Counter blast in cheque case by accused?

You seems to be in much over confidence and that is what happens in many such cases when accused are convicted .

Issuer of cheque is liable and so is vicarious and contructive liability.

It is not very clear what is the type of firm, but still it can be made out with some difficulty that it is a Proprietorship firm in the name of accused Father.

If it so then no case lies with the son, for proprietorship firm the accused would be the proprietor only and not any employee, unless and until some one is made GPA on behalf of proprietor, in that case both properietor and the GPA holder can be the accused.

In your case if you have proved that your client is not at all connected with the cheque then you may succeed, as far as the question of your catching the complainant, then it is difficult, because as per CPC (not CrPC) it is upto the respondent to come forward and state the facts about constitution of firm, complainant as a receiver may not know exactly about the status of firm and its prop/partners. Even otherwise if these facts were known, then you should have approached High Court under S.482 for dismissal. In my opinion no fault lies with the complainant, and on top of that complainant may loose his case atleast under S.138 if filed against the son.

I would personally suggest leave the father/son relationship aspect hidden as far as possible and prove that your client is no way associated with the case, by giving firm's constitution details. S.141 is not applicable on prop firm.

Mr. Trivedi,

You are very much right , that firm if prop firm only ( out of sec. 141) , as per your suggessions i m almost out of it.  But he ( complainant) well admitted this fact that he knew earlier that accused was not prop of this firm . Pl suggest me some thing about my available rights ( civil & criminal)  against complainant for such baseless case because he wasted lot of money, time, energy, peace of my client. Rather he lost lot of reputation of my client in market of business.

Thanks. 

Hi Yogeshwar ji,

Pl dont count my level of confidence , if every one startered to consider that issuer of cheque is liable than there is no need of any defence in cheque bounce cases.

My simple submission to all experts over this forum , is just to gain with updation of knowldge in regard to possible outcomes on above mentioned situation.

If you are aware about the solutions of this situation than pl share with everyone so some victims can take benefit .

Thanks. 

You should file a civil suit within one year of acquittal, claiming compensation of Rs. XXXXX for causing harrassment, economical loss, mental torture, loss of reputation in the business circle, due to false and malafide criminal case against your client.

You should make a solid ground in your suit. Mere acquittal is not sufficient for success in civil compensation suit.

In general many a times complainant makes very false statement in the affidavit, substantially false statement in the affidavit which has the potential for conviction (Pl read relevant sections of IPC you get an idea about false claim and perjury), if it is proved during trial that these statements are false and used to implicate only or to get undue enrichment or to get false decree or order then at the time of acquittal you may appeal the trial court for initiating the process of perjury against the complainant. If admitted the complainant will forget making any false case in future. In fact many of the these blank cheque holders or security cheque holders are so bold that they make factually incorrect statements in the affidavit. These guys deserve punishment, the reason is very simple if accused is guilty then he should be punished, but if complainant is guilty of false claim then he should also be taken to task. The act is regulatory offense and prima facie deals with honesty in transaction.

Hi Trivedi ji,

Thanks again, you said well in regard to both side of cases. In general i have seen in most of cases our most of defence lawyers surrender even before the case starts in cheque and from day one they start presuming to settlement with complainant. Most of them takes the situation in cheque case that conviction is sure. In fact there is nothing like that . I share with you one of the example , in one of my case complainant ( Rs.1 lac case) has settled in Canada with family and case is initiated by his father as POA , now xxx of Ex-CA was due , i forced POA to produce complainant in person for evidence because evidence can never be delegated in invidual evidence. Now for such small amount how complaint can afford to trevell India for such purpose for two or three different dates for xxx examination.  But i have seen that in ealier time there are so many cases which are evidenced by POA and accused have convicted even and so many case still in court to decide. There are around 35000 cases pending in my court and most of them in action by POA .

It is also ture that complainant never cares while framing basis of claim in his  legal notice , and do lot of mistakes further in complaint, affidavits, xxx etc because he lives in confidence that his amount is secure by filing this case.  If we as a defence lawyer are aware with all possible defences and  counter attacks against fake claimants , only then situation in cheque case will improve and real object of statue will be achieved.

Thanks..... 

1) Cheque bounce cases can be won but for that very hard work has to be done by defense advocate.

2) It is not true that POA can not file and conduct cheque bounce cases. All cases by cheque bounce by banks and NBFC s are by POA.

