Criminal Appeal No. 340-DBA of 1994 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Criminal Appeal No. 340-DBA of 1994 Date of Decision : 17.12.2008 M/s Surindera Steel Rolling Mills, Mandi Gobindgarh, through its Manager, Sh. Ram Sarup. ...Appellant Versus 1. Sh. Sanjiv Kumar s/o Sh. Baij Nath, Prop. M/s Prompt Steel Division, Old Post Office Road, Mandi Gobindgarh, Distt. Patiala. 2. State of Punjab. ....Respondents CORAM: HON'BLE MR. JUSTICE SHAM SUNDER Present: Mr. Gaurav Chopra, Advocate, for the appellant. Mr. V.K. Jain, Sr. Advocate, with Mr. J.K. Bhatti, Advocate, and Mr. J.S. Toor, Advocate, for the respondent. * * * * SHAM SUNDER, J. This appeal, is directed against the judgement of acquittal dated 13.08.1993, rendered by the Court of Sub Divisional Judicial Magistrate, Amloh, vide which, it acquitted Sanjiv Kumar, accused, of the offence, punishable under Section 138 of Negotiable Instruments Act, 1881 (Amended upto date) – (hereinafter to be called as the 'Act' only). 2. A criminal complaint, under Section 138 of the Act, was filed by M/s Surindera Steel Rolling Mills, Mandi Gobindgarh, (complainant – Criminal Appeal No. 340-DBA of 1994 2 now appellant), through Ram Sarup, its Manager, on the allegations, that the accused purchased re-rolling material from it, vide bill No. 880, dated 20.12.1989 of the value of Rs. 3,58,449/-. This amount was carried forward to the next financial year i.e. 1990-91. Against the amount of this bill, the accused, being proprietor of firm M/s Prompt Steel, issued a cheque No. 0718342 in the sum of Rs. 60,000/-, dated 10.11.1990, by way of part payment, in favour of the complainant firm, assuring that the same would be honoured. When the cheque was presented to the bank, by the complainant, through its bankers, the same was returned dishonoured, by the Union Bank of India, Mandi Gobindgarh, with the remarks “refer to drawer”, meaning thereby that there was no arrangement to pay the amount of the said cheque. Thereafter, the complainant, served a statutory notice, upon the accused, asking him to make the payment of Rs. 60,000/-, of the cheque, in question, within a period of 15 days, from the date of receipt of the said notice, which was delivered to him on 21.12.1990. Despite service of notice, payment was not made. 3. After going through the preliminary evidence, the accused was summoned for the offence, punishable under Section 138 of the Act. 4. On appearance of the accused, he was supplied a copy of the complaint. Notice, under Section 138 of the Act, was served upon him, to which he pleaded not guilty. 5. Ram Sarup, Manager of the Company, through whom, the complaint was filed, appeared as, PW1. Yashpal Singla, appeared as PW2, whereas, Atul Kumar Singla, Hand Writing and Finger Print Expert, Patiala, appeared as, PW3. Thereafter, the complainant closed its evidence. 6. The statement of the accused, under Section 313 Cr.P.C., was Criminal Appeal No. 340-DBA of 1994 3 recorded, wherein, he admitted having purchased the goods, from the complainant. He also admitted that he issued the cheque, in question, which was dishonoured. It was stated by the accused, that it was a post-dated cheque. It was further stated that since all the goods were not supplied, a civil suit for damages, was filed by him. He also stated that he did not give the cheque, as a part payment. 7. In defence, the accused examined Shanti Sarup, DW1, and Krishan Kumar, DW2. Thereafter, he closed the defence evidence. 8. After hearing the Counsel for the parties, and, on going through the record of the case, the trial Court, came to the conclusion, that the complaint had not been filed, through a competent person and, as such, was not maintainable. Ultimately, the accused was acquitted, on this sole ground. 9. Feeling aggrieved, the instant appeal, was filed, by the complainant/appellant. 10. I have heard the Counsel for the parties, and have gone through the record of the case, carefully. 11. The Counsel for the appellant, at the very outset, submitted that the trial Court, was completely wrong, in coming to the conclusion, that Ram Sarup, was not a duly authorized/ competent person, to file the complaint, on behalf of the complainant. He further submitted that Ram Sarup, being the Manager of the complainant firm, was duly competent to file the complaint. He further submitted that Ram Sarup, being the Manager and, as such, the Officer of the firm, could file the complaint. He placed reliance on M/s M.M.T.C. Ltd. Vs. M/s Medchl Chemicals & Pharma (P) Ltd., 2002(1), RCR (Criminal), 318 (SC), Raghu Lakshminarayanan Vs. Criminal Appeal No. 340-DBA of 1994 4 M/s Fine Tubes, 2007(2), RCR (Criminal) 571 (SC), Sri Vasavi Chit Funds, Eluru Vs. B. Eswaramma, Development Officer, LIC of India and Others, 2005(3), RCR (Criminal) 628 (AP), M/s Shankar Finance & Investments Vs. State of Andhra Pradesh & Others, 2008(3) RCR (Criminal), 885 (SC), C. Prabhu Vs. Sangam Corporation (Finance and Investment), Bangalore, 2002(3), RCR (Criminal), 23 (Karnataka), M/s Capital Leasing and Finance Co. Vs. Navrattan Jain, 2005(4), RCR (Criminal) 330 (P&H) and Gurcharan Singh Vs. State of U.P. and Another, 2002(4) RCR (Criminal) 414 (Allahabad), in support of his contention. 