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Indian Laws - Case Laws
Showing 81 to 100 of 950 Records
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2021 (12) TMI 326 - MADRAS HIGH COURT
Dishonor of Cheque - applicability of time limitation - cause of action for filing the suit present or not - Whether the person sueing on behalf of the plaintiff's firm has proved that he is the partner of the said firm? - HELD THAT:- The 1st defendant had even at the very outset contended that K. Venkatesh is not a partner of the plaintiff firm, since the plaintiff firm in the Criminal Proceedings before the Judicial Magistrate No. II, Erode, in C.C. No.584 of 2004, is represented by one Mr. Anbalagan who is described as the partner of the plaintiff firm. Though the defendants has taken out a categoric defence that the said Venkatesh is not a partner the plaintiff has not chosen to prove the same by producing a copy of the list of partners as registered with the Registrar of Firms. The non-production of the said document compels this Court to draw an adverse inference against the plaintiff. The finding of the Trial Court in this regard does not require any interference.
Whether the cheques have been endorsed in favour of the plaintiff as per the provisions of the Negotiable Instruments Act? - HELD THAT:- As per section 50, the endorsement of a Negotiable Instrument followed by its delivery gives a right to the endorsee for further negotiation. The effect of an endorsement of a Negotiable Instrument with the endorsements as illustrated above has the effect of transferring to the endorsee the property therein with the right to further negotiate. However, the endorsement may expressly restrict or exclude such a right or merely constitute an endorsee right of further negotiation - the plaintiff has not proved the endorsement in the manner known to law and the Judgment of the Trial Court which has elaborately considered this issue does not require any interference.
Whether the Judgment and Decree of the Trial Court calls for any interference? - HELD THAT:- The plaintiff has not made out any case to find fault with the findings of the Trial Court and its consequent Judgment.
Appeal dismissed.
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2021 (12) TMI 325 - MADRAS HIGH COURT
Dishonor of Cheque - validity of signature of defendant/appellant - presumption under Section 118 of the Negotiable Instruments Act can be raised against the defendant or not - rebuttal of presumption - establishment of due execution or not - HELD THAT:- The defendant had rebutted the presumption raised against her and onus once again fell on the plaintiff. The plaintiff should establish that he had lent a sum of ₹ 10,00,000/- to the defendant as per Ex.A.1. Since it has not been established by the plaintiff, the suit has to necessarily fail. The Court below failed to consider the circumstances projected by the defendant. Since the signature appearing in Ex.A1 is that of the appellant, presumption was rightly raised against her. But then, on a balance of probabilities, the defendant had rebutted the presumption. The plaintiff never had the financial capacity to lend the sum of ₹ 10.00 lakhs to the defendant. The defendant was having psychiatric issues and she had under influence of the plaintiff and making use of the same, the plaintiff had obtained certain signed blank documents from her. Ex.A1 was one such document.
Due execution of Ex.A1 has not at all been established - appeal allowed.
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2021 (12) TMI 280 - HIMACHAL PRADESH HIGH COURT
Dishonor of Cheque - guilty of having committed offence punishable under Section 138 of the Negotiable Instruments Act - HELD THAT:- Having taken note of the fact that entire amount of compensation stands received by the respondent-complainant and respondent has no objection in compounding the offence, this Court sees no impediment in accepting the prayer made on behalf of the petitioner for compounding of offence while exercising power under Section 147 of the Act as well as in terms of guidelines issued by the Hon'ble Apex Court in DAMODAR S. PRABHU VERSUS SAYED BABALAL H. [2010 (5) TMI 380 - SUPREME COURT], wherein it has been categorically held that court, while exercising power under Section 147 of the Act, can proceed to compound the offence even after recording of conviction by the courts below.
The petitioner-accused is acquitted of the charge framed against him under Section 138 of the Act - present matter is ordered to be compounded and impugned judgments of conviction and sentence passed by the courts below are quashed and set-aside - petition disposed off.
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2021 (12) TMI 279 - BOMBAY HIGH COURT
Dishonor of Cheque - discharge of legal debt and liability - rebuttal of presumption - offence under Section 138 of NI Act - reversal of the order of acquittal of accused - HELD THAT:- It is settled law that when an appeal against acquittal is being considered, the appellate Court shall not reverse the order of acquittal only because another view in the matter was possible on the basis of the material on record, when the view adopted by the Court below while acquitting the accused was a reasonable and possible view. Therefore, the test to be satisfied by the appellant while seeking reversal of the order of acquittal is a stringent test and the material on record will have to be appreciated in that context.
