TMI Blog2013 (9) TMI 948X X X X Extracts X X X X X X X X Extracts X X X X ..... al power of attorney. As a result, the authority to sub-delegate the functions must be explicitly mentioned in the general power of attorney. Otherwise, the sub-delegation will be inconsistent with the general power of attorney and thereby will be invalid in law. Nevertheless, the general power of attorney itself can be cancelled and be given to another person. In the light of section 145 of N.I 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 N.I Act and the Magistrate is neither mandatorily obliged to call upon the complainant to remain present before the Court, nor to examine the complainant of his witness upon oath for taking the decision whether or not to issue process on the complaint under Section 138 of the N.I. Act. - Criminal Appeal No. 73 of 2007, Criminal Appeal No. of 2013 (Arising out of S.L.P. (Crl.) No.2724 of 2008) - - - Dated:- 13-9-2013 - CJI. P. Sathasivam And Ranjana Prakash Desai And Ranjan Gogoi,JJ. JUDGMENT P. Sathasivam,CJI. Criminal Appeal No. 73 of 2007 1)This appeal is filed against the final common judgment and order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or quashing of the complaints. By impugned order dated 12.08.2005, the said applications were dismissed by the High Court. (e) Against the said order, the appellant has preferred this appeal by way of special leave before this Court. Criminal Appeal ./2013 @ S.L.P.(Crl.) No. 2724 of 2008: 3) Leave granted. 4) This appeal is directed against the judgment and order dated 19.09.2007 passed by the High Court of Judicature, Andhra Pradesh at Hyderabad in Criminal Appeal No. 578 of 2002 whereby the High Court allowed the appeal filed by M/s Surana Securities Ltd.-Respondent No.1 herein (the complainant) against the judgment and order dated 30.10.2001 passed by the Court of XVIII Metropolitan Magistrate, Hyderabad in C.C. No. 18 of 2000 dismissing the complaint and acquitting the accused for the offence under Section 138 of the N.I. Act. 5) Brief facts (a) Respondent No.1 herein-the complainant is a limited company carrying on the business of trading in shares. The appellant herein is a client of the respondent-Company and used to trade in shares. During the course of business, the appellant became liable to pay an amount of Rs. 7,21,174/- towards the respondent-Company. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidering Criminal Appeal No. 73 of 2007 (arising out of Special Leave Petition (Crl.) Nos. 6703-6708 of 2005) with regard to the interpretation of Section 142(a) of the N.I. Act observed that in view of the difference of opinion among various High Courts as also the decisions of this Court in M.M.T.C. Ltd. and Anr. vs. Medchl Chemicals and Pharma (P) Ltd. and Anr., (2002) 1 SCC 234 and Janki Vashdeo Bhojwani and Anr. vs. Indusind Bank Ltd. and Ors., (2005) 2 SCC 217, the matter should be considered by a larger Bench in order to render an authoritative pronouncement. In view of the same, it is desirable to extract the entire order of reference which reads as under:- Delay in filing counter affidavit is condoned. Leave granted. Interpretation and/or application of Section 142(a) of the Negotiable Instruments Act, 1881, ("NI Act") is in question in this appeal which arises out of a judgment and order dated 12.8.2005 passed by a learned Single Judge of the High Court of Judicature at Bombay. The basic fact of the matter is not in dispute. Several cheques on different dates were issued by the appellant herein which were dishonoured. The complainant executed a Special Power o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is Court overruled the judgment of the Bombay High Court in Pradeep Mohanbay vs. Minguel Carlos Dias [2000 (1) Bom. L.R. 908], inter alia opining as follows: "Order 3 Rules 1 and 2 CPC empowers the holder of power of attorney to 'act' on behalf of the principal. In our view the word 'acts' employed in Order 3 Rules 1 and 2 CPC confines only to in respect of 'acts' done by the power-of-attorney holder in exercise of power granted by the instrument. The term 'acts' would not include deposing in place and instead of the principal. In other words, if the power of attorney holder has rendered some 'acts' in pursuance of power of attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for the acts done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter of which only the principal is entitled to be crossexamined." "On the question of power of attorney, the High Courts have divergent views. In the case of Shambhu Dutt Shastri v. State of Rajasthan (1986 2 WLN 713 (Raj.) it was held that a general power-or-attorney holder can appear, plead and act on behalf of the party but he cannot b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l contentions and the legal issues, it is useful to refer Sections 138 and 142(a) of the N.I. Act which read as under: 138. Dishonour of cheque for insufficiency, etc., of funds in the account.- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... torney Act, 1882 cannot override the specific provisions of the Statute which require that a particular act should be done in a particular manner (vide Nazir Ahmed vs. King Emperor, AIR 1936 PC 253, Rao Bahasur Ravula Subba Rao Ors. vs. Commissioner of Income Tax, AIR 1956 SC 604 at 612-613). It was further pointed by learned senior counsel for the appellant that the decision in Rao Bahasur Ravula Subba Rao (supra) was followed in Jimmy Jahangir Madan vs. Bolly Cariyappa Hindley (dead) by LRs, (2004) 12 SCC 509. 9) In view of the above, learned senior counsel for the appellant relied on a decision of this Court in Janki Vashdeo Bhojwani (supra) wherein this Court held that Power of Attorney cannot depose for the acts done by the principal. Likewise, it was further held that he cannot depose for principal in respect of matters of which only the principal can have personal knowledge and in respect of which the principal is liable to be cross-examined. It was further held that the Power of Attorney can appear only as a witness in respect of facts, which are within his personal knowledge. 