G. Rukkumani Vs. K. Rajendran - Court Judgment

Excerpt:
- b. akbar basha khadiri, j. 1. the instant criminal original petition is to call for records in c.c. no. 109 of 2000 pending on the file of the judicial magistrate, no. 1 erode and quash the same.2. the respondent herein preferred a private complaint under section 200 of the codeof criminal procedure before the learned judicial magistrate no. 1 erode, alleging that the petitioner herein and her son had committed offence under section 138 of the negotiable instruments act. according to the respondent, the petitioner is the proprietrix of sri lakshmi agencies and her son poondevan is the mandate holder, who happened to be the authorized signatory of the petitioner. on 15.10-1999 poondevan borrowed rs. 5,00,000/- from the respondent-complainant on behalf of sri lakshmi agencies, the concern run by the petitioner herein and agreed to repay the sum with an interest at 24% p.a. within a period of 2 1/2 months. he gave a post-dated cheque dated 31.12.1999 for rs. 5,25,000/-. when the cheque was presented in the bank on 31.12.1999, it was returned with a memo endorsed insufficient funds on the same date. the respondent/complainant issued legal notice on 3.1.2000 to the petitioner and her son. the petitioner received the notice on 4.1.2000. her sen received the notice on 19.1.2000. the petitioner sent a reply on 7.1.2000 denying the liability. her son has not sent any reply. since no amount was forthcoming after expiry of the statutory period of fifteen days after receipt of the notice by the petitioner and her son, the respondent herein preferred the complaint. now, the petitioner who happens to be the first accused has come forward with the instant criminal original petition to quash the proceedings contending that she is not a signatory to the cheque and, therefore, she has not committed any offence and, consequently, the proceeding against her under section 138 of the negotiable instruments act is illegal and should be quashed.3. heard both the sides it is not in dispute that the petitioner is the proprietrix of the 'sri lakshmi agencies' and the second accused before the learned judicial magistrate is her son. it is also not in dispute that her son is the mandate-holder and the authorized signatory. the respondent had pleaded so in the complaint and the petitioner had also not disputed these facts. in fact, in her reply dated 7.1.2000, the petitioner had admitted that her son is the authorized signatory 4. the question is how far the act of authorized signatory would bind the petitioner. it is settled law that the drawer of the cheque is primarily liable if the cheque bounced. some difficulty would arise when acomplaint is preferred against a third person who is not adrawer of the cheque, but he is in some way connected with the issuance of the cheque. the petitioner admits that the second accused-her son is her authorized signatory. reference to law lexicon by p. ramanatha aiyar, 1997 edition would go to show what is authorized signatory, which reads:'authorise : to empower; to give right or authority to act. to endow with authority cr effective legal power, warrant or right. to permit a thing to be done in the future. it has a mandatory effect or meaning, implying a direction to act.'it is evident that the second accused, namely, the son of the petitioner has been given authority, a mandate, to sign on behalf of the petitioner. in other words, the petitioner is the principal and her son is the agent.5. the learned counsel for the petitioner submitted that the petitioner who is not the drawer of the cheque would not come within the purview of section 138 of the negotiable instruments act, because it would apply only to a drawer. in support of such contention, the learned counsel has cited the decision rendered by sudesh kumar sharma v. k.s. selvamani 1994 1 mlw (cri) 337. that was a case where a complaint was preferred against the father and son alleging that the father was the proprietor of the concern and the son was an authorized signatory, that the cheque was drawn by the son and it was dishonoured. whena question arose whether the father is criminally liable, the noble judge held that the drawer of the cheque was the second accused-son and the first accused-father was the proprietor of the concern for whose liability, his son the second accused has issued the cheque and so, criminal liability cannot be fastened on the first accused. the learned judge had observed: 'so i am clear of the view that the first accused cannot be made liable for an offence under section 138 of the negotiable instruments act'. the learned judge did not go into the question whether an agent can bind the principal i.e. whether an authorized signatory can bind the mandate-giver.6. the learned counsel for the respondent cited a decision rendered by the calcutta high court in sova mukherjee v. rajiv mehra, ii (1997) ccr 3 j 3 that was a decision rendered on identical facts. in that case, the learned judge pointed out that when a general power is given, it applies to everything in which the grantor is interested, that but when a special power is given, it applies to specific matter, such as the power to sign cheques, to make transfers, to receive money, to present documents for registration, etc. under such circumstances, the mandate-giver cannot shrug off the claim of demand of the opposite party under the pretence that he or she owes no liability under the negotiable instruments act, when the cheque was issued to discharge the partial liability. the learned judge has pointed out that a principal is always bound by the act of his of her attorney so long as the attorney does not exceed his right. the view of the learned judge, is that the principal cannot plead that she will be only bearing the fruit, but not the burden of the act of her agent.7. offence under section 138 of the negotiable instruments act is a statutory offence. section 138 of the negotiable instruments act excludes mens rea, by creating strict liability. it does not say that there should be a direct nexus between the person who commits the act and the offence. but, from the words, 'such person shall be deemed to have committed an offence' giving room for a deeming provision would show that not only the principal or direct offender, an indirect offender who has allowed room for perpetuation of the offence, is also liable. section 140 of the negotiable instruments act in clear terms excludes the defence that the drawer had no reason to believe when he issued a cheque that it may be dishonoured on presentment for the reasons stated in section 138 of the negotiable instruments act. the exclusion of mens rea as a necessary ingredient of an offence under section 138 of the negotiable instruments act is very explicit. therefore, when the petitioner herein had permitted the second accused to act as an authorized signatory, she is bound by the act and as such she is also liable. in the decision, sudesh kumar sharma and anr. v. k.s. selvamani, etc. cited supra, pratap singh, j. appears to be of the view that offence under section 138 of the negotiable instruments act requires essential ingredient of mens rea and, therefore, the proprietor who was not the drawer was not liable. when it is made clear that the petitioner had given mandate to her son to sign cheques, she is bound by the acts committed by the mandate-holder and, therefore, she is also liable. in my considered opinion,, the view expressed by the calcutta high court in sova mukherjee v. rajiv mehra, cited supra is more acceptable than the views expressed by pratap singh. j. in sudesh kumar sharma and another v. k.s. selvamani, etc. etc. in that view of the matter, i hold that the petitioner cannot seek to quash the proceedings against her. this criminal original petition is, therefore, dismissed. consequently, cri. m.p. nos. 4216 and 4217 of 2000 are also dismissed.