w w w . L a w y e r S e r v i c e s . i n



M/s. Choice Intermodel Services rep. by Shari S. Nath Power of Attorney Holder & Legal Executive v/s M/s. Green Sea Marine Alappuzha rep. by its Managing Partner S.K. Muhammed & Others


Company & Directors' Information:- J K MARINE SERVICES PRIVATE LIMITED [Converted to LLP] CIN = U05005MH2006PTC160885

Company & Directors' Information:- C R GREEN POWER PRIVATE LIMITED [Active] CIN = U74120WB2010PTC150166

Company & Directors' Information:- SEA SERVICES PRIVATE LIMITED [Active] CIN = U28999GJ1990PTC013498

Company & Directors' Information:- INDIA CHOICE PRIVATE LIMITED [Active] CIN = U51900DL2013PTC253963

Company & Directors' Information:- V V GREEN POWER PRIVATE LIMITED [Active] CIN = U40108TZ2009PTC014966

Company & Directors' Information:- GREEN POWER COMPANY LIMITED [Strike Off] CIN = U40108MH2000PLC129637

Company & Directors' Information:- J AND L MARINE SERVICES PRIVATE LIMITED [Active] CIN = U61100GA2008PTC005868

Company & Directors' Information:- V G S LEGAL SERVICES PRIVATE LIMITED [Active] CIN = U74900DL2000PTC106988

Company & Directors' Information:- G R K GREEN POWER PRIVATE LIMITED [Active] CIN = U36100TN2015PTC101050

Company & Directors' Information:- GREEN INDIA GREEN SERVICES PRIVATE LIMITED [Active] CIN = U01403BR2014PTC022617

Company & Directors' Information:- G K GREEN POWER PRIVATE LIMITED [Active] CIN = U40108TZ2012PTC018328

Company & Directors' Information:- S L S GREEN POWER PRIVATE LIMITED [Active] CIN = U40109KA2004PTC033520

Company & Directors' Information:- SEA GREEN MARINE PVT LTD [Strike Off] CIN = U05005KL1993PTC007606

Company & Directors' Information:- R A MARINE SERVICES PRIVATE LIMITED [Active] CIN = U74990TN2012PTC084832

Company & Directors' Information:- A T MARINE SERVICES (INDIA) PRIVATE LIMITED [Strike Off] CIN = U35910MH2011PTC217734

Company & Directors' Information:- B S R GREEN POWER INDIA PRIVATE LIMITED [Active] CIN = U40108TG2010PTC071938

Company & Directors' Information:- LEGAL SERVICES INDIA PRIVATE LIMITED [Strike Off] CIN = U74110KA1996PTC020769

Company & Directors' Information:- S K S MARINE SERVICES PRIVATE LIMITED [Strike Off] CIN = U93000WB2011PTC168425

Company & Directors' Information:- R & L LEGAL SERVICES PRIVATE LIMITED [Strike Off] CIN = U74999MH2008PTC185128

Company & Directors' Information:- SK MARINE PRIVATE LIMITED [Strike Off] CIN = U05001GJ2007PTC050278

Company & Directors' Information:- SEA POWER MARINE PRIVATE LIMITED [Strike Off] CIN = U74999WB2011PTC164450

Company & Directors' Information:- C S GREEN POWER PRIVATE LIMITED [Strike Off] CIN = U74900PY2010PTC002478

Company & Directors' Information:- S R LEGAL SERVICES PRIVATE LIMITED [Active] CIN = U74140RJ2014PTC045816

Company & Directors' Information:- R A R MARINE SERVICES PRIVATE LIMITED [Strike Off] CIN = U29253MH2013PTC243978

Company & Directors' Information:- M K MARINE SERVICES PRIVATE LIMITED [Strike Off] CIN = U74140MH2005PTC158295

Company & Directors' Information:- C G MARINE SERVICES PRIVATE LIMITED [Strike Off] CIN = U35117MH1998PTC116744

Company & Directors' Information:- R. K. MARINE SERVICES PRIVATE LIMITED [Active] CIN = U61200MH2014PTC258038

Company & Directors' Information:- J T MARINE SERVICES PRIVATE LIMITED [Active] CIN = U63032MH2004PTC148926

