Concurrent Conviction U/S.138 NI Act Can’t Be Overturned Merely Due To Absence Of Contention About Direct Personal Knowledge Of PoA Holder: Kerala High Court

The revision petition before the High Court was filed against the concurrent verdicts of conviction recorded and sentence awarded by the Chief Judicial Magistrate Court, Kollam and the Additional Sessions Court in connection with a case registered under Section 138 of the Negotiable Instruments Act (N.I Act).

The Single Bench of Justice G. Girish held, “It is also pertinent to note that, the petitioner did not avail the remedy to challenge the order of the learned Magistrate taking cognizance of the complaint filed by the power of attorney holder, by taking recourse to appropriate procedures before this Court. In the above circumstances, the verdicts rendered by the Trial Court and the Appellate Court are not liable to be overturned in this revision proceedings due to the irregularity pertaining to the absence of specific contentions in the complaint about the direct personal knowledge of the power of attorney holder about the transactions which resulted in the offence.”

Factual Background

The case involved the dishonor of two cheques issued by the petitioner to the complainant/first respondent. The Trial Court relied on the evidence tendered by the complainant and the documents to conclude that the petitioner committed the offence punishable under Section 138 of the NI Act. Accordingly, the petitioner, who represented the first accused company, was sentenced by the Magistrate to undergo simple imprisonment for six months, and to pay a sum of Rs.29,50,000 as compensation to the complainant under Section 357(3) of the Cr.P.C.

A default clause of simple imprisonment for a further period of four months was prescribed for non-payment of compensation. The Additional Sessions Judge concurred with the findings of the Magistrate and dismissed the appeal, confirming the conviction recorded and sentence awarded by the Trial Court. Aggrieved by the above concurrent verdicts of the Courts below, the petitioner instituted the revision petition.

Arguments

It was the case of the revisionist petitioner that the entire criminal prosecution launched against him was legally unsustainable since the power of attorney holder of the complainant, who had filed the complaint before the Magistrate, had not stated anywhere in the complaint that she was having direct personal knowledge about the transactions between the complainant and the accused, which resulted in the commission of the offence alleged in the complaint.

Reasoning

On a perusal of the facts of the case, the Bench found that at the stage of trial, the complainant himself had appeared before the Trial Court and adduced evidence about the transactions alleged in the complaint, which gave rise to the offence under Section 138 of the NI Act. It was further noticed that by relying on the aforesaid evidence, the Trial Court and the Appellate Court found the petitioner guilty of the offence under Section 138 of the NI Act and resorted to the conviction and sentence.

Referring to Section 465 of the Code of Criminal Procedure, the Bench explained that the findings of conviction and sentence of the Trial Court, which were upheld by the Appellate Court, were not liable to be reversed in the revision proceedings unless it was shown that a failure of justice had been occasioned due to the act of the Magistrate taking cognizance of the offence upon the complaint filed by the power of attorney holder of the complainant.

“Going by the provisions contained in sub Section (2) of Section 465 Cr.P.C, in determining whether a failure of justice has occasioned, this Court shall have regard to the fact whether the objection raised by the revision petitioner regarding the non-competence of the power of attorney holder to institute the complaint, was raised at an earlier stage in the proceedings”, it added.

The Bench noted that it could not be said that the act of the Magistrate, taking cognizance of the offence on the basis of the complaint filed by the power of attorney holder of the complainant, had resulted in the failure of justice. “This is especially so in view of the fact that the complainant himself had adduced evidence at the stage of trial, and the petitioner exercised his right to cross-examine the complainant on all aspects relating to the averments in the complaint”, it stated.

The Bench upheld the concurrent verdicts of the Courts below, convicting and sentencing the petitioner, except for the portion of the sentence prescribing simple imprisonment for six months. “Instead of simple imprisonment for six months, the petitioner is sentenced to undergo imprisonment till the rising of the Court”, it ordered.

Cause Title: Kannan V. M/S. Adisiva Enterprises (Neutral Citation: 2026:KER:33347)

Appearance

Petitioner: Advocate H. Ramanan

Respondent: Advocates B. Mohanlal, Biju George, Public Prosecutor Anima M.

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