JUDGMENT : Rakesh Kainthla, J. The present appeal is directed against the judgment dated 22.11.2010, passed by learned Sessions Judge, Kullu, District Kullu, H.P. (learned Appellate Court), vide which the judgment of conviction and order of sentence dated 30.03.2009 passed by learned Judicial Magistrate, First Class, Manali (learned Trial Court) were set aside. (Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience) 2. Briefly stated, the facts giving rise to the present appeal are that the complainant filed a complaint before the learned Trial Court against the accused for the commission of an offence punishable under Section 138 of the Negotiable Instruments Act (NI Act). It was asserted that the complainant is an agent of M/s A.M. Fruit Commission Agent, Delhi. He used to pay advance money to the fruit growers who used to send the fruits to M/s A.M. Fruit Commission Agent for sale. The accused is a fruit grower and has an orchard under the name and style of Shringi Orchard. The accused approached the complainant and demanded Rs.1,00,000/- as an advance, consisting of Rs.60,000/- in cash and packing material worth Rs.40,000/-. The accused assured the complainant that he would send the fruits to M/s A.M. Fruit Commission Agent, Delhi. The complainant paid Rs.60,000/- in cash and supplied the packing material worth Rs.40,000/- to the accused. The accused failed to send the fruits from his orchard to M/s A.M. Fruit Commission Agent, Delhi. The complainant subsequently demanded Rs.1,00,000/- from the accused. The accused handed over a cheque for Rs.1,00,000/- to the complainant to return the amount. The complainant presented the cheque before the Kangra Cooperative Bank, Banjar, for encashment; however, the cheque was dishonoured with an endorsement of ‘insufficient funds’. The complainant sent a legal notice to the accused, requesting him to pay the amount within 15 days of receipt of the notice. The accused failed to make the payment despite receiving the notice. Hence, the complaint was filed against the accused. 3. The learned Trial Court found sufficient reasons to summon the accused. When the accused appeared, notice of accusation was put to him for the commission of an offence punishable under Section 138 of the NI Act, to which he pleaded not guilty and claimed to be tried. 4. The complainant examined himself (CW-1), Jai Chand Thakur (CW-1 wrongly mentioned), and Harish Thakur (CW-2).
When the accused appeared, notice of accusation was put to him for the commission of an offence punishable under Section 138 of the NI Act, to which he pleaded not guilty and claimed to be tried. 4. The complainant examined himself (CW-1), Jai Chand Thakur (CW-1 wrongly mentioned), and Harish Thakur (CW-2). 5. The accused in his statement recorded under Section 313 of Cr.P.C. admitted that he had taken the advance of Rs.60,000/- in cash and packing material worth Rs.40,000/- from the complainant. He stated that he had sent the fruit from his orchard to the fruit company as per the agreement. He admitted that he had handed over a cheque to the complainant, which was dishonoured. He admitted that a notice was issued to him. He examined Jeet Ram (DW-1), Bali Ram (DW-2) and himself (DW-3) in his defence. 6. Learned Trial Court held that the accused had admitted the case of the complainant in his statement recorded under Section 313 of Cr.PC. It was proved that the accused had taken the advance from the complainant and issued a cheque in his favour. The cheque was dishonoured due to ‘insufficient funds’, and the accused had failed to pay money despite receipt of a valid legal notice of the demand. The plea of the accused that he had sent the fruit to M/s A.M. Fruit Commission Agent, Delhi, was not established by his testimony. Therefore, the accused was convicted of the commission of an offence punishable under Section 138 of the NI Act, and he was sentenced to undergo simple imprisonment for one year and pay a compensation of Rs.1,40,000/- for the commission of the aforesaid offence. 7. Being aggrieved by the judgment and order passed by the learned Trial Court, the accused filed an appeal, which was decided by the learned Appellate Court on 05.06.2008., Learned Appellate Court noticed that the complainant was not examined after the appearance of the accused, and he was only cross-examined. His examination-in-chief was recorded in the absence of the accused and could not have been read in evidence. The procedure adopted by the learned Trial Court was not proper. Hence, judgment of conviction dated 23.08.2007 and order of sentence dated 27.08.2007 were set aside and the matter was remanded to the learned Trial Court for deciding the matter afresh. 8.