12. On the other hand, the Counsel for respondent No. 1, submitted that Ram Sarup, Manager, was not a duly authorized person, of the complainant firm, to file the complaint. He further submitted that, no resolution was passed, by the partners of the unregistered firm authorizing Ram Sarup, Manager, to file the complaint. He further submitted that the complainant, being un-registered firm, and, as such, a compendium of persons, could not be said to be a legal entity. He further submitted that, no doubt, a duly incorporated company or a Corporation has a legal entity and, as such, a juristic person, is competent to file a complaint through one of its Officers. He further submitted that the complainant, being not a legal entity and, as such, a juristic person, could not file the complaint through Ram Sarup, Manager, who was not duly authorized by it, but could only file a complaint through its partner, who was duly authorized. He also placed reliance on K.M. Maregowda Vs. M/s Seven Hills Ex-Import Corporation, Bangalore, 2004, Crl. L.J. 4119 (Karnataka), U.C. Saxena, Managing Director, Mehra Machines & Equipments Pvt. Ltd., Noida Vs. Shri Criminal Appeal No. 340-DBA of 1994 5 Madan Mohan, Vol. CIV-1993-2, Punjab Law Reporter, 161, and Mr. Amit Desai and Another Vs. M/s Shine Enterprises and Another, 2000 Crl. L.J. 2386. He further submitted that the accused was ready to pay the amount of the cheque, even if the appeal was accepted or dismissed. 13. When the Counsel for the complainant, was asked, as to whether, he accepted the offer of the Counsel for the respondent, he submitted that he was ready to accept the amount of the cheque, alongwith penal interest, upto date. He further submitted that the complainant was not ready to accept the amount of the cheque only. 14. After giving my thoughtful consideration, to the rival contentions, raised by the Counsel for the parties, in my considered opinion, the appeal is liable to be dismissed, for the reasons to be recorded, hereinafter. Section 142 of the Act, deals with the cognizance of offences, which reads as under:- “Notwithstanding anything contained in the Code of Criminal Procedure, 1973(2 of 1974)-- (a) No Court shall take cognizance of any offence, punishable under Section 138, except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque; (b) Such complaint is made within one month of the date, on which the cause of action arises, under CI. (c) of the Proviso to Section 138; (c) No Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the First Class, shall try any offence, punishable under Section 138.” The plain reading of this Section, makes it clear, that a complaint, under Section 138 of the Act, can only be filed, by the payee or the holder of the cheque, in due course. In the instant case, the payee of the cheque, exhibit Criminal Appeal No. 340-DBA of 1994 6 P2, was M/s Surindera Steel Rolling Mills, Mandi Gobindgarh, and not Ram Sarup, Manager. Section 9 of the Act, defines holder of the cheque, as under:- “Holder in due course means any person who for consideration became the possessor of a promissory note, bill of exchange or cheque, if payable to bearer, of the payee or endorsee thereof, if (payable to order), Before the amount, mentioned in the became payable, and without having sufficient cause to believe that any defect existed in the title of the person from whom he drived his title.” Ram Sarup, Manager, was neither the payee of the cheque, nor the holder of the same, as per the definition, extracted above. He was merely an employee of the complainant firm. During the course of his cross-examination, it was admitted by him, that there were, as many as, eight partners of the complainant firm, out of whom, six were available at Mandi Gobindgarh. He also admitted that Ghansham Dass and Surinder Kumar, were authorized, on behalf of the complainant, to take decision. He admitted, in categorical terms, during the course of his cross-examination, that he was not authorized, by any one, to file this complaint, against the accused. It was also admitted by him, that such decisions were taken by the partners of the firm, and the record thereof also existed, in the office. He further stated that decision to file the complaint, was taken after the service of notice, but neither the original, nor copy thereof, was placed on record. Admittedly, the complainant firm is an un-registered firm, which was merely a compendium of persons. It was not a legal entity and a juristic person, like an incorporated company or corporation. M/s M.M.T.C. Ltd's case (supra), was a company, and, as such, a juristic person. A juristic person or corporeal Criminal Appeal No. 340-DBA of 1994 7 person, cannot speak itself, but is to be represented, by a duly authorized person. In that case, the cheque, was in favour of the company (juristic person), which was dishonoured. The complaint was filed by the Company, under Section 138 of the Act, through an officer of the same. Later on, another officer was authorized by the Company, to represent it, with the permission of the Court. In these