Madras High Court
B. Adarsh Rao vs Tamil Nadu Electricals on 23 April, 1998
Equivalent citations: 1998(2)ALD(CRI)586, [1998]94COMPCAS375(MAD)
JUDGMENT S.M. Sidickk, J.
1. This criminal revision is preferred as against the order passed by the learned Fifth Metropolitan Magistrate, Egmore, Madras, in Crl. M. P. No. 131 of 1994 in C. C. No. 9604 of 1993, dated July 18, 1994, dismissing the petition filed by the petitioner/accused to dismiss the complaint since it is not maintainable in law and discharge the petitioner/accused from the case.
2. On the materials placed before him, the learned Fifth Metropolitan Magistrate, Egmore, Madras, came to the conclusion that only after evidence, it can be decided as to whether the petitioner/accused obtained the long-term loan or short-term loan and as to whether the cheque was given by the accused for the long-term loan or short-term loan and as to whether the same was returned by the bank and so there is no reason to dismiss the complaint and, accordingly, he dismissed the application filed by the petitioner/accused for dismissing the complaint filed by the respondent/complainant on July 18, 1994. Aggrieved against the said findings, the petitioner/accused preferred this revision before this court.
3. After hearing learned counsel for both the parties, the point that arises for consideration in this revision petition is as follows :
"Whether the complaint preferred by the respondent herein is not maintainable for the reasons stated in the petition filed by the revision petitioner/accused before the trial magistrate in Crl. M. P. No. 131 of 1994 in C. C. No. 9604 of 1993, and whether the revision petitioner/ accused can be arrayed for in Crl. M. P. No. 131 of 1994 in C. C. No. 9604 of 1994 ?"
4. Point : The respondent/complainant has filed the complaint before the Fifth Metropolitan Magistrate, Egmore, Madras, in C. C. No. 9604 of 1993, under Sections 138 and 142 of the Negotiable Instruments Act, 1881, stating that the revision petitioner/accused gave a cheque dated August 11, 1993, drawn in favour of Tamil Nadu Electricals for a sum of Rs. 57,750 which was not honoured when presented to the bankers for collection and the cheque was returned with an endorsement of "insufficient funds" in the accounts of the drawer. During the pendency of the complaint the revision petitioner/accused filed the discharge petition with the preliminary objections in Crl. M. P. No. 131 of 1994, and the same was resisted by the respondent/complainant by filing a counter. Though the revision petitioner has raised several objections in the discharge petition in Crl. M. P. No. 131 of 1994, the only objection that was pressed into service during the course of the arguments in his revision is about the maintainability of the complaint on the ground that no document was produced to authorise the manager of the complainant firm. The necessary pleas on this aspect are found in para. 1 of the discharge petition filed by the revision petitioner before the lower court in Crl. M. P. No. 131 of 1994, which reads as follows :
"The petitioner/accused submits that the complainant had not filed any document to substantiate his claim that he is the manager of the complainant firm and he is duly authorised to appear and file before this Hon'ble Court. Therefore, in the absence of such a document, the said manager has no locus standi to file this complaint and the Hon'ble Court ought to have rejected the complaint ab initio."
5. So the only objection taken by the revision petitioner is that no document was produced by the complainant authorising the manager to file a complaint All the other objections relating to the merits of this case in the discharge petition were not pressed into service at the time of the arguments in this criminal revision.
6. Learned counsel for the revision petitioner/accused contended that the complaint is filed by Tamil Nadu Eleclricals represented by its manager, B. Sailesh Kumar, 633/6, Poonamalle High Road, Aminjikarai, Madras, as mentioned in the cause title, and it is stated in para. 1 of the complaint that the complainant is a proprietorship concern represented by its manager, B. Sailesh Kumar, and it is involved in the wholesale business of selling electrical goods under the name and style of Tamil Nadu Electricals at No. 633/6, Poonamalle High Road, Madras-600 029, and the complainant was duly authorised by the proprietor to represent the case, and the complainant is represented by the manager. He further contended that there should be some document duly authorising the manager to act and plead on behalf of the sole proprietor, but in the list of documents no such document is mentioned authorising the manager to file the complaint on behalf of the proprietorship concern, and during, the pendency of the discharge petition in Criminal M, P. No. 131 of 1994, only the authorisation letter dated October 5, 1993, as well as the power of attorney were produced before the magistrate at a later point of time and so at the time of taking cognizance of the complaint they were not filed, and in such circumstances it must be held that the complaint is not maintainable under law. In support of his above contentions learned counsel for the revision petitioner placed reliance on the following decisions.
