Proprietary concern under cheque dishonour law: complainant must get a chance to prove sole proprietorship before rejection.

A complaint under Section 138 of the Negotiable Instruments Act involving a cheque issued in the name of a proprietary concern cannot be finally rejected merely because immediate documentary proof of proprietorship is absent, where the complainant consistently asserts that he is the sole proprietor and that assertion has not been effectively disputed. A proprietary concern is not a separate juristic entity from its proprietor, so the proprietorship issue must be fairly tested on evidence. The complainant should be given an opportunity to prove proprietorship, and the accused must be allowed to meet that evidence before final adjudication.

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Issues: Whether the complaint under Section 138 of the Negotiable Instruments Act was maintainable when the cheque was drawn in the name of a proprietary concern, and whether the complainant had to be given an opportunity to prove that he was its sole proprietor.

Analysis: The cheque was drawn in the name of Zenith Constructions, which was stated to be the complainant's sole proprietary concern. A proprietary concern is not a separate juristic entity distinct from its proprietor, but the complainant had not produced documentary proof of proprietorship. At the same time, the pleadings, affidavit, agreement, and statutory notice consistently asserted that the complainant was the sole proprietor, and that assertion was not effectively denied in cross-examination. The Trial Court had rejected the complaint solely on the ground of maintainability without finally determining the proprietorship issue. In these circumstances, the proper course was to permit the complainant to establish proprietorship and to allow the accused to meet that evidence.

Conclusion: The complaint could not be finally rejected on the existing record on the sole ground of want of proof of proprietorship. The matter required fresh adjudication after giving the complainant an opportunity to prove that he was the sole proprietor of the payee concern.

Ratio Decidendi: Where a cheque is issued in the name of a proprietary concern and the complainant asserts that he is its sole proprietor, the complaint is not liable to be dismissed merely for want of immediate documentary proof if the issue was not conclusively tested at trial; the complainant must be afforded an opportunity to establish the proprietorship before the complaint is finally decided.

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