BUT IN SHORT PL TELL US WHAT HAPPENED IN YOUR CASE, WHAT RESULTS YOU HAVE ACHIEVED IN THE CURRENT CASE DISCUSSED BY YOU.

POA aspect is quite badly understood even by the trial courts, and there are ample example of convictions like the one you have given. The lawful position with respect to POA is as follows. anything contrary must be strongly taken up by defense.

For Companies / Organisations / Group of individuals

1. Any POA holder, even authority holder, duly authorized can be the complainant.

2. This POA can give evidence based on record in his individual capacity or even on behalf of payee, but matters which require personal knowledge must be proved by competent witness only as per Evidence Act. If this POA hodler has handled the transaction then he can give evidence to this effect also.

3. This POA holder as complainant can be substituted also in future.

4. A witness ( POA or non POA) who has given affidavit cannot be substituted or cannot be withdrawn. Once the affidavit is given accused has absolute right to cross him, otherwise S.114 rebuts the presumption under S.139 or even he can file application under S.145(2) for acquittal. (Let is get dismissed, if so, it will be useful later on). This is very good tool, many a times there will be only one specific witness in these SPA type cases and most likely he will run away before cross and prosecution will file for substitution. The point here is complainant can be substituted, who bothers, but not the witness or not the person who was examined under S.200.

For Individual / Prop firms

1. If a person has carried out the relevant transaction with accused as the POA holder of (individual / prop) then he can be both complainant as well as witness. This means the POA must be existing at the time of transaction for this man to become both complainant as well as witness on behalf of prop/firm.

2. If the SPA is given only at the time of filing of the case, then such person can become the complainant, but he cannot become the witness on behalf of individual/prop. For such case that individual/prop as payee must depose as witness otherwise case fails.

3. Subsequent GPA holder (GPA given after the transaction date) cannot be examined as complainant for transaction matters.

4. As above in pT#4

One more conviction example due to defense failure:

1. Complaint was filed by an employee of proprieyorship firm under simple authority letter, his affidavit was taken.

2. After few dates this employee left the firm and a new person filed the affidavit as complainant under SPA, without taking the permission of the court, without any application.

3. this person was crossed by the defense.

4. No issue of competence of original complainant or of this new complainant was raised by defense.

5. Conviction

Who to blame for such fiasco ?? Trial Court magistrate ?  Defense counsel ? 

Another Goof up by many trial courts

The cases under S.138 shall be tried as summary trial, only under a written order the same can be converted into normal summon trial,  majority of the courts in india are trying these cases as normal summon trial which is the deliberate and wilful violation of the legislature by the trial courts. S.537 cannot be invoked by the court for its own benefit for such wholesale deleberate irregularity. BUT COURTS ARE HAPPY ---- CHAL RAHA HAI.... COUNSELS ARE HAPPY ------ DATES LAG RAHI HAI. Only complainant and accused (genuine of the two) is suffering.

Madhya Pradesh High Court

Mahendra Kumar vs Armstrong And Anr. on 24 February, 2005

Equivalent citations: 2005 (2) ALD Cri 21, 3 (2006) BC 294

Author: S Kochar

Bench: S Kochar

ORDER

S.L. Kochar, J.

1. Being aggrieved of the order dated 25.5.2004 passed by learned Addl. Sessions Judge, Kukshi, District Dhar in Cr. Revision No. 38/2004 wherein the learned revisional Court maintained the order of the Trial Court dated 21.1.2004 passed in Criminal Case No. 169/2003, the petitioner has filed Misc. Criminal Case No. 2972/2004 and against the order dated 8.9.2004 passed by learned XV Addl. Sessions Judge, Indore, in Criminal Revision No. 564/2004, wherein the learned revisional Court maintained the order of the Trial Court dated 16.8.2004 passed in Criminal Case No. 1742/2002, the petitioner has preferred Misc. Criminal Case No. 4198/2004.

2. Since common questions arc involved in both the petitions, the same are taken up together and dispose of by this common order.

3. In both the above mentioned petitions under Section 482 of Criminal Procedure Code filed by the petitioner/accused, the core question for decision is whether the criminal complaint can be filed for the offence under Section 138 of the Negotiable Instruments Act (hereinafter shall be referred to as "the Act") by general or special power of attorney holder of the complainant and whether the examination of power of attorney holder of complainant on oath satisfies the requirements of Section 200 of the Criminal Procedure Code.