circumstances, it was held that a complaint could be filed by an officer of the Company, in the name of, and, on behalf of the Company. It was further held that the concerned officer, may not have the authority initially, but, such a defect could be rectified subsequent to the filing of the complaint. In M/s Capital Leasing and Finance Company's case (supra), it was held that the provisions of Section 69(2) of the Partnership Act, 1932, are not applicable to a complaint, filed by an un- registered firm. In that case, a criminal complaint, under Section 138 of the Act, was filed, by an un-registered firm, through one of its partners, who was duly authorized. In these circumstances, it was held that he was a competent person. In Raghu Lakshminarayanan's case (supra), it was held that a juristic person can be a Company, within the meaning of the provisions of the Companies Act, 1956. A proprietary concern is not a company. In Sri Vasavi Chit Funds, Eluru's case (supra), the complaint was filed by a registered partnership firm, through its Managing Partner, without authorization, from the firm. It was held that the complaint was maintainable. In M/s Shankar Finance & Investments' case (supra), it was held that it was permissible to lodge a criminal complaint, in the name of proprietary concern itself. In C. Prabhu's case (supra), a complaint, under Section 138 of the Act, was filed by a firm, through its Manager, who stated that he was duly authorized to file the complaint for and on behalf of the Criminal Appeal No. 340-DBA of 1994 8 firm. In these circumstances, it was held that the Court need not doubt his authorization or capacity, and, if at all, the same was required to be considered, it was at the stage of trial. In K.M. Maregowda's case (supra), the cheque was, in favour of the partnership firm, which was dishonoured. It was held that the complaint could be filed, by a person, authorized by the firm or power of attorney holder, in the name, and on behalf of the firm, and not in the name of power of attorney. There is, no dispute, with the proposition of law, laid down, in the aforesaid cases, relied upon, by the Counsel for the appellant. However, in none of these cases, the complaint was filed through a Manager of the firm, who was not duly authorized, by the partners of the firm. In some of the cases, the complaint was filed by a juristic person i.e. Company or the Corporation, through its duly authorized officer. No help, from the ratio of law, laid down, in the aforesaid authorities, can be drawn, by the Counsel for the appellant, as in the instant case, the complainant, being un-registered firm, could only file the complaint, through one of its duly authorized partners or its duly authorized officer, and not through Ram Sarup, Manager, who was not authorized, as is evident from his cross-examination, extracted above. Had the instant complaint, been filed by the Company, through its Officer or by a Corporation through its Officer, the matter would have been different. In U.C. Saxena, Managing Director, Mehra Machines & Equipments Pvt. Ltd., Noida's case (supra), relied upon, by the Counsel for the respondent, it was, in clear-cut terms, held by this Court that, no doubt, under Section 190 of the Code of Criminal Procedure, it can be said, that upon a complaint, filed by a person, setting out facts therein, which constitutes the offence, before a Magistrate, specified in Section 190, the Magistrate would be Criminal Appeal No. 340-DBA of 1994 9 competent to take cognizance of the offence, irrespective of the qualification or eligibility of the complainant, to file the complaint, but where a provision to the contrary, is made in any Statute, which may indicate the qualification or eligibility of a complainant, to file the complaint, the Magistrate before taking cognizance, is entitled and has power to enquire, whether the complaint satisfies the eligibility criteria. In that case, Madan Mohan, complainant, was neither the payee nor the holder, in due course of the cheque and, therefore, he was not competent to institute the complaint. The principle of law, laid down, in U.C. Saxena, Managing Director, Mehra Machines & Equipments Pvt. Ltd., Noida's case (supra), is fully applicable, to the instant case. Since there is a special provision, under Section 142 (a) of the Act, regarding the mode and manner, in which the cognizance, could be taken, the general provisions of Section 190 Cr.P.C., could not be made applicable. The trial Court was, therefore, right in coming to the conclusion, that the complaint, having not been filed through a duly authorized person, the cognizance thereof, could not be taken and, as such, the accused was entitled to acquittal. 15. The judgment of acquittal dated 13.08.1993, rendered by the trial Court, vide which, the accused was acquitted, is based on the correct appreciation of evidence, and the law on the point. The same does not suffer from any illegality or infirmity. The same is liable to be upheld. 16. For the reasons recorded above, Criminal Appeal No. 340-DBA of 1994, being without merit, must fail, and the same is dismissed. 17.12.2008 (SHAM SUNDER) Amodh JUDGE