Delhi District Court
M/S Sangam Enterprises vs M/S Drj Chemicals (P) Ltd on 29 October, 2011
IN THE COURT OF SH. VIRENDER KUMAR GOYAL
ADDL SESSIONS JUDGE: FAST TRACK COURT
ROHINI:DELHI
Criminal Appeal No. 33/11
Unique case ID No. 02404R0281672011
1. M/s Sangam Enterprises,
At18, Ambey Garden,
Near Krishna Dharam Kanta,
Behind IBP Petrol Pump,
Libas Pur, G.T. Road,
Delhi110042
2. Mr. Suraj Kohli,
Prop of M/s Sangam Enterprises,
Residence at D4/58, 2nd Floor,
Sector16, Rohini,
Delhi110085
..... Appellants
Versus
M/s DRJ Chemicals (P) Ltd
Having its office at 102,
Surya Deep Building,
37, Community Center
Wazirpur Ind. Area
Delhi110052
.......Respondent
Date of institution: 03/10/2011
Arguments heard on : 21/10/2011
Date of reservation of order: 21/10/2011
Date of Decision: 29/10/2011.
CA No. 33/11 1/9
ORDER
This is an appeal u/s 374 of Cr.Pc for setting aside the judgment dated 29/08/2011 and the order on sentence dated 05/09/2011 passed by Ld Trial Court.
In brief the facts are that the complaint u/s 138 was filed. Appellant was summoned. Notice was given to the appellant to which he pleaded not guilty and claimed trial and the matter was fixed for complainant's evidence.
Complainant was also directed to file the affidavit and matter was fixed for complainant's evidence again and again and vide order dated 25/11/10, Ld Trial Court observed that there is no necessity to continue complainant's evidence and in view of section 145(1) of N.I. Act and further relying upon judgment filed i.e. Rajesh Aggarwal Vs State and also relying upon Gurpreet Vs Ranbaxy, accused was directed to lead defence evidence and on 18/12/10, defence evidence of accused was closed.
Accused filed revision petition and vide order dated 24/01/2011, Ld ASJ provided one opportunity to the accused to lead defence evidence. However accused examined himself as DW1 and after hearing the parties, the impugned judgment and order on sentence were passed, which have been challenged.
Ld Counsel for appellant has challenged the impugned judgment and order on sentence on various grounds. Firstly that the Ld Trial court failed to appreciate that the complaint was filed by Private Ltd Company and no document was filed on record to substantiate that one Deepak Raj Jindal was authorized by the Board of Directors to file the complaint against the appellant. So the complaint is not sustainable in the eyes of law. Ld Counsel for appellant has further contended that even if it is assumed that Deepak Raj Jindal is Director of the Private Ltd Company, but as an individual, he has no right to act on behalf of company unless CA No. 33/11 2/9 authorized by the Board of Directors by passing resolution in this respect.
Ld counsel for appellant has further contended that Ld Trial Court has failed to appreciate that Sh. Deepak Raj Jain was neither the payee nor the holder of the cheque in due course, hence he could not have filed the complainant without any authorization.
Ld counsel for appellant has further contended that Ld trial Court failed to appreciate that Pvt Ltd Company is a legal entity and it can act through its Directors only and not otherwise and such Director is required to be authorised by passing a resolution by the Board of Directors. Even this fact has not been mentioned in the complaint that Sh Deepak Raj Jindal was authorised by the complainant company and no document in support has been filed, hence the complaint is bad in law.
Ld counsel for appellant has further contended that Ld Trial Court has failed to appreciate that the appellant/accused has discharged his initial burden rebutting the presumption u/s 118 of N.I. Act and it was for the complainant to prove the same as the burden was shifted to the respondent, which the respondent failed to do.
Ld counsel for appellant has further contended that the cheques in question were issued as security, which is evident from the statement of accounts and through evidence and the same has not been rebutted by the respondent in any manner .
