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2026 (2) TMI 774
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.... 3. One Manab Lahkar representing himself as Marketing Manager of the respondent Company M/S Gupta Hardware Pvt. Ltd. filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as "NI Act") before the Chief Judicial Magistrate, Kamrup (Metro) alleging dishonour of a cheque issued by the petitioner company. The case was made over to the learned Judicial Magistrate, Munsiff No. 4, Kamrup (Metro) and the following order was passed on 26.08.2015 which is as follows:- "The complainant has filed their evidence-on-affidavit along with original document with copies and the original documents are returned to the complainant. The evidence on affidavit and photocopies of the original documents are kept with C.R. From the perusal of the same I have found sufficient grounds for proceeding U/S 138 N.L. Act against the accused. Issue summons to the accused. Complainant shall take steps. The summons shall carry copy of the complaint petition along with copies of documents which are part of complaint as per sec 204(3) of the Code of Criminal Procedure, 1973. Fixing 16.10.2015 for Service Report/Appearance/O.E." 4. A....
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....ndicate. Secondly, it is submitted that there is no resolution of the Board of Directors authorizing the person who has instituted the complaint, i.e. Manab Lahkar, to lodge the said complaint, and thereby the requirement of Section 291 of the Companies Act has clearly been violated. 8. The next limb of argument advanced by learned counsel for the petitioner is that there is no reflection in the order dated 26.08.2025 taking cognizance of the case regarding any satisfaction drawn by the learned Magistrate regarding the authorization aspect of the matter. 9. In other words, the learned Magistrate has failed to examine whether the person who has instituted the complaint is duly authorized to do so, before taking cognizance of the matter. Continuing his arguments, Mr. Bhattacharjee next submitted that the Order dated 07.12.2019 whereby the complainant was allowed to adduce additional evidence in the form of a resolution of the Board of Directors and a General Power of Attorney, both of which were created after the institution of the case, was wholly illegal and amounts to granting an opportunity to the prosecution to fill up the lacunae which is impermissible in law. In suppo....
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....company. He is only one of a body of Directors called the Board of Directors and alone he has no power except such as may be delegated to him by the Board of Directors or given to him by the articles of association of a company." 12. In another decision cited on behalf of the petitioner, i.e. Debson Pumps Pvt. Ltd. Vs. Gauhati Municipal Corporation reported in 2018 Supreme (Gau) 1237, the Gauhati High Court has referred to the decision in Sampath Shipping Company Pvt. Ltd. Vs. Dolly George reported in 2002(9) SCC 445 and Dell and Carrington Investment Private P. Ltd. vs. P. K. Prathapan reported in 2005 (1) SCC 212. Referring to the aforesaid decisions, our High Court has held as follows:- "19. The decision in Samrat Shipping Co. Pvt. Ltd. (supra) was in the context of the Negotiable Instruments Act, 1881 (for short, "1881 Act"), wherein dismissal of the complaint under Section 138 at the threshold on the premise that the individual had not produced certified copy of the resolution of the Board of Directors was held to be too hasty an action. In National Small Industries Corporation Limited (supra), the Supreme Court, referring to section 291(1) of the Companies Act, 19....
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....eing a mere technicality that would not vitiate the proceedings. Section 291 of the Companies Act, 1956, did embody the principle that subject to the specific exceptions mentioned, the directors of the company, as its governing body, are entitled to exercise all the powers of the company. In the instant case on hand, it is noticed by the lower appellate court that the Articles of Association of the company, did confer the power on the Directors to sue or defend any proceedings on behalf of the company. A delegation of such power can only be by a resolution of the Board of Directors. Hence, a letter of authorization or a Power of Attorney executed by the Chairman or other officer of the company, without a delegation of the power to institute such proceedings having emanated from the Board of Directors, would invalidate any proceedings brought without the necessary authority. This lack of authority could have been supplied even before the appellate court when the issue arose for consideration, as has been observed by the apex court in MMTC's case as well in the case of United Bank of India v. Naresh Kumar (1996) 6 SCC 660. In other words even on a presumption, that in th....
