B.A. Shivaraj vs D.L. Krishnaswamy and Others

N. Ananda, J.—The petitioners are arraigned as accused Nos. 1 and 2 in C.C. No. 2009/2001. They were convicted for an offence punishable under Section 138 of Negotiable Instruments Act. They were before the Appellate Court in Crl. Appeal Nos. 33/09 & 36/09. The complainant had preferred Crl. R.P. No. 39/09 regarding inadequacy of compensation granted to him.

The main contention of the petitioners (accused 1 and 2) is as follows:

The first accused is the Proprietor of M/s. Testater''s Choice Coffee. He had nothing to do with M/s. R.D. Curers Pvt. Ltd. Therefore, the complainant had no right to proceed against the first accused. The contention of the second accused is that the complainant without arraying the Company as a party, cannot be proceed against its directors.

The trial court on appreciation of evidence has held:

"22. No doubt that, Ex. P. 3 cheque consists the signature of accused No. 1, who being the proprietor of Taster''s Choice Coffee. But Ex. P. 2 Warehouse receipt clearly discloses that, the coffee was purchased from the complainant by R.D. Curers Company. Admittedly, accused No. 2 is also a Director of R.D. Curers. Though accused No. 2 has deposed to the effect that, the coffee was purchased in the name of Taster''s Choice Coffee, but Ex. P. 2 Warehouse receipt clearly discloses that, the said coffee was purchased by R.D. curers Company. Accused No. 1 during the course of his cross-examination he has also admitted that, the Taster''s Choice Coffee was started to help the R.D. Curers. He use to issue the cheques of Taster''s Choice Coffee towards transaction held at R.D. Curers. Since he does not know the local language, accused No. 2 was handling all the business of R.D. Curers. Since he does not know the local language, accused No. 2 was handling all the business of R.D. Curers. Hence, this admission made by accused No. 1 clearly corroborated with Ex. P. 2 and Ex. P. 6 and proved the transaction fact that, the said transaction was held in between the complainant and R.D. Curers Company. Towards this transaction the cheque was issued to discharge the liability of RD Curers. Accordingly, though accused No. 2 has contended that, the coffee purchased in the name of Taster''s Choice Coffee, but except his self-explanatory oral evidence, absolutely there is no material to prove his defence. On the other hand, Ex. P. 1 Memorandum of articles of Association, Ex. P. 2 Warehouse receipt and Ex. P. 6-letter written by the R.D. Curers to the complainant are clearly corroborated with the admission made by accused No. ,1 and oral evidence of complainant and proved that, the transaction was held with R.D. Curers and not under Taster''s Choice Coffee. Though accused No. 1 himself was the proprietor of Taster''s Choice Coffee, but the cheque was issued to clear the debt or liability of R.D. Curers. When accused No. 2 himself admitted that, he is the Director of R.D. Curers, he is also responsible for the said transaction."

The learned Judge of the First Appellate Court has confirmed the findings of trial court by holding;-

"18. During the cross examination by accused No. 1 he admits that during August-2000 R.D. Curers suffered loss; a complaint was lodged before the court against all the three directors by one Subeer Rebello; he and the first accused had engaged a common counsel; again both of them engaged a common counsel before the Hon''ble High Court in respect of Crime No. 178/2000 of Chamarajpet Police Station; apart from R.D. Curers he along with other 2-3 persons had started another company by name Fresh Been Export; said Fresh Been Export was carrying on business in the office of the R.D. Curing; though he denies the suggestion that he along with the first accused gave a Car to Subeer Rebello, who had lodged complaint against accused No. 1 at Mangalore in respect of a cheque from Tasters Choice, he voluntarily stated that the Police took his signature on a document; he admits that he came in contact with first accused during 1998 and uptill 2001 he used to transact along with him.

In view of the admission emerging from the tone of cross examination to the complainant by the first accused and also cross examination admission of the first accused, it is established that the cheque Ex. P. 3 is in the signature of first accused and pertains to a private concern by name Tasters Choice and the account stood in the names of the first accused;. It is also established from the above evidence that the cheque was issued in respect of legally recoverable debt and the demand notice as per Ex. P. 7 was served on 1st accused. Hence, the finding of the trial court in finding the first accused guilty of the offence under Section 138 of N.I. Act is on proper appreciation of facts of law. But, how to bind accused No. 2 to the alleged offence, when the cheque does not bear his signature and not from his account. The material at the hands of the complainant is, first and second accused along with one Subramanyam were the directors of R.D. Curers (P) Ltd.,; the cheque in question was issued in respect of coffee seeds purchased under warehouse receipt Ex. P2 pertaining to the R.D. Curers."

In this petition under Section 482 Cr.P.C., this Court cannot interfere with the concurrent findings recorded by the courts below unless it is found that the courts below have committed glaring errors in appreciation of evidence or errors of law resulting manifest injustice to the accused.

The first accused has admitted that he had issued cheque in favour of complainant to discharge the liability of R.D. Curers Pvt. Ltd. He also admitted that R.D. Curers had started the Taster''s Choice Coffee. Therefore, it can safely be held that the first accused had issued the cheque to discharge legally recoverable debt. The contention of accused that the cheque was not drawn by the second accused as a Director of R.D. Curers Pvt. Ltd., and that the complainant cannot proceed against the second accused cannot be accepted.

The law is fairly well settled, when the complainant has proved subsistence of legally recoverable debt or liability, the presumption that the cheque was issued to discharge the said legally recoverable debt would arise under the Negotiable Instruments Act. The accused have not adduced evidence to rebut the presumption.

The learned Judge of the Revisional Court has enhanced the compensation from Rs. 6,20,000/- to Rs. 12,43,000/-. The dishonoured cheque was issued in the year 2002 and the impugned proceedings were pending for over a period of 7 years. The learned Trial Judge having regard to the date of transaction and time taken for disposal of the case before the trial Court and various grounds urged by the accused has enhanced compensation from Rs. 6,20,000/- to Rs. 12,43,000/-. Therefore there are no reasons to interfere with the order of the Revision Court.

The learned counsel for the second accused has relied on the judgment of this Court in the case of Sri Prakash Martin Tegur Vs. Smt Joyce Samuel, to contend that the Director of Company cannot be prosecuted alone without arraying the Company as accused.

In the discussions made supra, I have held that the dishonoured cheque was not issued by the R.D. Curers. The first accused who is one of the Directors of the R.D. Curers had issued the cheque on the account held by him in the name of Taster''s Choice Coffee. When the cheque is not drawn on the account held by the Company, it is not necessary to array the Company as one of the accused.

There are no reasons to interfere with impugned orders. The petitions are dismissed.

The Registry is directed to send back the records along with a copy of this order.