The appellant has specifically stated that the blank cheques were delivered at the time of placing the order, thus no liability arose till the goods are delivered to the appellant. The goods were never delivered and the letter to this effect was also written to the complainant in which shows that the cheques were CA No. 33/11 3/9 not issued in discharge of any liability and some of the cheques were also not bearing the signatures of appellant. Ld counsel for appellant has further contended that in such circumstances, appellant be provided an opportunity for re examination of the witnesses of respondent's company and the judgement and impugned order be set aside.
In support of his contention Ld Counsel for appellant has relied upon Dale and Carrington Invt. (Pvt) Ltd and Anr Vs P.K. Prathapan and Ors wherein it has been observed that the " company is a juristic person and it acts through its Directors who are collectively referred to as the Board of Directors. An individual Director has no power to act on behalf of company of which he is a Director unless by some resolution of the Board of Directors of the Company specific power is given to him/her. Whatever decisions are taken regarding running the affairs of the company, they are taken by the Board of Directors".
He has further relied upon on Om Shakthi SC/ST and Minority Credit Cooperative Society VS M. Venkatesh wherein it has been held that "
a complainant filing complaint on behalf of the company has to establish by an authorization or power of attorney that he has been authorised to file complaint for and on behalf of the Company under Negotiable Instruments Act."
Ld counsel has further relied upon Uma Gangadhar Vs Classic Coffee and Spices Private Limited, Chickmagalur, wherein it has been held that " in law it was necessary that for launching of prosecution on behalf of company u/s 138 N.I Act , there should be necessary and proper authorization for launching prosecution right from stage of filing of complaint and in absence of such authorization, prosecution launched could not be bad in law and could not be CA No. 33/11 4/9 deemed to have been lawfully and validly launched by company."
Ld Counsel has further relied upon Criminal Appeal No.233 of 2007 (arising out of S.L.P. (Crl.) No. 3410 of 2006) decided on 20.02.2007 titled as Kamala S. Vs Vidhyadharan M.J. And Anr, wherein it has been held that, "
standard of proof in discharge of burden under section 139 is preponderance of probability inference therefore can be drawn not only from materials brought on record, but also from reference to circumstances relied on by accused."
Ld Counsel has also relied upon on Criminal Appeal No. 1012 of 1999, decided on 04/07/2006 titled as M.S. Narayana Menon @ Mani Vs State of Kerala and Anr, Wherein it has been held that "evidence adduced itself by parties before trial Court, leading to one conclusion that appellant able to discharge his initial burden then it shifted to complainant to prove his case, but if complainant failed to do so then such defence could be accepted as probable."
On the other hand Ld counsel for respondent has contended that the auhtroisation of Sh. D.R. Jindal as director of complainant was never challenged at any stage nor argued before the Ld Trial Court and at this stage it cannot be agitated . Ld counsel for respondent has further contended that from the Trial Court record it is clear that after framing notice u/s 251 Cr.PC against the respondent, affidavit in evidence was filed and the complainant was not cross examined in any manner by the accused, hence the evidence of complainant is unrebutted and unshaken, so all the contentions raised by appellant are not helpful in any manner. Ld counsel has further contended that even in the revision petition filed by the accused before Ld ASJ, no such contention was raised that accused wanted to cross examine the complainant, hence at this stage as on today the evidence of CA No. 33/11 5/9 complainant is unrebutted and unshaken, so the contentions of Ld Counsel for appellant are meritless.
Ld counsel has further contended that during the trial of the case, no application u/s 145(2) of N.I Act was filed and evidence of DW1 i.e. accused has been appreciated by Ld Trial Court also, so after appreciating the deposition of DW1 coupled with the testimony of the complainant, Ld Trial court rightly convicted the accused vide impugned judgment and passed order on sentence as per facts and circumstances.
Ld counsel has further contended that regarding the contentions of issuing letter to the complainant and that the cheques were given as security and were given blank and even all the cheques were not signed are just after thought and infact if these were the facts then accused could have wrote letter to the bank to stop the payment of these cheques given to the complainant and as such there is no ground to set aside the judgment and order on sentence, hence the appeal be dismissed.
I have considered the submission of Ld Counsel for appellant and also of the counsel for respondent company.
