Hon''ble Sri Justice Samudrala Govindarajulu
1. This batch of nine Criminal Appeals are filed by the Complainant M/s. Videocon International Limited, Represented by its Accounts Officer,
Khem Chand Khatri. The Respondents 1 and 2 are the Accused 1 and 2/A-1 and A-2. They are M/s. Innovations, Represented by its Proprietor
Anjan Kumar and also Anjan Kumar in his personal capacity. The complainant filed 9 private complainants against A-1 and A-2 in the Court of IV
Metropolitan Magistrate, Hyderabad alleging the offences u/s 138 of the Negotiable Instruments Act, 1881. In C.C. No. 114 of 2000, the subject
matter is three cheques of the value of Rs. 40,000/- each. In C.C. No. 120 of 2000, the subject matter is three cheques of the value of Rs.
40,000/- each. In C.C. No. 122 of 2000, the subject matter is three cheques of the value of Rs. 35,000/- each. In C.C. No. 118 of 2000, the
subject matter is three cheques of the value of Rs. 40,000/- each. In C.C. No. 115 of 2000, the subject matter is three cheques of the value of Rs.
40,000/-, Rs. 42,475/- and Rs. 42,475/- respectively. In C.C. No. 119 of 2000, the subject matter is three cheques of the value of Rs. 40,000/-
each. In C.C. No. 121 of 2000, the subject matter is three cheques of the value of Rs. 40,000/-, Rs. 45,000/- and Rs. 45,000/- respectively. In
C.C. No. 113 of 2000, the subject matter is three cheques of the value of Rs. 40,000/- each. In C.C. No. 123 of 2000, the subject matter is three
cheques of the value of Rs. 40,000/- each. When the complainant presented all the above 27 cheques for encashment, the banker of the accused
dishonoured those cheques for want of sufficient funds as per cheque return memos dated 22-12-1998 respectively. Thereupon the complainant
got issued legal notices to A-1 and A-2 on 30-12-1998 in accordance with Section 138(b) of the Negotiable Instruments Act, 1881 (In short,
''the Act''). A-1 and A-2 received the said notices on 06-01-1999. But A-1 and A-2 did not choose to give any reply to those notices. The
complainant filed all the relevant documents in the lower Court in all the cases, like cheques, dishonour memos, legal notices, the postal receipts
and postal acknowledgments of the accused. After trial in which PW.1 was examined on behalf of the complainant in all the cases, and all the
documents were marked on behalf of the complainant, the lower Court found A-1 and A-2 guilty of the offences u/s 138 of the Act and
accordingly convicted them and sentenced A-1 to fine of Rs. 5,000/- in each case and A-2 to simple imprisonment for three months and fine of
Rs. 5,000/- in each case.
2. Questioning the said convictions and sentences passed by the IV Metropolitan Magistrate, Hyderabad, A-1 and A-2 filed Criminal Appeals
before the VII Additional Metropolitan Sessions Judge, Hyderabad in Criminal Appeal Nos. 2370 of 2004, 2372 of 2004, 2375 of 2004, 2377
of 2004, 2378 of 2004, 2379 of 2004, 2380 of 2004, 2381 of 2004 and 2382 of 2004. The VII Additional Metropolitan Sessions Judge, by the
impugned judgments dated 23-07-2004 allowed all the Appeals setting aside the convictions and sentences passed by the trial Court against A-1
and A-2. Aggrieved by the same, the complainant filed this batch of Appeals against the acquittals recorded by the lower Appellate Court.
3. Originally the complaints were presented before the Magistrate by the complainant company represented by its Officer, Srinivas Shukla. After
the Magistrate took cognizance of the said offences and issued summonses to the accused in all the cases, the complainant came forward with a
petition in the lower Court to permit Khem Chand Khatri (PW.1) to represent the company in all the complaints in the place of Srinivas Shukla.
The trial Court permitted the same and allowed PW.1 to represent the complainant-company in all the cases. During trial before the Magistrate,
the said Khem Chand Khatri was examined as PW.1 on behalf of the complainant in all the cases and marked the relevant documents Exs.P-1 to
P-13 in each case. On behalf of the accused, no oral evidence was let in and no documents were marked.