In the present case, the Magistrate has acquitted the respondent no. 1 on the basis that the complaint filed by the appellant for dishonour of the three cheques pertained only to the alleged liability towards bus stand fees for the Panaji bus stand. The Magistrate found that the oral and documentary evidence placed on record by the appellant pertained not only to the Panaji bus stand but also to other bus stands where respondent no. 1 had been engaged for collection of bus stand fees and parking fees. On this basis, the Magistrate found that the extent of dues and/or liability was not clear and that amounts stated in the cheques were far more than the debt or liability as projected by the appellant, thereby justifying the acquittal of respondent no. 1.
There can be no doubt that under Section 139 of the aforesaid Act, a presumption operates in favour of the appellant and against the respondent no. 1 (accused). But, the presumption arises when foundational facts are proved by the complainant i.e. appellant in the present case. The documentary material on record was used on behalf of the respondent no. 1 to confront the witnesses in cross examination, which brought on record material that effectively rebutted the presumption that could have operated in favour of the appellant under Section 139 of the aforesaid Act.
The appellant while challenging an order of acquittal has to pass a stringent test to successfully demonstrate that the order of acquittal deserves to be reversed.
Appeal dismissed - decided against appellant.
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2021 (12) TMI 278 - TRIPURA HIGH COURT
Dishonor of cheque - denial of reasonable opportunity to explain the incriminating circumstances - rebuttal of statutory presumptions - burden of proof on the complainant or not - HELD THAT:- In the present case, the complainant has presented a probable story supported by evidence. It stands established that he developed a relationship with the accused who was a cashier at the Kailashahar branch of SBI where the complainant used to come for drawing his pension. It is not denied that as an employee of the bank the accused maintained a bank account in the said branch of the bank. The fact that the accused visited the house of the complainant and requested him to give loan of ₹ 4,50,000/- also stands established. PW-2 has supported the evidence of complainant PW-1 that in his presence the complainant gave the loan in cash to the accused and in turn the accused had issued the impugned cheque to the complainant and requested him to present the cheque at the bank at the end of the month. During cross examination of PW-1 and 2, accused did not deny the cheque nor he disowned his signature thereon. During his examination under Section 313 Cr.P.C. also he did not project any defence case. He simply stated that the evidence of PW-1 and 2 were false.
The statutory presumption under Section 139 read with the Rule of Evidence as provided under Section 118 NI Act with regard to the existence of debt or liability is not a discretionary presumption, it is a statutory presumption which is obligatory on the part of the court. A huge burden is cast on the accused to rebut such presumption by adducing reasonably probable defence. It cannot be rebutted by merely offering an explanation - In the instant case, apparently the accused petitioner did not lead any evidence in rebuttal of such statutory presumptions. He has also failed to bring on record such facts and circumstances which would make the courts believe that the liability, attributed to the accused petitioner was improbable or doubtful.
This court is of the view that there is no reason to interfere with the concurrent findings of the courts below with regard to conviction of the petitioner under Section 138 NI Act. As a result, his conviction under Section 138 NI Act is upheld.
Petition disposed off.
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2021 (12) TMI 277 - TRIPURA HIGH COURT
Dishonor of Cheque - insufficiency of funds - expiry of statutory period - acquittal of the accused mainly on the grounds that cognizance of the offence under Section 138 NI Act was taken before expiry of the statutory period of 15 days commencing from the date of receipt of the demand notice - condonation of delay in terms of the proviso to clause (b) of sub-section (1) of Section 142 NI Act - HELD THAT:- In the case of YOGENDRA PRATAP SINGH VERSUS SAVITRI PANDEY & ANR. [2014 (9) TMI 1129 - SUPREME COURT], appellant filed a complaint under Section 138 NI Act against respondent No. 01 before expiry of the statutory period of 15 days and the Magistrate took cognizance of offence and issued summons to the accused who assailed the order in a petition under Section 482 CrPC before the High Court. The High Court held that since the complaint was filed within 15 days of the service of the demand notice, the same was premature and the order passed by the Magistrate taking cognizance was quashed against which the appellant came to the Hon'ble Supreme Court.
In the present case, for same cause of action complainant private respondent filed a complainant under Section 138 NI Act in the court of the CJM, South Tripura, Belonia which was registered as CR(NI)23 of 2013 in which evidence was taken and learned CJM by his judgment and order dated 11.04.2016 found the petitioner not guilty and acquitted him of the said charge on various grounds - It is thus clear that accused was once tried in NI 23 of 2013 for the same cause of action in which evidence was taken and after full trial he was acquitted because the complainant could not establish the charge against him. Order of his acquittal still remains in force. In these circumstances, learned trial court committed error by entertaining a fresh complainant for the same cause of action between the same parties.
The Criminal Revision Petition stands allowed.
