Personal knowledge and strict proof of debt are essential in cheque dishonour complaints under the Negotiable Instruments Act.

In a prosecution under the Negotiable Instruments Act, a company may act through an authorised representative, but that witness must have personal knowledge of the transaction or other due knowledge; mere authority is not enough where cross-examination shows only document-based awareness. Once the accused raises a probable defence, the complainant must prove the subsisting legally enforceable debt with reliable evidence. Here, the defence of blank security cheques and the mismatch with the firm's later corporate form shifted the burden back, yet the complainant failed to produce supporting invoices, correspondence, or properly proved account records. The computer-generated statement was not proved in compliance with the evidence law, so the debt was not established and the conviction could not stand.

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Issues: (i) Whether a power of attorney holder of a company can validly file and support a complaint under Section 138 of the Negotiable Instruments Act, 1881 without showing personal knowledge of the transaction; (ii) whether the complainant proved the existence of a legally enforceable debt so as to sustain conviction under Sections 138 and 141 of the Negotiable Instruments Act, 1881.

Issue (i): Whether a power of attorney holder of a company can validly file and support a complaint under Section 138 of the Negotiable Instruments Act, 1881 without showing personal knowledge of the transaction.

Analysis: A complaint under Section 138 may be instituted through an authorised representative, but the authority to file and depose is effective only if the representative has witnessed the transaction or otherwise possesses due knowledge of it. Mere authorisation is insufficient where the witness admits that he had not witnessed the transaction and knew the facts only from documents. The statutory presumptions under Sections 118(a) and 139 can be tested through cross-examination, and that opportunity is materially undermined if the witness lacks personal knowledge. On the evidence, the authorised witnesses were not shown to have the requisite knowledge of the dealings giving rise to the cheques.

Conclusion: The complaint could not be sustained on the basis of testimony from witnesses lacking personal knowledge; the objection to their competence succeeded.

Issue (ii): Whether the complainant proved the existence of a legally enforceable debt so as to sustain conviction under Sections 138 and 141 of the Negotiable Instruments Act, 1881.

Analysis: The accused rebutted the initial presumption by showing that the cheques bore signatures as if issued in the earlier partnership form, though the firm had already been converted into a company, and by raising a probable defence that the cheques were signed blank security cheques. Once that defence became probable, the burden shifted back to the complainant to prove the actual subsisting liability. The complainant failed to produce the foundational invoices, correspondence, or supporting account records to establish the exact outstanding liability. The computer-generated statement of account was also not proved in accordance with Section 65B of the Indian Evidence Act, 1872, and the certificate was not shown to have been issued by a competent person with proper control over the relevant system or records. In the absence of reliable proof of debt, the conviction could not stand.

Conclusion: The complainant failed to prove a legally enforceable debt or liability, and the conviction under Sections 138 and 141 of the Negotiable Instruments Act, 1881 was unsustainable.

Final Conclusion: The revision succeeded, the conviction and sentence were set aside, and the accused were acquitted.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, the complainant must prove the subsisting liability once the accused raises a probable defence, and a representative witness who lacks personal knowledge cannot fill the evidentiary gap; computer-generated account statements are admissible only on strict compliance with Section 65B of the Indian Evidence Act, 1872.

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