CC.NI. No.8462/2022
IN THE COURT OF THE V III METROPOLITAN MAGISTRATE ::
HYDERABAD.
PRESENT: SRI. B. SAI MANOJ, VIII Metropolitan Magistrate, Hyderabad. Friday, the 2nd day of December, 2022.
CC.NI.No. 8462 OF 2022
(Old CC.No.232/2018 of XI SPL.M., Hyderabad)
Between:
Sri Vijay Agarwal, (Special Power of Attorney) Marketing Manager of M/s. Jai Balaji Traders, Sale Depot, H.NO.15-2-329/1, Mukthiyar Gunj,
Hyderabad-500 012. T.S. ...Complainant
AND
1. J. Vijaya Kumar Rep: Prop. of M/s. Vijayasai Traders, Plot No.717, Venkateshwara Enclave, Suchitra, Quthubullapur, RR District-500 054. T.S.
2. J. Virender Brother of J. Vijaya Kumar, Plot NO.171, Venkateshwara Enclave, Suchitra, Quthubullapur, RR District-500 054. T.S. … Accused Nos. 1 & 2
Section of Law:138 of the Negotiable Instruments Act
Plea of the Accused:Pleaded guilty
Finding of the court:Accused No.1 and Accused No.2 found guilty for the offence Under Section 138 of the Negotiable Instruments Act, 1881, as such convicted for the said offence Under Section 255(2) Cr.P.C.
This case came before me for final hearing in presence of Sri. Anil Kumar
Yadav B, Counsel for complainant and Sri G. Krishna Kishore, counsel for accused, hearing upon their arguments, and having stood over for consideration till this day, the court delivered the following :-
JUDGMENT
1.The complainant filed complaint U/sec.200 Cr.P.C. against accused
Nos. 1 & 2 alleging, they have committed an offence punishable U/sec.138 of the Negotiable Instrument Act.
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2. Brief contents of the complainant are: That the accused No.1 is the proprietor of M/s. Vijayasai Traders and that accused No.1 and 2 are brothers having their business at Suchitra, Quthubullapur, RR District.
That Accused No.1 and Accused No.2 used to purchase Dall items from complainant, as such good relation developed between complainant and accused Nos. 1 & 2 and that out of the said acquaintance, on 25.11.2017,
Bill No.B1584, the accused have ordered Moongdall of 15 Qty, total amount of Rs.97,720/- for which the bill was raised and the material was dispatched by Auto bearing No.AP29V 7320, and after third day the accused have ordered on 29.11.2017, Bill No.B1622, Turdall, 25 qty, +
Ordinary Dall of 5 qty to an amount of Rs.1,83,920/- and the material was sent by auto. Again the accused Nos. 1 and 2 have ordered on 05.12.2017 vide Invoice No.B1702, Turdall 25 Qty and ordinary dall 2.50 Qty (55
Katta) for an amount of Rs.1,67,885/- which was delivered by Auto. Again on 07.12.2017, they have ordered vide Invoice No.B1714 for Chanadall and ordi dall, Batana and dall for 35 qty total, and an amount of Rs.1,97,490/- and the material was dispatched and received by the said accused by auto bearing No. AP29V 7320, again on the same day another invoice was raised by the accused for Invoice No.B1718, Dt: 07.12.2017 for Ordi Dall,
Chanadall, Masur and Saurd dall and among dall for total 28 qts, and an amount of Rs.1,67,492/- was raised and the same was dispatched by auto, again on 08.12.2017 another order for Turdall was ordered vide invoice
No.B1728 for qty 25 and an amount of Rs.1,51,600/- was raised and the same material was sent to accused by Auto No.AP29 V7320. Again the said 2
CC.NI. No.8462/2022 accused have ordered on 14.12.2017 vide Invoice No.B1782, for Turdall for
Qty 28 for which an amount of Rs.1,51,600/- was raised and the same material was sent by Auto bearing No.AP29 V7320. Again on 14.12.2017 another order was done vide bill No.B1783 for Channadal and Batana for which an amount of total bill was raised Rs.75,245/- and again they have ordered dt:18.12.2017 vide invoice No.B1823 Toordall for an amount of
Rs.1,50,350/-. That the complainant enquired about the balance amount due, the accused promised to pay the same and the accused have raised another due bill dt:13.12.2017 and promised to pay the whole amount but paid only Rs.2 Lakhs, and that the remaining balance of Rs.18,43,079/- was acknowledged by accused Nos. 1 & 2 and promised by the accused
Nos. 1 and 2 to be paid within one month and signed the total due as on 18.12.2017.
3.That again on 20.12.2017 there were orders from accused Nos. 1 & 2 for ordinary dall for 15 qty and invoice was raised vide B1849 for an amount of Rs.1,05,210/-, Toordall, Moongdall for 15 qty for an amount of
Rs.94,560/- vide invoice No.B1853 dt:20.12.2017, on 23.12.2017 two bills were ordered vide Invoice No.B1883, B1884 for Masoor Dall, Chanadall,
Moongdall and Toordall respectively for which an amount of Rs.90,210/- and Rs.1,66,600/- was raised and on 30.12.2017 another order vide invoice B1934 for Toordall 25 qty and an amount Rs. 78,925/- bill was raised and that all the material in respect of all the above mentioned orders were sent through different Autos which were mentioned in respective bills.
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That the accused Nos. 1 & 2 have promised to repay bills pending and as the amount pending was huge and when the complainant was making repeated reminder calls to both the accused, the accused Nos. 1 and 2 kept on postponing the payment process and upon repeated request for two months the accused No.2 have issued cheque bearing Nos. 110979,
Dt:06.03.2018 for an amount of Rs.1,00,000/- and another cheque issued
by the accused No.1 bearing No.088453 drawn on IDBI Bank,
Dt:12.03.2018 for amount of Rs.10,44,800/- to deposit on 13.03.2018.