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2021 (12) TMI 276 - KERALA HIGH COURT
Equitable Mortgage - seeking to direct the petitioner Bank to deposit before the court the whole of the auction amount received in the SARFAESI sale proceedings - HELD THAT:- To enable the decree holder to participate in the assets of a judgment debtor, the following conditions are to be satisfied by the decree holder; namely, (i) decree holder claiming share in the rateable distribution should have applied for execution of his decree to the appropriate Court, (ii) such application should have been made prior to the receipt of the assets by the Court, (iii) the assets of which a rateable distribution is claimed must be assets held by the Court, (iv) the attaching creditor as well as the decree holder claiming to participate in the assets should be holders of decrees for the payment of money, and (v) such decrees should have been obtained against the same judgment debtor. Therefore, no rateable distribution can be claimed unless all the aforesaid conditions are fulfilled.
All the aforesaid conditions have not been satisfied and so the learned Munsiff could not have passed Exts.P7 order on that ground also. Even otherwise, the attachment which has been affected after the mortgage has been created in respect of the property, will have no effect and hence on the said ground alone, the order is liable to be set aside - Petition allowed - decided in favor of appellant.
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2021 (12) TMI 275 - ALLAHABAD HIGH COURT
Dishonor of Cheque - signatories of the defaulted cheque - Liability of Chairman / Managing Director - burden to establish the applicability of the exemption created by the second proviso to Section 141 of the Act - case of applicants is that no proceedings may continue against any of the accused persons/applicants by virtue of the bar created by the second proviso to Section 141 of the Act - HELD THAT:- In the context of the present facts, none of the applicants namely Krishan Mohan Pandey, Manoj Kumar Pathak, Bhikari Singh and Yogesh Shukla are shown to be either officers of the Central Government or the State Government or a Financial Corporation owned or controlled either by the State Government or Central Government. It is also not shown that they had been nominated as Directors of the Corporation by virtue of that office held. On the contrary, it does appear that all the applicants were appointed as officers of the Corporation itself.
The burden to establish the applicability of the exemption created by the second proviso to Section 141 of the Act was on the applicants. That burden not discharged, at present, no good ground is made out to offer any interference on such count. It is however made clear that the Court has not adjudicated the rights of the applicants on this issue. It may therefore remain open to the applicants to raise proper objection before the learned Magistrate, if such facts exist.
Prima facie case is made out against applicant nos. 1 and 2 at this stage. Therefore, the application filed on behalf of applicant nos. 1 and 2 is dismissed. At the same time, it may be noted that the present application was filed in the year 2009 and there is an interim order operating in favour of the applicants since 03.06.2009. More than 12 years have passed - in absence of any specific allegation made against applicant no. 3-Bhikari Singh, the complaint may not be prosecuted further against him.
Having done that there was no liberty available to the complainant and there was no requirement in law to implead the Managing Director. The Corporation is a juridical person, which was required to be impleaded (in the complaint lodged) to fulfill the requirement of law. That requirement however does not create any offence by its Managing Director.
The entire proceedings of Complaint Case No. 283 of 2007 (Dinesh Tyagi Vs. Manoj Pathak), under Section-138 Negotiable Instruments Act, 1881, pending in the court of Special Chief Judicial Magistrate, Meerut against applicant no. 3 and Yogesh Shukla are quashed - Application allowed in part.
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2021 (12) TMI 274 - BOMBAY HIGH COURT
Dishonor of Cheque - existence of legal debt/liability or not - guilty of offence under Section 138 of the Negotiable Instruments Act, 1881 - HELD THAT:- There cannot be any quarrel with the proposition that the jurisdiction being exercised by this Court in revision necessarily limits the scope to interfere in concurrent findings rendered by the two Courts below against the applicants. Nonetheless, if the applicants are able to demonstrate that the findings rendered by the two Courts below are erroneous, perverse and wholly unsustainable, the impugned judgments and orders can certainly be interfered with.
A perusal of the nature of cross examination of the witnesses of the respondent and the manner in which defence evidence was led by examining witnesses, it becomes clear that the material brought on record fell way short of rebutting the presumption that operated against the applicants. The elaborate submissions sought to be made before this Court on behalf the applicants on the aspect of the alleged failure of the respondent to give details of the account and crystalized form of legal debt or liability is not supported by the material available on record - In fact, with the nature of stand taken before the Magistrate and the manner in which oral and documentary evidence was led on behalf of the applicants, it becomes clear that there is no scope for the applicants to raise such a contention in revisional jurisdiction before this Court.
This Court finds that no case for interference is made out on behalf of the applicants in revisional jurisdiction - the revision application is found to be without any merits and it is dismissed.