His examination-in-chief was recorded in the absence of the accused and could not have been read in evidence. The procedure adopted by the learned Trial Court was not proper. Hence, judgment of conviction dated 23.08.2007 and order of sentence dated 27.08.2007 were set aside and the matter was remanded to the learned Trial Court for deciding the matter afresh. 8. After the matter was remanded to the learned Trial Court, the complainant examined himself (CW-3). 9. The accused, in his statement recorded under Section 313 of Cr.P.C., denied the complainant’s case. He asserted that he had sent the fruits to Om Prakash and Ashok worth Rs.1,68,000/-. He had to settle the accounts with Om Parkash and Ashok Kumar. He examined Jeet Ram (DW-1), Krishan Chand (DW-2), Dolma Devi (DW-3), Kamle Ram (DW-4) and Sanjeev Kumar (DW-5) in his defence. 10. Learned Trial Court held that the complainant had proved his case beyond a reasonable doubt. The defence of the accused was not proved. Hence, the learned Trial Court convicted the accused for the commission of an offence punishable under Section 138 of N I Act and sentenced him to undergo simple imprisonment for six months and pay a compensation of Rs.1,50,000/- to the complainant for the commission of the aforesaid offence. 11. Being aggrieved by the judgment and order passed by the learned Trial Court, the accused preferred an appeal, which was decided by the learned Appellate Court on 22.12.2010. Learned Appellate Court held that the complainant claimed himself to be an agent of M/s A.M. Fruit Commission Agent Delhi. He had advanced an amount of Rs.1,00,000/- with an assurance that the accused would send his fruit to M/s A.M. Fruit Commission Agent, Delhi. The complainant was merely an agent, and the accused owed no liability to him. The liability, if any, was towards M/s A.M. Fruit Company, which could have filed a complaint before the Court. The complainant was a stranger to the transaction, and he could not have filed any complaint. Therefore, the judgment and order passed by the learned Trial Court on 30.03.2009 were set aside. 12. Feeling aggrieved and dissatisfied with the judgment dated 22.12.2010, passed by the learned Appellate Court, the complainant has filed the present appeal asserting that the learned Appellant Court erred in acquitting the accused.
Therefore, the judgment and order passed by the learned Trial Court on 30.03.2009 were set aside. 12. Feeling aggrieved and dissatisfied with the judgment dated 22.12.2010, passed by the learned Appellate Court, the complainant has filed the present appeal asserting that the learned Appellant Court erred in acquitting the accused. The complainant had specifically mentioned that he had advanced Rs.1,00,000/- in the form of cash and packing material to the accused. The cheque was issued to the complainant in his name. Learned Appellate Court erred in holding that the accused owed no liability to the complainant. The accused initially admitted the case of the complainant, but he made a different statement after the case was remanded to the learned Trial Court. This aspect was ignored by the learned Appellate Court. Therefore, it was prayed that the present appeal be allowed and the judgment passed by the learned Appellate Court be set aside. 13. I have heard Mr. G.R. Palsra, learned counsel for the appellant/complainant and Mr. Raj Thakur, vice Mr. Gurmeet Bhardwaj, learned counsel for respondent No.1/accused and Mr. Ajit Sharma, learned Deputy Advocate General for the respondent No. 2/State. 14. Mr. G.R. Palsra, learned counsel for the appellant, submitted that the learned Appellate Court erred in acquitting the accused. It was wrongly held that the accused owed no liability to the complainant. The complainant had advanced Rs.60,000/- in cash and packing material worth Rs.40,000/- to the accused. The accused issued the cheque to discharge his legal liability. The accused had initially admitted all the ingredients of the commission of an offence punishable under Section 138 of the NI Act. The learned Appellate Court erred in holding that the ingredients of Section 138 NI Act were not satisfied. Therefore, he prayed that the present appeal be allowed and the judgment passed by the learned Appellate Court be set aside. 15. Mr. Raj Thakur, learned vice counsel for respondent No.1/accused, submitted that the complainant claimed himself to be an agent of M/s A.M. Fruit Commission Agent. He had advanced the money on behalf of M/s A.M Fruit Commission Agent, Delhi. Learned Trial Court had rightly held that the accused owed no liability to the complainant, and there is no infirmity in the finding recorded by the learned Trial Court. This was a reasonable view which could have been taken based on evidence led before the learned Trial Court.
