Sreeram Hire Purchase and Loans, Thriprayar, Chavakkad Taluk, rep. by its Managing Partner Leeba Sukumaran v. K.B. Anilkumar and State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR. JUSTICE P.D.RAJAN** **THURSDAY, THE 7TH DAY OF JANUARY 2016/17TH POUSHA, 1937** **CRL.A.No. 973 of 2004 ( ) --------------------------** **AGAINST THE JUDGMENT IN CC 712/2000 of JUDICIAL MAGISTRATE OF FIRST CLASS, CHAVAKKAD DATED 20-04-2004** **APPELLANT(S)/COMPLAINANT:: ------------------------SREERAM HIRE PURCHASE AND LOANS, THRIPRAYAR, CHAVAKKAD TALUK, REP. BY ITS MANAGING PARTNER, LEEBA SUKUMARAN, D/O.V.T.BALAN.** **BY ADV. SRI.K.N.PADMAKUMAR** **RESPONDENT(S)/ACCUSED & STATE:: ------------------------------1. K.B.ANILKUMAR, S/O. BHASKARAN, KALATHIL HOUSE, THIRUVATHRA DESOM, MANATHALA VILLAGE, CHAVAKKAD TALUK, THRISSUR.** **2. STATE OF KERALA, REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA.** **R, BY PUBLIC PROSECUTOR SRI. N. SURESH R BY ADV. SRI.P. RAMACHANDRAN** **THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 07-01-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **acd** ## **P.D. RAJAN, J.** ------------------------------------------Crl.Appeal No.973 of 2004 ---------------------------------------------Dated this the 7[th] day of January, 2016 ## **JUDGMENT** This appeal is preferred by the complainant against the judgment in C.C.No.712/2000 of Judicial First Class Magistrate Court, Chavakkad, which was filed by him against the accused for offence punishable u/s.138 of the Negotiable Instruments Act (hereinafter referred to as the N.I. Act). The complainant is a registered firm dealing with hire purchase and loan business. On 16.12.1998 , the accused entered into hire purchase agreement with the complainant to purchase an autorickshaw and availed an amount of ₹21,440/-. He agreed to repay the amount in 18 equal monthly instalments, but he paid only 5 instalments and Crl.Appeal No.973/2004 2 thereafter defaulted the payment. The complainant claimed the due amount, the accused issued Ext.P3 cheque, drawn on Nattika Firka Service Co-operative Bank to the complainant. When he presented the cheque for encashment, it was dishonoured for the reason of funds insufficient. After this the complainant demanded the amount by giving a notice in writing to the accused. Even after receipt of notice, there was no payment. Hence the complaint. 2. During trial, the complainant was examined as PW1 and her documents were marked as Exts.P1 to P8. The incriminating circumstances brought out in evidence were denied by the accused while questioning him u/s.313 Cr.P.C. The accused examined DW1 and DW2 and marked Exts.D1 to D4. The learned Magistrate acquitted the accused u/s.255(1) Cr.P.C. Being aggrieved by that, Crl.Appeal No.973/2004 3 complainant preferred this appeal. 3. The main contention advanced by the learned counsel for the appellant is that the complainant is a partnership firm between family members. The cheque was issued in the name of V.T. Balan, since he was the Managing Partner of the firm. The partnership firm has no separate legal entity like a company. Every partner can accept the cheque in their name for the liability of the firm. When cheque is issued in the name of Managing Partner, the Company is the payee or holder in due course and he/she can file a complaint. 4. In reply to the argument, the 1[st] respondent contended that Ext.P3 cheque was issued in the name of one V.T. Balan and the partner cannot claim that it was issued in discharge of a debt or liability of the partnership firm. Payee or holder of the cheque is one V.T. Balan. Crl.Appeal No.973/2004 4 When cheque is issued to one V.T. Balan in a personal capacity, a complaint on behalf of the partnership firm is not maintainable. 5. The general law is that anyone can set the criminal law in motion by filing a complaint before a Magistrate to take cognizance under Section 190 of the Code of Criminal Procedure. If a Statute prescribes any special criteria for putting the criminal law in motion, no court can take cognizance of the offence by violating those special criteria. Section 190 of the Code does not indicate any qualification for the complainant. But when a special statute prescribes an offence and provides special provision for taking cognizance of such offences under the Act, the complainant must satisfy the eligibility criterion prescribed by the statute for taking **Vishwa Mitter** v. cognizance of the offence. Apex Court in **O.P. Poddar** [1983 4 SCC 701] held that any one can set the criminal law in motion by filing a complaint before a Magistrate Crl.Appeal No.973/2004 5 to take cognizance. It has been held that where any special statute prescribes offences and makes any special provision for taking cognizance of such offences under the statute, the complainant requesting the Magistrate to take cognizance of the offence must satisfy the eligibility criterion prescribed by the statute. But in **M.M.T.C. and Anr** . vs. **Medchl Chemicals and Pharma (P) Ltd. and Anr** [2002 1 SCC 234], Apex Court held that "In the present case, the only eligibility criteria prescribed by Section 142 is that the complaint must be by the payee or the holder in due course. 