Again the accused No.1 have issued another cheques bearing Nos. 088455,
Dt:12.04.2018 for Rs.1,65,038/- and another cheque of same date bearing
No.088446, for Rs.1,67,481/- another cheque bearing No.088454,
Dt:16.04.2018 for Rs.5 Lakhs and upon instructions of accused, the
complainant have deposited the said cheques in his account i.e.,
Tamilnadu Mercantile Bank, Maharaj Gunj, P.S. Afzalgunj, Hyderabad and the cheques got dishonoured for the reason “Insufficient Funds”. As the accused gave evasive replies and also got issued legal notice with all false allegations on 29.03.2018 to the complainant to misguide the complainant.
That upon instructions of accused the complainant deposited the said cheques in his account on 21.05.2018, the said cheques were dishonoured for the reason “Insufficient Funds”. Thereafter, the complainant got issued legal notice to the accused on 23.05.2018, the same was received by the accused Nos. 1 and 2 on 09.06.2018 and even after receipt of the said notice the accused Nos. 1 and 2 did not pay the amount nor gave any reply to the notice and thereby the accused committed an offence punishable 4
CC.NI. No.8462/2022 under section 138 of NI Act therefore the complainant prayed to punish the accused Nos. 1 & 2 and also prayed to award compensation to the complainant under section 357 Cr.P.C.
4.The complainant filed above complaint before II ACMM, Hyderabad which took cognizance of the case against the accused for the offence
U/sec. 138 of NI Act and numbered as CC.No.654/2018, after considering the contents of complaint, sworn statement of complainant and documents filed along with the complaint. The case is transferred to the XI Special
Magistrate Court, Erramanzil, Hyderabad and renumbered as CC.No.
232/2018, after that the case is transferred to this court at the stage of final judgment, in pursuance of directions of Hon'ble Metropolitan Sessions
Judge, Hyderabad and renumbered as CC.NI.No.8462/2022.
5.On appearance of the accused, copy of complaint and documents filed along with complaint are furnished to accused, as required U/sec.207
Cr.P.C.
6.The accused Nos. 1 & 2 were examined U/sec.251 Cr.P.C. for which the accused Nos. 1 & 2 admitted the business transactions as mentioned in the complaint and also admitted amount as mentioned in the complaint is due to the complainant but denied issuance of cheques for repayment purpose and submitted that the said cheques were issued to the complainant as security purpose before supply of material by the complainant as part of business transaction and further contended that the amount due to the complainant has already been repaid and pleaded 5
CC.NI. No.8462/2022 not guilty, for the offence punishable U/sec. 138 of NI Act and claimed for trial. Hence, the trial.
7.The complainant in order to establish the case got PW1 & PW2 examined and has got exhibited Exs.P1 to Ex.P46 marked on complainant’s behalf. Ex.P1 to Ex.P36 through Pw1 and Ex.P37 to Ex.P46 through PW2.
8.After closure of complainant evidence, the accused Nos. 1 & 2 were examined Under Section 313 Cr.P.C. by notifying them the incriminating material against them from the evidence of complainant witnesses i.e., PW1 and PW2, for which the accused Nos. 1 & 2 denied the same and admitted that they are due an amount of Rs.2,70,000/- to be payable to the complainant and reported that there is evidence on their behalf but failed to adduce any evidence on their behalf. As such the defense evidence was closed.
9.After closure of defense evidence both counsel submitted their respective arguments.
10.Counsel for complainant filed written arguments on behalf of the complainant which are nothing but the replica of the facts as mentioned in the complaint as such they are not reproduced in order to avoid repetition.
11.The counsel for complainant by way of written arguments further submitted that the complainant by examining PW1 and PW2 as oral evidence and by producing Exs.P1 to P46 as documentary evidence could prove the case of the complainant as such prayed to convict the accused
Nos. 1 & 2 and to punish the accused Nos. 1 & 2 for the offence Under 6
CC.NI. No.8462/2022
Section 138 of the Negotiable Instrument Act, 1881 and also prayed the compensation to the complainant. The counsel for complainant by way of written arguments relied upon few judgments of Hon’ ble Supreme Court of
India in support of the complainant which would be discussed at an appropriate stage of this Judgment.
12.On the other hand the learned counsel for the accused by way of his written arguments submitted that the present complaint is not maintainable as the complaint was filed by the Special Power of Attorney holder in his individual capacity but not by the payee of the cheques pertaining to this case and that the Special Power of Attorney holder cannot file a complaint Under Section 138 of the Negotiable Instrument
Act, 1881 in his individual capacity without their being the payee as a complainant and as such the ingredients of Sec. 142 of the Negotiable
Instrument Act, 1881, are not satisfied as such criminal liability against the accused cannot be fastened. The counsel for accused also by way of his oral arguments raised a defense that this complaint was filed against A1 and A2 for different cheques that they have alleged to have been issued, as such the same complaint against two different accused who are alleged to have been issued different cheques is not permissible as such this complaint is not maintainable, as such the accused Nos. 1 & 2 has to be acquitted.
13.Counsel for accused further submitted that the acquisition or claim against particular accused in this case has not been crystallized by the 7
CC.NI. No.8462/2022 complainant as such the complaint against the accused Nos. 1 & 2 is not maintainable and accused has to be acquitted. The counsel for accused by way written arguments submitted that the claim of complainant that accused is due an amount of Rs.19,17,319/- is not true and that the accused paid an amount of Rs.15,73,079/- by way of cash and that accused are only liable to pay Rs.2,70,000/- to the complainant. The counsel for accused further submitted that there is no GPA in existence at the time of filing of complaint and the GPA dt:04.07.2018 was filed after the complaint is returned on 28.06.2018 and as such complaint is not maintainable. The counsel for accused further submitted that PW1 stated she has no personal knowledge about facts of case as such evidence of
PW1 is not valid and that in the complaint and sworn statement there was no statement that GPA is taking care of sales and recovery as such evidence of PW2 also not valid and has to be discarded and therefore submitted the court that present complaint is not maintainable and as such prayed to acquit the accused Nos. 1 & 2.
14.The counsel for accused relied upon a Judgment of the Hon’ble
Supreme Court and few Judgments of Hon’ble High Court of Andhra
Pradesh which would be discussed at an appropriate stage of this judgment.
15.Heard both sides and perused the record and material available on record.
