Tough Bags (A Parnership Concern), Madurai v. Vaaman Capital, Coimbatore, represented by its Managing Partner, P. Karthik
2022-07-08
M.NIRMAL KUMAR
body2022
DigiLaw.ai
JUDGMENT : (Prayer: Criminal Original Petitions filed under Section 482 of the Code of Criminal Procedure, to call for the records relating to the proceedings in C.C.No.963 of 2018, now pending on the file of the Fast Track Magistrate No.II of Coimbatore, and to quash the same, insofar as the petitioners are concerned.) 1. This Criminal Original Petition is filed to quash the proceedings in C.C.No.963 of 2018, pending on the file of the Fast Track Magistrate No.II, Coimbatore, insofar as the petitioners are concerned. 2. The 1st petitioner/A1is the partnership concern; 2nd and 3rd petitioners / A2 & A3 are the partners of Accused No.1 and the 4th petitioner/A4 is the mother of A2 and A3. 3. The gist of the case is that Accused Nos.2 and 3 taken a loan of Rs.50,00,000/- from the complainant during January 2018. Out of the said loan amount, a sum of Rs.29,00,000/- due and outstanding to them. After repeated request, A2, as power of attorney holder of A1 Company, issued a cheque, drawn on Union Bank, Madurai Main Branch, bearing No.50517, dated 25.05.2018, for a sum of Rs.19,00,000/-. A4 issued a cheque, drawn on State Bank of India, Pasumalai, Madurai, bearing No.942066, dated 25.05.2018, for the balance of Rs.10,00,000/-. On 28.05.2018, when the cheques presented for payment in Kotak Mahendra Bank Ltd, R.S.Puram, the said cheques returned with an endorsement, “Insufficient Funds”. Hence, the complaint. 4. For the sake of convenience and clarity, the petitioners and the respondent are referred to their original rank as in the complaint. 5. Mr. S.Subbiah, the learned Senior Counsel appearing for the petitioner would submit that the complainant has proceeded on a premise that A1 is the partnership Firm, A2 and A3 are its partners and A4 is the mother of A2 and A3. In discharge of their earlier loan availed by A2 and A3, during the month of January 2018, the cheque in question has been issued during May 2018. The complaint is bereft of particulars. Further, the complainant admits that the second accused issued the cheque, as power of attorney holder of A1 Firm. There is no averments to show how the accused as partners actively involved in the day-to-day affairs of the Firm. There is no averments to attract Section 142 of the Negotiable Instruments Act. 6. The learned Senior Counsel contended that that A2 signed as mandate holder for A1.
There is no averments to show how the accused as partners actively involved in the day-to-day affairs of the Firm. There is no averments to attract Section 142 of the Negotiable Instruments Act. 6. The learned Senior Counsel contended that that A2 signed as mandate holder for A1. A4 / mother of A2 and A3 issued another cheque in her individual capacity. Thus, clubbing the two cheques of separate cause of action projecting as single cause of action and proceeding against the accused is not proper. It is further contended that on bare perusal of the cheques in question, it is seen that the Cheque bearing No.501757, drawn on Union Bank of India, Madurai Main Branch, dated 25.05.2018, signed by A2, as power of attorney holder. Likewise, the Cheque bearing No.942066, drawn on State Bank of India, Pasumalai, Madurai, dated 25.05.2018, signed by A4, in her individual capacity. The statutory requirement of putting the accused on notice to hold them vicariously liable for the liability of A1 Firm not followed. Thus, the requirement under Sections 138 and 142 of the Negotiable Instruments Act not followed. Further, perusal of the Registration Certificate produced for GST registration as well as Certificate of Registration issued by the Commercial Tax Department, Government of Tamil Nadu, it is seen that A1 Firm is a proprietorship Firm and A4 is its proprietrix . 7. Thus, the complaint lodged against the accused on the premise that A1 is a Firm represented by its partners A2 and A3 is totally incorrect and case cannot be proceeded against A1 to A3. Further, this Court time and again held that mandate holder alone cannot be proceeded in the absence of principle being arrayed as an accused. Likewise, A4 given the cheque in her individual capacity. Both the cheques create different cause of action. Both cause of a cannot be clubbed and proceeded. A1 to A3 cannot be proceeded in a single case. Notice of the complainant issued in a composite manner clubbing two transaction into one. In view of the same, the case against the accused cannot be proceeded. In support of his contention, the learned Senior Counsel relies upon the Judgment of this Court in the case of R. Ravi Chandran Vs.