10) In the case on hand, it is pointed out by learned senior counsel for the appellant that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) Whether a Power of Attorney holder can sign and file a complaint petition on behalf of the complainant?/ Whether the eligibility criteria prescribed by Section 142(a) of NI Act would stand satisfied if the complaint petition itself is filed in the name of the payee or the holder in due course of the cheque? (ii) Whether a Power of Attorney holder can be verified on oath under Section 200 of the Code? (iii) Whether specific averments as to the knowledge of the Power of Attorney holder in the impugned transaction must be explicitly asserted in the complaint? (iv) If the Power of Attorney holder fails to assert explicitly his knowledge in the complaint then can the Power of Attorney holder verify the complaint on oath on such presumption of knowledge? (v) Whether the proceedings contemplated under Section 200 of the Code can be dispensed with in the light of Section 145 of the N.I. Act which was introduced by an amendment in the year 2002? 16) In order to find out the answers to the above and also to ascertain whether there is any conflict between the two decisions as pointed out in the referral order, let us consider the factual details and the ultimate dictum laid d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f original plaintiff is maintainable provided he has personal knowledge of the transaction in question. This Court further held as under: 12. In the context of the directions given by this Court, shifting the burden of proving on to the appellants that they have a share in the property, it was obligatory on the appellants to have entered the box and discharged the burden by themselves. The question whether the appellants have any independent source of income and have contributed towards the purchase of the property from their own independent income can be only answered by the appellants themselves and not by a mere holder of power of attorney from them. The power-of-attorney holder does not have personal knowledge of the matter of the appellants and therefore he can neither depose on his personal knowledge nor can he be cross-examined on those facts which are to the personal knowledge of the principal. 13. Order 3 Rules 1 and 2 CPC empower the holder of power of attorney to act on behalf of the principal. In our view the word acts employed in Order 3 Rules 1 and 2 CPC confines only to in respect of acts done by the power-of-attorney holder in exercise of power granted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er to depose on behalf of his principal. The High Court further held that the word act appearing in Order 3 Rule 2 CPC takes within its sweep depose . We are unable to agree with this view taken by the Bombay High Court in Floriano Armando. 21. We hold that the view taken by the Rajasthan High Court in the case of Shambhu Dutt Shastri followed and reiterated in the case of Ram Prasad is the correct view. The view taken in the case of Floriano Armando Luis cannot be said to have laid down a correct law and is accordingly overruled. 19) As noticed hereinabove, though Janki Vashdeo Bhojwani (supra), relates to powers of Power of Attorney holder under CPC but it was concluded therein that a plaint by a Power of Attorney holder on behalf of the original plaintiff is maintainable provided he has personal knowledge of the transaction in question. In a way, it is an exception to a well settled position that criminal law can be put in motion by anyone [vide Vishwa Mitter (supra)] and under the Statute, one stranger to transaction in question, namely, legal heir etc., can also carry forward the pending criminal complaint or initiate the criminal action if the original complainant die ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the sole proprietor. However, we make it clear that the power of attorney holder cannot file a complaint in his own name as if he was the complainant. In other words, he can initiate criminal proceedings on behalf of the principal. 22) From a conjoint reading of Sections 138, 142 and 145 of the N.I. Act as well as Section 200 of the Code, it is clear that it is open to the Magistrate to issue process on the basis of the contents of the complaint, documents in support thereof and the affidavit submitted by the complainant in support of the complaint. Once the complainant files an affidavit in support of the complaint before issuance of the process under Section 200 of the Code, it is thereafter open to the Magistrate, if he thinks fit, to call upon the complainant to remain present and to examine him as to the facts contained in the affidavit submitted by the complainant in support of his complaint. However, it is a matter of discretion and the Magistrate is not bound to call upon the complainant to remain present before the Court and to examine him upon oath for taking decision whether or not to issue process on the complaint under Section 138 of the N.I. Act. For the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 2008, which stand answered as above. Apart from the above questions, one distinct query was raised as to whether a person authorized by a Company or Statute or Institution can delegate powers to their subordinate/others for filing a criminal complaint? The issue raised is in reference to validity of sub-delegation of functions of the power of attorney. We have already clarified to the extent that the attorney holder can sign and file a complaint on behalf of the complainant-payee. However, whether the power of attorney holder will have the power to further delegate the functions to another person will completely depend on the terms of the general power of attorney. As a result, the authority to sub-delegate the functions must be explicitly mentioned in the general power of attorney. Otherwise, the sub-delegation will be inconsistent with the general power of attorney and thereby will be invalid in law. Nevertheless, the general power of attorney itself can be cancelled and be given to another person. 26) While holding that there is no serious conflict between the decisions in MMTC (supra) and Janki Vashdeo Bhojwani (supra), we clarify the position and answer the questions in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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