4. The respondent/complainant filed a complaint before the Trial Court through their power of attorney holder for an offence punishable under Section 138 of the Act under the signature of the power of attorney hold. After taking cognizance, the power of attorney holder was examined upon oath by the learned Magistrate and thereafter processes were issued. On appearance, the respondent herein in both the petitions, submitted an objection before the Trial Court that in view of Section 142 of the Act, complaint filed by the complainant through power of attorney holder, that too without the signature of the complainant on it, was not at all proper and that recording of sworn statement of general power of attorney holder cannot be taken as examining the complainant on oath by learned Magistrate envisaged under Section 200 of Criminal Procedure Code. The learned Magistrates in both the cases, after hearing rival contentions, dismissed the objection against which the petitioners/ accused persons went up in revision and revisional Courts have also dismissed the revision, upholding the orders passed by Magistrates in both the cases.

5. In Misc. Criminal Case No. 2972/2004, the complaint was filed by general power of attorney holder named Ranapratap Gupta on behalf of complainant, his son Armstrong. Power of attorney holder has also examined himself under Section 200 of Criminal Procedure Code and thereafter the learned Magistrate issued process against the petitioner Mahendra Kumar.

6. In Misc. Criminal Case No. 4198/2004, criminal complaint under Section 138 of the Act has been filed on behalf of the complainant Jayesh Shah by his special power of attorney holder Lokendrasingh Tomar. He has also examined himself under Section 200 of Criminal Procedure Code and thereafter the learned Magistrate issued process against petitioner/accused Dipesh Shrivastava.

7. The learned Counsel for petitioners/accused persons, relying on Supreme Court judgment passed in case of Janki Vashdeo Bhojwani and Anr. v. Indusind Bank Ltd. and Ors. I (2005) BC 399 (SC) : 2004 AIR SCW 7064, has submitted that a general or special power of attorney holder can appear, plead and act on behalf of the party but he cannot become a witness on behalf of the party. He has also placed reliance on an unreported judgment passed by this Court in Ramesh v, Smt. Laxmi Devi and Others, Misc. Criminal Case No. 2161/2003 dated 27.11.2003 wherein it is held that in view of the provisions of Powers of Attorney Act, complaint can be presented by the holder of power of attorney but for the purposes of further prosecution, the examination of the complainant as a witness is essential.

8. In oppugnation, the learned Counsel for respondent in both the petitions have vehemently submitted that in view of the provision of Section 2 of the Powers of Attorney Act (7 of 1882), the complaint under Section 138 of the Act can be filed by the holder of power of attorney and he can also enter as a witness on behalf of the complainant in the witness box and give sworn testimony. The learned Counsel has placed reliance on the following judgments:

(1) Judgments rendered by Single Judge of this High Court, Bench at Gwalior in cases of Dr. Anil Kumar Haritwal v. Sant Prakash I (2002)BC 113 : 2001(2) MPLJ 488; (2) Smt. Shanti Devi Agrawal v. V.H. Lulla, 2003(4) MPLJ 138; (3) KM. Maregowda v. Seven Hills Ex.-Import Corporation, Bangalore 2004 Cri.LJ. 4119, Karnataka High Court.

9. Having heard the learned Counsel for parties and after perusing the impugned orders as well as the judgments relied upon by the Counsel for parties, this Court is of the view that in Negotiable Instruments Act, there is no special or separate provision authorising the complainant to file a complaint by his authorised agent or attorney and allow the attorney or agent to enter into grace the box to lead evidence on his behalf. In Code of Civil Procedure Rule 2 of Order 3 provides the recognized agent of the parties by whom such appearances, applications and acts may be made or done. The persons holding power of attorney authorising them to make and do such appearances, applications and acts or behalf of such party. In case of Janki Vashdeo Bhojwani (supra), the Supreme Court, after considering the divergent views of the various High Courts on the question of use of power of attorney has observed thus:

17. 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) WLL 713 it was held that a general power of attorney-holder can appear, plead and act on behalf of the party but he cannot become a witness on behalf of the party. He can only appear in his own capacity. No one can delegate the power to appear in witness box on behalf of himself. To appear in a witness box is altogether a different act. A general power of attorney holder cannot be allowed to appear as a witness on behalf of the plaintiff in the capacity of the plaintiff.