7. In the decision in Raman v. Krishna Phartnaceutical Distributors [1994] 3 CCR 1601 (at page 1604 and in para. 5) it is stated as follows :
"As per Section 138 of the Act, only the drawer of the cheque can be prosecuted. In the complaint in paragraph 2, it is stated that the accused is A. Raman. In paragraph 4, it is stated that the accused issued a cheque. From the above it transpires that it was A. Raman, who was the drawer of the cheque. But the case is being proceeded with against Sri Janaki Pharmacy represented by the proprietor, A. Raman. Only the drawer of the cheque can be prosecuted and as such the proceedings against Sri Janaki Pharmacy, who is arrayed as the accused, is to be quashed,"
8. That was a case where the drawer of the cheque was stated to be one Raman, whereas the complaint was laid as against the proprietorship concern under the name and style of S. Janaki Pharmacy, and in those circumstances, it was held that the complaint filed against the said S. Janaki Pharmacy is not maintainable since Raman was the drawer of the cheque. Here is a case before us where the cheque was issued by the revision petitioner/accused in the name of Tamil Nadu Electricals, which is the complainant and which is represented by its manager, Sailesh Kumar. Therefore, the facts in this case are totally different from the facts in the decision in Raman v. Krishna Pharmaceutical Distributors [1994] 3 CCR 1601, and so the decision reported above will have no application to the facts of the present case.
9. Learned counsel for the revision petitioner has drawn my attention to the decision in Sudesh Kumar Sharma v. K. S. Selvamani [1994] 1 LW (Crl.) 337 ; [1995] 84 Comp Cas 806, wherein it was laid down by his Lordship Pratap Singh J. as follows (page 810) :
"In this case, nowhere in the complaint it was stated that the complainant is the power of attorney agent of the four companies and in that capacity he is filing these complaints. In paragraph 4, it was stated that he was duly authorised to file the complaints. Learned counsel submitted that while the complaints were returned by the trial court, authorisation letters were filed and the complaints were again re-presented. Because the power deed was not referred to in the complaints and because only authorisation letters were filed while the complaints were re-presented after return by the court, the power deed cannot be taken into account. When the power deed is not taken into account, the resultant position is that 'S' had filed these complaints as manager of the four companies as a person duly authorised to file the complaints. Inasmuch as he is not the payee of the cheques, he cannot file these complaints as per the cheques, he cannot file these complaints as per the provisions of the Act."
10. That was a decision where the complaint itself stated that the complainant is the power of attorney agent of four companies, and the power of attorney duly authorised to file the complaints and yet the power of attorney was not produced in the court at the time of filing of the complaint, but they were produced at the time of re-presentation of the complaint and it was a case where the companies were involved but not a proprietary concern. In these circumstances, the facts and circumstances in the decision in Sudesh Kumar Skarma v. K. S. Selvamani [1994] 1 LW (Crl.) 337 ; [1995] 84 Comp Gas 806 are different from that of this case and so the said decision will not apply to this case.
11. One another decision that was relied on by learned counsel for the revision petitioner is the judgment of his Lordship T. S. Arunachalam J. in Ruby Leather Exports v. K. Venu [1994] 1 LW (Crl.) 34, 43 ; [1995] 82 Comp Cas 776, where it was laid down as follows :
"The cause title in the complaint shows K. Venu as the complainant. He has stated even in the cause title that he was representing Vandhana Chemicals, Madras. It cannot be stated that the complainant is the payee, Vandhana Chemicals, which stood represented by Venu, an authorised representative, who could be deemed as such in law. Further as I have already stated, while narrating the facts, no authorisation as such was also produced before the trial magistrate at the time of taking cognizance. On the peculiar facts of this case it has to be held that cognizance of the impugned complaint was barred under Section 142(a) of the Negotiable Instruments Act ... The next contention urged by Mr. T. K. Sampath that in view of a part payment having been made after issue of a statutory notice, the pending prosecution cannot be maintained, has no merit in it ...
The second ground shall stand rejected, in any event since the petitioner is bound to succeed on the first ground. Crl, 0. P. No. 8731 of 1992, is allowed. All further proceedings in C. C. No. 9123 of 1991, on the file of the Fifth Metropolitan Magistrate, Egmore, Madras-600 008, shall stand quashed".
12. Counsel for the revision petitioner/accused has laid emphasis on the following words in the above decision, i.e., "no authorisation as such was also produced before the trial magistrate at the time of taking cognizance. On the peculiar facts of this case it has to be held that cognizance of the impugned complaint was barred under Section 142(a) of the Negotiable Instruments Act." Relying on these words he argued that in the present case also no authorisation was produced at the time of taking cognizance of the complaint by the magistrate, and so the complaint cannot be maintained, and it is an illegality and not an irregularity, which can be cured by filing the authorisation letter dated October 5, 1993, or the power of attorney at a later point of time.
