Karnataka High Court
Om Shakthi Sc/St And Minority Credit ... vs M. Venkatesh S/O M. Muniyappa on 5 October, 2007
Equivalent citations: 2008CRILJ998, 2008(2)KARLJ486, AIR 2008 (NOC) 697 (KAR.) = 2008 (1) AIR KAR R 311, 2008 CRI. L. J. 998, 2008 (2) ALJ (NOC) 483 (KAR.), 2008 (1) AIR KANT HCR 311, (2008) 66 ALLINDCAS 414 (KAR), 2008 (66) ALLINDCAS 414, (2007) ILR (KANT) 5126, (2008) 1 ICC 808, (2008) 1 ALLCRILR 711, (2008) 1 NIJ 489, (2008) 2 BANKCAS 149, (2008) 2 KANT LJ 486, (2008) 4 BANKCAS 657, 2008 (2) ANDHLT(CRI) 174 KAR, (2008) 2 ANDHLT(CRI) 174
JUDGMENT R.B. Naik, J.
Page 2303
1. This is an appeal filed by the original complainant - appellant challenging the order of acquittal passed by the XXII Addl. CMM, Bangalore and XXIV Page 2304 Addl. Small Causes Judge, Bangalore City dated 6.4.2005 in CC No. 36103/2002 acquitting the respondent - accused of the offence punishable under Section 138 of the NI Act.
2. It is the case of the appellant - complainant that it is a Co-operative society and it had disbursed a loan of Rs. 25,000/- to the respondent accused on 5.2.2001. The respondent accused failed to discharge the loan and pay the installments due as and when they fell due. After due persuasion, the respondent - accused issued a cheque Ex.P-2 in favour of the complainant Co-operative society for a sum of RS. 25,000/- dated 12.2.2002 towards the discharge of liability. The cheque so issued was presented by the complainant - Co-operative Society through its banker KSC Apex Bank Ltd., Magadi road, Bangalore on 18.6.2002. Ex.P-3 is the endorsement issued by the Bank returning the cheque with an endorsement "funds insufficient". The said endorsement in dated 19.6.2002. On the return or the cheque without realisation, the complainant Society through its Secretary got issued a legal notice dated 2.7.2002 EX.P-5 to the respondent - accused, as provided under Section 138(2)(b) of the NI Act, demanding the amount covered under the cheque dated 12.2.2002. The said notice was sent through Registered Post Acknowledgement Due. The acknowledgement for having served the notice to the respondent - accused is marked as Ex.P-8 the same is signed by respondent/accused on 4.7.2002. In addition to sending the notice under Registered Post Acknowledgement Due, the copy of the notice was also sent under Certificate of posting on 2.7.2002 and the postal endorsement issued is marked as Ex.P-6. In addition to producing the said documents pertaining to the transaction and filing of the complaint under Section 200 Cr.PC for offence punishable under Section 138 of the NI Act, the complainant Bank also produced EX.P-9 and P-10 to establish the transaction of having disbursed a sum of Rs. 25,000/- to the respondent - accused. EX.P-9 is a voucher dated 5.2.2001 indicating payment of loan to the respondent - accused, Ex.P-10 is the letter of undertaking of the respondent - accused.
3. As the respondent - accused did not respond to the notice dated 2.7.2002, nor replied the same, nor made the payment as demanded in the said notice, the appellant -complainant presented a complaint as per Ex.P-1, on 30.7.2002 with a prayer that the respondent - accused should be convicted and to pass an order for payment of the amount with cost and interest. On presentation of the complaint the Trial Court took cognizance, recorded the sworn statement of the complainant - appellant, directed issue of process to the accused. In response to the process, the respondent - accused, put in appearance in the case. The complainant on its behalf examined the President of the Complainant Society as PW-1 and got marked Ex.P-1 to P-10. The defence got marked EX.D-1 to D-6. Ex.D-1 is a receipt issued by the complainant Society in favour of the respondent - accused for having paid a sum of Rs. 2,500/-. Ex.D-2 is the passbook reflecting payment of Rs. 1,452/- and Rs. 1,449/- by the respondent - accused to Page 2305 the complainant Society, Ex.D-3 to D-6 are the receipts issued by the complainant Society in favour of the accused for having received a sum of RS. 1,452/-, Rs. 1,435/-, Rs. 1,449/- and Rs. 3,414/- respectively. The Trial Court on appreciation of the material on record, has arrived at a conclusion that the presentation of the complaint by the complainant society through its President without authorisation of the Society or without any Power of Attorney executed by the Society in favour of the President and as no document was produced before the Court to establish that the President was authorised to present the complaint, the trial Court acquitted the respondent - accused of the charges levelled against him and accordingly has dismissed the complaint. This order of acquittal is challenged in this appeal.
4. I have heard the learned Counsel for the appellant - complainant and the respondent - accused.
5. The points that arise for consideration in the present appeal are:
(a) Whether a complaint for an offence punishable under Section 138 of the NI Act, can be presented by a person other than payee or holder in due course and their authorised agents, power of attorney holder? - No. -
(b) Whether a complaint for an offence punishable under Section 138 of the NI Act filed by a Firm, Society, Company by President, Secretary, Director, Employee without authorisation or power of attorney is maintainable? - No. -
(c) Can a complaint be presented and prosecuted by a person other than the payee or holder in due course. - Yes. -
(d) Whether the Trial Court is justified in acquitting the respondent - accused for the offence punishable under Section 138 of the NI Act.? - Yes. -
ANSWERS:
POINT (a): In the negative in view of Section 142 of the NI Act.