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2021 (12) TMI 273 - HIMACHAL PRADESH HIGH COURT
Dishonor of cheque - denial of issuance of cheque and signatures - presumption as available under Section 118 and 139 of NI Act - HELD THAT:- This court finds no force in the submission made by learned counsel for the petitioner that the learned courts below have misread the evidence, as a consequence of which findings, detrimental to the accused have come on record, rather, careful perusal of evidence led on record by the parties clearly proves that the accused with a view to discharge his liability issued cheque in the sum of ₹ 50,000/- to the complainant, but the same was dishonoured on account of insufficient funds in his bank account.
Once there is no denial of issuance of cheque and signatures thereupon, presumption as available under Ss. 118 and 139 comes into play. Section 118 and 139 of the Act clearly provide that it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability. True, it is that to rebut aforesaid presumption accused can always raise probable defence either by leading some positive evidence or by referring to the material, if any adduced on record by the complainant - Once issuance of cheque and signatures thereupon are not denied, presumption starts in favour of holder of cheque and once such presumption starts, onus shifts upon the person issuing the cheque.
This court is convinced and satisfied that complainant has successfully proved by leading cogent and convincing evidence that the accused issued cheque in question in discharge of his lawful liability, but the same came to be dishonored. Since despite issuance of legal notice, accused failed to make good the payment, learned court below, in the totality of evidence led on record by the complainant, rightly held accused guilty of having committed offence punishable under Section 138 of act and as such, no interference in the impugned judgment/order of conviction and sentence is called for.
The present revision petition is dismissed being devoid of any merit.
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2021 (12) TMI 237 - BOMBAY HIGH COURT
Dishonor of Cheque - discharge of legally enforceable liability or not - existence of valid agreement between parties or not - HELD THAT:- Indisputably, complainant was a member of ‘COC’ and he accepted the consideration from the accused for not preferring an appeal against the order of the NCLT. Section 23 of the Contract Act, lays down that ‘Consideration’ or ‘Object’ of the agreement is unlawful, if it is forbidden by law or would defeat the provisions of law or would involve injury to any person or property of another or the Court considers it, as immoral, or opposed to public policy. It may be stated that it is contrary to the public policy to induce public officer for money or other valuable consideration, to use their position/office and influence to procure benefit.
The agreement between the Complainant and the accused was, void since, beginning.
Since liability sought to be enforced by the complainant under the agreement was ‘void’, the complaint under Section 138 of the NIA was not maintainable - Application allowed.
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2021 (12) TMI 236 - MADRAS HIGH COURT
Dishonor of Cheque - breach of contract - offence of cheating - contention of the learned counsel appearing for the petitioner is that absolutely there is no intention whatsoever to deceive the 2nd Respondent/defacto complainant - HELD THAT:- The Courts have quashed the proceedings when the companies were not arrayed as accused and the allegations primarily targeted the company. In such a situation the company not being made a party and the Directors of the company prosecuted in their individual capacity were relieved from the criminal prosecution. It is not the case in the present FIR. The very allegation of false assurance on payment of money made against the A1 and A2 in their individual capacity. Therefore, this Court is of the view that merely the company is not made as a party, it will not absolve the petitioners when the allegation prima facie made against them.
Though, it is the contention of the learned counsel for the Petitioner that there is no evidence to show that there is a deception from the inception, it is relevant to note that whether the deception was present from the inception or developed later is the matter of evidence. What has to be seen in the FIR stage is, whether the allegation attracts the offence or not. The evidentiary value of the statements or ingredients cannot be gone into while exercising power under Section 138 of the Negotiable Instruments Act.
It is very clear that merely because the commercial transaction it cannot be generally concluded that no criminal prosecution is maintainable. If the allegation in the FIR prima facie show the implication of the offence, the court cannot interfere the investigation at that stage. On looking of the allegations in the present FIR, as indicated, the allegations are made against both husband and wife on false promise and assurance given from the very inception. It is also indicated that six cheques have been issued on the promise of repayment, however the same was dishonoured. Thereafter, wife also assured and given other cheques. It is also alleged that the very supply itself were made on the promises and assurances by both the parties.
Petition dismissed.
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2021 (12) TMI 235 - DELHI HIGH COURT
Smuggling - narcotics medicine covered under the Narcotics Drugs and Psychotropic Substances Act, 1985 - 4200 tablets of Zolpidam - 6000 tablets of Alprazolam - 12000 tablets of Tramadol - admissibility of statements u/s 67 of the NDPS Act - HELD THAT:- The facts stated in the charge sheet do show prima facie the petitioners were dealing with narcotics and psychotropic substances in large scale. The petitioner Bablu Bhagwan Dangre allegedly had a company under the name of Krivi Infotech which used to deal with narcotic tables and an bank account in HDFC Bank, Nagpur and all the payments were received in this account in relation to the tramadol and other narcotic tablets were being used by petitioners along with Barun Chauhan. It is alleged all the orders of Tramadol tablets were received from India or other countries through mail or on phone were forwarded by Barun Chauhan for confirmation and thereafter to Mr.Lutz at Singapore through mail - Admittedly, the incriminating material has been seized from the mobiles, laptops of petitioners categorically demonstrate trafficking/ transportation/shipping/ external dealings in Tramadol and other psychotropic substances/drugs from India to UK and Singapore etc and petitioners are involved in external trading.