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16.Having been heard the both sides and having been perused the record, the following points fell for determination in this present case.
17.Points for determination are:
(i) Whether the mandatory requirements for an offence to be constituted Under Section 138 and 142 (1) (a) of the Negotiable Instrument Act, 1881 are satisfied in the present case?
(ii) If so whether the accused have rebutted the presumption Under Section 139 of the Negotiable Instrument Act, 1881?
(iii) To what order?
18. POINT (i):
If an offence to be constituted Under Section 138 of the Negotiable
Instrument Act, 1881, the said section itself mandates requirements to be satisfied if the offence under the said Section to be constituted.
Section 138 of the Negotiable Instrument Act is as
follows:
Dishonour of cheque for insufficiency, etc., of funds in the account: Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other 9
CC.NI. No.8462/2022 provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless:
(a)the cheque has been presented to the bank within a period of six months (now three months as per circular of RBI vide circular RBI/2011-12/251 DBOD AML BC No.47/14.01.001/2011-2012
dated 04.11.2011, with effect from 01.04.2012) from the date on
which it is drawn or within the period of its validity, whichever is earlier:
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid: and
(c)the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation:For the purposes of this section, “debt or other liability” means a legally enforceable debt or other liability.
19.The complainant in order to establish the case has got examined the proprietor of M/s. Jai Balaji Traders as PW1 and has got marked Exs.P1 to 10
CC.NI. No.8462/2022
P36 through PW1 and has got GPA holder examined as PW2 and has got
Exs.P37 to P46 through PW2.
20.PW1 by way of chief examination in the form of chief affidavit reiterated the facts those are mentioned in the complaint as evidence as such they are not reproduced in order to avoid repetition.
Ex.P1 is the Original Bill No.B1584, Dt:25.11.2017 for Rs.97,710/-,
Ex.P2 is the Original Bill No.B1622, Dt:29.11.2017 for Rs.1,83,920/-,
Ex.P3 is the Original Bill No.B1698, Dt:05.12.2017 for Rs.1,67,885/-,
Ex.P4 is the Original Bill No.B1714, Dt:07.12.2017 for Rs.1,97,490/-,
Ex.P5 is the Original Bill No.B1718, Dt:07.12.2017 for Rs.1,67,492/-,
Ex.P6 is the Original Bill No.B1719, Dt:07.12.2017 for Rs.1,65,350/-,
Ex.P7 is the Original Bill No.B1728, Dt:08.12.2017 for Rs.1,51,600/-,
Ex.P8 is the Original Bill No.B1782, Dt:14.12.2017 for Rs.1,51,600/-,
Ex.P9 is the Original Bill No.B1783, Dt:14.12.2017 for Rs.75,245/- (Rs.1,44,927-69,682)
Ex.P10 is the Original Bill No.B1823, Dt:18.12.2017 for Rs.1,50,350/-,
Ex.P11 is the Original Bill No.B1849, Dt:20.12.2017 for Rs.1,05,210/-,
Ex.P12 is the Original Bill No.B1853, Dt:20.12.2017 for Rs.94,560/-,
Ex.P13 is the Original Bill No.B1883, Dt:23.12.2017 for Rs.90,210/-,
Ex.P14 is the Original Bill No.B1884, Dt:23.12.2017 for Rs.1,66,600/-,
Ex.P15 is the Original Bill No.B1934, Dt:30.12.2017 for Rs.78,925/-, which shows business transactions between the complainant and accused
Nos. 1 & 2 as mentioned in the complaint which are admitted to be true by 11
CC.NI. No.8462/2022 the accused Nos. 1 & 2 during their examination Under Section 251 Cr.P.C.
i.e., all the business transactions as mentioned in complaint. PW1 further deposed that the accused No.1 issued cheque bearing NO.088453,
Dt:12.03.2018 for Rs.10,44,800/- i.e., Ex.P17, Cheque bearing NO.088455,
Dt:12.04.2018 for Rs.1,65,038/- i.e., Ex.P19, Cheque bearing NO.088454,
Dt:16.04.2018 for Rs.5,00,000/- i.e., Ex.P20 and Cheque bearing
NO.088446, Dt:12.04.2018 for Rs.1,67,481/- i.e., Ex.P18 and that accused
No.2 issued Ex.P16 i.e., cheque bearing No.110979, Dt:06.03.2018 for
Rs.1,00,000/- and that both the accused issued the said cheques for repayment amount due to be payable to M/s. Jai Balaji Traders as part of their business transactions which were mentioned in the complaint. And that the said cheques upon their presentation in Tamilnadu Mercantile
Bank, Afzalgunj, Hyderabad, has got dishonoured for reason “Funds
Insufficient” as such deposed that the accused Nos. 1 & 2 are liable to be punished Under Section 138 of the Negotiable Instrument Act, 1881.
Exs.P21, Ex.P22, Ex.P23, Ex.P24 and Ex.P25 are cheque return memos in respect of Exs.P16, P17, P18, P19 and P20, Dt:22.05.2018. It is evident from Exs.P16 to P25 that Ex.P16 to Ex.P20 were presented within prescribed period as required Under Section 138 of the negotiable
Instrument Act, 1881 and that they have got dishonoured for the reason “Funds Insufficient”, as such the proviso (a) to section 138 of the
Negotiable Instrument Act, 1881 has been satisfied. Ex.P26 is the office copy of legal notice dt:23.05.2018 issued by M/s. Jai Balaji Traders represented by its Proprietor Babitha Agarwal to accused Nos. 1 & 2.