Learned Trial Court had rightly held that the accused owed no liability to the complainant, and there is no infirmity in the finding recorded by the learned Trial Court. This was a reasonable view which could have been taken based on evidence led before the learned Trial Court. Therefore, he prayed that the present appeal be dismissed. 16. Mr. Ajit Sharma, learned Deputy Advocate General for respondent No.2/State, supported the arguments advanced by Mr. G.R. Palsra, learned counsel for the appellant/complainant. 17. I have given considerable thought to the submissions made at the bar and have gone through the records carefully. 18. The present appeal has been filed against a judgment of acquittal. It was laid down by the Hon’ble Supreme Court in Surendra Singh v. State of Uttarakhand, 2025 SCC OnLine SC 176 : (2025) 5 SCC 433 that the Court can interfere with a judgment of acquittal if it is patently perverse, is based on misreading/omission to consider the material evidence and reached at a conclusion which no reasonable person could have reached. It was observed: “11. Recently, in the case of Babu Sahebagouda Rudragoudar v. State of Karnataka 2024 SCC OnLine SC 4035 , a Bench of this Court to which one of us was a Member (B.R. Gavai, J.) had an occasion to consider the legal position with regard to the scope of interference in an appeal against acquittal. It was observed thus: “ 38. First of all, we would like to reiterate the principles laid down by this Court governing the scope of interference by the High Court in an appeal filed by the State for challenging the acquittal of the accused recorded by the trial court. 39. This Court in Rajesh Prasad v. State of Bihar [Rajesh Prasad v. State of Bihar, (2022) 3 SCC 471 : (2022) 2 SCC (Cri) 31] encapsulated the legal position covering the field after considering various earlier judgments and held as below : (SCC pp. 482-83, para 29) “29. After referring to a catena of judgments, this Court culled out the following general principles regarding the powers of the appellate court while dealing with an appeal against an order of acquittal in the following words: ( Chandrappa case [Chandrappa v. State of Karnataka, (2007) 4 SCC 415: (2007) 2 SCC (Cri) 325 ], SCC p. 432, para 42) ‘42.
After referring to a catena of judgments, this Court culled out the following general principles regarding the powers of the appellate court while dealing with an appeal against an order of acquittal in the following words: ( Chandrappa case [Chandrappa v. State of Karnataka, (2007) 4 SCC 415: (2007) 2 SCC (Cri) 325 ], SCC p. 432, para 42) ‘42. From the above decisions, in our considered view, the following general principles regarding the powers of the appellate court while dealing with an appeal against an order of acquittal emerge: (1) An appellate court has full power to review, reappreciate and reconsider the evidence upon which the order of acquittal is founded. (2) The Criminal Procedure Code, 1973 puts no limitation, restriction or condition on the exercise of such power and an appellate court, on the evidence before it, may reach its own conclusion, both on questions of fact and law. (3) Various expressions, such as “substantial and compelling reasons”, “good and sufficient grounds”, “very strong circumstances”, “distorted conclusions”, “glaring mistakes”, etc., are not intended to curtail the extensive powers of an appellate court in an appeal against acquittal. Such phraseologies are more in the nature of “flourishes of language” to emphasise the reluctance of an appellate court to interfere with an acquittal than to curtail the power of the court to review the evidence and to come to its own conclusion. (4) An appellate court, however, must bear in mind that in case of acquittal, there is a double presumption in favour of the accused. Firstly, the presumption of innocence is available to him under the fundamental principle of criminal jurisprudence that every person shall be presumed to be innocent unless he is proved guilty by a competent court of law. Secondly, the accused having secured his acquittal, the presumption of his innocence is further reinforced, reaffirmed and strengthened by the trial court. (5) If two reasonable conclusions are possible on the basis of the evidence on record, the appellate court should not disturb the finding of acquittal recorded by the trial court.” 40. Further, in H.D. Sundara v. State of Karnataka [H.D. Sundara v. State of Karnataka, (2023) 9 SCC 581 : (2023) 3 SCC (Cri) 748] this Court summarised the principles governing the exercise of appellate jurisdiction while dealing with an appeal against acquittal under Section 378CrPC as follows: (SCC p. 584, para 8) “8. … 8.1.
