1997 (12) TMI 629 - SC - Companies Law

Supreme Court sets aside company's acquittal, emphasizes judicial discretion

ASSOCIATED CEMENT CO. LTD. Versus KESHVANAND

The Supreme Court allowed the appeal, setting aside the acquittal of the respondent company under Section 247 of the Code of Criminal Procedure. The Court ... Whether company or association of persons or body corporate can be a complainant as per the new Code as for all practical purposes? Held that:- The complainant must be a corporeal person who is capable of making physical presence in the court. Its corollary is that even if a complaint is made in the name of an incorporeal person (like a company or corporation) it is necessary that a natural person represents such juristic person in the court and it is that natural person who is looked upon, for all practical purposes to be the complainant in the case. In other words, when the component to a body corporate it is the de jure complainant, and it must necessarily associate a human being as de facto complainant to represent the former in court proceedings. Be that so, we suggest as a pragmatic proposition that no magistrate shall insist that the particular person, whose statement was taken on oath at the first instance, alone can continue to represent the company till the end of the proceedings. There e may be occasions when a different person can represent the company e.g. the particular person who represents the company at the first instance may either retire for, the company's service or may otherwise cease to associate therewith or he would be transferred to a distant place. In such cases it would be practically difficult for the company to continue to make the same person represent the company in the court . In any such eventuality it is open to the de jure complainant company to seek permission of the court for sending any other person to represent the company in the court. At any rate For those reasons we are not persuaded to uphold the contention that Section 247 of the old Code (or Section 256 of the new Code) is not applicable in a case where the complainant is a company or any other justice person. However, as we have taken the view that the magistrate should not have acquitted the respondent under Section 247 of the old Code on the facts of this case we allow the appeal and set aside the order of acquittal as well as the impugned judgment of the High Court. The prosecution would now proceed from the stage where it reached before the order of acquittal was passed. Issues Involved:1. Absence of the complainant leading to acquittal under Section 247 of the Code of Criminal Procedure, 1998.2. Applicability of Section 247 to complaints filed by a company.3. Difference between appellate and revisional jurisdiction.4. Judicial discretion in dismissing complaints due to non-appearance of the complainant.Detailed Analysis:1. Absence of the complainant leading to acquittal under Section 247 of the Code of Criminal Procedure, 1998:The appellant company prosecuted the respondent under Section 138 of the Negotiable Instruments Act. The trial court acquitted the respondent on 24-8-1996 due to the complainant's absence. The appellant's appeal to the High Court was dismissed, leading to this Supreme Court appeal. The magistrate acquitted the accused under Section 247 of the old Code, which mandates acquittal if the complainant does not appear unless the magistrate finds a reason to adjourn the case. The High Court upheld the acquittal by adopting a 'grammatical construction' of Section 247, emphasizing that non-appearance of the complainant may result in acquittal.2. Applicability of Section 247 to complaints filed by a company:The appellant contended that Section 247 was inapplicable as the complainant was a company, an incorporeal entity. The High Court rejected this, noting that a company can be a complainant, but must be represented by a natural person in court. The Supreme Court agreed, stating that while a company is a juristic person, it must be represented by a natural person in court. The absence of this representative can lead to dismissal under Section 247, but the magistrate should exercise judicial discretion.3. Difference between appellate and revisional jurisdiction:The High Court equated appellate powers with revisional powers, focusing only on the legality or propriety of the trial court's order. The Supreme Court clarified that appellate jurisdiction is coextensive with the original court's jurisdiction, allowing the appellate court to reach its own conclusions on evidence. Revisional jurisdiction, however, is supervisory, limited to legality and propriety. The High Court's narrow approach was incorrect.4. Judicial discretion in dismissing complaints due to non-appearance of the complainant:The Supreme Court emphasized that Section 247 imposes constraints on the court's power to acquit due to complainant absence. The court must consider if adjournment is proper or if the complainant's presence is unnecessary. In this case, the magistrate should not have acquitted the respondent as the complainant had already been examined and absence was due to unavoidable circumstances. The magistrate should have adjourned the case.Conclusion:The Supreme Court allowed the appeal, set aside the acquittal, and directed the prosecution to proceed from the stage before acquittal. The judgment highlighted the need for judicial discretion and fairness in dismissing complaints due to non-appearance and clarified the roles of appellate and revisional jurisdictions.