4. The lower appellate Court found fault with the complaints on the ground that the complainant did not sign the complaints and they were signed
by the power of attorney holder of the complainant. The lower appellate Court further observed that though one Officer Srinivas Shukla presented
the complaints on behalf of the complainant, the complainant did not produce any power of attorney in favour of the said Srinivas Shukla and did
not prove any such power of attorney in his favour and that therefore taking cognizance of the complaint filed by Srinivas Shukla representing the
complainant company is bad in law I do not agree with the said reasoning of the lower appellate Court. In K.S. Ramachander Rao Vs. State of
A.P. and Another, Full Bench of this Court found favour with the presentation of complaint by power of attorney holder of a juristic person like a
company and held that it is valid in law. The Full Bench also overruled previous contra decision on this aspect. The Full Bench further held that
there is nothing wrong in power of attorney holder of a complainant signing the complaint on behalf of the complainant and presenting the same
before the Criminal Court. The Full Bench observed:
14. ""Complainant"" is not defined either in the Code of Criminal Procedure or in the General Clauses Act. Therefore, for the purpose of Section
200 Code of Criminal Procedure ''Complainant'' should be taken to mean a person who presents the complaint to the Court or who makes the
complaint to the Court. That that should be so would be clear from the fact that if a company or other juristic person gives the complaint, it cannot
be examined. Somebody on its behalf who can speak about the facts of the case would be examined when he presents the complaint on behalf of
a juristic person. The same analogy applies to a power of attorney also. If the complainant himself is able to come to Court and present the
complaint in person, why should be or where is the need or necessity for him to file the complaint through his power of attorney? In fact, in
Nirmaljit Singh v. State of West Bengal (1973) 2 SCSR 66, it is held that the object of examination of the complainant u/s 200 Code of Criminal
Procedure is to ascertain if there is prima facie case and sufficient grounds for proceeding against the accused. So, the power of attorney who
presented the complaint on behalf of the ''payee'' or the ''holder in due course'' of a dishonoured cheque can be examined on behalf of the
complainant to find out if there is prima face case against the accused.
5. Section 142 of the Act has no bearing on the aspect of deciding whether a power attorney holder is competent in law to present the complaint
on behalf of a company. Section 142 of the Act deals with the case of a ""payee""/Accused and not a case of the ""Drawer""/Complainant. The lower
Court erred in adverting to Section 142 of the Act on this aspect of the matter.
6. It is contended that the complainant did not mark and prove power of attorney executed by the complainant company in favour of Srinivas
Shukla. In the trial Court, the complainant filed Ex.P-1 copy of certificate of incorporation of the complainant company and Ex.P-2 copy of
general power of attorney executed in favour of PW.1 namely Khem Chand Khatri who was running the litigation in Courts on behalf of the
complainant company after substituting himself in the place of Srinivas Shukla. It is for the Magistrate to satisfy himself before taking cognizance of
the offence whether the complaint was properly prepared and was properly presented and was properly signed by the proper person. Along with
the complaints, copies of general power of attorney executed by the complainant company in favour of Srinivas Shukla were filed. It is only after
satisfying itself about the authority in favour of Srinivas Shukla, the Magistrate/trial Court took cognizance of the complaints for the respective
offences after making required enquiry u/s 200 Code of Criminal Procedure After trial, and after decision of the trial Court, in the appeal the lower
appellate Court should not have gone into the question as to presentation of the complaint before the Magistrate. The lower appellate Court should
have noticed that the Magistrate after satisfying himself about the validity and propriety of the power in favour of Srinivas Shukla, issued
summonses to A-1 and A-2 in the respective cases. Therefore, there cannot be any doubt of the fact that taking cognizance of the cases for the
respective offences by the Magistrate is valid and legal.