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Ex.P27 and P28 are postal receipts in respect of Ex.P26 being issued to accused Nos. 1 & 2. Ex.P29 and P30 are online copies of postal tracking consignments dt:09.06.2018 in respect of Ex.P26. The accused has never denied the receipt of the legal notice issued by the M/s. Jai Balaji Traders to them even during his cross examination of Pws. 1 & 2, as such in the absence of denial of receipt of the notice it amounts to admission and as such it can be held that Ex.P26 has been served to accused Nos. 1 & 2 as such it can be held that the requirement under proviso (b) to the section 138 of the Negotiable Instrument Act, 1881 i.e., demand for repayment has been satisfied. As proviso (c) to Section 138 of the Negotiable Instrument
Act, 1881 i.e., failure to drawer failure to make payment to the payee within 15 days of the receipt of notice, is a subject matter of trial, it can be held that the aspect that the other requirements Under Section 138 of the
Negotiable Instrument Act, 1881 can be said to have been satisfied in this present case. As the accused in the present case has taken the defense of non maintainability of the complaint as it is filed the Power of Attorney holder in his individual capacity but not by the payee i.e., M/s. Jai Balaji
Traders and that the power of attorney holder has no locustandi to file the present case in his individual capacity, it is just and necessary that the requirements Under Section 142 of the Negotiable instrument Act, 1881 are to be satisfied in the present case.
Section 142 of the Negotiable instrument Act, 1881 reads as hereunder:
142. Cognizance of offences:- (1) Notwithstanding anything 13
CC.NI. No.8462/2022 contained in the Code of Criminal Procedure, 1973 (2 of 1974)--
(a) no court shall take cognizance of any offence punishable under Section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque:
(b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138:
[Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant satisfies the Court that he had sufficient cause for not making a complaint within such period]
(c) no court inferior to that for a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence punishable under Section 138].
[(2) The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction,-
(a) if the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated; or
(b) if the cheque is presented for payment by the payee or holder in due course otherwise through an account, the branch of the drawee bank where the drawer maintains the account, is situated.
Explanation: For the purposes of clause (a), where a cheque is delivered for collection at any branch of the bank of the payee or holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or holder in due course, as the case may be, maintains the account].
21.Section 142 of the Negotiable Instrument Act, 1881 requires a complaint in writing to be made by the payee of the cheque or by the holder in due course as the case may be. In the present case the defense raised by the accused is that the complaint is filed by the Special Power of Attorney
Holder in his personal capacity himself as a complainant but not as representative of the payee of the cheques and as such the complaint is not maintainable as requirements Under Section 142 of the Negotiable 14
CC.NI. No.8462/2022
Instrument Act, 1881 are not being satisfied. The accused relied upon
Judgment of the Hon’ble Supreme Court of India in support of his contention i.e., Shankar Finance and Investments Vs. State of Andhra
Pradesh and others (2008) 8 SCC 536, wherein the Hon’ble Supreme
Court of India in para No.11 of the said Judgment observe that:
“the Attorney holder is the agent of the grantor. When the grantor authorizes the attorney holder to initiate legal proceedings and the attorney holder accordingly initiates legal proceedings, he does so as the agent of the grantor and the initiation is by the grantor represented by his attorney holder and not by the attorney holder in his personal capacity. Therefore, where the payee is a proprietary concern, the complaint can be filed: (I) by the proprietor of the proprietary concern, describing himself as the sole proprietor of the “payee”; (ii) the proprietary concern, describing itself as a sole proprietary concern, represented by its sole proprietor; and (iii) the proprietor or the proprietary concern represented by the attorney holder under a power of attorney executed by the sole proprietor. It follows that in this case the complaint could have been validly filed by describing the complainant in any one of the following four methods:
SHANKAR FINANCE & INVESTMENTS VS. STATE OF A.P.
(Raveendran. J) “Atmakuri Shankara Rao, sole proprietor of M/s. Shankar Finance &
Investments”or “M/s. Shankar Finance & Investments, a sole proprietary concern represented by its proprietor Atmakuri Shankara Rao”. or 15
CC.NI. No.8462/2022 “Atmakuri Shankara Rao, sole proprietor of M/s. Shankar Finance &
Investments, represented by his attorney holder Thamada Satyanarayana”.
Or M/s. Shankar Finance & Investments, a proprietary concern of
Atmakuri Shankara Rao, represented by his attorney holder Thamada
Satyanarayana”.
What would have been improper is for the attorney holder Thamada
Satyanarayana to file the complaint in his own name as if he was the complainant”.
From the above judgment of the Hon’ble Supreme Court of India it can be said that there is no doubt that a power of attorney holder can initiate legal proceedings Under Section 138 of the Negotiable Instrument
Act, 1881 on behalf of the grantor i.e., the payee.
22.The Hon’ble Supreme Court of India in its Judgment in A.C.
Narayanan Vs. State of Maharashtra and Another (2014) 11 SCC 790 in para No.30 and 31 of the above said Judgment while answering a question as to whether a power of attorney holder can sign and file a complaint on behalf of the complainant and whether the eligibility criteria prescribed by
Section 142(a) of the Negotiable Instrument Act would stand satisfied if the complaint itself is filed in the name of the payee or holder in due course, held that:
In para No.30:In the light of the discussion, we are of the view that the power-of-attorney holder may be allowed to file, appear and depose for the purpose of issue of process for the offence punishable under section 148 of the Negotiable instrument Act, An exception to 16
CC.NI. No.8462/2022 the above is when the power-of-attorney holder of the complainant does not have a personal knowledge about the transactions then he cannot be examined. However, where the attorney holder of the complainant is in charge of the business of the complainant payee and the attorney holder alone is a personally aware of the transactions, there is no reason why the attorney holder cannot depose as a witness. Nevertheless, an explicit assertion as to the knowledge of the power-of-attorney holder about the transaction in question must be specified in the complaint. On this count, the fourth question becomes infructuous.
In para No.31: In view of the discussion, we are of the opinion that the attorney holder cannot file a complaint in his own name as if he was the complainant, but he can initiate criminal proceedings on behalf of his principal. We also reiterate that where the payee is a proprietary concern, the complaint can be filed:
(i)by the proprietor of the proprietary concern, describing himself as the sole proprietor of the “payee”.
(ii)the proprietary concern, describing itself as a sole proprietary concern, represented by its sole proprietor;a and
(iii)the proprietor or the proprietary concern represented by the attorney holder under a power of attorney executed by the sole proprietor.
23.In light of the above two judgments of the The Hon’ble Supreme 17
CC.NI. No.8462/2022
Court of India it can be observed that a complaint Under Section 138 of the
Negotiable Instrument Act, 1881 can be filed by the Attorney holder on behalf of the payee but the complaint Under Section 138 of the Negotiable
Instrument Act, 1881 cannot be filed by the Attorney holder in his personal capacity as if he was the complainant.
