IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.P.BALACHANDRAN TUESDAY, THE 26TH FEBRUARY 2008 / 7TH PHALGUNA 1929 CRL.A.No. 238 of 2001 ------------------------------------- CC.1532/1997 of JUDL.MAGISTRATE OF FIRST CLASS-III, KOTTAYAM .................... APPELLANT/COMPLAINANT: T.O.PHILIP, EXECUTIVE DIRECTOR, K.P.B.ADVERTISING PVT. LTD., KOTTAYAM. BY ADV. SRI.MATHEW JOHN (K) SRI.BABY THOMAS RESPONDENTS/ACCUSED: 1. B.JAYAKUMARI, REVATHI, OPP: KARAPPUZHA GOVT. H.S., KARAPPUZHA, KOTTAYAM. 2. SANKARAN NAMBOOTHIRI, DO. DO. THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 26/02/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.P. Balachandran, J. --------------------------- Crl.A.No. 238 of 2001 --------------------------- JUDGMENT This is an appeal filed with leave challenging the acquittal of the first respondent under Section 255(1) Cr.P.C. of offence punishable under Section 138 of the Negotiable Instruments Act in a complaint filed by the appellant as C.C.No.1532/97 on the file of the Judicial First Class Magistrate's Court-III, Kottayam. 2. The complaint was filed in the court below by the appellant alleging, inter alia, that he is the Executive Director of K.P.B. Advertising (P) Limited, engaged in the business of advertising; that the respondents are the Managing Directors of Sanco Aryaoushadha Laboratories (P) Limited, which is an Ayurvedic medicine manufacturing company; that an amount of Rs.4,59,238/- was due to the appellant from the respondents towards advertising charges of Sanco Aryaoushadha Laboratories (P) Limited, broad casted in All India Radio, CRA 238/01 2 Thiruvananthapuram through the appellant; that by way of part payment of the charges, the accused (respondents 1 and 2) issued Exhibit P3 cheque drawn on the State Bank of India, Kottayam Branch for an amount of Rs.1,73,356/-, making the appellant to believe that sufficient cash will be arranged in the Bank by the month of January 1996; that on forwarding of the cheque for collection through Kottayam Branch of State Bank of Travancore, the said cheque was returned dishonoured by the drawee Bank under Exhibit P6 memorandum dated 18.1.1996 assigning the reason “payment stopped by drawer”; that the bankers of the appellant forwarded Exhibit P3 cheque along with Exhibit P6 memorandum to the appellant along with Exhibit P7 covering letter dated 19.1.1996; that consequent thereon, on 22.1.1996, the original of Exhibit P8 notice was issued through Lawyer to the respondents, intimating them of the fact of dishonour of the cheque and demanding payment of the amounts covered by the cheque; that the notices CRA 238/01 3 so issued were received by the respondents respectively on 24.1.1996 and 25.1.1996 under Exhibit P9 postal acknowledgment card, but they have not cared to make payment of the amounts due under the cheque either within the statutory period or ever thereafter and thus, they have committed an offence punishable under Section 138 of the Negotiable Instruments Act. 3. On appearance of the first respondent/first accused in the court below, pursuant to receipt of summons, she was served with copies of all relevant records in the case and was questioned by the learned Magistrate, reading over the particulars of the offence and explaining it to her. Thereupon, she pleaded not guilty and consequently, a trial of the case was conducted against her, splitting up and re-filing the case as against the second respondent/second accused as C.C.No.125/01, as he was absconding. 4. On the side of the complainant, he has tendered evidence as PW1 and got marked Exhibits P1 CRA 238/01 4 to P11. On the complainant closing his evidence, the first respondent was questioned under Section 313 Cr.P.C. Thereupon, she generally denied all incriminating circumstances appearing in evidence against her and maintained that she is innocent. According to her, she was not the Managing Director of Sanco Aryaoushadha Laboratories (P) Limited; that it is incorrect to say that under Exhibit P2, authority was given to K.P.B. Advertising (P) Limited to make advertisements in the Radio on their behalf and that it is incorrect to say that towards part payment of the amounts due to the appellant Exhibit P3 cheque was issued by her signing in the cheque. She has also stated that she has not received the notice. According to her, she is not the Managing Director of the Company; that however, the Company owes no amount to the appellant; that Exhibit P3 cheque is not the one issued by the Company; that she is only a member of the Director Board and that all responsibilities in the matter of running of the Company are vested CRA 238/01 5 with the second respondent/second accused, who was in charge and in management of the affairs of the Company. On the defence side Exhibit D1 Articles of Association of M/s.Sanco Aryaoushadha Laboratories (P) Limited is produced. 