Company & Directors' Information:- P R MARINE SERVICES PRIVATE LIMITED [Active] CIN = U63032MH2007PTC173271

Company & Directors' Information:- N A MARINE SERVICES PRIVATE LIMITED [Active] CIN = U63090MH2005PTC156391

Company & Directors' Information:- POWER ON SERVICES PRIVATE LIMITED [Active] CIN = U51909MH2013PTC241871

Company & Directors' Information:- S B M MARINE SERVICES PRIVATE LIMITED [Active] CIN = U74999MH2014PTC255594

Company & Directors' Information:- B V K R POWER SERVICES PRIVATE LIMITED [Strike Off] CIN = U40108TG2009PTC064142

Company & Directors' Information:- S V LEGAL SERVICES PRIVATE LIMITED [Active] CIN = U74110TG2014PTC093676

Company & Directors' Information:- D AND P LEGAL SERVICES PRIVATE LIMITED [Active] CIN = U74140DL2005PTC135437

Company & Directors' Information:- C T LEGAL SERVICES PRIVATE LIMITED [Strike Off] CIN = U93000HR2010PTC041131

Company & Directors' Information:- K K LEGAL SERVICES PRIVATE LIMITED [Active] CIN = U74140GJ2015PTC082023

Company & Directors' Information:- U E LEGAL SERVICES INDIA PRIVATE LIMITED [Strike Off] CIN = U74140KL2014PTC036076

Company & Directors' Information:- MARINE POWER PRIVATE LIMITED [Strike Off] CIN = U31909GJ2002PTC041255

Company & Directors' Information:- K P S MARINE SERVICES INDIA PRIVATE LIMITED [Active] CIN = U34101GJ2015PTC082794

Company & Directors' Information:- K P MARINE SERVICES PRIVATE LIMITED [Active] CIN = U35303GJ2011PTC063942

Company & Directors' Information:- O. P. MARINE SERVICES PRIVATE LIMITED [Active] CIN = U63090GJ2010PTC061335

Company & Directors' Information:- A & G LEGAL SERVICES PRIVATE LIMITED [Under Process of Striking Off] CIN = U74110KL2013PTC035282

Company & Directors' Information:- R S MARINE SERVICES PRIVATE LIMITED [Strike Off] CIN = U63032MH2008PTC188164

Company & Directors' Information:- A & Z MARINE SERVICES PRIVATE LIMITED [Strike Off] CIN = U00738BR1995PTC006448

Company & Directors' Information:- SEA INDIA LIMITED [Dissolved] CIN = U99999MH1949PLC007943

    CRL. A. No. 22 of 2007

    Decided On, 12 September 2013

    At, High Court of Kerala

    By, THE HONOURABLE MR. JUSTICE HARUN-UL-RASHID

    For the Appellant: V.J. Mathew, Advocate. For the Respondents: R1 & R2, Babu Cherukara, K.K. Alias, R3, Ashik K. Mohammed Ali, Advocates, R4, Mrs. Sareena George, Public Prosecutor.



Judgment Text

1. Appellant is the complainant in C.C.No.715/2001 on the file of the Judicial First Class Magistrate-I, Ernakulam. The complaint was instituted alleging offence punishable under Section 138 of the Negotiable Instruments Act. The accused were found guilty of the offence punishable under Section 138 of the Act and they are convicted therein. Accused No.1 Company was sentenced to pay fine of 5,000/-, Accused Nos.2 and 3 were sentenced to undergo simple imprisonment for one month and also to pay a sum of 1,90,000/- to the complainant as compensation under Section 357 (3) of the Cr.P.C. In default of payment of compensation to undergo simple imprisonment for three months. The accused preferred Crl. Appeal No.747/2005 before the learned Sessions Judge. The learned Sessions Judge allowed the appeal and set aside the conviction and sentence. The parties are hereinafter referred to as arrayed in the said C.C.