24.In the present case the defense of the accused is that the attorney holder has filed the complaint against the accused in his personal capacity but on behalf of the payee of the cheques pertaining to this case and as such the complaint is not maintainable and the accused has to be acquitted.
25.The description of the complainant in cause title in the present complaint is as hereunder:
Sri Vijay Agarwal, (Special Power of Attorney), Marketing Manager of
M/s. Jai Balaji Traders, Sale Depot, H.NO.15-2-329/1, Mukthiyar Gunj,
Hyderabad-500 012, T.S. From the description of the complainant it can be seen that the complainant described himself as Special Power of Attorney holder of M/s. Jai Balaji Traders which is the payee of the cheques pertaining to this case, the only thing missing is the name of the proprietor of the payee. Even though the description of the complainant is not exactly as the examples given in the judgment of the Hon’ble Supreme Court in
Shankar Finance and Investments Vs. State of Andhra Pradesh but as the description shows that the complainant is the attorney holder of the M/s.
Jai Balaji Traders which is the payee of the cheques in the present case, 18
CC.NI. No.8462/2022 this court is of the opinion that the said description of the complainant would be covered under the Clause (iii) of the para No.11 of the said
Judgment i.e., complaint filed by the proprietor are the proprietary concern represented by the attorney holder under a power of attorney executed by the sole proprietor, and which was also reiterated by the Hon’ble Supreme
Court of India in its Judgment A.C. Narayanan Vs. State of Maharashtra and another in para NO.31 (iii) i.e., complaint filed by the proprietor are the proprietary concern represented by the attorney holder under a power of attorney executed by the sole proprietor, as such as the complainant in its description in the present case shows that the complainant is the special power of attorney holder of M/s. Jai Balaji Traders who is the payee of the cheques involved in this case, in can be held that the complaint in this present case was filed by the attorney holder on behalf of the proprietor as such it can be held that the requirements prescribed under Section 142 (1)
(a) of the Negotiable Instrument Act, 1881 are being satisfied in this present case. Point No. (i) is answered accordingly.
POINT (ii):
26.Once Point (I) answered in favour of the complainant the presumption
Under Section 139 of the Negotiable Instrument Act, 1881 raises in the favour of the complainant and the burden will be upon the accused to rebut the presumption Under Section 139 of the Negotiable Instrument Act, 1881.
The complainant in this present case relied upon the Judgment of the Hon’ble Supreme Court of India i.e., ‘Rangappa Vs. Sri Mohan’ 19
CC.NI. No.8462/2022 reported in (2010) 11 SCC 411 where in the Hon’ble Supreme Court of
India held that the presumption Under Section 139 of the Negotiable
Instrument Act, 1881, extends to existence of legally enforceable debt and that once the signature of accused is admitted, the burden is upon the accused to rebut the presumption Under Section 139 of the Negotiable
Instrument Act, 1881.
Section 139 of the Negotiable Instrument Act,1881 reads as given under:
Section 139 of the Negotiable Instrument Act is as follows:
Presumption in favour of holder: It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.
27.In the present case the another defense raised by the accused Nos. 1 & 2 is that they have issued blank signed cheques as security purpose to the complainant as part of business transactions between them and the complainant but not for repayment of any legally enforceable debt much less the alleged debt covered under the cheques pertaining to this case.
28.In the present case, it is the admitted fact that the accused are due an amount as mentioned by the complainant in the complaint, as the same was admitted by the accused Nos. 1 & 2 during their examination Under
Section 251 Cr.P.C., where both the accused admitted the business transactions as mentioned by the complainant in the complaint to be true and that they are due an amount as mentioned in the complaint to the 20
CC.NI. No.8462/2022 complainant to be true, but it is the defense of the accused Nos. 1 & 2 that they have repaid the amount that was due to the complainant i.e., M/s. Jai
Balaji Traders. The accused Nos. 1 & 2 even by way of written arguments through their counsel have contended that have contended that they are due an amount of Rs.18,43,079/- to the complainant i.e., M/s. Jai Balaji
Traders and that they have repaid an amount of Rs.15,73,079/- to the complainant by way of cash and that they are liable to pay only
Rs.2,70,000/- to the complainant. Even Ex.P35 which is the notice sent by the accused Nos. 1 & 2 to the complainant i.e., M/s. Jai Balaji Traders which is admitted to be true by the accused Nos. 1 & 2 themselves would show that there existed business transactions between the complainant and accused Nos. 1 & 2 out of which the accused Nos. 1 & 2 are due an amount of Rs.19,00,000/- to the complainant.
29.In the present case as the accused Nos. 1 & 2 has taken the defense that they have repaid the amount due to the complainant, the burden is upon the accused to prove that they have repaid the amount due to the complainant. But the accused Nos. 1 & 2 has not led any evidence on their behalf to prove the same either by way of oral evidence or by way of documentary evidence but, completely relied upon the cross examination of the complainant witnesses i.e., PW1 and PW2 to prove their contention that they have repaid the amount due to the complainant. Now the only remedy left to the accused Nos. 1 & 2 is cross examination of PW1 and
PW2 to prove their defense.
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30.In the present case the proprietor of M/s. Jai Balaji Traders got examined as PW1 and the Special Power of Attorney Holder got examined as PW2. PW1 by way of chief examination in the form of affidavit reiterated the facts as mentioned in the complaint as evidence. Even though PW1 was elaborately cross examined by counsel for accused, nothing was elicited in contrary to the version as deposed during the chief examination. PW1 during the cross examination deposed that accused did business with her proprietorship concern of about Rs.80,00,000/- and out of which they have paid Rs.61,00,000/- and that they were due Rs.19,70,000/- and odd to her proprietorship concern. PW1 deposed that her husband is GPA holder as such he has filed the complaint before this court on behalf of her proprietary concern. PW1 further deposed that her proprietorship concern has five cheques of the accused which were given to her husband in the name of the proprietorship concern. PW1 further deposed she has given
GPA to her husband i.e., PW2 and that he has been looking after and running the business transactions after proprietorship concern.