18. The aforesaid judgment was quoted with the approval in the case of Ram Prasad v. Hari Narain and Ors. AIR 1998 Raj. 185. It was held that the word 'acts' used in Rule 2 of Order 3 of the Civil Procedure Code does not include the act of power of attorney-holder to appear as a witness on behalf of a party. Power of attorney-holder of a party can appear only as a witness in his personal capacity and whatever knowledge he has about the case he can state on oath but he cannot appear as a witness on behalf of the party in the capacity of that party. If the plaintiff is unable to appear in the Court, a commission for recording his evidence may be issued under the relevant provisions of the Civil Procedure Code.

19. In the case of Dr. Pradeep Mohanbay v. Minguel Carlos Dias II (2002) BC 118 : 2000 Vol. 102(1) Bom.L.R. 908, the Goa Bench of the Bombay High Court held that a power of attorney can file a complaint under Section 138 but cannot depose on behalf of the complainant. He can only appear as a witness.

20. However, in the case of Humberto Luis and Anr. v. Floriano Armando Luis and Anr. 2002(2) Bom. C.R. 754 on which the reliance has been placed by the Tribunal in the present case, the High Court took a dissenting view and held that the provisions contained in Order 3, Rule 2 of Civil Procedure Code cannot be construed to disentitle the power of attorney holder to depose on behalf of his principal. The High Court further held that the. word 'act' appearing in Order 3 Rule 2 of Civil Procedure Code takes within its sweep 'depose'. We arc unable to agree with this view taken by the Bombay High Court in Floriano Armando (supra),

21. We hold that the view taken by the Rajasthan High Court in the case of Shambhu DuttShastri (supra) followed and reiterated in the case of Ram Prasad (supra) is the correct view. The view taken in the case of Floriano Armando Luis (supra) cannot be said to have laid down a correct law and is accordingly overruled.

10. The Supreme Court in case of Janki Vashdeo Bhojwani (supra) has finally set at rest the controversy about filing of the complaint or plaint and examination of the holder of power of attorney as witness and ruled that a general power of attorney holder can appear, plead and act on behalf of the party but he cannot become a witness on behalf of the party. He can only appear in his own capacity. No one can delegate the power to appear in witness box on behalf of himself. To appear as a witness is altogether a different act. A general power of attorney holder or special power of attorney holder cannot be allowed to appear as a witness on behalf of the plaintiff/complainant in the capacity of plaintiff/complainant.

11. Section 118 of the Evidence Act, is a provision giving power to the Court to examine a person as witness. According to this section, all persons shall be competent to testify unless the Court considers that they are prevented from understanding the questions put to them, or from giving rational answers to those questions, by tender years, extreme old age, disease, whether of body or mind, or any other cause of the same kind. In explanation of this section, it is said that a lunatic is not incompetent to testify, unless he is prevented by his lunacy from understanding the questions put to him and giving rational answers to them. In the opinion of this Court, if Court does not find a person competent to testify as envisaged under Section 118 of the Evidence Act, such incompetent person also cannot execute general or special power of attorney to act on his/her behalf for filing plaint or complaint, so the question for the purposes of deciding whether the agent or holder of power of attorney can appear as a witness, on behalf of the person who is incompetent to be examined in a Court as per provision under Section 118 of the Evidence Act would not arise.

12. The judgments passed in case of Dr. Anil Kumar Haritwal and in case of Smt. Shanti Devi (supra) by Single Judges of this High Court regarding examination of holder of power of attorney on behalf of the party as witness is impliedly overruled by recent judgment tendered in case of Janki Vashdeo Bhojwani (supra). The holder of power of attorney can only appear on his capacity but he cannot become a witness on behalf of the party under any circumstance,

13. In the instant petitions, the filing of the complaint on behalf of the complainant by holder of general power of attorney and special power of attorney arc valid in view of the definition of power of attorney and provision of Section 2 of the Power of Attorney Act but examination of the attorney as witness in the capacity of the complainant would not be permissible. The holder of power of attorney can appear as a witness in his own capacity but only by non-examination of the complainant under Section 200 of Criminal Procedure Code, the cognizance taken by the Magistrates on the complaints cannot be held illegal or without jurisdiction. For prosecuting the complaint the complainant can examine himself in further proceeding of the case and because of some reason if the complainant is not able to appear before the Court, he can file an appropriate application for his examination on commission. At the stage of taking cognizance, if the holder of power of attorney has appeared as a witness, his testimony can be considered for the purposes of registration of the complaint/issuances of process under Section 204 of Criminal Procedure Code but for further proceeding, examination of the complainant would be must and if the complainant is a juristic person, then on his behalf, the managing partner/working partner if it is a partnership firm and if it is a company or any other juristic person than the person authorised in this behalf would be competent to enter into witness box.

