Case: A.C. Narayanan &amp; Another Vs. State of Maharashtra &amp; Others

Criminal Appeal No.73 of 20072. Brief facts of the case are as follows:The accused-appellant,A.C. Narayanan challenged the common order dated 29th November, 2000 passed by the Additional Chief Metropolitan Magistrate, 9th Court, Bandra, Mumbai (hereinafter referred to as the, Trial Court) by filing applications u/s 482 of the Code of Criminal Procedure, 1973 before the High Court. By the said common order the applications preferred by the appellant-A.C.Narayanan for discharge/recalling process against him was rejected by the Trial Court. The High Court by impugned judgment dated 12th August, 2005, dismissed the applications preferred by the appellant and upheld the order passed by the Trial Court.3. The appellant is the Vice-Chairman and Managing Director of the Company M/s Harvest Financials Ltd. (hereinafter referred to as the "Company") having its registered office at Bombay. Under a scheme of investment, the appellant collected various amounts from various persons in the form of loans and in consideration thereof issued post-dated cheques either in his personal capacity or as the signatory of the Company which got dishonoured.4. Respondent No. 2-Mrs. Doreen Shaikh is the power of attorney holder of six complainants, namely Mr.Yunus A. Cementwalla, Smt. Fay Pinto, Mr. Mary Knoll Drego, Smt. Evelyn Drego, Mr. Shaikh Anwar Karim Bux and Smt. Gwen Piedade. On 16th December, 1997, Respondent No.2 on behalf of the six complainants filed Complaint Case Nos.292/S/1998, 293/S/1998, 297/S/1998, 298/S/1998, 299/S/1998 and 300/S/1998 respectively against the appellant herein under Sections 138 and 142 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the, N.I. Act) before the Trial Court. The said Respondent No. 2 verified the complaint in each of those cases as Power of Attorney Holder of the complainants. The Additional Chief Metropolitan Magistrate vide order dated 04th April, 1998 issued process against the appellant u/s 204 of the Cr.P.C for the offences punishable under Sections 138 and 142 of the N.I. Act.5. The appellant, being aggrieved moved an application for discharge/recall of process in each of the complaints. The Trial Court vide common order dated 29th November, 2000 dismissed the applications filed by the appellant.6. The appellant being aggrieved preferred applications being Criminal Application Nos.797, 798, 799, 801, 802 and 803 of 2002 before the High Court for calling for the records of the case pending in the Trial Court.By impugned order dated 12th August, 2005 the said applications were dismissed by the High Court.Criminal Appeal No.1437 of 20137. The brief facts of the case is as follows:This appeal has been preferred by the accused-G. Kamalakar against the judgment and order dated 19th September, 2007 passed by the High Court of Judicature, Andhra Pradesh of Hyderabad in Criminal Appeal No. 578 of 2002. By the impugned judgment, the High Court allowed the appeal preferred by the 1st respondent- M/s Surana Securities Ltd. (hereinafter referred to as the Company) set aside the judgment of acquittal dated 30th October, 2001 passed by the XVIII Metropolitan Magistrate, Hyderabad in CC No.18 of 2000 convicted the appellant under Section 138 of the N.I. Act and sentenced the appellant to pay a fine of Rs. 6,10,000/-, out of which an amount of Rs. 6,00,000/- was to be paid to the complainant towards compensation and in default to suffer simple imprisonment for a period of one month.8. The 1st respondent - M/s Surana Securities Ltd. is the complainant and is a limited Company carrying on business of trading in shares. The appellant-G. Kamalakar is the client of the 1st respondent-Company and used to trade in shares. During the course of business, the appellant-G.Kamalakar became liable to pay an amount of Rs. 7,21,174/- towards the respondent-Company. In order to discharge the said liability, the appellant issued six cheques amounting to Rs. 1,00,000/- each and another cheque for Rs. 1,21,174/- of different dates. When first six cheques were presented for encashment on 18th September, 1997, the same got dishonoured with an endorsement "funds insufficient". Upon receiving such information, the Company issued a legal notice to the appellant to pay the amount but the same was not paid by the appellant.9. The Board of Directors of the 1st respondent-Company, by a resolution authorized its Managing Director to appoint an agent to represent the Company. Pursuant thereto, one Shri V. Shankar Prasad was appointed as an agent by executing a General Power of Attorney. Later, he was substituted by one Shri Ravinder Singh under another General Power of Attorney. The respondent-Company filed a complaint under Section 138 of the N.I. Act being CC No. 1098 of 1997 in the Court of XIth Metropolitan Magistrate, Secunderabad. The complaint was transferred to the Court of XVIIIth Metropolitan Magistrate, Hyderabad by order dated 3rd May, 2000 and was registered as CC No. 18 of 2000. By judgment dated 30th October, 2001, the Metropolitan Magistrate dismissed the complaint filed by the respondent- Company u/s 138 of the N.I. Act.10. Aggrieved by the said order, respondent-Company filed an appeal being Criminal No. 578 of 2002 before the High Court of Judicature, Andhra Pradesh at Hyderabad. By the impugned judgment dated 19th September, 2007, the High Court allowed the appeal, set aside the judgment dated 30th October, 2001 passed by the XVIIIth Metropolitan Magistrate, Hyderabad and convicted the appellant u/s 138 of the N.I. Act. Against the aforesaid order of conviction, the present appeal has been preferred.

