was the specific case of
the complainant company that the hire purchase agreement
as well as the dues were against the partnership firm and the
accused had handed over signed cheques to clear the dues of
the partnership firm and the case of the complainant was
that the cheques were issued against legally payable debt of
the partnership firm. In view of the specific case of the
complainant in both the cases, non-production of the hire
purchase agreements or the partnership deed before the
learned court below has no bearing in the matter.
36.This Court finds that the learned appellate court in both the
cases held that the complainant has been able to prove that
the accused had taken loan of Rs.12 lakhs for purchase of
vehicle on hire purchase, but the accused did not fulfill the
terms and conditions of the agreement and after payment of
some installments, he left to pay the balance amount of loan
and after several requests or by settlement, the accused
issued the cheque in favour of the complainant.
This Court is of the considered view that the aforesaid
finding recorded by the learned appellate court in both the
cases is ex-facie perverse as it was never the case of the
complainant company that-
- the accused had taken loan of Rs.12 lakhs for purchase of
vehicle on hire purchase
- the accused did not fulfill the terms and conditions of the
agreement
-after payment of some installment, he left to pay the
balance amount of loan,
Rather the specific case of the complainant company in both
the cases was that-
- the partnership firm, in which the accused was a partner
had taken loan of Rs.12 lakhs for purchase of vehicle on hire
purchase
- the partnership firm, in which the accused was a partner
did not fulfill the terms and conditions of the agreement
-after payment of some installment, the partnership firm, in
which the accused was a partner, left to pay the balance
amount of loan.
37. The aforesaid findings of the learned appellate 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 Instruments Act, 1881 and the judicial
pronouncement by the Hon'ble Supreme Court.
39. This Court is of the considered view that aforesaid legal
infirmities in the impugned judgements are required to be
considered with all legal consequences in the revisional
jurisdiction of this Court to prevent the failure of justice. This
Court is also conscious of the fact that the law in this regard
with respect of interpretation of the Section 141 of the
Negotiable Instruments Act, 1881 dealing with vicarious
liability in case of the company/partnership has been
crystalized by the Hon'ble Supreme Court in the judgements
passed after passing of the impugned judgements in both the
cases.
40.In the case of Aneeta Hada v. Godfather Travels & Tours (P)
Ltd., reported in (2012) 5 SCC 661, it has been held while
interpreting Section 138 and 141 of the Negotiable
Instruments Act, 1881 at para, 22, 24, 39, 51 and 59 as under:
"22. On a reading of the said provision, it is plain as day that if
a person who commits the offence under Section 138 of the Act
is a company, the company as well as every person in charge of
and responsible to the company for the conduct of business of
the company at the time of commission of offence is deemed to be
guilty of the offence. The first proviso carves out under what
circumstances the criminal liability would not be fastened. Sub-
section (2) enlarges the criminal liability by incorporating the
concepts of connivance, negligence and consent that engulfs
many categories of officers. It is worth noting that in both the
provisions, there is a "deemed" concept of criminal liability.
24. Section 141 uses the term "person" and refers it to a
company. There is no trace of doubt that the company is a
juristic person. The concept of corporate criminal liability is
attracted to a corporation and company and it is so luminescent
from the language employed under Section 141 of the Act. It is
apposite to note that the present enactment is one where the
company itself and certain categories of officers in certain
circumstances are deemed to be guilty of the offence.
39. The word "deemed" used in Section 141 of the Act applies
to the company and the persons responsible for the acts of the
company. It crystallises the corporate criminal liability and
vicarious liability of a person who is in charge of the company.
What averments should be required to 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. The other categories of offenders can only be
brought in the drag-net on the touchstone of vicarious liability
as the same has been stipulated in the provision itself. We say so
on the basis of the ratio laid down in C.V. Parekh which is a
three-Judge Bench decision. Thus, the view expressed in
Sheoratan Agarwal does not correctly lay down the law and,
accordingly, is hereby overruled. The decision in Anil Hada is
overruled with the qualifier as stated in para 51. The decision in
Modi Distillery has to be treated to be restricted to its own facts
as has been explained by us hereinabove."