POINT (b): Specific authorisation authorising the complainant or a power of attorney authorising to file complaint required.
POINT (c): Only in the event of death of payee or holder in due course, by their legal representatives and in case of Firm, Company, Society, in the event of new incumbent taking charge but only after obtaining due authorisation or power of attorney.
POINT (d): In the affirmative for the reasons stated.
6. On re-appreciation of the material on record, it is quite clear that the respondent - accused had issued a cheque for a sum of Rs. 25,000/- dated 12.2.2002 in favour of the complainant and the said cheque came to be presented to the Bank within the period of six months. On presentation, the cheque was returned with an endorsement "funds insufficient", then thereafter within the stipulated period on 2.7.2002, Page 2306 the complainant/appellant has issued a statutory notice as provided under Section 138(b) of the NI Act to the respondent - accused through its Secretary. The complainant Society has also produced Ex.P-8, the postal acknowledgement to establish the service of statutory notice to the respondent - accused.
7. Statutory notice was sent to respondent/accused under Registered Post Acknowledgement Due, in addition it was sent UCP. Postal endorsement is at Ex. P-6 for having sent the notice under certificate of posting. EX.P-9 and P-10 establish that the complainant Society had disbursed the loan, amount of Rs. 25,000/- in favour of the respondent - accused. The contentions referred above all go to clearly establish that the cheque was duly issued by the respondent - accused and the legal notice dated 02.07.2007 was issued in time on the accused - respondent. On the basis of the said material, the Trial Court taking cognizance issued process to the respondent - accused.
8. The respondent - accused in response to the process issued has put in appearance and has cross examined the complainant President of the Society who tendered evidence as PW-1. He has also got marked Ex.D-1 to D-6 to establish certain payments made to the complainant - appellant. These receipts go to establish payments made by accused but the complainant has not given deductions to the payments made by the respondent - accused and a legal notice was issued without giving such deductions under Section 138(b) of the NI Act to the respondent - accused calling upon him to make payment of entire amount of Rs. 25,000/-. The said notice as stated above has been issued by the society through its secretary and the notice also does not indicate whether the Secretary had been authorised toy the Society to cause legal notice issued to the respondent - accused. Then thereafter, the complainant - society has opted to present the complaint through its President - Sri Harikrishna. Even the said complaint has not been presented along with the authorisation issued by the Society in favour of the President or a Power of Attorney executed by the Society in favour of the President authorising him to present the complaint.
9. The learned Counsel for the appellant - complainant relied upon the Judgment A.R. Antulay v. Ramdas Sriniwas Nayak and Anr. and contended that criminal law can be set into motion by any one. He also relied upon the Judgment reported in 1991 CR.LJ 347 in the case of Union of India V. Madan Day and Anr., and contended that in general, a complaint for an offence can be filed by any person except in cases of offences mentioned in Sections 195 to 197 of the Cr.PC. In other words, any one can set the law in motion and no specific authorisation in necessary to file the complaint for offences punishable under Sections 5, 5-A and 7A of the Prevention of Corruption Act and Sections 4 and 85, 5 and 135 Page 2307 of the Gold Control Act, 1968. In view of Section 142 of the NI Act, I hold that the said two decisions are not applicable to the present case, the learned Counsel for the appellant complainant cannot contend that even a complaint under Section 200 Cr.PC for offence punishable under Section 138 of the NI Act can be presented by any one and thus law can be set in-to motion, it is to be noted that Section 142 of the NI Act is quite clear and reads as follows:
Notwithstanding anything contained in Cr.PC. 1973, no Court shall take cognizance of any offence punishable under Section 138 of the NI Act, except upon a complaint in writing made by the payee or as the case may be, the holder in due course of the cheque.
The reading of the said provision negates the argument of the learned Counsel for the appellant - complainant. The learned Counsel for the appellant - complainant also contended that the Society is registered under the Societies Registration Act and the President being an authorised officer of the Co-operative Society, can present a complaint on behalf of the society. Since the provisions of the Co-operative societies Act, clearly indicate that the President can exercise powers on behalf of the Society. The complaint is not accompanied with the bye-law of the Society to establish the said fact. In the instant case, as the complaint is one presented for the offence punishable under the NI Act, it should be supported by an authorisation or Power of Attorney as held by this Court in the case of Director Maruti Feeds and Farms Pvt. Ltd. v. Basanna Pattekar reported in ILR 2007 KAR 2135, wherein it is hold:
When a complainant deposing on behalf of the company - non production of resolution -authorising the Director of the Company to establish that the Director has been authorised to depose for and on behalf of the Company is fatal to the complaint and the complaint cannot be entertained in the absence of authorisation or a power of attorney.
10. In the instant case, the complainant is a Co-operative Society. The President has examined himself as PW-1. Besides the same, the legal notice has been issued for and on behalf of the Society by its Secretary. The prayer in the complaint is for payment of the amount covered under cheque with cost and interest. All these clearly indicate that the complaint is not maintainable in law and the Trial Court was justified in rejecting the complaint for the reason as stated above. In addition to the reasons assigned by the Trial Court in acquitting the accused and for the reasons stated above, I hold that the Trial Court was justified in acquitting the accused of the allegation made against him and hence the following order:
The appeal preferred by the complainant - appellant is hereby dismissed. The order of acquittal passed by the Trial Court dated 6.4.2005 in CC No. 36103/02 is upheld.