Court's reasoning:
13. The first question relating to the eligibility of Power of Attorney holder to sign and file a complaint petition on behalf of the complainants and whether eligibility criteria prescribed by Section 142(a) of N.I. Act issatisfied, if the complaint petition itself is filed in the name of the payee or the holder in due course of the cheque, was answered by larger Bench in affirmative by its judgment in A.C. Narayanan vs. State of Maharashtra, 2013(11) ScaleFrom the bare perusal of the said complaint, it can be seen that except mentioning in the cause title there is no mention of, or a reference to the Power of Attorney in the body of the said complaint nor was it exhibited as part of the said complaint. Further, in the list of evidence there is just a mere mention of the words at serial no.6 viz. "Power of Attorney", however there is no date or any other particulars of the Power of Attorney mentioned in the complaint. Even in the verification statement made by the respondent no.2, there is not even a whisper that she is filing the complaint as the Power of Attorney holder of the complainant. Even the order of issue of process dated 20th February, 1998 does not mention that the Magistrate had perused any Power of Attorney for issuing process.18. The appellant has stated that his Advocate conducted search and inspection of the papers and proceedings of the criminal complaint and found that no Power of Attorney was found to be a part of that record. This has not been disputed by the respondents. In that view of the matter and in light of decision of the larger Bench, as referred above, we hold that the Magistrate wrongly took cognizance in the matter and the Court below erred in putting the onus on the appellant rather than the complainant. The aforesaid fact has also been overlooked by the High Court while passing the impugned judgment dated 12th August, 2005.In this case it is not in dispute that the complaint was filed by one Shri V. Shankar Prasad claiming to be General Power of Attorney of the complainant company. Subsequently PW-1 Shri Ravinder Singh gave the evidence on behalf of the Company under the General Power of Attorney given by the complainant Company. The complaint was not signed either by Managing Director or Director of the Company. It is also not in dispute that PW-1 is only the employee of the Company. As per Resolution of the Company i.e. Ex.P3 under first part Managing Director and Director are authorized to file suits and criminal complaints against the debtors for recovery of money and for prosecution. Under third part of the said Resolution they were authorized to appoint or nominate any other person to appear on their behalf in the Court and engage lawyer etc. But nothing on the record suggest that an employee is empowered to file the complaint on behalf of the Company. This apart, Managing Director and Director are authorized persons of the Company to file the complaint by signing and by giving evidence. At best the said persons can nominate any person to represent themselves or the Company before the Court. In the present case one Shri Shankar Prasad employee of the Company signed the complaint and the Deputy General Manager of the Company i.e. PW-1 gave evidence as if he knows everything though he does not know anything. There is nothing on the record to suggest that he was authorized by the Managing Director or any Director. Therefore, Magistrate by judgment dated 30th October, 2001 rightly acquitted the appellant. In such a situation, the case of the appellant is fully covered by decision by the larger bench of this Court passed in the present appeal. We have no other option but to set aside the impugned judgment dated 19th September, 2007 passed by the High Court of Judicature, Andhra Pradesh at Hyderabad in Criminal Appeal No.578 of 2002. The judgment and order dated 30th October, 2001 passed by the Court of XVIII Metropolitan Magistrate, Hyderabad in C.C.No.18 of 2000 is upheld.