31.PW1 denied the suggestions that the entire payment was made by the accused through cash and that she deposed false. PW1 denied the suggestion that accused has given five cheques as per the assertions contained in Ex.P35 i.e., legal notice issued by accused Nos. 1 & 2 to the complainant. PW1 further denied the suggestion that she has no locustandi to represent the complainant firm. PW1 deposed to have not known who is Nitish whose signatures appears to be in Ex.P1, P3, P6, P7, 22
CC.NI. No.8462/2022
P11, P12, P13, P14 & P15 i.e., original bills as her husband was looking after her proprietorship concern. PW1 denied the suggestion that the accused has given five cheques towards security. Even though PW1 deposed as to how many cheques out of five cheques were issued by accused No.1 and accused NO.2 separately, she deposed that as her husband is looking after the business of her proprietorship concern, he knows all the details. PW1 further denied the suggestion that the accused were only due Rs.3,70,000/- but not Rs.19,00,000/- and that out of
Rs.3,70,000/- the accused have paid Rs.1,00,000/- as such they are due only Rs.2,70,000/-. PW1 further denied the suggestion that she created
Ex.P3, P11 and P15 and claiming that the accused are due Rs.19,00,000/- and odd. PW1 further denied that the accounts statement/ledger account filed by her proprietorship concern contain false particulars. PW1 further denied the suggestion that by misusing the blank signed cheques she have filed this case against the accused to extract more money and to harass the accused. From the above deposition and denials of the PW1 it can be said that the accused failed to establish that they have repaid the amount due to the complainant which was the defense taken by them as PW1 denied every such suggestion put to her. Even though the accused Nos. 1 & 2 by way of the written arguments raised an objection that the evidence of PW1 cannot be considered as PW1 deposed that her husband is looking after her business transactions i.e., M/s. Jai Balaji Traders and that she is not aware of business transactions with accused, the said objection would not sustain as PW1 during her cross examination also reaffirmed her version 23
CC.NI. No.8462/2022 that the accused did a business transaction of upto Rs.80,00,000/- with her proprietorship concern and that they have repaid Rs.61,00,000/- and that the accused are due an amount of Rs.19,00,000/- and odd, as such the objection of the accused Nos. 1 & 2 would not sustain.
32.In the present case the only remedy left to the accused Nos. 1 & 2 to prove their defense is cross of PW2. PW2 who is the Special Power of
Attorney holder of the complainant concern by way of chief examination in the form of affidavit deposed that PW1 has given registered GPA in his favour as such he is taking care of total marketing and collection affairs of complainant concern. Exs.P37 to Ex.P46 were marked through PW2.
Ex.P37 is the Original Credit Bill Dt:17.11.2017 for Rs.15,45,527/-,
Ex.P38 is the Letter Dt:06.12.2017 showing outstanding balance amount of Rs.15,11,122/-, Ex.P39 is the Letter Dt:18.12.2017 showing outstanding balance amount of Rs.18,43,070/-, Ex.P40 is the Letter Dt:04.04.2018 showing outstanding balance of Rs.19,80,515/-, Ex.P41 is the Color
Printouts and ordinary printouts of email and whatsapp made by the A1 &
A2, Ex.P42 is the CD containing whatsapp and the telephonic communication of A1 and A2, Ex.P43 is the Original income tax audit copy for the assessment year 2018-2019, Ex.P44 is the Form No.3CB, Ex.P45 is the Form No.3CD and Ex.P46 is the Special Power of Attorney executed by
Smt. Babitha Agarwal Proprietrix of complainant company. During cross of
PW2, PW2 deposed that he did dealings with accused on behalf of M/s. Jai
Balaji Traders. Even though PW2 was cross examined by counsel for accused in length, nothing was elicited from cross of PW2 in support of the 24
CC.NI. No.8462/2022 defense of the accused Nos. 1 & 2. PW2 denied the suggestion that PW1 does not know about affairs of M/s. Jai Balaji Traders. PW2 deposed that
Ex.P16 was issued by A2 and Ex.P17 to P20 were issued by proprietor of
M/s. Vijaya Sai Traders i.e., A1 in favour of M/s. Jai Balaji Traders. PW2 denied the suggestion that there is no mention of total amount due by M/s.
Vijaya Sai Traders to M/s. Jai Balaji Traders in the legal notice, complaint and also in chief evidence affidavit. PW2 deposed that in para NO.4 of the complaint it is mentioned the remaining balance of Rs.18,43,079/- was promised by both of the accused to be paid within one month as on 18.12.2017. PW2 denied the suggestion that there was no practice of issuing cash receipts and that only an amount of Rs.2,70,000/- is due from the accused persons to the complainant. PW2 admitted that Ex.P35 was issued by the accused to the complainant. PW2 denied suggestion that he was deposing false and that accused Nos. 1 & 2 are not liable to pay the subject cheques amount to the complainant. From the above depositions and denials of PW2 it is evident that the defense of Accused Nos.1 & 2 i.e., repayment of amount due to the complainant has not been elicited even from cross of PW2 as the suggestions in that regard were denied even by
PW2. As the accused Nos. 1 & 2 also failed to elicit from cross of PW1 and
PW2 that the accused Nos. 1 & 2 have repaid the amount due to the complainant and in the absence of oral or documentary evidence in support of their defense of repayment of due amount to the complainant as mentioned in the complaint, it can be held that the accused failed to prove their defense that they have repaid the amount due to the complainant.
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33.The another defense taken by the accused Nos. 1 & 2 they have issued blank signed cheques i.e., Exs. P16 to P20 to the complainant as security as part of their business transaction. But as per the Judgment of the Hon’ble Supreme Court of India in Bir Singh Vs. Mukesh Kumar (2019) 4SCC 197 in para No.36 of the said Judgment the Hon’ble Supreme
Court of India held that “Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under section 139 of the Negotiable Instrument Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt”.