Further, in H.D. Sundara v. State of Karnataka [H.D. Sundara v. State of Karnataka, (2023) 9 SCC 581 : (2023) 3 SCC (Cri) 748] this Court summarised the principles governing the exercise of appellate jurisdiction while dealing with an appeal against acquittal under Section 378CrPC as follows: (SCC p. 584, para 8) “8. … 8.1. The acquittal of the accused further strengthens the presumption of innocence. 8.2. The appellate court, while hearing an appeal against acquittal, is entitled to reappreciate the oral and documentary evidence; 8.3. The appellate court, while deciding an appeal against acquittal, after reappreciating the evidence, is required to consider whether the view taken by the trial court is a possible view which could have been taken on the basis of the evidence on record; 8.4. If the view taken is a possible view, the appellate court cannot overturn the order of acquittal on the ground that another view was also possible; and 8.5. The appellate court can interfere with the order of acquittal only if it comes to a finding that the only conclusion which can be recorded on the basis of the evidence on record was that the guilt of the accused was proved beyond a reasonable doubt and no other conclusion was possible.” 41. Thus, it is beyond the pale of doubt that the scope of interference by an appellate court for reversing the judgment of acquittal recorded by the trial court in favour of the accused has to be exercised within the four corners of the following principles: 41.1. That the judgment of acquittal suffers from patent perversity; 41.2. That the same is based on a misreading/omission to consider material evidence on record; and 41.3. That no two reasonable views are possible and only the view consistent with the guilt of the accused is possible from the evidence available on record.” 12. It could thus be seen that it is a settled legal position that the interference with the finding of acquittal recorded by the learned trial judge would be warranted by the High Court only if the judgment of acquittal suffers from patent perversity; that the same is based on a misreading/omission to consider material evidence on record; and that no two reasonable views are possible and only the view consistent with the guilt of the accused is possible from the evidence available on record.” 19.
The present appeal is required to be decided as per the parameters laid down by the Hon’ble Supreme Court. 20. The complainant specifically mentioned in para 2 of the complaint that he is an agent of M/s A.M. Fruit Commission Agent Delhi, and he used to pay advance money to the fruit growers who used to send the fruits for sale. He mentioned in para 3 of the complaint that the accused approached the office of the complainant and demanded a sum of Rs.1,00,000/- in advance and assured to send the fruit of his orchard to M/S A.M. Fruit Commission Agent Dehil. The complainant paid Rs.60,000/- in cash and handed over packing material of Rs.40,000/- to the accused. He mentioned in para 4 of the complaint that the accused failed to send fruits to M/S A.M. Fruit Commission Agent, Delhi, or return Rs.1,00,000/-. 21. It is apparent from these averments that the transaction was entered into between the accused and the M/s A.M. Fruit Commission Agent Delhi through the complainant as an agent. The accused was to send the fruits to M/s A.M. Fruit Commission Agent, Delhi. The advance was taken for the price of the fruit from the complainant, who was acting as an agent of M/s A.M. Fruit Commission Agent Delhi, therefore, the learned Appellate Court had rightly held that the transaction was between the accused and the principal, i.e. M/s A.M. Fruit Commission Agent Delhi. 22. Section 230 of the Indian Contract Act provides that an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them in the absence of a contract to the contrary. It was laid down by the Hon’ble Supreme Court in Marine Container Services South (P) Ltd. v. Go Go Garments [ (1998) 3 SCC 247 that an agent acting on behalf of a disclosed principal cannot sue nor can he be sued on the transactions entered by him. This judgment was followed in Vivek Automobiles Ltd. v. Indian Inc. , (2009) 17 SCC 657, wherein it was observed: - 8. Section 230 of the Contract Act categorically makes it clear that an agent is not liable for the acts of a disclosed principal subject to a contract to the contrary. No such contract to the contrary has been pleaded.