The simplictor statement under Section 67 of the NDPS Act may not be admissible under Section 25 of the Indian Evidence Act, however the disclosure leading to discovery of facts within their knowledge that they were indulging in trade of narcotics, including Tramadol tablets in conspiracy with other accused persons coupled with other incriminating material seized on record is relevant in terms of Section 27 of the Indian Evidence Act - Even otherwise, per Section 66 of the NDPS Act, it is presumed the documents and other material seized and/or produced by the person are deemed to be conclusively proved and shall be used against such person unless contrary is proved.
No ground is made out to release the petitioners on bail at this stage - Petition dismissed.
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2021 (12) TMI 234 - GUJARAT HIGH COURT
Dishonor of Cheque - cheque was issued for discharge of legal liability towards complainant or not - failure to rebut the onus of proof and statutory presumption under Sections 118(a) and 139 of the NI Act - acquittal of the accused - HELD THAT:- It is well settled by catena of decisions that an appellate Court has full power to review, re-appreciate and consider the evidence upon which the order of acquittal is founded. However, the Appellate Court must bear in mind that in case of acquittal, there is prejudice 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 reaffirmed and strengthened by the trial Court.
The fact remains that there appears nothing on record to substantiate the claim of the complainant that the debt was legally enforceable debt for want of any material to substantiate the same and therefore, in the overall facts and circumstances of the case, the learned Magistrate has come to the conclusion that the debt cannot be said to be the legally enforceable debt, which is sine qua non in such matters and the complainant has failed to prove the same beyond reasonable doubt and in view of the aforesaid facts and circumstances and the evidence on record, this Court agrees with the view taken by the learned Magistrate.
The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. In the instant case, the accused has succeeded in rebutting the presumption, showing preponderance of probability by leading evidence and hence, onus shifts upon the complainant to prove otherwise, however, the complainant has failed to prove that the cheque was drawn towards legally enforceable debt as neither any account nor any details of amount paid by the complainant is submitted by the complainant before the trial Court.
The complainant has failed to bring home the charge against accused for want of sufficient material. The findings recorded by the learned Magistrate do not call for any interference - Appeal dismissed.
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2021 (12) TMI 233 - DELHI HIGH COURT
Principles of natural justice - petitioner’s right to cross-examine the complainant was closed - issuance of non-bailable warrants - HELD THAT:- It is apparent that mere change of counsel cannot be a ground to recall a witness. It is further discernible that no prejudice would be caused to an accused if relief of recalling a witness is denied, considering that the accused was given sufficient opportunity to examine the witness but he failed to do the same - At this stage, learned counsel for the petitioner has prayed that only one opportunity may be granted to the petitioner to lead defence evidence. He submits that if permitted, the petitioner undertakes to examine the defence witnesses in one day.
Doubtless, the petitioner is guilty of delaying the trial, however, this Court cannot lose sight of the fact that a fair trial is the hallmark of criminal procedure. It entails not only the rights of the victims but also the interest of the accused. It is the duty of every Court to ensure that fair and proper opportunities are granted to the accused for just decision of the case. In furtherance of the above, adducing of evidence by the accused in support of his defence is also a valuable right and allowing the same is in the interest of justice - this Court is of the opinion that interest of justice would be served if the petitioner is allowed one last opportunity to lead defence evidence, subject to his examining the defence witnesses on one single day.
It is directed that the matter be listed before the concerned Trial Court on 10.12.2021 for the petitioner to take appropriate steps for leading his defence evidence. The same shall however be subject to payment of cost of ₹ 10,000/- to be payable to the respondent, within a period of three weeks from today - Petition disposed off.