34.In light of the Judgment of the Hon’ble Supreme Court of India in Bir
Singh Vs. Mukesh Kumar the burden will be upon the accused to prove that the cheques were not given for the purpose of discharge of legally enforceable debt even a defense of issuance of blank signed cheques was taken by the accused. But in the present case even though the accused
Nos. 1 & 2 has taken a defense of issuance of blank signed cheques as security purpose as part of business transactions to the complainant, the accused Nos. 1 & 2 has failed to prove their version as PW1 and PW2 denied the suggestions in regard to issuance of blank cheques by the accused Nos. 1 & 2 to the complainant during their cross examination.
35.The another defense raised by accused Nos. 1 & 2 by way of written arguments is that the attorney holder i.e., PW2 has no authority to sign 26
CC.NI. No.8462/2022 the complaint and filed the complaint on 28.06.2018 as there was no GPA in existence in favour of PW2 at the time of filing of the complaint. But the said objection of the accused Nos. 1 & 2 would not sustain, because from
Exs.P46 i.e., Special Power of Attorney executed by Babitha Agarwal
Proprietrix of complainant i.e., M/s. Jai Balaji Traders in favour of PW2 it is evident that the said power of attorney in favour of PW2 was given on 27.06.2018, as such it can be said that PW2 is empowered to file complaint on behalf of the complainant.
36.The accused Nos. 1 & 2 relied upon Judgment upon Hon’ble High Court of Andhra Pradesh in ‘Gadale Vasantha (died) by LRs and another Vs.
Cybcermate Infotek Ltd., Secunderabad and another’ reported in 2012 (1) ALD (Crl.) 865 (AP) where in the Hon’ble High Court that in a case where two cheques issued by accused to two complainants and when those two complainants filed consolidated complaint Under Section 138 of the
Negotiable Instrument Act against the same accused, in para No.8 of the said Judgment observed that the same as not maintainable and not tenable in law. The contention of accused Nos. 1 & 2 by relying on above Judgment is that when same complaint by two complainants to whom two different cheques were issued by same accused is not maintainable, similarly same complaint against two different accused who alleged to have issued cheques separately is also not maintainable. But the said contention of the accused Nos. 1 & 2 is would not sustain as both the accused in the present case issued cheques to the same complainant as part of same transaction as such the cause of action for filing the complaint against both the accused is one and the same, hence the above Judgment can be said cannot be 27
CC.NI. No.8462/2022 applied to the present case and will not come the rescue of the accused
Nos. 1 & 2.
37.The accused Nos. 1 & 2 further relied upon another Judgment of the
Hon’ble High Court of Andhra Pradesh in ‘Lakshmi Prabhakar Vs. Satya
Venkata Srinivasa Borusu and another’ reported in 2013 (2) ALD (Crl.) 320 (AP) where in the Hon’ble High Court in para No.13 of the said Judgment observed that ‘To attract section 138 of the Negotiable Instrument Act, firstly, the liability must be crystallized. By relying of this Judgment, the accused Nos. 1 & 2 contended that in the present case as the complainant failed to crystallized the total amount due, the offence Under Section 138 of the Negotiable Instrument Act would not be attracted. The said contention of the accused would not sustain as the complainant through Ex.P26 i.e.,
Legal notice, Dt:23.05.2018 specified the claim covered under the cheques by calling upon the accused Nos. 1 & 2 to pay the amount due under the cheques issued by them. Hence the above Judgment would not come in the rescue of the accused Nos. 1 & 2 in the present case.
38.As the accused Nos. 1 & 2 failed to prove any of their defenses, it can be said that the accused could not rebut the presumption Under Section 139 of the Negotiable Instrument Act, 1881, as such it is held that the accused
Nos. 1 & 2 failed to rebut the presumption Under Section 139 of the
Negotiable Instruments Act, 1881, as such it can be held that the accused
Nos. 1 & 2 are liable to punishable for the offence Under Section 138 of the
Negotiable Instrument Act, 1881. Point No.(ii) is answered accordingly.
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POINT (iii):
39.In view of the findings given to point No. (I) & (ii), this point is answered as here under:
In the result, Accused No.1 and Accused No.2 are found guilty for the offence Under Section 138 of the Negotiable Instrument Act, 1881, as such accused No.1 and accused No.2 are convicted Under Section 255(2) Cr.P.C.
for the said offence.
Dictated by me to the Stenographer and transcribed corrected and
pronounced by me in the open Court on 2nd day of December, 2022.
Sd./-
VIII METROPOLITAN MAGISTRATE
HYDERABAD.
29
CC.NI. No.8462/2022
Quantum of sentence:
40.Upon questioning the Accused No.1 and Accused No.2, they submitted they both are brothers and that recently their father died and their whole family is dependents of them and therefore prayed to show mercy on them.
But keeping in view the gravity of the offence committed, this court is of the opinion that lenient view cannot be taken against the accused Nos. 1 & 2.
41.Considering the facts and circumstances, as the Accused No.1 and
Accused No.2 found guilty for the offence Under Section 138 of the
Negotiable Instrument Act, 1881, the Accused No.1 is sentenced to under go simple imprisonment for a period of (1) year i.e., one year and accused
No.1 also sentenced to pay fine of Rs.30,10,000/- (Rupees Thirty Lakhs
Ten Thousand only) and in default to under go simple imprisonment for a period of (3) months i.e., three months for the offence Under Section 138 of the Negotiable Instrument Act, 1881. Out of the fine amount of
Rs.30,10,000/-, Rs.10,000/- (Rupees Ten Thousand only) shall go to State and the remaining fine amount of Rs.30,00,000/- (Rupees Thirty Lakhs only) shall be paid to the complainant as compensation Under Section 357(1)(b) Cr.P.C.
