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2019 DIGILAW 50 (TS)

Eye Ads Pvt. Ltd. v. Lydian Herbal Products

2019-02-12

SHAMEEM AKTHER

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JUDGMENT : Shameem Akther, J. 1. This criminal appeal, filed by the appellant-complainant, under Section 378(4) of the Code of Criminal Procedure, 1973 (for short, "Cr.P.C."), is directed against the acquittal recorded on 28.4.2014 in CC No. 533 of 2012 by the VIII Special Magistrate, Errum Manzil, Hyderabad, acquitting the respondents 1 to 5-accused 1 to 5 under Section 255(1) Cr.P.C. for the offence punishable under Section 138 of Negotiable Instruments Act, 1981 (for short 'the N.I. Act'). 2. For convenience sake, hereinafter the appellant-complainant herein is referred to as 'complainant' and respondents 1 to 5-accused 1 to 5 herein are referred to as 'accused 1 to 5'. 3. Heard the learned Counsel for the complainant and the learned Additional Public Prosecutor for the respondent No. 6-State and perused the record. 4. There is no representation for accused 1 and 2, inspite of service of notice. 5. This Court, on 26.6.2014, at the stage of admission, admitted the appeal against accused 1 and 2 and dismissed the appeal against accused 3 to 5 holding that there is no material to show that accused 3 to 5 are the Directors of the accused No. 1 company and they are in-charge of day-today affairs of accused No. 1 company. 6. The brief case of the prosecution is that the complainant is a company registered under the provisions of the Companies Act, 1956 and engaged in the business of advertising, printing, designing etc. The accused No. 1 is a company engaged in the business of Herbal Products. Accused No. 2 is a Director of accused No. 1 company. Accused 2 to 5 on behalf of accused No. 1 company placed orders with the complainant company between 15.5.2011 to 12.6.2011 for advertising its products in newspapers, telecast in Electronic Media etc., and the same was executed by the complainant company and bills for a sum of Rs. 14,66,399/- were sent to accused No. 1 company. The accused No. 1 company paid Rs. 12,45,324/- and the balance of Rs. 2,21,075/- was agreed to be payable by 12.6.2011, but it did not. On repeated requests, the accused No. 1 company issued a cheque signed by its Director, accused No. 2, bearing No. 600532, dated 4.7.2011 for a sum of Rs. 2,20,600/-, drawn on I.C.I.C.I. Bank Limited, Yelahanaka Branch, Bangalore in favour of complainant company. 12,45,324/- and the balance of Rs. 2,21,075/- was agreed to be payable by 12.6.2011, but it did not. On repeated requests, the accused No. 1 company issued a cheque signed by its Director, accused No. 2, bearing No. 600532, dated 4.7.2011 for a sum of Rs. 2,20,600/-, drawn on I.C.I.C.I. Bank Limited, Yelahanaka Branch, Bangalore in favour of complainant company. When the cheque was presented on 26.12.2011, it was returned with an endorsement "insufficient funds" and the said dishonored cheque was received by the complainant company on 28.12.2011. A legal notice was issued by the complainant company to the accused No. 1 company demanding to pay the dishonored cheque amount. Inspite of receipt of legal notice, the accused No. 1 company did not pay the amount. Therefore, the complainant company filed the complaint. 7. The complaint was taken on file under Section 138 of the N.I. Act by the I ACMM Court, Hyderabad and numbered as CC No. 125/2012 and subsequently was transferred to XXVI Special Magistrate, Hyderabad and numbered as CC No. 62/2012. Again the case was transferred to the Court of VIII Special Magistrate, Errum Manzil, Hyderabad and numbered as CC No. 533 of 2012. 8. During the trial, Mr. D. Nagesh, the Power of Attorney Holder of the complainant company got himself examined as PW1 and got marked Exs. Pl to P26. In defence, N.V. Balakrishna Reddy-accused No. 2, the Director of accused No. 1-company, got himself examined as DW1 and got marked Exs. D1 to D7. 