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2021 (12) TMI 175 - SUPREME COURT
Dishonor of Cheque - vicarious liability against the appellants - legally enforceable debt or other liability - furnishing of ‘security’ is covered under the provisions of Section 138 of the NI Act - Magistrate in view of Section 202 CrPC - postponment the issuance of process - HELD THAT:- The explanation to Section 138 of the NI Act provides that ‘debt or any other liability’ means a legally enforceable debt or other liability. The proviso to Section 138 stipulates that the cheque must be presented to the bank within a period of six months from the date on which it is drawn or within its period of validity. Therefore, a cheque given as a gift and not for the satisfaction of a debt or other liability, would not attract the penal consequences of the provision in the event of its being returned for insufficiency of funds - the term debt also includes a sum of money promised to be paid on a future day by reason of a present obligation. A post-dated cheque issued after the debt has been incurred would be covered by the definition of ‘debt’. However, if the sum payable depends on a contingent event, then it takes the color of a debt only after the contingency has occurred. Therefore, in the present case, a debt was incurred after the second respondent began supply of power for which payment was not made because of the non-acceptance of the LCs’. The issue to be determined is whether Section 138 only covers a situation where there is an outstanding debt at the time of the drawing of the cheque or includes drawing of a cheque for a debt that is incurred before the cheque is encashed.
Under Sub-Section (1) of Section 202, a Magistrate upon the receipt of a complaint of an offence of which he/she is authorized to take cognizance is empowered to postpone the issuance of process against the accused and either (i) enquire into the case; or (ii) direct an investigation to be made by a police officer or by such other person as he thinks fit. The purpose of postponing the issuance of process for the purposes of an enquiry or an investigation is to determine whether or not there is sufficient ground for proceeding - The requirement of recording reasons which is specifically incorporated in Section 203 does not find place in Section 202. Section 204 which deals with the issuance of process stipulates that if in the opinion of the Magistrate taking cognizance of an offence, there is sufficient ground for proceeding, he may issue (a) in a summons case, a summons for attendance of the accused; (b) in a warrant case, a warrant or if he thinks fit a summons for the appearance of the accused. These proceedings have been interpreted in several judgments of this Court. For the purpose of the present case, some of them form the subject matter of the submissions by the appellants and the second respondent.
Section 145 of the NI Act provides that evidence of the complainant may be given by him on affidavit, which shall be read in evidence in an inquiry, trial or other proceeding notwithstanding anything contained in the CrPC. The Constitution Bench held that Section 145 has been inserted in the Act, with effect from 2003 with the laudable object of speeding up trials in complaints filed under Section 138. Hence, the Court noted that if the evidence of the complainant may be given by him on affidavit, there is no reason for insisting on the evidence of the witnesses to be taken on oath - Section 202(2) CrPC is inapplicable to complaints under Section 138 in respect of the examination of witnesses on oath. The Court held that the evidence of witnesses on behalf of the complainant shall be permitted on affidavit. If the Magistrate holds an inquiry himself, it is not compulsory that he should examine witnesses and in suitable cases the Magistrate can examine documents to be satisfied that there are sufficient grounds for proceeding under Section 202.
The test to determine if the Managing Director or a Director must be charged for the offence committed by the Company is to determine if the conditions in Section 141 of the NI Act have been fulfilled i.e., whether the individual was in-charge of and responsible for the affairs of the company during the commission of the offence. However, the determination of whether the conditions stipulated in Section 141 of the MMDR Act have been fulfilled is a matter of trial. There are sufficient averments in the complaint to raise a prima facie case against them. It is only at the trial that they could take recourse to the proviso to Section 141 and not at the stage of issuance of process - In the present case, it is evident that the principal grounds of challenge which have been set up on behalf of the appellants are all matters of defence at the trial. The Magistrate having exercised his discretion, it was not open to the High Court to substitute its discretion.
Appeal dismissed - decided against appellant.
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2021 (12) TMI 174 - SUPREME COURT
Principle of Issue Estoppel - whether, in view of the award declared by the Housing Commissioner, M.P. Housing Board, who was appointed as an arbitrator pursuant to the order passed by the High Court in Writ Petition No.9131 of 2008, was it open for the respondent – contractor thereafter to file a reference before M.P. Arbitration Tribunal with respect to the very claim/claims which were the subject matter of arbitration before the Arbitrator – Housing Commissioner?
HELD THAT:- Apart from the fact that the award declared by the Arbitrator – Housing Commissioner was not challenged by the respondent – contractor, even, so long as the said award is not challenged before the higher forum the same is binding between the parties. Even the award or a nullity order has to be challenged before the appropriate forum/higher forum. In the present case it cannot be said that there was a total lack of jurisdiction of the Arbitrator – Housing Commissioner in passing the award as it was the High Court who passed the order with consent referring the dispute between the parties for the adjudication to the Arbitrator – Housing Commissioner. Therefore, unless and until it was challenged by the contractor before the higher forum, the respondent – contractor cannot be permitted to ignore and/or to avoid the award passed by the Arbitrator – Housing Commissioner dated 07.11.2008.