14. For the purposes of issuing process and trying the case under Section 138 of the Act, as per provision under Section 145 of the Act, the evidence of the complainant may be given by him on affidavit and may, subject to all just exceptions be read in evidence in any inquiry, trial or other proceeding under the said Code. Sub-section (2) further envisages that the Court may, if it thinks fit, and shall, on the application of the prosecution or the accused, summon and examine any person giving evidence on affidavit as to the facts contained therein. The provision under Section 145 of the Act shows that whole evidence can be adduced by filing affidavit of the complainant. At the same time, discretion is given to the Court to call the complainant and examine on application filed by the prosecution or the accused and the application will be decided by the Court on the basis of the fact and circumstances of each case. Apart from the criminal complaint filed under Section 138 of the Criminal Procedure Code, the complaints for the offences under the Indian Penal Code can be filed by the holder of the power of attorney of the complainant but complainant would be required to be examined in Court as a witness as per provision under Section 200 of Criminal Procedure Code and if the complainant is not able to appear before the Court because of some or other reason, his statement can be recorded on commission but the original complainant cannot be substituted by holder of power of attorney or his agent. The view taken by this Court in case of Ramesh (supra) that examination of the complainant as a witness for further prosecution is essential, is not sustainable in the case of complaint filed under Section 138 of the Criminal Procedure Code in view of the provision under Section 145 of the Act (ibid) but this view is applicable in the complaint cases filed for the offences under the Indian Penal Code or under any other penal provisions of the Acts wherein no special provision is prescribed in such enactments.

15. In view of the aforementioned factual and legal discussion, this Court does not find any substance in both the petitions worth for invoking inherent power enshrined tinder Section 482 of Criminal Procedure Code. Therefore, both the petitions are hereby dismissed.

16. Original order be retained in Misc. Criminal Case No. 2972/2004 and a copy thereof be placed in the record of connected Misc. Criminal Case No. 4198/2004.

This is the major problem that citation as a whole is not read, please read the operative part of the above citation-

The view taken by this Court in case of Ramesh (supra) that examination of the complainant as a witness for further prosecution is essential, is not sustainable in the case of complaint filed under Section 138 of the Criminal Procedure Code in view of the provision under Section 145 of the Act (ibid) but this view is applicable in the complaint cases filed for the offences under the Indian Penal Code or under any other penal provisions of the Acts wherein no special provision is prescribed in such enactments.

15. In view of the aforementioned factual and legal discussion, this Court does not find any substance in both the petitions worth for invoking inherent power enshrined tinder Section 482 of Criminal Procedure Code. Therefore, both the petitions are hereby dismissed.

The above order is very clear and precise, that is:

1. Complaint can be filed by anyone under authority.

2. But witness act cannot be delegated atleast for individuals / prop firms, that means if the complaint is lodged by an SPA or authority holder then he can become the complainant but the actual payee must depose/give his evidence.

Supreme Court has ruled that only when the GPA holder has the personal knowledge of the transaction, that is if he has carried out the work in pursuance to GPA, then the act of complainant and witness would merge. That means if X is the GPA holder of the Y (payee) from start to end of transaction, then this X can be further authorised by an SPA or by a simple authority letter to pursue the case, even depose on behalf of payee. Only in this case Y is not at all required. No one stops Y from giving his evidence if at all he wishes to, but conviction may be possible with the evidence of X only. 

What is happening now is complainants are giving SPA for filing the case only to an employee or to some one (this employee or someone does not have an existing GPA to carry out the work on behalf of payee), and this SPA holder is giving evidence not in personal capacity but on behalf of payee, this is not acceptable for Individual / prop firms. In this case this some one can become complainant, he can give evidence in his personal capacity, but the payee must depose, he cannot be the mere name lender.

Any cheque case can be won but for that defense advocate has to do hard work on individual cases.