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....ney pursuant thereto in favour of the said Manab Lohkaur, pursuant to which appropriate application was filed before the learned Magistrate seeking to adduce additional evidence in the form of the aforesaid two documents which was rightly allowed by the learned Magistrate and the same cannot be regarded as merely filling up of lacunae in the prosecution case. 17. It is further submitted that the defect, if any, in instituting the complaint was a curable one which has been duly done by the complainant company. 18. In support of the aforesaid contentions, learned counsel for the respondent has relied upon Bhupesh Rathod vs. Dayashankar Prasad Chaurasia & Another reported in (2022) 2 SCC 355, wherein it has been held by the Supreme Court at paragraph 19 as follows:- "19. In the conspectus of the aforesaid principles we have to deal with the plea of the respondent that the complaint was not filed by the competent complainant as it is the case that the loan was advanced by the Company. As to what would be the governing principles in respect of a corporate entity which seeks to file the complaint, an elucidation can be found in the judgment of this Court in Associated Ceme....
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....al is sufficient for the learned Magistrate to take cognizance and issue process. If at all, there is any serious dispute with regard to the person prosecuting the complaint not being authorised or if it is to be demonstrated that the person who filed the complaint has no knowledge of the transaction and, as such that person could not have instituted and prosecuted the complaint, it would be open for the accused to dispute the position and establish the same during the course of the trial. As noted in Samrat Shipping Co., dismissal of a complaint at the threshold by the Magistrate on the question of authorisation, would not be justified. Similarly, we are of the view that in such circumstances entertaining a petition under Section 482 to quash the order taking cognizance by the Magistrate would be unjustified when the issue of proper authorisation and knowledge can only be an issue for trial." 20. In Standard Chartered Bank Vs. Ravi Bhandari reported in 2002 SCC Online Del 1583, it has been held by the Delhi High Court that the offences under the NI Act, the only criteria prescribed by Section 142 is that the complaint must be instituted by the payee or holder in due course. ....
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....t case, i.e. whether the initial defect in lodging of the complaint could be subsequently cured and therefore, this decision does not help the petitioner. 28. In Ashok Bampto Pagui (Supra), what the Bombay High Court has said that the individual Director has no power to sue on behalf of the company unless authorized by the Board of Directors or by the articles of association. There is no cavil with the aforesaid proposition. 29. The decision in Samrat Shipping Co. Pvt. Ltd. (Supra) rather holds that dismissal of the complaint under Section 138 at the threshold on the premise that the individual had not produced the certified copy of the resolution of the Board of Directors to be too hasty an action. Therefore, this decision goes against the petitioner. 30. In Entertainment Society of Goa (Supra), the Bombay High Court has held that a complaint under Section 142 of the Act can be filed either by the payee or holder in due course. In the present case, the complainant company is the payee of the cheque and as held in the decision cited above, the complaint was instituted by one of its employees who though lacking proper authorization in the manner envisaged by the Companies A....
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....erefore and that the contents of the complaint are within his knowledge. Such averment and prima facie material is sufficient for the learned Magistrate to take cognizance and issue process. 37. On perusal of the record, it appears that is what has precisely happened in the present case and therefore, the Magistrate cannot be faulted for taking cognizance on the basis of the averments of the petitioner and complainant. 38. The Apex Court further held that if at all there is any serious dispute with regard to the person prosecuting the complaint not being authorized or if it is to be demonstrated that the person who filed the complaint has no knowledge of the transaction, it would be open for the accused to dispute the position and establish the same during the course of the trial and the Magistrate would not be justified in dismissing the complaint at the threshold on the question of authorization. It was further held that in such circumstances, entertaining a petition under Section 482 to quash the order taking cognizance by the Magistrate would be unjustified when the issue of proper authorization can only be an issue for trial. Further, it has been clearly held in MMTC Lim....