As per Section 19 of the 1983 Act, Revision Application to the High Court shall be maintainable only against the award passed by the learned Arbitral Tribunal. Therefore, prima facie it appears that as such the order passed by the learned Arbitral Tribunal rejecting the reference petition was not maintainable as by order dated 27.02.2017, no award was passed by the Tribunal - technically speaking the award passed by the Arbitrator – Housing Commissioner dated 07.11.2008 stands even today. It is binding between the parties. So long as the award passed by the Arbitrator – Housing Commissioner dated 07.11.2008 stands, there cannot be any subsequent fresh proceeding with respect to the same claims which were considered and adjudicated by the Arbitrator – Housing Commissioner while passing the award dated 07.11.2008. So long as the said award stands it is binding between the parties.
As no objections were raised by the respondent – contractor at the appropriate stage, the award cannot be annulled subsequently. At the cost of repetition, it is observed that at no point of time the respondent – contractor had challenged the award passed by the Arbitrator – Housing Commissioner and as observed and held hereinabove even no court has set aside the award declared by the Arbitrator – Housing Commissioner dated 07.11.2008 and the same has attained finality. Therefore, the same is binding between the parties - the subsequent fresh reference petition before the learned Arbitral Tribunal under the 1983 Act for the very same claims which were raised before the Arbitrator – Housing Commissioner would not be maintainable at all. We agree with the view taken by the Arbitral Tribunal.
The impugned judgment and order passed by the High Court quashing and setting aside the order passed by the learned Arbitral Tribunal constituted under the 1983 Act dated 27.02.2017 is hereby quashed - Appeal allowed - decided in favor of appellant.
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2021 (12) TMI 173 - SUPREME COURT
Sale of the mortgaged asset - violation of the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the Security Interest (Enforcement) Rules, 2002 - obligation to comply with Section 13(3A) of the Act - Time Limitation - validity of separate valuation of machinery in the subject property when it obtained the valuation before it sold the property to the 2nd respondent - incumbent on the part of the 1st respondent to obtain a fresh valuation certificate in view of the long gap between the valuation report and the e-auction sale or not.
Whether the 1st respondent Bank had an obligation to comply with Section 13(3A) of the Act and give a response to the petitioners’ representation dt.01.11.2016 and whether the Debts Recovery Tribunal was correct in holding that there was no such obligation on the part of the 1st respondent Bank? - HELD THAT:- The Bank had proceeded to issue possession notice on 3rd March 2017 under Section 13(4) of the SARFAESI Act long after receipt of the representations dated 1st/6th November 2016, but without making any reference to the aforesaid representation. Accordingly, on the first point, the High Court concluded that there had been a violation by the Bank of its mandatory statutory duty under Section 13(3A) of the SARFAESI Act.
Whether any of the reliefs claimed in the O.A. by the petitioners is barred by limitation? - HELD THAT:- In the present case, it is clear from a bare perusal of the letter dated 7th November 2016 sent by the Bank to its Zonal Manager that the Bank actively considered the Borrower’s request for extension of the moratorium period. The Borrower did not submit the viability report and failed to bring in ₹ 45,00,000/- (Rupees forty five lakhs only). Post this default also there were negotiations with assurances and promises by the Borrower. Displaying forbearance, the Bank granted indulgence as action under the SARFAESI Act was deferred for nearly one year from 7th November 2016 till 6th October 2017. Thereafter, negotiations were held on 30th October 2017, 6th November 2017 and 8th November 2017 - in the present case, the Borrower has waived and is estopped from challenging violation of Section 13(3A) of the SARFAESI Act and hence, the first issue is decided in favour of the Bank. Given the aforesaid position, we do not think we are required to examine the second point, i.e. whether in an application under Section 17 of the SARFAESI Act, which can be filed when a Borrower is aggrieved by any of the measures referred to in sub-section (4) to Section 13 within forty five days from the date such measures are taken, the Borrower can challenge other measures, steps and procedures which preceded the ultimate sale even if barred by the limitation period of forty five days.
Whether it was proper for the 1st respondent Bank not to separately value the machinery in the subject property when it obtained the valuation before it sold the property to the 2nd respondent? - HELD THAT:- Auction sale as confirmed was at a price higher than the fair market valuation of the land, the building and the machinery. Whether or not the price of the machinery should be accounted for the purpose of payment of stamp duty on a composite sale wherein the land, the building and the machinery located in the building are sold, would not be of any relevance and importance as the issue in question does not concern payment of stamp duty and the principles applicable. On the other hand, the law recognises that the lender knows its interests and how to secure best value of the property given the fact that the mortgaged property had to be sold for recovery of the debts due and payable to the Bank.