7. The lower appellate Court observed that the complainant did not produce any evidence to show that the respective dishonoured cheques were
supported by legally enforceable debt. The lower Court further observed that suggestion given by the defence counsel to PW.1 that the
complainant used to dump goods with the accused and used to obtain blank cheques from the accused, cannot be taken as admission on the part
of the accused with regard to the existence of legally enforceable liability. It is contended by the Respondents'' counsel that the initial burden is on
the complainant to prove that the dishonoured cheques were supported by legally enforceable liability and that the complainant did not produce its
account books much less any vouchers with the signatures of the accused. The complainant filed Ex.P-3 statements of accounts of the accused
maintained by the complainant. Statements of accounts cannot be pieces of legal and admissible evidence in Court as per the provisions of the
Indian Evidence Act, 1872. The complainant is not a Banking company governed by the provisions of the Bankers Book of Evidence Act, 1891
which enables a banking company to file certified extracts of its accounts on proper certification, in case the books are required for day-to-day
maintenance by the Bank. Ex.P-3 statements of accounts have no value in the eye of law. But, even if Ex.P-3 is excluded from evidence, it has to
be seen whether the dishonoured cheques are supported by legally enforceable liability.
8. Section 139 of the Act raises a presumption in favour of the holder to the effect that the holder of a cheque received the cheque of the nature
referred in Section 138 for the discharge of any debt or other liability, in whole or in part. No doubt, the said presumption u/s 139 of the Act is
rebuttable presumption. Opening words of Section 131 reads, ""It shall be presumed unless the contrary is proved"". In that view of the matter it is
not for the complainant initially to prove existence of any legally enforceable debt or other liability for the cheques involved in these cases. The
initial burden is on the accused to prove that the dishonoured cheques were not supported by any legally enforceable debt or other liability. In
K.N. Beena Vs. Muniyappan and Another, the supreme Court observed:
6. In our view the impugned judgment cannot be sustained at all. The judgment erroneously proceeds on the basis that the burden of proving
consideration for a dishonoured cheuqe is on the complainant. It appears that the learned Judge had lost sight of Sections 118 and 139 of the
Negotiable Instruments Act. u/s 118, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had
been made or drawn for consideration. u/s 139 the Court has to presume, unless the contrary was proved, that the holder of the cheque received
the cheque for discharge, in whole or in part of a debt or liability. Thus, in complaints u/s 138, the Court has to presume that the cheuqe had been
issued for a debt or liability. This presumption is rebuttable. However, the burden of proving that a cheque had not been issued for a debt or
liability is on the accused. This Court in the case of Hiten P. Dalal Vs. Bratindranath Banerjee, has also taken an identical view.
9. The Supreme Court further observed that the accused has to prove in the trial by leading cogent evidence that there was no debt or liability. On
facts, the Supreme Court observed that the accused not having lead any evidence could not be said to have discharged the burden cast on him and
that the accused not having discharged the burden of proving that the cheque was not issued for a debt or liability, the conviction as awarded by
the Magistrate was correct.
10. The lower appellate Court committed similar mistake in the impugned Judgments. Even if Ex. P-3 statements of accounts are of no value, since
the burden is not on the complainant to prove existence of legally enforceable debt or liability, it is for the accused to prove otherwise. The accused
did not lead any evidence at all. Neither he examined himself as a witness to rebut the presumption u/s 139 of the Act nor he examined any
witnesses nor marked any documents in respect of his case. PW. 1 being an Accounts Officer of the complainant company gave evidence on the
basis of records even though he has no personal knowledge about those records. The accused having received legal notices u/s 138(b) of the Act,
did not choose to give any reply notice putting forward any contentions either with regard to the cheques or with regard to the liability under those
cheques. In those circumstances, the lower appellate Court should have held though the accused could not rebut the presumption u/s 139 of the
Act of existence of debt or liability I am of the view that the impugned judgments of the lower Court are not sustainable either on facts or in law.
11. In the result, all nine Appeals in this batch are allowed setting aside the judgments passed by the lower appellate Court and restoring
convictions and sentences passed by the trial Court against Respondents 1 and 2/A-1 and A-2. Sentences of imprisonment in all nine cases shall
run concurrently.