2. Complainant is M/s.Choice Intermodel Services. Accused No.1 is M/s.Green Sea Marine, Aroor represented by the Managing Partner S.K. Mohammed. Accused No.2 is S.K. Mohammed, Managing Partner and Accused No.3 is V.S.Abdul Gafoor, Partner. Complainant M/s.Choice Intermodel Services is a Division of Choice Trading Corporation Ltd., which is a public limited Company registered under the Companies Act. The complainant is doing business in the field of Shipping and Steamer Agent of Hyundai Marine Co.Ltd. Accused No.1 is a partnership firm doing C & F Agency and accused Nos.2 and 3 were its Managing Partner and partner respectively. Complainant's case is that accused Nos.2 and 3 hired the services of the complainant to make shipment of Cuttle Fish from Cochin to Ningbe China through the vessel 'MV Transcord', and that the accused incurred liability of 1,63,872/- towards the complainant for the charges of shipment. To discharge the liability the accused had issued cheque No.620411 dated 29/12/2000 drawn on Federal Bank Ltd., Aroor in favour of the complainant. Cheque when presented was dishonoured with memo dated 29/1/2001 stating 'funds insufficient'. On receipt of communication, the complainant issued notice dated 8/2/2001 demanding the cheque amount. Though the accused received notice on 14/2/2001 they failed to discharge the liability. Complainant company was represented by its power of attorney holder. PW1 was examined and Exts.P1 to P10 were marked. No defence evidence was adduced on the part of the accused. When questioned under Section 313 of the Cr.P.C., accused denied all the incriminating facts in evidence against them. Ext.P1 to P5 respectively are copy of the power of attorney, copy of agency agreement, copy of bill of lading, copy of freight memo and cheque. Exts.P6 to P10 are dishonoured memo, intimation letter, copy of demand notice, acknowledgement card, and true extract of bank account respectively.

3. PW1 testified before the court below that Ext.P5 cheque was issued by the accused for discharging the liability incurred by them in connection with the shipment of cuttle fish from Cochin to China through the vessel named in the complaint. Accused disputed the liability raising the contention that the goods were not delivered at the destination in proper time and damage was caused to the goods due to the negligence of the complainant and therefore accused are not liable to discharge the liability. It is not disputed that Ext.P5 was issued by the accused. Accused also contended that they are not partners of the firm and not liable in furtherance of Ext.P5 cheque. In the complaint it is pleaded that Ext.P5 cheque was delivered by accused Nos.2 and 3 to the complainant. The signature in Ext.P5 cheque is not disputed. The main contention is that they are not liable to pay the amount covered by the cheque due to the non-delivery of goods at the destination in proper time and damage was caused to the goods due to the negligence of the complainant and therefore they are not liable to discharge the liability. On facts and materials, the trial court rightly held that Ext.P5 was issued by the accused in favour of the complainant in which accused Nos.2 and 3 are described as Managing Partner and Partner of the lst accused Firm. They appeared before the court and contended that they are not partners of the lst accused firm. It is seen that the cheque was issued from the account of the lst accused firm. Ext.P10 account ledger shows the same. The trial court observed that in the normal course the accused are either the partners of the firm or agent of the firm to issue the cheque, otherwise they could not have issued the same.

4. The signature in Ext.P5 was not disputed. Ext.P5 cheque contains the signature of accused 2 and 3. In the circumstance, the contention of the accused that they are not partners of the firm is not acceptable. The trial court found that the the execution stands proved and therefore the presumption under Section 118 of the Negotiable Instruments Act is attracted. Other contention raised by the accused is that the entire goods transported through the complainant did not reach the destination in proper time and on account of the failure of the accused to keep -18 C temperature the entire goods were damaged. The accused could not establish the said contention. That is the suggestion put to PW1 when he was cross examined. The trial court rightly held that the issuance of cheque is an executed contract and further development would not mitigate the liability. The trial court also found that any damage caused to the accused even if it is true, would enable him to file a civil suit to recover compensation and it would not absolve his liability.

5. Ext. P2 is the agreement between Hyundai Merchant company and complainant company. The agreement would prove that the complainant is an authorised agent of Hyundai Merchant Company in India. The complainant, M/s.Choice Intermodel Services is a division of Choice Trading Corporation Ltd., a limited company. Exts.P3 and P4 are the bill of lading and freight memo. Exts.P3 and P4 would prove the liability of the accused besides the presumption. In view of the evidence adduced in this case and considering the defence version, it is proved beyond doubt that the accused is liable for discharging the entire amount covered in Ext.P5 towards the complainant.

