Disposed

Sesham Rao Niranjan v. State of Ap

Andhra Pradesh HC22 Nov 2023CRLP/324/2019

Case brief

AI extract

What is this about?

Single judge disposed of Criminal Petitions seeking quashal of cheque bounce complaints filed by a General Power of Attorney holder. Clarified existing Supreme Court precedents and directed expeditious disposal by trial court within four months.

What did the court decide?

Cr.P.Nos. 118, 324, 341, 352 of 2019 disposed; interlocutory applications closed; trial court directed to dispose matters within 4 months.

Sesham Rao Niranjan Vs State of Ap — Cheque Dishonour | Andhra Pradesh HC (2023)

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THE HON’BLE SRI JUSTICE TARLADA RAJASEKHAR RAO

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CRIMINAL PETITION Nos.118, 324, 341 and 352 OF 2019

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COMMON ORDER:

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The batch of Criminal Petitions are filed by the petitioner/accused to quash the complaints which were instituted for taking cognizance for the offences under Sections 138 and 142 of the Negotiable Instruments Act, 1881 (for short, „the NI Act‟).

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Brief facts of the case are that the petitioner herein has borrowed different amounts at different dates during the period from 25.07.2005 to 20.01.2006 by executing promissory note and agreeing to repay the same to the complainant or to the order of the complainant on demand together with interest @2% per month with monthly rests and the petitioner herein, who is the accused in the above said complainants, has issued different cheques towards part payments of the interest payable in the name of Miss Vidhi Mittal and the said cheques were presented for clearance before the drawee bank and the same were bounced with an endorsement “insufficient funds”.

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Therefore, the drawee of the cheque was constrained to file cases to punish the petitioner/accused under Sections 138 and

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142 of the NI Act. The said complaint was vociferously canvassed on the ground that 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 and the GPA holder cannot file a complaint without obtaining permission from the Court.

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Repelling the contentions raised by the counsel appearing for the petitioner/accused, the learned counsel for the respondent would contend that the GPA holder can file the complaint and he relied on the judgment of the Supreme Court in A.C.Narayanan vs. State of Maharashtra and G.Kamalakar vs.

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Surana Securities Pvt. Ltd.¹ and M.M.T.C. Ltd. and Anr. vs. Medchel Chemicals and Pharma (P) Ltd.² and Janki Vashdeo Bhojwani vs. Indusind Bank Ltd.³ and would submit that the GPA holder can maintain a complaint. He would also submit that the petitioner/accused has filed a batch of Criminal Petitions before the common High Court vide Crl.P.No.8414 of 2016 and batch, on the very same contention and very same

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1 (2014) 11 SCC 790

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2 (2002) 1 SCC 234

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3 (2005) 2 SCC 217

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legal ground in between the same parties, wherein it is held that a power of attorney holder can maintain the complaint and the same being a curable, the affidavit can be filed during postcognizance stage.

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The matter was considered by a larger Bench of three Judges. By judgment dated 13.09.2013 in A.C.Narayanan’s case (1 supra), the said larger Bench framed the following questions:

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"21.1.(i) Whether a power-of-attorney holder can sign and file a complaint petition on behalf of the complainant?/Whether the eligibility criteria prescribed by Section 142(a) of the NI Act would stand satisfied if the complaint petition itself is filed in the name of the payee or the holder in due course of the cheque?

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21.2.(ii) Whether a power-of-attorney holder can be verified on oath under Section 200 of the Code?

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21.3.(iii) Whether specific averments as to the knowledge of the power-of-attorney holder in the impugned transaction must be explicitly asserted in the complaint?

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21.4.(iv) If the power-of-attorney holder fails to assert explicitly his knowledge in the complaint then can the powerof-attorney holder verify the complaint on oath on such presumption of knowledge?

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21.5.(v) Whether the proceedings contemplated under Section 200 of the Code can be dispensed with in the light of Section 145 of the NI Act which was introduced by an amendment in the year 2002?"