In respect of the submissions of Ld counsel for appellant that the director of the respondent who has filed the affidavit in evidence, is not duly authorized person as neither it has come in the complaint nor any Board of resolution has been produced before the Court, it has been held in M.M.T.C. Ltd Vs M/s Medchat Chemicals & Pharma P. Ltd 2002 (1) JCC 15 wherein the judgment Associated Cement Co Ltd Vs Keshvanand (1998) 1 SCC 687 was relied upon in which it has been held that "it is open to the de jure complainant company to seek permission of the Court for sending any other person to represent the company in CA No. 33/11 6/9 the Court. 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." so the contention of Ld counsel is not tenable in any manner and on this ground, complaint cannot be dismissed as the defect of duly authorised person by passing Board of resolution can be rectified by the company at any stage.
The procedure to conduct the trial of complaint u/s 138 has been set out in 2010 (3) JCC (NI) 273 titled as Rajesh Aggarwal Vs State and Ors, wherein following steps have been given.
Step 1: On the day complaint is presented, if the complaint is accompanied by affidavit of complainant, the concerned MM shall scrutinize the complaint and documents and if commission of offfence is made out, take cognizance and direct issuance of summons of accused, against whom case is made out.
Step II: If the accused appears, the MM shall ask him to furnish bail bond to ensure his appearance during trial and ask him to take notice u/s 251 of Cr.PC and enter his plea of defence and fix the case for defence evidence, unless an application is made by an accused under section 145(2) of N.I.Act for recalling a witness for cross examination on plea of defence.
Step III: If there is an application u/s 145(2) of N.I. Act for recalling a witness of complainant, the court shall decide the same, otherwise, it shall proceed to take defence evidence on record and allow cross examination of defence witness by complainant.
Step IV: To hear arguments of both sides.
CA No. 33/11 7/9
Step V: to pass order/judgment.
The complaint case was filed before 2010 and even notice was also
framed against the appellant/accused in the year 2009, but in view o the judgment, Ld Trial Court on 25/11/10, conducted the proceedings as set out in the aforesaid judgment, due to which 'Step II' could not be followed as at the time of framing notice against the appellant/accused u/s 251 of Cr.PC , plea of defence could not be recorded as at that time, judgment has not come, so when the plea of defence of appellant/accused while giving notice u/s 251 of Cr.PC, could not have been recorded for defence evidence at that time, then in such circumstances, Ld trial Court was required to frame a fresh notice against the appellant/accused u/s 215 of Cr.PC and also to record his plea of defence and then to fix the case for defence evidence. In such circumstances, application u/s 145(2) of Cr.PC could also not moved on behalf of appellant/accused. The affidavit of respondent was tendered in evidence and in absence of application u/s 145(2) of N.I Act, respondent/complainant could not be cross examined. Appellant/accused examined himself as defence witness u/s 315 of Cr.PC. So on one hand, there is unrebutted deposition of the complainant and on the other hand, there is evidence of accused himself as defence witness. In such circumstances, the court cannot reach at a just decision of the case. In such circumstances, the trial of the case has not been conducted as set out in the aforesaid judgment, which has caused grave miscarriage of justice and in such circumstances, it is required that the judgment and order on sentence be set aside. Accordingly both judgment dated 29/08/2011 and order on sentence dated 05/09/are set aside.
Ld trial court is directed to follow the procedure as set out in judgment as relied upon 2010 (3) JCC (NI) 273 titled as Rajesh Aggarwal Vs State and CA No. 33/11 8/9 Ors and fresh notice be framed against the appellant/accused u/s 251 of Cr.PC and further procedure be followed as set out in the judgment. Respondent/complainant be also given liberty to rectify the defect regarding his authorization from the Board of Directors. Ld Trial Court is also directed to dispose of the case within six months if possible, as per its diary.
In view of the above, appeal is allowed. Parties are directed to appear before the Ld Trial Court on 01/11/2011. No order for cost.
TCR be sent back with the copy of the order to learned Trial Court. Appeal file be consigned to record room.
Announced in Open Court on th dated 29 of October, 2011 (Virender Kumar Goyal) Additional Sessions Judge Fast Track Court Rohini : Delhi CA No. 33/11 9/9