The accused NO.2 is sentenced to under go simple imprisonment for a period of (6) months i.e., Six months and Accused No.2 also sentenced to pay fine of Rs.1,55,000/- (Rupees One Lakh Fifty Five Thousand only) and in default to under go simple imprisonment for a period of (2) months i.e., 30
CC.NI. No.8462/2022 two months for the offence Under Section 138 of the Negotiable Instrument
Act, 1881. Out of fine amount of Rs.1,55,000/-, Rs.5,000/- (Rupees Five
Thousand only) shall go to State and the remaining fine amount of
Rs.1,50,000/- (Rupees One Lakh Fifty Thousand only) shall go to complainant as compensation Under Section 357(1)(b) Cr.P.C. Keeping in view of the gravity of the offence committed the benefits under probation of offenders Act are not invoked. A free copy of Judgment shall be given to
Accused Nos. 1 and 2 as per Section 363 of Cr.P.C. As Accused Nos. 1 & 2 has not been remanded to judicial custody even for a single day, the provision Under Section 428 Cr.P.C. is not invoked. Bail bonds if any shall stands cancelled after lapse of appeal period.
Dictated by me to the Stenographer and transcribed corrected and
pronounced by me in the open Court on 2nd day of December, 2022.
Sd./-
VIII METROPOLITAN MAGISTRATE
HYDERABAD.
APPENDIX OF EVIDENCE
WITNESS EXAMINED
For Prosecution For Defence
PW-1 – Smt. Babita Agarwal NIL
PW-2 – Vijay Agarwal
Exhibits Marked for Prosecution
1. Ex.P1 Original Bill No.B1584, Dt:25.11.2017 for Rs.97,710/-,
2. Ex.P2 Original Bill No.B1622, Dt:29.11.2017 for Rs.1,83,920/-,
3. Ex.P3 Original Bill No.B1698, Dt:05.12.2017 for Rs.1,67,885/-,
4. Ex.P4 Original Bill No.B1714, Dt:07.12.2017 for Rs.1,97,490/-,
5. Ex.P5 Original Bill No.B1718, Dt:07.12.2017 for Rs.1,67,492/-,
6. Ex.P6 Original Bill No.B1719, Dt:07.12.2017 for Rs.1,65,350/-,
7. Ex.P7 Original Bill No.B1728, Dt:08.12.2017 for Rs.1,51,600/-,
8. Ex.P8 Original Bill No.B1782, Dt:14.12.2017 for Rs.1,51,600/-, 31
CC.NI. No.8462/2022
9. Ex.P9 Original Bill No.B1783, Dt:14.12.2017 for Rs.75,245/- (Rs.1,44,927-69,682)
10. Ex.P10 Original Bill No.B1823, Dt:18.12.2017 for Rs.1,50,350/-,
11. Ex.P11 Original Bill No.B1849, Dt:20.12.2017 for Rs.1,05,210/-,
12. Ex.P12 Original Bill No.B1853, Dt:20.12.2017 for Rs.94,560/-,
13. Ex.P13 Original Bill No.B1883, Dt:23.12.2017 for Rs.90,210/-,
14. Ex.P14 Original Bill No.B1884, Dt:23.12.2017 for Rs.1,66,600/-,
15. Ex.P15 Original Bill No.B1934, Dt:30.12.2017 for Rs.78,925/-,
16. Ex.P16 Cheque bearing No.110979, Dt: 06.03.2018 for Rs.1,00,000/-
17. Ex.P17 Cheque bearing No.088453, Dt:12.03.2018 for Rs.10,44,800/-.
18. Ex.P18 Cheque bearing No.088446, Dt:12.04.2018 for Rs.1,67,481/-.
19. Ex.P19 Cheque bearing No.088455, Dt:12.04.2018 for Rs.1,65,038/-.
20. Ex.P20 Cheque bearing No.088454, Dt:16.04.2018 for Rs.5,00,000/-.
21. Ex.P21 Cheque return memo Dt:22.05.2018
22. Ex.P22 Cheque return memo Dt:22.05.2018
23. Ex.P23 Cheque return memo Dt:22.05.2018
24. Ex.P24 Cheque return memo Dt:22.05.2018
25. Ex.P25 Cheque return memo Dt:22.05.2018
26. Ex.P26 Office copy of Legal notice Dt:23.05.2018
27. Ex.P27 Original RPAD receipt Dt: 24.05.2018
28. Ex.P28 Original RPAD receipt Dt: 24.05.2018
29. Ex.P29 Online copy of Postal tracking receipt Dt:09.06.2018
30. Ex.P30 Online copy of Postal tracking receipt Dt:09.06.2018
31. Ex.P31 Copy of Registered GPA Dt:04.07.2018
32. Ex.P32 Computer generated copy of Certificate of Provision Registration from GST
33. Ex.P33/1 Form GSTR-3B for the month of October, 2017-2018 (3 sheets)
34. Ex.P33/2 Form GSTR-3B for the month of November, 2017-2018 (3 sheets)
35. Ex.P33/3 Form GSTR-3B for the month of December, 2017-2018 (2 sheets)
36. Ex.P34 Ledger Account for the period from 01.04.2017 to 03.11.18 (2 sheets)
37. Ex.P35 legal Notice issued by Mr. J.L. Babu, Advocate on behalf of Vijaysai Traders Rep. By its Proprietor Mr. J. Vijay Kumar and Mr. J. Virender,
Dt:29.03.2018 addressed to Jai Balaji Traders.
38. Ex.P36 IT returns acknowledgment for the assessment year 2018-2019.
39. Ex.P37 Original Credit Bill Dt:17.11.2017 for Rs.15,45,527
40. Ex.P38 Letter Dt:06.12.2017 showing outstanding amount of Rs.15,11,122/-
41. Ex.P39 Letter Dt:18.12.2017 showing outstanding amount of Rs.18,43,070/-
42. Ex.P40 Letter Dt:04.04.2018 showing outstanding amount of Rs.19,80,515/-
43. Ex.P41 The color printouts and ordinary printouts of email and the whats app made by A1 and A2
44. Ex.P42 CD containing Whats app and the telephonic communication of A1 & A2
45. Ex.P43 The original income tax audit copy for the assessment year 2018-2019
46. Ex.P44 Form No.3CB
47. Ex.P45 Form No.3CD 32
CC.NI. No.8462/2022
48. Ex.P46 Special Power of Attorney executed by Smt. Babitha Agarwal proprietrix of complainant company
Exhibits Marked for Defence:
- NIL -
Sd./-
VIII METROPOLITAN MAGISTRATE
HYDERABAD.
33