THE HON’BLE SRI JUSTICE K.C.BHANU CRIMINAL APPEAL No. 1085 of 2003 JUDGMENT: 1. This Criminal Appeal is filed by the appellant/complainant challenging the judgment dated 01.06.2001 in C.C. No.924 of 1997 on the file of the IV Metropolitan Magistrate, Hyderabad, whereunder and whereby the respondents 1 and 2/A.1 and A.2 were found not guilty of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the Act’) and accordingly acquitted. 2. The brief facts that are necessary for disposal of the present cases may be stated as follows. T h e c o m p l a i n c e m e T h e a c c u s e d a s u p b a s F o r t h e s u p p m a i A s p e r t h e s t a t e m e n t o f a c c o u n t , a c c I n p a r t i a l d i s c h a r g e o f t h e o u a n d d a t e d 2 5 . 5 . 1 9 9 3 0 . 7 . 1 9 9 7 r e s p e c t i v e l y , f o r R s . e a c O n p r e s e n t e n d c o m p T h e c o m p l a i n a n t g o t i s s u e d t h e s t 2 0 T h e r e a f t e r a H e n c e , t h 3. When the accused were examined under Section 251 Cr.P.C. for the offence punishable under Section 138 of the Act, they pleaded not guilty and claimed to be tried. 4. To substantiate its case, P.W. 1 was examined and xs.P1 to P8 were marked on behalf of the complainant. On behalf of accused, no oral or documentary evidence was adduced. 5. The trial Court, after consideration of the evidence on record, came to conclusion that P.W.1 was not properly authorized to represent the complainant company and accordingly acquitted the accused. Challenging the same, the present appeal is preferred by the complainant. 6. Now, the point for determination is whether the complainant proved its case beyond reasonable doubt for the offence punishable under Section 138 of the Act and whether the judgment of the trial court is correct, legal and proper ? 7 . T h e l e a r n r e E x t h p e f H e n c e , h e p r a y s t o s e t a s 8 . O n t h e o t h f D i o n c o n t h H e n c e , h e p r a y s t o d i s m i s s t h 9. There cannot be any dispute that there is a presumption under law that the accused is presumed to be innocent unless contrary is proved. That presumption of innocence is further strengthened by an order of acquittal passed by the trial Court. In dealing with the appeals against acquittal, though this Court has full power to re-appreciate the evidence, at the same time, it would be slow in interfering with the order of acquittal because there is a presumption under law that accused is presumed to be innocent unless contrary is proved and that presumption is further strengthened by the order of acquittal. Unless there are substantial or compelling reasons, this Court will not ordinarily disturb the findings of the trial Court. If the trial Court has given any perverse finding, then it can be a ground to interfere with the order of acquittal. Similarly, if admissible evidence has not been taken into consideration or inadmissible evidence has been looked into for the purpose of arriving at a particular finding, then also it can be said to be a compelling reason to interfere with the same. 10. On this aspect, it is pertinent to refer to a decision in Harbans Singh & another v. The State of Punjab[1], wherein it is held as follows: (para 8) “The question as regards the correct principles to be applied by a Court hearing an appeal against acquittal of a person has engaged the attention of this Court from the very beginning. In many cases, especially the earlier ones, the Court has in laying down such principles emphasized the necessity of interference with an order of acquittal being based only on ‘compelling and substantial reasons’ and has expressed the view that unless such reasons are present in an Appeal, Court should not interfere with an order of acquittal (Vide Suraj Pal Singh v. The State, 1952 SCR 193: (AIR 1952 SC 52); Ajmer Singh v. State of Punjab, 1953 SCR 418: (AIR 1953 SC 459). The use of the words, ‘compelling reasons’ embarrassed some of the High Courts in exercising their jurisdiction in appeals against acquittals and difficulties occasionally arose as to what this Court had, meant by the words ‘compelling reasons’. In later years the Court has often avoided emphasis on ‘compelling reasons’ but nonetheless adhered to the view expressed earlier that before interfering in appeal with an order of acquittal a Court must examine not only questions of law and fact in all their aspects but must also closely and carefully examine the reasons which impelled the lower courts to acquit the accused and should interfere only if satisfied, after such examination that the conclusion reached by the lower court that the guilt of the person has not been proved is unreasonable.” 1 1 T h e f a c t c o m p T h e e v i d e n c e o f P . W . 1 c o u p l e d w i t h E x s a c c t o c r i s T h e r e f o r e , c h e e n e v t o w T h e r e i s n o o t h e r r e a s o n t o d o u B u t , o n t h e s o l e g r o u n d t h 12. The learned counsel for the appellant relied on a decision in M.M.T.C. Limited and another v. Medchal Chemicals and Pharma Private Limited & another [2] wherein it is held thus: “.. 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.” 