Telangana High Court
M/S Paras Collins Distilleries ... vs The State Of Andhra Pradesh, on 8 September, 2022
Bench: K.Surender
HIGH COURT FOR THE STATE OF TELANGANA
AT HYDERABAD
*****
Criminal Petition No.9368 OF 2013
Between:
M/s.Paras Collin's Distilleries Pvt. Ltd.,
Rep. by its Managing Director and others. ... Petitioners
And
The State of A.P, rep. by its Public Prosecutor
and another. ... Respondents
DATE OF JUDGMENT PRONOUNCED: 08.09.2022
Submitted for approval.
THE HON'BLE SRI JUSTICE K.SURENDER
1 Whether Reporters of Local
newspapers may be allowed to Yes/No
see the Judgments?
2 Whether the copies of judgment
may be marked to Law Yes/No
Reporters/Journals
3 Whether Their
Ladyship/Lordship wish to see Yes/No
the fair copy of the Judgment?
_________________
K.SURENDER, J
2
* THE HON'BLE SRI JUSTICE K.SURENDER
+ CRL.P. No.9368 of 2013
% Dated 08.09.2022
# M/s.Paras Collin's Distilleries Pvt. Ltd.,
Rep. by its Managing Director and others. ... Petitioners
And
$ The State of A.P, rep. by its Public Prosecutor
and another. ..Respondents
! Counsel for the Petitioners: Sri V.Pattabhi.
^ Counsel for the Respondents: Public Prosecutor for R1
Sri M.Vijay for R-2
>HEAD NOTE:
? Cases referred
1
2015 (1) ALT (CRI.) (A.P) 36 (S.B)
2 (2002) 1 Supreme Court Cases 234
3
THE HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL PETITION No.9368 OF 2013
ORDER:
1. This petition is filed to quash the proceedings against these
petitioners/A1 and A2 in CC No.206 of 2015 on the file of the III
Special Magistrate Court, Erramanzil. The petitioners are being
prosecuted by the 2nd respondent for the offence under Section
138 of the Negotiable Instruments Act.
2. The case of the 2nd respondent is that an amount of
Rs.75,00,000/- was given to the accused/petitioners as loan and
towards repayment the petitioners issued a cheque bearing
No.180902 for Rs.75.00 lakhs. The said cheque was returned
unpaid for the reason of 'payment stopped by the drawer'.
Aggrieved by the return of the cheque, a notice was issued. Since
the payment covered by the cheque was not paid within the
statutory period, after issuing legal notice, the complainant filed
the present case.
4. Learned counsel for the petitioners submits that the
respondent/complainant is prosecuting the case in his
individual capacity. Even according to the complaint, the amount
was given from the account of M/s.I.K. Distilleries Private
Limited and the cheque was issued in favour of M/s. I.K.
Distilleries Private Limited. Prosecuting the petitioners by the
complainant in his individual capacity is contrary to the
provisions under Section 138 of the Negotiable Instruments Act.
As per Section 138 of the N.I.Act, only the payee or holder-in-due
course is authorized to file a complaint and the petitioners are
neither payee, as seen from the cheque, nor the holders-in-due
course. Further, the complainant has failed to file any
authorization which was issued in his favour by M/s.I.K.
Distilleries Private Limited to prosecute the said case. The
cognizance taken by the learned Magistrate is bad in law in view
of the bar under Section 142 of the N.I.Act, which prohibits
taking cognizance of an offence unless there is authorization
given on behalf of the complainant. In support of his contention,
he relied on the judgment of this Court reported in the case of
Duncan Industries Limited v. T.G.Srinivas1. In the said
judgment, it was held that since the power of attorney holder
was neither party to the transaction or witness and further no
2015 (1) ALT (CRI.) (A.P) 36 (S.B)
material was placed to show that the authorization given in
favour of P.W.1 was valid, in the said circumstances, the appeal
against acquittal was dismissed.
5. It is not in dispute that the amount was paid through
account of M/s.I.K. Distilleries Private Limited to the 2nd
respondent. The cheque was also issued in favour of M/s.I.K.
Distilleries Private Limited. The company is a legal entity and
any prosecution before a Court shall be by a person duly
authorized by the said company.
6. In the cause title, 2nd respondent has described himself as
the Director of M/s.I.K. Distilleries Private Limited. However, as
seen from the documents appended to the complaint, no
authorization of M/s.I.K. Distilleries Private Limited is filed.
7. The subject cheque was issued in favour of M/s.I.K.
Distilleries Private Limited and admittedly, the complainant is
one of the Directors of M/s.I.K. Distilleries Private Limited.
8. The Hon'ble Supreme Court in the Judgment of M.M.
T.C.Limited and another v. Medchl Chemicals and Pharma (P)
Limited2, held that though initially there was no authority to
represent the company still a company can at any stage rectify
the defect. A company at subsequent stage can send a person
who is competent to represent the company. The Hon'ble
Supreme Court at para 12 of the Judgment held as follows:
"12.... It has been held that it is open to the de jure complainant
company 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. At a subsequent
stage the company can send a person who is competent to
represent the company. The complaints could thus not have
been quashed on this ground."
8. In the said circumstances, when the complainant described
himself as the director of the company and though no
authorization was initially filed, in view of the dictum of the
Hon'ble Supreme Court in M.M.T.C's case, the grounds raised
by the petitioner/accused are not tenable.
9. Accordingly, the Criminal Petition is dismissed.
_________________
K.SURENDER, J
Date:08.09.2022
Note: LR copy to be marked. B/o.kvs
(2002) 1 Supreme Court Cases 234
THE HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL PETITION No.9368 of 2013
Dated:08.09.2022
kvs
