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2016 DIGILAW 1489 (ALL)

Yashpal Singh Chauhan v. State of U. P.

2016-04-21

SUNEET KUMAR

body2016
JUDGMENT Suneet Kumar, J. Sri S.K. Tyagi, Advocate has filed his vakalatnama on behalf of opposite party no. 2, is taken on record. Heard learned counsel for the applicant, learned counsel for opposite party no. 2 and the learned A.G.A. 2. By means of the present application filed under Section 482 Cr.P.C., the applicant has prayed for quashing the proceeding of Complaint Case No.4343 of 2015 (Smt. Komal Bhasin v. Yashpal Singh Chauhan), under Section 138 of Negotiable Instruments Act, 1881 (for brevity 'N.I. Act'), P.S. Kotwali, Kanpur Nagar pending in the court of Special Chief Judicial Magistrate, Kanpur Nagar. 3. Three fold argument has been advanced by the learned counsel for the applicant: (i) The complaint under Section 138 N.I. Act could not have been filed by the power of attorney holder; (ii) The applicant to satisfy the decree passed by the Arbitral Tribunal had issued the alleged cheques which subsequently bounced. The complainant has already approached the competent court for executing the decree, therefore, parallel proceeding under the N.I. Act to recover the sum due is misuse of process of court; (iii) The applicant can avail one remedy, either to execute the decree or to proceed under Section 138 N.I. Act. 4. Shri Tyagi, learned counsel appearing for opposite party no. 2 would contend that the power of attorney holder can file the complaint on behalf of the complainant, mere pendency of execution of an arbitral award would not preclude the opposite party no. 2 from availing the remedy under Section 138 N.I. Act, therefore, there is no illegality or infirmity in the order summoning the applicant. 5. Rival submission falls for consideration: The record would reveal that opposite party no. 2 instituted the complaint upon dishonour of a cheque of Rs.50/- lac drawn by the applicant. The complainant would allege that in a dispute between the parties, the matter was referred to the arbitrator. A consent award for a sum of Rs.1,92,56,698/- was passed. The applicant failed to satisfy the award, consequently, opposite party no. 2 approached the Delhi High Court in execution proceedings. The execution court attached the property belonging to the applicant and directed for its auction. To avoid the auction, the applicant furnished an undertaking to pay Rs.2,26,62,000/-, accordingly, cheques were issued by the applicant for various sums including the amount mentioned herein above. 2 approached the Delhi High Court in execution proceedings. The execution court attached the property belonging to the applicant and directed for its auction. To avoid the auction, the applicant furnished an undertaking to pay Rs.2,26,62,000/-, accordingly, cheques were issued by the applicant for various sums including the amount mentioned herein above. It is alleged in the complaint that the applicant also furnished an undertaking that in the event of the cheque being dishonoured, it would be open to the opposite party to invoke the provision of N.I. Act, consequently, the present complaint was filed. Learned Magistrate upon considering the statement and material filed along with complaint, summoned the applicant. 6. A three Judge Bench of Supreme Court in A.C. Narayanan vs State of Maharashtra & another : 2014 (11) SCC 790 , was called upon to answer as to whether a complaint under Section 138 N.I. Act can be instituted by a power of attorney holder, the Court held that the power of attorney holder can institute a complaint on behalf of the complainant but cannot institute the complaint in his own name. 7. After considering the relevant provisions of Negotiable Instruments Act and the relevant judgements on the point, the Court clarified the legal position and answered the question in the following manner. "(i) Filing of complaint petition under Section 138 of NI Act through power of attorney is perfectly legal and competent. (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. (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. (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. (iv) In the light of section 145 of 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 or his witness upon oath for taking the decision whether or not to issue process on the complaint under Section 138 of the NI Act. (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." (Ref: Vinita S. Rao v. M/s. Essen Corporate Services Pvt. Ltd. & another : 2015 (1) SCC 527 ). 8. A bare perusal of the complaint would reflect that the complaint has been filed on behalf of the complainant through power of attorney holder, as such, the objection raised by the learned counsel for the applicant that the complaint cannot be instituted by power of attorney holder, is untenable. 9. The Supreme Court in M/s Sri Krishna Agencies vs State of A.P. & another : 2009 (1) SCC 69 , wherein the question for consideration before the Court was as to whether separate liability arose in terms of Section 138 N.I. Act, where an arbitration proceedings under the agreement signed between the parties was also simultaneously initiated. The Court held that the commencement and the continuance of the arbitration proceedings could in no way affect criminal proceedings taken separately. There can be no bar to the simultaneous continuance of a criminal proceeding and a civil proceeding if the two arise from separate cause of action. 10. Merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. There can be no bar to the simultaneous continuance of a criminal proceeding and a civil proceeding if the two arise from separate cause of action. 10. Merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. It is untenable that the provision incorporated in the agreement for referring the disputes to arbitration is an effective substitute for a criminal prosecution when the disputed act is an offence. Arbitration is a remedy for affording relief to the party affected by breach of the agreement but the arbitrator cannot conduct a trial of any act which amounted to an offence albeit the same act may be connected with the discharge of any function under the agreement. Hence, those are not good reasons for the High Court to axe down the complaint at the threshold itself. [Ref: Trisuns Chemical Industry v. Rajesh Agarwal : (1999) 8 SCC 686 . 11. The total sum sought to be recovered in execution of the award is to the tune of Rs.2,26,62,000/-, whereas, in the present case, the cheque that was returned by the bank is of Rs.50/- lac only, which would not satisfy the decree, therefore, it cannot be said that both the proceedings cannot be continued simultaneously. In my opinion, the argument is misconceived for the reason that it is not the case of the applicant that the decree has been satisfied. It is not being disputed by learned counsel for the applicant that the decree has been satisfied and that cheque returned would satisfy the decree or the liability. The complaint, in my opinion, is maintainable. The application is, accordingly, dismissed.