13. The learned counsel for the appellant also placed reliance on a decision in M/s. Shankar Finance & Investments v. State of A.P. & others[3] wherein it is held thus: “As contrasted from a company incorporated under the Companies Act, 1956, which is a legal entity distinct from its shareholders, a proprietary concern is not a legal entity distinct from its proprietor. A proprietary concern is nothing but an individual trading under a trade name. In civil law where an individual carries on business in a name or style other than his own name, he cannot sue in the trading name but must sue in his own name, though others can sue him in the trading name. Therefore, if the appellant in this case had to file a civil suit, the proper description of plaintiff should be ‘Atmakuri Sankara Rao carrying on business under the name and style of M/s. Shankar Finance & Investments, a sole proprietary concern’. But, we are not dealing with a civil suit. We are dealing with a criminal complaint to which the special requirements of section 142 of the Act apply. Section 142 requires that the complainant should be payee. The payee is M/s. Shankar Finance & Investments. Therefore, in a criminal complaint relating to an offence under section 138 of the Act, it is permissible to lodge the complaint in the name of the proprietary concern itself.” 14. In another decision in National Small Industries Corporation Ltd. v. State (NCT of Delhi) & others[4] relied on by the learned counsel for the appellant, it is held thus: “.. A company can be represented by an employee or even by a non-employee authorized and empowered to represent the company either by a resolution or by a power of attorney.” 15. The learned counsel for the appellant also relied on a decision in Y.Venkata Reddy v. Jagadamba Enterprises, Hyderabad[5], wherein it is held thus: “Undoubtedly, as can be seen from the description of the complainant in the complaint, it is M/s. Jagadamba Enterprises, which is no doubt a proprietary concern and therefore is a juristic person. This being a body corporate, it shall have to necessarily be represented by a corporeal person.” From the above decisions, it is clear that when a juristic person is the complainant, there must be proper authorization. There is no dispute about the law laid down in the aforesaid decisions. 16. On the other hand, the learned counsel for the respondents/accused placed relied on a decision in M.G. Brothers Automobiles Ltd. v. B.Masthan Reddy & another[6], wherein it is held thus: “.. Thus, the accused in the instant case stands on much better footing than the accused concerned in the Eenadu, A Daily Newspaper’s case (supra) {2004(2) ALT (Cri.) 254 (AP)}. The learned Magistrate placed reliance on these two decisions of this Court and held that the conviction cannot be recorded against the accused as the Assistant Works Manager was not authorized to file the complaint on behalf of the complainant company.” It is a case where no authorization at all was filed. But, in the case on hand, Ex.P1 is the General Power of Attorney which was executed by one of the Directors of the complainant company. As seen from Ex.P1, it is clear that the Board of Directors passed resolution giving authorization to one of the Directors to nominate a person to prosecute the case on behalf of the complainant company. It is not the case of the accused that the company is not properly constituted under the Companies Act, 1956. It is not the case of the accused that no resolution was passed by the Board of Directors on 14.2.1998. Once a fact has been stated by a witness and the same has not been denied or disputed in cross-examination, it can be said that such a fact is admitted. On the simple ground that copy of the resolution dated 14.2.1998 was not produced, the accused were acquitted by the trial Court. 17. Section 50(2) of the Companies Act, 1956 reads thus: “A company having an official seal for use in any such territory, district or place may, by writing under its common seal, authorize any person appointed for the purpose in that territory, district or place to affix the official seal to any deed or other document to which the company is a party in that territory, district or place.” 18. Section 50(3) of the Companies Act, 1956 reads thus: “The authority of any agent authorized under sub-section (2) shall, as between the company and any person dealing with the agent, continue during the period, if any, mentioned in the instrument conferring the authority, or if no period is there mentioned, until notice of the revocation or determination of the agents authority has been given to the person dealing with them.” From the above provisions, P.W.1 is the authorized agent by one of the Directors of the complainant company. Therefore, the findings of the trial court are perverse on this aspect, and the acquittal recorded by the trial court is liable to be set aside and is accordingly set aside. The respondents 1 and 2/A.1 and A.2 are found guilty of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 and accordingly convicted therefor. 19. With regard to sentence, supply of cement was effected about 12 years back. More than a decade has been elapsed. At this stage, it is not desirable to send the accused to jail. Therefore, to meet the ends of justice, the accused can be directed to pay compensation. 20. In the result, the judgment dated 01.06.2001 in C.C. No.924 of 1997 on the file of the IV Metropolitan Magistrate, Hyderabad is set aside. The respondents 1 and 2/A.1 and A.2 are found guilty of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 and accordingly convicted and sentenced to pay twice the cheques amount viz. Rs.88,000/- (Rupees eighty eight thousand only) within six months from today, failing which A.2 shall undergo simple imprisonment for a period of three months. 21. The Criminal Appeal is, accordingly, allowed. --------------------- (K.C.Bhanu, J.) 17.12.2009 DRK THE HON’BLE SRI JUSTICE K.C.BHANU CRIMINAL APPEAL No. 1085 of 2003 Date: 17.12.2009 Between: M/s. Orient Cement, rep. by its Proprietor & another …Appellant/complainant And M/s. Pancharathna Agencies & Enterprises Rep. by its Managing Partner & others …Respondents THE HON’BLE SRI JUSTICE K.C.BHANU CRIMINAL APPEAL No. 1085 of 2009 17.12.2009 [1] AIR 1962 Supreme Court 439 [2] (2002) 1 SCC 234 [3] (2008) 8 SCC 536 [4] (2009) 1 SCC 407 [5] 2002(1) ALT (Cri.) 329 [6] 2006(1) ALD (Crl.) 180 (AP)