6. According to Section 142 of the N.I. Act, notwithstanding anything contained in the Code of Criminal Procedure, no court shall take cognizance of any offence punishable under Section 138 except upon a complaint in writing, made by the payee or, as the case may be, the holder in due course of the cheque. When there is no proper notice and demand, a stranger cannot file a 6 Crl.Appeal No.973/2004 complaint u/s.142 of the Negotiable Instruments Act. The Delhi High Court in **Eita India Ltd.** v. **NCT of Delhi** [2003 (113) Company Case 32] held that the eligibility criterion prescribed by Section 142 of the N.I. Act is that the complaint must be by the payee or the holder in due course. This criterion is satisfied as the complaint is in the name and on behalf of the appellant-company. When the sole proprietorship concern was payee u/s.142 of the Act, it could validly institute the complaint, but it cannot act on its own and it can act through its proprietor. Here, the cheque was issued in the name of one of the partners. No documents were produced in the trial Court to show that it was issued in discharge of a debt or liability of the partnership firm. 7. The appellant partners of the firm by a resolution filed a complaint to prosecute the accused, the Crl.Appeal No.973/2004 7 1[st] respondent in this case. After filing the case, the Managing Partner, who filed the complaint died. Thereafter, his daughter was proceeded with the complaint and examined as PW1. Ext.P1 is the copy of the partnership deed and Ext.P2 is the minutes of the meeting. According to Section 142 of the N.I. Act, notwithstanding anything contained in the Code of Criminal Procedure 1973, no Courts shall take cognizance of an offence punishable us.138 except upon a complaint in writing made by the payee or as the case may be order in due course of the cheque. A complaint on behalf of the partnership firm can be filed by any partner of the firm without any specific authorisation since each partner is the agent of the firm. A power of attorney holder can also file a complaint on behalf of the firm against the accused provided the power of attorney holder has to duly authorised. If the 8 Crl.Appeal No.973/2004 partnership deed itself makes any express provision to authorise to file a complaint, then special authorisation is not necessary. The specific case of the appellant is that Ext.P3 was issued in discharge of a debt. When it was presented for encashment, it was dishonoured for the reason of funds insufficient. Ext.P4 is the dishonour memo. Ext.P5 is the copy of the lawyer notice. Ext.P6 is the acknowledgment card. Ext.P7 is the postal receipt and Ext.P8 is the ledger extract. Ext.P1 is the copy of the partnership deed. Ext.P2 is the minutes of the meeting. On a perusal of Exts.P1 to P8 it is clear that no documents were produced in the trial Court to show that Ext.P3 was issued in discharge of a loan amount between appellant and the 1[st] respondent. The cheque was issued in the name of one V.T. Balan and no documents were produced to prove hire purchase agreement and the payment of five Crl.Appeal No.973/2004 9 instalments. No documents have been produced in the trial Court to show that Ext.P3 was issued in discharge of a debt or liability to the partnership firm. When there is no document to show that the accused/respondent entered into hire purchase agreement with a partnership firm to purchase an autorickshaw and part payment was made by the accused and for the balance amount, he issued a cheque, the partnership firm cannot file a complaint as a payee or holder in due course. Therefore, filing a complaint on behalf of the partnership firm on Ext.P3 is not maintainable. Then it is only a personal transaction with V.T. Balan and I do not find any illegality in the order passed by the learned Magistrate. Therefore, there is no merit in this appeal and it is dismissed accordingly. **P.D. RAJAN, JUDGE.** acd