2025 (11) TMI 1085 - HC - Indian Laws

Conviction under Section 138 for cheque dishonour upheld; evidence reappreciation denied without patent legal error

Super Inducto Steels Limited & Anr. Versus Annapurna Cast Ltd & Anr.

The HC dismissed the petition, upholding the trial court's conviction and sentence under section 138 for dishonour of a cheque. The court held it would ... Disnonour of Cheque - power of this Court to re-assess the entire evidence adduced before the Trial Court for the purpose of setting aside the impugned judgment and order - powers that can be exercised under Article 227 - failure to amend the cause title of the newly amended company’s name during the pendency of the proceedings would affect the validity of the entire judgment and order of conviction or not - HELD THAT:- It appears from the record that the evidence of P.W. 1 has fully established the case of the complainant, which was duly considered by the Trial Court, culminating in the conviction and sentence of the Petitioners. This Court finds that the Petitioner has failed to demonstrate any cogent reason to show that the impugned order suffers from any legal infirmity or perversity. The complainant successfully proved all the essential ingredients of the offence under section 138. The contention of the petitioners regarding payment of money to the complainant against the cheque amount is not supported by any admissible evidence. The Petitioners have also not disputed the fact that the cheque was not issued by the Petitioners. Even after receiving the statutory notice, the Petitioners neither paid the cheque amount nor rebutted the complainant’s claim by replying in any manner. It is a well-settled principle of law that the power of superintendence conferred upon the High Court under Article 227 of the Constitution of India and the inherent powers vested under Section 482 of the Code of Criminal Procedure, 1973, are of an extraordinary and discretionary nature. These provisions are intended to ensure that the process of law is not abused and that justice is secured in cases where no other efficacious remedy is available - However, the scope of interference under these provisions is narrow and circumscribed. The High Court, while exercising its supervisory jurisdiction, does not act as a court of appeal to re-appreciate or reevaluate evidence adduced before the Trial Court or to substitute its own findings of fact for those recorded by the subordinate courts. Interference is justified only when there is a patent error of law, a manifest miscarriage of justice, or where the findings are perverse or based on no evidence at all. This Court, in the present case, cannot reassess or reappreciate the entire evidence as if sitting in appeal over the Trial Court’s findings. Its interference would be warranted only if the petitioners succeed in demonstrating that the impugned judgment suffers from a jurisdictional error, a violation of due process of law, or a patently perverse conclusion unsupported by the record or wholly an abuse of process of law. Maintainability of complaint due to lack of authority - HELD THAT:- The contention of the Petitioners that the complaint was not maintainable due to lack of authority is equally untenable. The complainant has established its authority by producing the board resolution authorising Kuldip Yadav to represent the company in the complaint. Subsequently, upon Kuldip Yadav’s departure from the company, Sri Raj Narayan Singh was authorised to represent the company in connection with the above complaint case vide resolution dated 1st December, 2001 (Ext.1/1), Therefore, the complaint is well maintainable. The judgment passed in the case of Pioneer Protective Glass Fibre P. Ltd. v. Fibre Glass Pilkington Ltd [1984 (9) TMI 242 - HIGH COURT OF CALCUTTA], relied upon by the Opposite party no. 1, squarely applies to the present case. It was held therein that a complaint, filed in the old name of the company, remains maintainable even after the subsequent change of name and/or status of the company. This Court, therefore, finds no reason to interfere with the impugned judgment and order passed by the learned courts below. Consequently, the petiiton stands dismissed. ISSUES PRESENTED AND CONSIDERED 1. Whether the High Court, in exercise of its supervisory jurisdiction under Article 227 of the Constitution and inherent powers under Section 482 Cr.P.C., may re-appreciate and reassess the entire evidence recorded by the trial court in order to set aside a conviction under Section 138 of the Negotiable Instruments Act? 2. Whether failure to amend the cause title to reflect a subsequent change in the complainant company's name or status during the pendency of proceedings affects the maintainability of a complaint under Section 138 of the Negotiable Instruments Act and vitiates conviction? ISSUE-WISE DETAILED ANALYSIS - ISSUE 1: Scope of Interference under Article 227 / Section 482 in Reassessment of Evidence Legal framework: Article 227 and Section 482 are extraordinary, supervisory and inherent powers conferred on the High Court to