41.This judgment has been followed in the case of Anil Gupta
Vs. Star India Private Limited and Another reported in
(2014) 10 SCC 373 wherein at para 8 and 9 it has been held
that from Section 138 of the Act it is clear that only the
drawer of the cheque falls within the ambit of Section 138 of
the Act whether human being or a body corporate or even a
firm. The guilt for offence under Section 138 will be deemed
to be upon other persons connected with the Company in
view of Section 141 of the Act. In the said judgment
following the judgement of Aneeta Hada (supra), the part of
the impugned judgment whereby the High Court held that
the proceedings against the appellant Managing Director can
be continued even in absence of the Company, was set aside.
42.In the case decided by Hon'ble Supreme Court, G Ramesh
Vs. Kanike Harish Kumar Ujwal and Anr. in Criminal
Appeal No.603 of 2019, it has been held in para 10, 11 and 12
as under:
"10. In terms of the explanation to Section 141, the expression
"company" has been defined to mean anybody corporate and to
include a firm or other association of individuals. Sub-section
(1) of Section 141 postulates that where an offence is committed
under Section 138 by a company, the company as well as every
person who, at the time when the offence was committed, was in
charge of and was responsible to the company for the conduct of
the business shall be deemed to be guilty of the offence.
11. In determining as to whether the requirements of the above
provision have been fulfilled, it is necessary to bear in mind the
principle of law that a partnership is a compendious expression
to denote the partners who comprise of the firm. By the deeming
fiction in Explanation (a) the expression company is defined to
include a firm."
43.In the case of 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 appellant had signed the cheque as a Director
of the company and for and on its behalf. Moreover, in the
absence of a notice of demand being served on the company and
without compliance with the proviso to Section 138, the High
Court was in error in holding that the company could now be
arraigned as an accused."
44. It is an admitted case on record that the cheques in both
the complaint cases were issued under the signature of the
accused, in the capacity of the partner of the partnership firm
namely Mehta Transport Company i.e. for and on behalf of
the said partnership firm; the Legal Notices in connection
with the bouncing of cheques were also issued in the name
of the accused being the partner of the said firm; the
complaint case was also filed against the accused being the
partner of the said firm.
45.It is also an admitted fact on record that the specific case of
the complainant in both the cases was that the accused being
partner of Mehta Transport Company and on behalf of the
partnership firm entered into hire purchase agreement for
purchase of vehicle and the loan was to the extent of Rs.
12,00,000/- was extended to the partnership firm. In
discharge of the said debt, the accused handed over two
cheques in favour of the complainant which had bounced on
account of 'insufficient fund'. The cheques were issued from
the account of the said partnership firm and the petitioner
had signed the cheques as a partner.
46.It is also not in dispute that the partnership firm has not been
made accused in both the complaint cases and cognizance of
the offence was taken only under Section 138 of the
Negotiable Instruments Act, 1881.
47.In view of the aforesaid judgements passed by the Hon'ble
Supreme Court, in the absence of the partnership firm being
arraigned as an accused, both the complaint petitions against
the petitioner (partner of the firm) for offence under Section
138 of the Negotiable Instruments Act, 1881 were not
maintainable. No bar or impediment, legal or otherwise, has
been reflected from the records of the two cases in making
the partnership firm as an accused in the complaint cases
and accordingly the doctrine of lex non cogit ad impossibilia is
not attracted. The petitioner had signed the cheque in both
the cases as a partner of the partnership firm, for and on its
behalf.
48. In the aforesaid view of the matter, the issue no. (b) is
decided 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 directed to send back the lower court records to
the concerned court.
54.Let this order be communicated to the learned court below
through 'FAX/E-mail'.
(Anubha Rawat Choudhary, J.)
Saurav/Mukul