Whether it was incumbent on the part of the 1st respondent to obtain a fresh valuation certificate dt.19.02.2018 in view of the long gap between the valuation report and the e-auction sale held on 11.09.2018? - HELD THAT:- The valuation certificate or report is dated 19th February 2018. As held above, attempts to sell the property were made thereafter on 28th March 2018 and 14th June 2018 but without success as there were no bidders. Accordingly, it was decided to reduce the reserve price from ₹ 2,78,10,000/- to ₹ 2,60,00,000/-. However, in the fourth auction the successful bid given by Basa Chandramouli was for ₹ 2,91,20,000/-, which is much higher than the reserve price of ₹ 2,60,00,000/- or the fair market value of ₹ 2,73,80,000/- in terms of the valuation report.
The order passed by the Debts Recovery Tribunal dated 1st July 2019 upholding the procedure and sale of the Subject Property under the SARFAESI Act is upheld - petition dismissed.
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2021 (12) TMI 147 - SUPREME COURT
Owner of suit property - joint ownership - legality and validity of the power of attorney and the sale deeds - contention of the respondents is that instead of purchasing suit properties only in the name of Sudarshan Kumar, the appellant incorporated his name in the sale deeds along with Sudarshan Kumar - HELD THAT:- It is an admitted position that the said Sudarshan Kumar did not step into the witness box. Moreover, there is a finding recorded by the District Court that no evidence was adduced by Sudarshan Kumar to prove that certain amounts were transmitted by him from a foreign country to the appellant. This finding has not been disturbed by the High Court. The modified decree passed by the High Court by the impugned Judgment and order proceeds on the basis of the finding that the appellant and Sudarshan Kumar were the joint owners of the suit properties as Sudarshan Kumar failed to establish his claim that he was the sole owner of the suit properties. The respondents have not chosen to challenge the impugned Judgment and order and therefore, the finding that the appellant and Sudarshan Kumar were the joint owners of the suit properties has become final.
Admittedly, there is no evidence adduced on record by Sudarshan Kumar that his minor sons had any source of income at the relevant time and that they paid him consideration as mentioned in the sale deed. Similarly, no evidence was adduced to show that Sudarshan Kumar’s wife had any source of income and that she paid consideration mentioned in the sale deed. An issue was specifically framed by the Trial Court on the validity of the sale deeds. There is a specific finding recorded by the District Court that there was no evidence adduced to show that Sudarshan Kumar’s wife and minor children paid consideration as shown in the sale deeds. In fact, before the District Court, it was pleaded that Sudarshan Kumar’s wife had brought some money from her parents - undisputed factual position is that the respondents failed to adduce any evidence to prove that the minor sons had any source of income and that they had paid the consideration payable under the sale deed. They did not adduce any evidence to show that Sudarshan Kumar’s wife was earning anything and that she had actually paid the consideration as mentioned in the sale deed.
It is the specific case made out in the plaints as originally filed that the sale deeds are void as the same are without consideration. It is pleaded that the same are sham as the purchasers who were minor sons and wife of Sudarshan Kumar had no earning capacity. No evidence was adduced by Sudarshan Kumar about the payment of the price mentioned in the sale deeds as well as the earning capacity at the relevant time of his wife and minor sons. Hence, the sale deeds will have to be held as void being executed without consideration. Hence, the sale deeds did not affect in any manner one half share of the appellant in the suit properties - It was not necessary for the appellant to specifically claim a declaration as regards the sale deeds by way of amendment to the plaint. The reason being that there were specific pleadings in the plaints as originally filed that the sale deeds were void. A document which is void need not be challenged by claiming a declaration as the said plea can be set up and proved even in collateral proceedings.
As no title was transferred under the said sale deeds, the appellant continues to have undivided half share in the suit properties. That is how the District Court passed the decree holding that the appellant is entitled to joint possession of the suit properties along with Sudarshan Kumar. Therefore, for the reasons, by setting aside the impugned Judgment and order of the High Court, the decree passed by the District Court deserves to be restored - Appeal allowed - decided in favor of appellant.
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2021 (12) TMI 146 - JAMMU & KASHMIR HIGH COURT
Dishonor of Cheque - discharge of legally enforceable debt or not - rebuttal of presumption or not - section 138 of NI Act - HELD THAT:- The Court, in the present case, is called upon to give verdict upon factual aspects of the matter which are required to be decided in trial Court. The truth can be unfolded after the evidence is lead in the matter. The proceedings cannot be allowed to be truncated and curtain brought down on the same only for the reason that the petitioners may have some defense which requires consideration in the trial.
The argument is also raised that the respondent herein has not controverted the stand taken by the petitioners herein qua the application filed for dropping of proceedings before the trial court and therefore, the complaint is without basis - the Court finds no reason either to interfere in the order dated 19.05.2012, passed by the trial court, whereby the application filed for dropping of proceedings & exemption to the applicants therein, was dismissed.
Petition dismissed.
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