6. Ext.P1 certified copy of the power of attorney was issued by Choice Trading Corporation empowering PW1 to lodge the complaint. Ext.P5 cheque was issued in the name of the complainant division. PW1 testified before the court that she is working in the division. She testified that Choice Intermodel Services is a division of Choice Trading Corporation. The contention raised by the accused that the complainant has no authority to file this complaint was brush aside for valid reasons.

7. The accused preferred Criminal Appeal No.747/2005 challenging the findings of the trial court. The Appellate Court, after perusing the materials and after placing reliance on them, found that PW1 is competent to file the complaint on behalf of the complainant. The Appellate Court also found that Exts.P5 and P10 documents clearly go to show that Ext.P5 cheque was dishonoured for want of money in the account of the first accused firm, that the complainant issued statutory notice demanding the cheque amount as per the provisions of the Act, that even after receipt of the notice, the accused failed to pay the cheque amount and that complaint was filed within the statutory period. The Appellate Court allowed the appeal and set aside the judgment for the reason that PW1 is a person who has no direct knowledge regarding the transaction and about the issuance of Ext.P5 cheque. The learned Judge relied on the decision reported in Janki Vashdeo v. Indusind Bank ((2005 (2) KLT 265)(SC)) and held that the power of attorney holder cannot give evidence on behalf of the principal without having direct knowledge regarding the transactions. According to the learned Judge, the evidence of power of attorney holder can be considered only after evaluating the worth of the evidence tendered by that witness and if she has no direct knowledge regarding the transaction, the appellant is not in a position to state the credibility of the evidence tendered by PW1 with regard to the transaction. The learned Judge found that the said fact would go to show that the complainant has not succeeded in discharging the initial burden of proof.

8. I have read the said decision. The decision was rendered in the context and circumstances of the said case. In that case there was an earlier remand by the Apex Court. The Court directed the appellants to adduce evidence as to whether they were the co-owners of the property for ascertaining whether the appellants had any independent source of income and whether they had contributed for purchase of this property from their own independent income. The Apex Court further directed the Debt Recovery Tribunal to permit the parties to lead evidence, both oral and documentary and further clarified that the burden of proving that the appellants have a share in the property will be on the appellants. The matter was again considered by the Apex Court after remand. In that case, after remand, the appellants did not enter the box to lead the evidence but authorised the power of attorney holder to appear on behalf of the appellants. The Apex Court held that it was in the context of the directions given by this Court, shifting the burden of proving on the appellants that they have a share in the property, it was obligatory on the appellants to have entered the box and discharged the burden by themselves. The question as to whether the appellants have any independent source of income and have contributed towards the purchase of the property from their own independent income can be only answered by the appellants themselves and not by a power of attorney for them. The power of attorney holder does not have the personal knowledge of the matter of the appellants and therefore he can neither depose on his personal knowledge nor can he be crossexamined on those facts which are to the personal knowledge of the principal. The court also held that the power of attorney holder cannot depose for the principal for the acts done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter which only the principal can have a personal knowledge and in respect of which the principal is entitled to be cross-examined. In that case the dispute is between private parties. There is a specific direction by the Apex Court to adduce evidence by the appellants themselves. The point directed to be examined is as to whether the appellants had any independent income and whether the appellants are co-owners of the property. It is clarified in the remand order that the burden of proving that the appellants have a share in the property will be on the appellants. Further direction issued by the court was that the Debt Recovery Tribunal shall forward its decision to the court within a period of six months from the date of the judgment.

9. In this case the complaint is a company and power of attorney was deputed to tender evidence on behalf of the company. In company matters always officers are representing the company. One officer may go and another may come. The evidence is always let in on the basis of the documentary evidence. Any responsible officer of the company can represent the matter before a court, who is authorised to do so. Complaint instituted alleging offence punishable under the Negotiable Instruments Act should be supported by an authorisation or power of attorney. It is true that the complaint cannot be entertained in the absence of authorization or power of attorney. It can safely be inferred that PW1 has the express authority to act on behalf of the company and after all she represented the company only to safeguard its interest, i.e. her acts are not to the prejudice of the company, but on the contrary they are for the benefit of the company. Most importantly the Board of the company never expressly or impliedly, disrobed PW1 for acting on behalf of the company.