9. The Trial Court, after closure of evidence, both oral and documentary, framed the following points for consideration: (1) Whether Ex. P3 cheque was not issued in order to discharge the legal enforceable debt? (2) Whether A3 to A5 are no way related to A1 Company/Firm and hence, they are not necessary parties to the present case? (3) Whether the complainant failed to comply with the provisions of law as laid down under Section 138(b) of Negotiable Instruments Act? (4) Whether the banks in Ex. P3 cheque were got filled up by the complainant? 10. (3) Whether the complainant failed to comply with the provisions of law as laid down under Section 138(b) of Negotiable Instruments Act? (4) Whether the banks in Ex. P3 cheque were got filled up by the complainant? 10. Taking into consideration, both oral and documentary evidence and the submissions put forth before it, the Court below held Points 1 to 3 in favour of accused 1 to 5 and Point No. 4 in favour of the complainant company and acquitted the accused 1 to 5 under Section 255(1) Cr.P.C. for the offence punishable under Section 138 of Negotiable Instruments Act, 1981. Hence, this criminal appeal. 11. In view of the submissions made on behalf of the appellant-complainant, the following points have come up for determination: (1) Whether the appellant-complainant established legally enforceable debt against accused 1 and 2? (2) Whether the Ex. P3-Subject cheque bearing No. 600532, dated 4.7.2011 was dishonoured for want of sufficient funds in the account of the accused 1 and 2? (3) Whether the appellant-complainant proved an offence under Section 138 of the Negotiable Instruments Act, 1881 against accused 1 and 2? 12. It is the case of accused No. 2, the Director of accused No. 1 company, that he paid an amount of Rs. 4,50,000/- on 29.9.2011 to one P. Ram Chander Rao, who was then working in the complainant company. To establish the same, Ex. D6-Debit Voucher dated 29.9.2011 and Ex. D7-acknowledgment given by P. Ram Chander Rao, evidencing the payment of Rs. 4,50,000/-, were filed and marked through the evidence of DW1, wherein there is a specific mention that the amount of Rs. 4,50,000/- was paid to the complainant company towards full and final settlement of dues in between the complainant and accused No. 1-company. There is also specific evidence of PW1-D. Nagesh that one P. Ramachander Rao, worked as one of the employees of the complainant company and was also looking after the affairs of the complainant company as on 29.9.2011 i.e., on the date of issuance of Exs. D6 and D7. The complainant did not choose to examine P. Ramchander Rao to dispute the genuineness of Exs. D6 and D7. As per the evidence, Ex. P3-cheque was issued on 4.7.2011 and Ex. D7-acknowledgment setting the due amounts in between the parties is dated 29.9.2011 i.e., subsequent to the issuance of Ex. P3-cheque. Exs. D6 and D7. The complainant did not choose to examine P. Ramchander Rao to dispute the genuineness of Exs. D6 and D7. As per the evidence, Ex. P3-cheque was issued on 4.7.2011 and Ex. D7-acknowledgment setting the due amounts in between the parties is dated 29.9.2011 i.e., subsequent to the issuance of Ex. P3-cheque. Exs. D6" and D7 establishes that the disputed amounts were paid subsequent to the date of Ex. P3-cheque dated 4.7.2011 towards full and final settlement of amounts due. Therefore, the statutory notice and receipt of the same under Ex. P6 are not helpful to the complainant to establish that there was subsisting legally enforceable debt on the date of filing of the complaint. This aspect was elaborately dealt with by the Trial Court and answered in favour of the accused. When essential ingredients of Section 138 of N.I. Act are not being established as indicated above, the appeal merits no consideration to allow as prayed for. There is no infirmity in the impugned judgment and the points framed above are answered against the appellant-complainant accordingly. 13. For the foregoing reasons, the criminal appeal is dismissed confirming the acquittal recorded on 28.4.2014 in CC No. 533 of 2012 by the VIII Special Magistrate, Errum Manzil, Hyderabad. 14. Miscellaneous petitions pending, if any, in this appeal shall stand closed.