prevent abuse of process and secure ends of justice; these powers are not appellate and do not enable routine reappraisal of evidence or substitution of findings of subordinate courts. Precedent Treatment: The Court relied on established higher-court authorities laying down that supervisory/inherent jurisdiction is narrow, to be exercised only for jurisdictional error, patent illegality, perverse findings, or absence of evidence; it is not a forum for factual re-evaluation. Interpretation and reasoning: The Court applied the principle that interference is permissible only where the trial record demonstrates a manifest miscarriage of justice, perverse conclusions or findings based on no evidence. The record in this matter showed that the complainant's evidence established ingredients of the offence under Section 138 (issuance of cheque, presentation within validity, dishonour for insufficiency, service of demand notice, and failure to pay). The petitioners failed to produce admissible evidence to substantiate alleged payments and did not rebut the statutory notice; no jurisdictional error, procedural illegality or perverse finding was shown. Ratio vs. Obiter: Ratio - supervisory powers cannot be invoked for routine re-appreciation of evidence; interference requires patent legal infirmity or perversity. Obiter - discussion emphasising the purpose of Sections 138-142 and subsequent amendments to ensure credibility of negotiable instruments and speedy disposal. Conclusions: The Court refused to re-assess the entire evidence; interference under Article 227/Section 482 was unwarranted because no jurisdictional error, perverse finding or absence of evidence was demonstrated. Conviction sustained on this ground. ISSUE-WISE DETAILED ANALYSIS - ISSUE 2: Effect of Change of Company Name/Status on Maintainability of Complaint Legal framework: Corporate succession provisions and procedural rules permit continuation of proceedings instituted in the old name after a change of name/status; rights and liabilities of the existing company vest in the renamed entity and existing proceedings may be continued in the old name. Precedent Treatment: The Court treated applicable authority as directly applicable, holding that a change of name/status does not invalidate a pending proceeding if statutory provisions permit continuation in the old name and if authority to prosecute is established. Interpretation and reasoning: The Court examined proof of authority (board resolutions) showing authorised agents conducted the complaint proceedings. The Court reasoned that subsequent change of corporate name or conversion of company status during pendency does not defeat maintainability where the company's rights and liabilities remain vested and appropriate authority to prosecute exists. The Court rejected the argument that non-amendment of the cause title vitiated the proceedings, noting statutory provision and precedent permitting continuation in the old name. Ratio vs. Obiter: Ratio - a subsequent change of company name/status does not render a pending complaint under Section 138 non-maintainable where authority to prosecute is demonstrated and statutory provision allows continuation; mere non-amendment of cause title does not automatically vitiate proceedings. Obiter - observations on procedural propriety and advisability of amending pleadings for clarity. Conclusions: The failure to amend the cause title did not affect the validity of the complaint; maintainability was established by board resolutions authorising representatives, and conviction was not vitiated on this ground. ADDITIONAL ANALYTICAL POINTS ADDRESSED BY THE COURT On proof of ingredients of Section 138: The Court reiterated the essential ingredients required for conviction under Section 138 (drawer, cheque drawn for discharge of debt/liability, presentation within validity, return of cheque for insufficiency, service of written demand within statutory period, failure to make payment within statutory period and timely complaint) and found these ingredients satisfied on the record. On burden and credibility: The Court observed that the defence bore the burden of adducing admissible evidence to substantiate alleged payments and to rebut the complainant's claim; absence of such evidence and failure to reply to the demand notice weighed against the defence. The Court held credibility and evaluation of witnesses as matters for the trial court unless findings are perverse. On appropriate remedy and scope of relief: The Court confirmed that extraordinary remedies under Article 227/Section 482 are not substitutes for appellate remedies and should not be used to disturb concurrent findings of subordinate courts absent demonstrable illegality or perversion. FINAL CONCLUSION The Court dismissed the revisional petition: supervisory/inherent jurisdiction could not be exercised to re-appreciate evidence, and the complaint was maintainable despite change of company name/status; the conviction under Section 138 was affirmed for lack of any legally cognizable infirmity or perversity in the impugned judgments.