Notice of the complainant issued in a composite manner clubbing two transaction into one. In view of the same, the case against the accused cannot be proceeded. In support of his contention, the learned Senior Counsel relies upon the Judgment of this Court in the case of R. Ravi Chandran Vs. C. Subramanian alias C.S. Maniam reported in (2006 (1) M.L.J. (Crl.) 68), for the proposition that the signature of the cheque is only by a mandate holder, who is competent and authorized to sign on behalf of the account holder or on behalf of the drawer. Hence, the mandate holder certainly will not come under the meaning of the person, cheque drawn by a person or on an account maintained by him. Further, in the the case of Manjula Vs. M/s. Colgate Palmolive (India) Limited reported in (2006-2-L.W. (Crl.) 851) the circumstances under which Section 219 Cr.P.C., can be invoked in detailed. In this case, no such circumstances would arise. 8. The learned Senior Counsel further relied on the Judgment of the Hon-ble Apex Court in Harshendra Kumar D Vs. Rebatilata Koley and Others reported in ( 2011 (3) SCC 351 ), wherein it is held that public documents or the materials which are beyond suspicion or doubt, can be looked into by the High Court in exercise of its jurisdiction under Section 482 of Cr.P.C. Further, the learned Senior Counsel relied on the Judgment of the Delhi High Court in M/s.Nova Vision Electronics Pvt.Ltd., and Anr Vs. State and Anr reported in (2011 Cri.L.J. 868) for the proposition that the accused should be charged in respect of each distinct offence alleged to have been committed by him and he is entitled to a separate trial with respect to each of such charge in accordance with the provisions of Section 218 of the Cr.P.C. 9. Mr. K.G. Senthil Kumar, the learned counsel for the complaint submitted that the petitioners, not denied availing of loan from the complainant Firm. Further, A2 and A4 not denied their signatures found in the cheques, and failed to give reason how the cheque came in possession of the complainant. A2 and A3 projected themselves as partners of A1 Firm. They availed loan transaction and in discharge of their liability, signed and issued the cheques, now suppressing the real facts, projecting false defence, which would amount to case of cheating.
A2 and A3 projected themselves as partners of A1 Firm. They availed loan transaction and in discharge of their liability, signed and issued the cheques, now suppressing the real facts, projecting false defence, which would amount to case of cheating. Further, A2 to A4 are closely related viz., sons and mother. The complainant on the representation of the accused extended loan and in discharge of the liability, accused issued the cheque. The notice under Section 138 of the Negotiable Instruments issued, which received by the accused, no reply sent denying the liability further for the first time, such defence is taken by the accused, which are to be necessarily decided during trial. They are only taking technical plea, which is stoutly opposed. Further during trail complaint can involve Section 219Cr.p.c which are matter of fact to be decided during trial. Merely on the ground of Technicalities case cannot be quashed. 10. I have heard the learned counsels appearing on either side and perused the materials available on record. 11. It is seen that A1 is a proprietorship Firm, as could be seen from the Registration Certificate issued by the Commercial Tax Department. On perusal of the cheque it is seen that one cheque signed by A2, as power of attorney holder of A1 Firm and the other cheque signed by A4 in her individual capacity. The Firm A1 whether it is partnership or proprietorship the complainant is not aware. The basic constitution of the accused to whom complainant lent loan is not known to the complainant which is surprising cannot be passed over. Further, this Court in para 10 of the Judgment reported in (2006 (1) M.L.J. (Crl.) 68) (cited supra) held as follows:- 10. “Mandate” means in the commercial circle as per the law lexicon: A mandate is a contract by which a lawful business is committed to the management of another, and by him undertaken to be performed without reward.” It is also further seen from the said definition, a mandate is an act by which one person gives power to another to transact for him and in his name, one or several affairs. From the above definition, it is crystal clear that the role of the mandate holder is limited.
From the above definition, it is crystal clear that the role of the mandate holder is limited. In the sense, obeying the mandate or any of the member and in this way alone, the accused A2 in this case had signed in the cheque as mandate holder and therefore, as such, he cannot be held responsible for the non-payment or the amount.” Admitted A4 not arrayed as accused as proprietor of A1 Firm. 12. As per Section 138 of the Negotiable Instruments Act, the Mandate Holder is not a drawer in the legal sense, as it should be understood for the purpose of Section 138 of the Act. The other cheque issued by A4 is in her individual capacity and clubbing these two separate cause of action as one, and filling the complaint against all four accused is not proper. Further, from the complaint it is seen that the minimum averments required to invoke Section 142 of the Act is also not available. In view of the above, this Court finds that the case against the accused cannot be proceeded with in the present form. 13. In the result, this Criminal Original Petition stands allowed and the proceedings in C.C.No.963 of 2018, pending on the file of the learned Fast Track Magistrate No.II, Coimbatore, is quashed against all the accused. Consequently, the connected miscellaneous petitions are closed.