5. The learned Magistrate considered the case in the light of the evidence so adduced; found that Exhibit P3 cheque is issued by the first respondent in discharge of the liability of Sanco Aryaoushadha Laboratories (P) Limited to K.P.B. Advertising (P) Limited, but that, however, PW1 has not been proved to be a competent person to represent the appellant Company and that the complaint is, therefore, not proper and is not maintainable and consequently, acquitted the first respondent, splitting up and re-filing the case as against the second accused as C.C.No.125/01. It is, as if both the respondents are acquitted, that this appeal is filed as against both of them by the aggrieved appellant. Apart from submitting that the appellant is competent to file the complaint; that the cheque is signed by the CRA 238/01 6 first respondent and the first respondent is liable to be convicted for offence under Section 138 of the Negotiable Instruments Act, as the cheque is issued by her as has been found by the court below, the learned counsel did not advance any other argument in the matter, on the merits of the case. 6. It is worthy to note that in the complaint Sanco Aryaoushadha Laboratories (P) Ltd. is not impleaded as an accused and therefore, it cannot be said that there is proper impleadment of the accused as envisaged under Section 141 of the Negotiable Instrument Act. On the case of the appellant amount is due from the Company and Exhibit P3 cheque was being issued for and on behalf of the Company Sanco Aryaoushadha Laboratories (P) Ltd. Hence, obviously, it is a case where, on dishonour of the cheque and on satisfying the other pre-requisites for the maintainability of a complaint under Section 138 of the Negotiable Instruments Act, the person, who has committed the offence, viz. the Company, is CRA 238/01 7 proceeded against. Section 141 provides that if the person committing an offence under Section 138 of the Negotiable Instruments Act is a Company, 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 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 accordingly. In the instant case, the Company is not made an accused. So, it cannot be said that the case is one, which is framed as envisaged under Section 141 of the Negotiable Instruments Act. Further, there is no evidence adduced on the side of the appellant that the first respondent was responsible to the Company for the conduct of the business of the Company, so as to hold her liable under the deeming provisions of Section 141 of the Negotiable instruments Act. She is also not shown to be the Managing Director of the Company. CRA 238/01 8 7. In evidence, PW1 has stated that Exhibit P2 is the cheque signed by the first respondent. In cross-examination, he has deposed that Sanco Aryaoushadha Laboratories (P) Limited was being run by the second respondent Sankaran Namboothiri (A2) and his wife, the first respondent Jayakumari (A1). He has further added that he has seen both the respondents in the business premises. He further stated that the cheque was being delivered at the office of the complainant by Sankaran Namboothiri (A2) and that he has not seen signature being affixed in Exhibit P3 cheque. He has also stated that he has not seen any record, which bears the signature of the first respondent Jayakumari. Thus, there is, absolutely, no proof regarding execution of Exhibit P3 by the first respondent Jayakumari. She has also denied that she was the one, who signed in Exhibit P3 cheque. According to her, she is not the Managing Director of the Company and the Managing Director is her husband Sankaran Namboothiri, who is the second respondent in the CRA 238/01 9 appeal and the absconding second accused in the court below. In the complaint filed in the court below, the appellant has no case that Exhibit P3 cheque was being dishonoured for want of sufficient funds in the account of the Company, of which, according to him, respondents 1 and 2 are the Managing Directors. When there is no sufficient proof regarding execution of Exhibit P3 cheque and there is not even an allegation in the complaint that Exhibit P3 cheque was being dishonoured for want of sufficient funds in the account of the Company, of which, the respondents are the Managing Directors and also in the absence of evidence that the first respondent was in charge of and was responsible to the Company for the conduct of business of the Company and further, when the Company itself is not impleaded as an accused in the case, it cannot be found that the first respondent has committed an offence punishable under Section 138 of the Negotiable Instruments Act. CRA 238/01 10 8. For all the above reasons, I can only concur with the finding of the court below that the offence under Section 138 of the Negotiable Instruments Act does not stand proved against the first respondent. Consequently, therefore, the complaint filed in the court below was not maintainable and the first respondent was rightly being acquitted by the court below. Thus, there is no merit in this appeal filed against the acquittal of the first respondent. In the result, I dismiss this appeal. 26th February, 2008 (K.P.Balachandran, Judge) tkv CRA 238/01 11 K.P.Balachandran, J. --------------------- Crl.A.No.238 of 2001 --------------------- JUDGMENT 26th February, 2008