10. In this case the complainant M/s.Choice Intermodel Services, a division of Choice Trading Corporation Ltd. This fact is not disputed. Being a company, evidence can be tendered only through its officers. M/s. Choice Trading Corporation Ltd. is a limited company registered under the companies Act. Complaint was presented by PW1 in his capacity as the power of attorney holder of the said company. In the complaint it is stated that the complaint is filed through PW1.

11. In the decision reported in Om Sakthi SC/ST and Minority Credit Co-operative Society Ltd. v. M. Venkateshm (2008 KHC 5500) the Karnataka High Court held that a complaint instituted alleging offence punishable under the Negotiable Instruments Act should be supported by an authorisation or Power of Attorney. Following the decision reported in Director, Maruti Feeds and Farms Pvt.Ltd. v . Basanna Pattekar (ILR 2007 Kar. 3155) it was held that 'when a complainant deposing on behalf of the company - non production of resolution - authorising the Director of the Company to establish that the Director has been authorised to depose for and on behalf of the company is fatal to the complaint and the complaint cannot be entertained in the absence of authorisation or a power of attorney.'

12. In the decision reported in Waterbase Ltd. v. K.Ravindra and another (2003 KHC 2175) the Andhra Pradesh High Court took the same view. In that case, a contention was raised that PW1 is not competent to lodge the complaint representing the company, inasmuch as there is no proper authorisation. PW1 was the Assistant Manager of the company. After lengthy discussion, the Court held that 'it can safely be inferred that PW1 has the implied authority to act on behalf of the company and after all he represented the company only to safeguard its interest, i.e. his acts are not to the prejudice of the company, but on the contrary they are for the benefit of the company.

13. In view of the legal position discussed above, this Court is of the view that the learned Judge is not justified in dismissing the complaint finding that the complainant has not succeeded in discharging the initial burden of proof by examining PW1, who has no direct knowledge about the issuance of Ext.P5 cheque.

14. This case relates to dishonour of cheques in the year 2003. As limitation for filing civil suit expired long back, the appellant has also lost opportunity of recovering the amount by way of civil suit. The apparent intention of the Act is to ensure that not only the offender is punished but also that the complainant invariably receives the amount of cheque by way of compensation under Section 357(1)(b) of the Code. In practice once the criminal complaint is lodged under Section 138 of the Act, a civil suit is seldom filed to recover the amount of the cheque. This is because of the provision enabling the court to levy a fine linked to the cheque amount and the usual direction in such case is for payment as compensation, the cheque amount, as loss incurred by the complainant on account of dishonour of cheque under Section 357 (1)(b) of the Code. The Apex Court in the decision reported in Vijayan v. Baby (2011(4) KLT 355 (SC)) held:

'As the provisions of Chapter XVII of the Act strongly lean towards grant of reimbursement of the loss by way of compensation, the court should, unless there are special circumstances, in all cases of conviction, u

Please Login To View The Full Judgment!

niformly exercise the power to levy fine upto twice the cheque amount (keeping in view the cheque amount and the simple interest thereon at 9% per annum as the reasonable quantum of loss) and direct payment of such amount as compensation. Direction to pay compensation by way of restitution in regard to the loss on account of dishonour of the cheque should be practical and realistic, which would mean not only the payment of the cheque amount but interest thereon at a reasonable rate.' Exts.P1 cheque is dated 29/12/2000. The amount is due from that date. Taking a practical and realistic view the accused shall compensate the complainant by making payment of Rs. 2,50,000/- (Rupees two lakhs and fifty thousand only)." 15. On a reading of the materials on record, I am of the view that the impugned judgment passed by the Appellate Court is legally and factually incorrect and therefore liable to be set aside. I agree with the finding recorded by the trial court. At the same time, considering the fact that the cheque is of the year 2000, this Court is inclined to modify the sentence imposed by the trial court. In the result, The appeal is allowed. The conviction passed by the trial court is confirmed. The sentence as against the lst accused company is confirmed. Accused Nos.2 and 3 are sentenced to undergo simple imprisonment till the rising of the court and also to pay a sum of Rs. 2.5 lakhs (Rupees two lakhs and fifty thousand only) as compensation within a period of two months from today. In default of payment of compensation the accused 2 and 3 shall undergo simple imprisonment for a period of six months each. The accused shall appear before the trial court on 06/11/2013 for undergoing substantive sentence.
O R