M. Lakshmi vs M/s. Shanmuga Priya Textiles (P) Ltd., Thungavi, Udumalpet

Judgment Pronounced by S. Thangaraj, J.—The petitioner has filed this petition u/s 482 Cr.P.C. to call for the records in C.C,No.321 of 1997 on the file pf the Judicial Magistrate, Udumalpet and to quash the same.

The respondent herein, Who is the complainant, has filed a complaint u/s 200 Cr.P.C. for an offence u/s 138 Negotiable Instruments Act against the petitioner herein alleging that for the purchase of 4.2 counts Cotton Yarn worth Rs.1,35,000 the petitioner herein has issued a cheque dt.4.1.97 drawn on City Union Bank for Rs.1,35,000 and when presented for collection, it was returned with an endorsement "returned as funds are insufficient". Thereafter, the petitioner had sent a lawyer''s notice dated 12.5.97 and the same was received by the petitioner herein on 15.5.97 and no reply has been sent by the petitioner. The said complaint is pending in C.C.No.321 of 1997 on the file of the Judicial Magistrate I, Udumalpet.

The cause title shows that the complaint was filed by one K.Rajaram - Power of Attorney of Thiru Ramakrishnan - Managing Director of M/s.Shanmuga Priya Textiles (P) Ltd. As per the provisions of the Companies Act, there should be a resolution by the Board of Directors conferring a specific authority on an individual to represent the company in any matter particularly for filing a criminal complaint. As no such authorisation was given by Board of Directors in favour of K.Rajaram, the complaint is not maintainable since the same was filed by K.Rajaram as Power of Attorney of Ramakrishnan.

The petitioner has relied on a decision of this Court in P.M. Vijayakumar Vs. Monara Chits (P) Ltd., , wherein it was held when once the capacity of the person to file a complaint "has not been substantiated and when it is submitted that the petitioner is a company incorporated under the Companies Act, Without a resolution of the Board and in the absence of proof, the person mentioned in the complaint had no right to maintain the complaint and therefore the lower Court was not justified in taking cognizance of the complaint".

The respondent has relied on a decision of this Court in Shakthi Concrete Industries Ltd. v. M/s.Valuable Steels (India) Ltd., 1998 (1) L.W. (Cri.) 354, wherein it was held:-

"The cause title as well as the averments made in the complaints and the sworn statement would disclose that the complaints had been filed by the company represented by the Director and as such, the company alone approaches the Court as payee as provided under S.142 of the Negotiable Instruments Act. In the instant case, as per the cause title and the averments, the complainant company has approached the court through some human agency, namely, Director of the Company, in preferring the complaints, as the company has no soul, body and limbs. If the company approaches the court through some other person, who is not connected with the affairs of the company, then necessarily to authorise that person to file the complaint on its behalf. Therefore, in this case, the company being the complainant through its Director is competent to file the complaints even without any authorisation. The complaints are valid and the same are in accordance with law."

The present case is somewhat different on the question of fact. The transaction was between the petitioner/company and the respondent/company. The petitioner/company has issued the cheque in favour of the respondent/company which was subsequently dishonoured. The petitioner has questioned the locus standi of the person who has filed the complaint.

Section 142(a) of the Negotiable Instruments Act, says-

"Cognizance of offences. - Notwithstanding anything contained in the code of Criminal Procedure, 1973 (2 of 1974),-

(a) no court shall take cognizance of any offence punishable u/s 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque."

The words of the Section would go to show that the complaint should be in writing made by the payee or as the case may be the holder in due course of the cheque. Except the payee and the holder in due course, if any other person has filed the complaint, he should have locus standi to file the complaint. The cause title clearly shows that the complaint was filed by the complainant M/s.Shanmuga Priya Textiles (P) Ltd., Udumalpet, by its Managing Director V.Ramakrishnan. From the name it is clear that Shanmuga Priya Textiles (P) Ltd. is a Private Limited Company. The representation by the Managing Director shows that the company has the Board of Directors. If any person files any complaint on behalf of the company, he should be sufficiently authorised to do so by way of a resolution. There was no resolution authorising the Managing Director Thiru V.Ramakrishnan to file the complaint. Even if it is taken that in his capacity as Managing Director, he has got authority to file the complaint, then also, the complaint should be filed by him and not by any other person. However, the present complaint is filed by one K.Rajaram who is the Power Agent of V.Ramakrishnan - the Managing Director. A delegate cannot delegate his powers to another person. In Skakthi Concrete Industries Ltd. v. M/s.Valuable Steels (India) Ltd., 1998 (1) L.W.(Cri.) 354 this Court has not approved the decisions of the Andhra Pradesh High Court in 1997 (1) ALD (Cri.) 370 . On the contrary this Court has relied on a previous decision of this Court in M/s. Gopalakrishnan Trading Co. v. Baskaran, 1992 (3) Crimes 1094. In that decision it was held-

"The person connected with the affairs of the company, in the normal run of things may be either its manager, partner, managing partner or director or any other person authorised by the company who can represent it during the course of legal proceedings before the court."

In the instant case though Rajaram was employed in the said company, he was not filed in his capacity as the employee, who is the administration of the said company. On the contrary, he had filed the complaint on the basis of the Power of Attorney dt.19.6.97 given by Mr.V.Ramakrishnan, Managing Director. As such Rajaram cannot be said to be a person authorised by the company.

In Sagayadurai v. J.D.Electronics, 1997 (1) L.W. (Cri.) 297 it was held that the complaint filed by the Manager representing company was in order. In the present case, Mr.R.Rajaram was not the Manager and a person in the administration of the company and in such capacity he has filed the complaint and on the contrary as the Power of Attorney of the Managing Director he has filed this complaint.

The power of Attorney dt. 19.6.97 says - "V.Ramakrishnan, Managing Director of M/s. Shanmugapriya Textiles (P) Limited, Indira Nagar, Thungavi Post, Udumalpet Taluk, do hereby nominate, constitute and appoint Mr.K.Rajaram S/o. S.Kulandaivel, working as Accountant in my mills as my attorney for me in my name and on my behalf."

A mere reading of the above, would go to show that though Ramakrishnan is the Managing Director of the Mills he has nominated Rajaram as his Attorney in his name and on his behalf and not on behalf Shanmugapriya Textiles (P) Ltd. In Paragraph-3 it is stated further-

"To do all other lawful acts and things in connection with the cases as effectually as I could do the same if I were personally present. And I ratify and confirm all and whatsoever my said attorney shall lawfully do."

A mere reading of the Power of Attorney would go to show that it was given in the personal capacity of Mr.Ramakrishnan and not by M/s.Shanmugapriya Textiles (P) Ltd.

This Court in P.M. Vijayakumar Vs. Monara Chits (P) Ltd., has distinguished the decision of Sagayadurai v. J.D.Electronics, 1997 (1) L.W. (Cri.) 297 regarding the capacity of the person who laid the complaint. In the instant case also, the capacity of the person, who laid the complaint is questioned. Unlike the other two cases, in the present case, the Managing Director of the company has given Power of Attorney to one Rajaram to represent himself and such Power of Attorney has been given individual capacity and not by the company and therefore there is no proper representation of the complainant/company in the complaint. As such, the complaint is not filed in accordance with Section 142(a) of the Negotiable Instruments Act by the payee or the holder in due course of the cheque. There is no proper authorisation by the payee/company in favour of Rajaram, who has represented the payee. On this ground the complaint is liable to be quashed.

In the result, C.C.No.321 of 1997 on the file of the Judicial Magistrate, Udumalpet is hereby quashed. There is no order necessary in Crl.M.P.4408 of 1998.