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The first question is answered in the following:

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"However, it is expected that such power-of-attorney holder or legal representative(s) should have knowledge about the transaction in question so as to able to bring on record the truth of the grievance/offence, otherwise, no criminal justice could be achieved in case payee or holder in due course, is unable to sign, appear or depose as complainant due to abovequoted reasons. Keeping these aspects in mind, in M.M.T.C. case [(2002) 1 SCC 234], this Court had taken the view that if complaint is filed for and on behalf of payee or holder in due course, that is good enough compliance with Section 142 of the NI Act."

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The second question:–

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"There is no dispute that complaint has to be filed by the complainant as contemplated by Section 200 of the Code, but the said section does not create any embargo that the attorney holder or legal representative(s) cannot be a complainant."

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The second question answered in the following:

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Nevertheless, an explicit assertion as to the knowledge of the power-of-attorney holder about the transaction in question

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must be specified in the complaint. On this count, the fourth question becomes infructuous.

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It was also held in A.C.Narayanan’s case (1 supra) that there is no serious conflict between the decisions in M.M.T.C. case [(2002) 1 SCC 234] and Janki Vashdeo Bhojwani case [(2005) 2 SCC 217], the larger Bench clarified the position and answered the questions framed on the following manner:

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33.1(i) Filing of complaint petition under Section 138 of the NI Act through power of attorney is perfectly legal and competent.

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33.2(ii) The power-of-attorney holder can depose and verify on oath before the court in order to prove the contents of the complaint. However, the power-of-attorney holder must have witnessed the transaction as an agent of the payee/holder in due course or possess due knowledge regarding the said transactions.

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33.3(iii) It is required by the complainant to make specific assertion as to the knowledge of the power-of-attorney holder in the said transaction explicitly in the complaint and the power-of-attorney holder who has no knowledge regarding the transactions cannot be examined as a witness in the case.

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33.4(iv) In the light of Section 145 of the NI Act, it is open to the Magistrate to rely upon the verification in the form of affidavit filed by the complainant in support of the complaint under Section 138 of the NI Act and the Magistrate is neither mandatorily obliged to call upon the complainant to remain present before the Court, nor to examine the complainant of his

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witness upon oath for taking the decision whether or not to issue process on the complaint under Section 138 of the NI Act. 33.5(v) The functions under the general power of attorney cannot be delegated to another person without specific clause permitting the same in the power of attorney. Nevertheless, the general power of attorney itself can be cancelled and be given to another person.

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In A.C.Narayanan’s case (1 supra), the Supreme Court held that filing of complaint/ petition under Section 138 of the NI Act through GPA holder perfectly legal and competent. However,

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(i) GPA holder certify due knowledge about transaction in question,

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(ii) GPA holder cannot file a complaint in his own name as if he is the complainant,

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(iii) the GPA holder can only initiate proceedings on behalf of the complainant under Section 200 of Cr.P.C. and Section 60 of the Indian Evidence Act and there should be an averment as to the knowledge of the complainant required to be made in the complaint,

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(iv) in the complaint filed through the GPA holder, an explicit assertion as to the knowledge of the GPA holder as to the prosecution in question must be satisfied, and

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(v) the GPA holder who has no knowledge about the transactions, then he cannot be examined as a witness and these are the guidelines where the Supreme Court has framed in the aforesaid case of A.C.Narayanan (1 supra).

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Basing upon the above referred cases, the common High Court has disposed of the Criminal Petitions filed by the same petitioner herein against the same respondent to raise all the grounds before the trial Court, which were putforth in the said Criminal Petitions.

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The ground raised by the petitioner herein is no more res integra as the Supreme Court has categorically held that the GPA holder can maintain a complaint, however for the aforesaid guidelines.

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In the present case, it is specifically asserted about the knowledge of the facts of the case and the present complaint is not filed in the name of the GPA holder.

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However, it is left open to the petitioner to raise all the grounds before the trial Court which are raised in the Criminal Petition.

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The learned counsel for the respondent would request this Court to direct the trial Court to dispose of the matters expeditiously. In view of the request made by the learned counsel for the respondent, the trial Court shall proceed with the matter, as expeditiously as possible, but in any event shall

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dispose of the matters within a period of four months from the

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date on which the copy of the judgment is furnished.

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