13. Learned counsel for the respondent/complainant would repudiate the above arguments by contending that the authorisation letter dated October 5, 1993, was produced before the magistrate at the time of taking the complaint on file and the sworn statement was recorded, and the magistrate was satisfied and thereafter only he had taken cognizance of the complaint and ordered to issue process to the accused, and further later on, the power of attorney was filed. This contention of learned counsel for the respondent did not find any support either in the sworn statement of the manager recorded by the magistrate or in the list of documents in the complaint. Nor any reference is made about the filing of the authorisation letter in the endorsement or the order of the magistrate at the time of taking cognizance of the complaint. It was not even mentioned in the complaint that the authorisation letter dated October 5, 1993, was initially filed into the magistrate's court to take the complaint on file for verification, and later the complainant got back the authorisation letter dated October 5, 1993, for some other purpose. The list of documents in the complaint did not state anything about the filing of the authorisation letter dated October 5, 1993, nor the sworn statement of the manager recorded by the magistrate would make any reference to the same. In those circumstances, the contention of learned counsel for the respondent/complainant that the authorisation letter dated October 5, 1993, was initially produced before the magistrate the time when the sworn statement of the manager was recorded by the magistrate and the magistrate was satisfied about the same, is not entitled to any acceptance in this case.
14. Following the decision of his Lordship T. S. Arunachalam J. reported in Ruby Leather Exports v. K. Venn [1994] 1 LW (Crl.) 34, 43 ; [1995] 82 Comp Cas 776, I am of the view that the said principles will apply to the facts of the present case. In those circumstances, I am constrained to hold that the complaint is not maintainable since at the time of taking cognizance of the complaint no authorisation letter much less the power of attorney on behalf of the complainant was produced before the magistrate.
15. Even assuming without admitting that the authorisation letter dated October 5, 1993, was produced before the magistrate at the time of recording the sworn statement of the manager of the complainant, there is yet another legal impediment with regard to the maintainability of this complaint. No doubt a cheque was issued by the revision petitioner/ accused in the name of Tamil Nadu Electricals. So the holder of the cheque is none other than the proprietorship concern, viz., the Tamil Nadu Electricals. But the proprietorship concern as such under the name and style of Tamil Nadu Electricals cannot maintain the complaint for the simple reason that it has no independent and legal entity in the eye of law. The proprietorship concern is not a firm. The firm is a partnership firm consisting of partners. Thus, there is a basic and fundamental difference between a firm and a proprietorship concern. The complainant in this case viz., the Tamil Nadu Electricals is not a firm. It is a proprietorship concern and cannot initiate legal proceedings. The proprietor or the owner of the said concern is the affected party and he can only file the complaint. This was the view expressed by his Lordship R. R. Jain J., in the latest decision in Satish Jayanthilal v. Pankaj Mashruwala [1997] 1 CCR 603, wherein it was held as follows :
"The proprietary concern is not an independent, legal and juristic entity having legal recognition in the eye of law. Therefore, neither can it initiate any proceedings nor proceedings can be initiated against it. In case of proprietary concern the proprietor is always an affectcd person, who can either indict or be indicted."
16. So in view of the legal principles laid down in the above judgment of his Lordship R. R. Jain J. in Satish Jayanthilal v. Pankaj Mashruwala [1997] 1 CCR 603, the proprietary concern in this case under the name and style of Tamil Nadu Electricals cannot maintain the complaint because the proprietorship concern has no independent and legal entity having legal recognition in the eye of law.
17. Learned counsel for the respondent/complainant further contended that at the end of para. 1 of the complaint it is stated clearly that the complainant was duly authorised by the proprietor to re-present the case and so the complaint is maintainable. It cannot reflect or prove the authorisation given by the proprietor. At best it is an averment that the proprietor has authorised the complainant, but it will not substantiate or establish the filing of the authorisation letter or the production of the said authorisation letter for the limited purpose of taking cognizance of the complaint. In other words an allegation in the complaint about authorisation will not amount to proof of the production of the authorisation letter dated October 5, 1993, for taking cognizance of the complaint.
18. Taking into consideration the above facts and circumstances of the case I hold that the complaint as framed in the name of Tamil Nadu Electricals without disclosing the name of the proprietor of the said concern in the cause title of the complaint is not maintainable in law, and further the authorisation letter dated October 5, 1993, was not produced before the magistrate at the time of taking cognizance of the complaint and in those circumstances the complaint is not maintainable under law, and the petition filed by the revision petitioner/accused in Crl. M. P. No. 131 of 1994, in C. C. No. 9604 of 1993, to discharge him from the case has to be allowed, and the order of the learned magistrate suffers from illegality and impropriety and so it has to be set aside and hence this criminal revision is allowed, and I answer this point in favour of the revision petitioner/accused and as against the respondent/complainant.
19. In the result this criminal revision is allowed. The order of the learned Fifth Metropolitan Magistrate, Egmore, Madras, dated July 18, 1994, in Crl. M. P. No. 131 of 1994, in C. C. No. 9604 of 1994, is set aside. The petition filed by the revision petitioner/accused in Crl. M. P. No. 131 of 1994, to discharge him from the case shall stand allowed. The revision petitioner is discharged from the case in C. C. No. 9604 of 1993, on the file of the Fifth Metropolitan Magistrate's Court, Egmore, Madras.