, (2009) 17 SCC 657, wherein it was observed: - 8. Section 230 of the Contract Act categorically makes it clear that an agent is not liable for the acts of a disclosed principal subject to a contract to the contrary. No such contract to the contrary has been pleaded. An identical issue was considered by this Court in Marine Container Services South (P) Ltd. v. Go Go Garments [(1998) 3 SCC 247: AIR 1999 SC 80 ] , where a similar order passed under the Consumer Protection Act was set aside by this Court. It was held that by virtue of Section 230, the agent could not be sued when the principal had been disclosed. 23. A similar view was taken in Prem Nath Motors Ltd. v. Anurag Mittal , (2009) 16 SCC 274 , wherein it was held: - 7. Section 230 of the Contract Act categorically makes it clear that an agent is not liable for the acts of a disclosed principal subject to a contract to the contrary. No such contract to the contrary has been pleaded. An identical issue was considered by this Court in Marine Container Services South (P)Ltd. v. Go Go Garments [(1998) 3 SCC 247: AIR 1999 SC 80 ], where a similar order passed under the Consumer Protection Act was set aside by this Court. It was held that by virtue of Section 230, the agent could not be sued when the principal had been disclosed. A similar view has been expressed by a three-judge Bench of this Court in Civil Appeal No. 6653 of 2005 arising out of SLP (C) No. 19562 of 2004 [Vivek Automobiles Ltd. v. Indian Inc., (2009) 17 SCC 657 ]. 24. This judgment was followed in Virender Khullar v. American Consolidation Services Ltd. , (2016) 15 SCC 308 , and it was observed: - 14. Since Respondent 1 was simply acting as an agent of Coronet Group Inc., as such, in view of Section 230 of the Indian Contract Act, 1872, it cannot be held personally liable to enforce the contract entered into between its principal and the appellants.
Since Respondent 1 was simply acting as an agent of Coronet Group Inc., as such, in view of Section 230 of the Indian Contract Act, 1872, it cannot be held personally liable to enforce the contract entered into between its principal and the appellants. This Court, in its order dated 10-9-2009 [ American Consolidation Service Ltd. v. Virendra Khullar, Civil Appeal No. 2080 of 2004, order dated 10-9-2009 (SC) ], has accepted the plea of Respondent 1 that Respondent 1 is not a consignee, but only an agent of the intermediate consignee. That being so, Respondent 1 cannot be held to be liable in respect of the claim made by the appellants. We think it relevant to mention here that in Marine Container Services South (P) Ltd. v. Go Go Garments [Marine Container Services South (P) Ltd. v. Go Go Garments, (1998) 3 SCC 247 ] , this Court has already made clear that defence under Section 230 of the Indian Contract Act, 1872 is available in the cases under the Consumer Protection Act, 1986 by the agents of the principal with whom the complainant had the agreement. 25. In the present case, the complainant specifically stated that he had disclosed the name of M/s A.M. Fruit Commission Agent, Delhi and that the accused had assured to send fruits to M/s A.M. Fruit Commission Agent. Thus, the complainant was acting on behalf of a disclosed principal, and he could not have enforced the contract entered into by him on behalf of the principal. 26. It was submitted that the cheque was issued in the name of the complainant, and the complainant was the payee entitled to file the complaint based upon the cheque issued in his name. This submission is not acceptable. The complainant was acting on behalf of M/s A.M. Fruit Commission Agent Delhi, and he was bound to pay money to the principal, had the cheque been realised. Therefore, the mere fact that the cheque was issued in his name does not show that it was issued in his favour in discharge of any legal liability. 27. Therefore, the learned Appellate Court had taken a reasonable view, which cannot be interfered with while deciding an appeal against acquittal. 28. Consequently, the present appeal fails, and the same is dismissed. 29.
27. Therefore, the learned Appellate Court had taken a reasonable view, which cannot be interfered with while deciding an appeal against acquittal. 28. Consequently, the present appeal fails, and the same is dismissed. 29. The record of the learned Court below be sent back with a copy of this judgment for the information of the learned Trial Court. 30. Appeal stands disposed of along with pending miscellaneous application(s), if any.