Case Note & Summary
The appellant, Upendra Devendra Lad, filed a complaint under Section 138 of the Negotiable Instruments Act, 1881, against the respondents, including M/s. Dart Computers Ltd. and its directors, alleging dishonour of cheques. The appellant claimed to be the proprietor of Hindustan Computers, a proprietary concern. However, during the proceedings, the accused filed an application under Exhibit 171 seeking dismissal of the complaint on the ground that the appellant was not the proprietor; the actual proprietor was Mrs. Neeta Lad, the appellant's wife. The appellant had consistently stated in the verification statement, examination-in-chief, and cross-examination that he was the proprietor. The accused argued that the appellant was neither the holder in due course of the cheques nor the authorized power of attorney holder of the proprietor, and thus lacked locus standi to file the complaint. The learned Judicial Magistrate First Class, Malegaon, had issued process against the accused. The appellant appealed against the dismissal of the complaint. The High Court of Bombay considered the issue of locus standi and held that the appellant, not being the proprietor or holder in due course, had no right to file the complaint. The court dismissed the appeal, affirming the trial court's decision.
Headnote
A) Negotiable Instruments Act - Section 138 - Locus Standi - Complaint by person not proprietor or holder in due course - The complainant filed a complaint under Section 138 of the Negotiable Instruments Act, 1881, claiming to be the proprietor of the firm, but evidence showed the proprietor was his wife. The court held that the complainant lacked locus standi as he was neither the holder in due course nor the authorized power of attorney holder of the proprietor. The complaint was dismissed. (Paras 1-3)
Issue of Consideration
Whether the complainant, who was not the proprietor of the firm nor the holder in due course of the cheque, had the locus standi to file a complaint under Section 138 of the Negotiable Instruments Act, 1881.
Final Decision
The High Court dismissed the appeals, holding that the appellant lacked locus standi to file the complaint under Section 138 of the Negotiable Instruments Act, 1881, as he was not the proprietor of the firm nor the holder in due course of the cheques.
Law Points
- Locus standi
- Holder in due course
- Power of attorney holder
- Section 138 Negotiable Instruments Act
- 1881
- Proprietary concern
- Verification statement
Case Details
2013 LawText (BOM) (09) 89
Criminal Appeal No. 1008 of 2008 with Criminal Appeal Nos. 1009-1014 of 2008
Smt. Sadhana S. Jadhav, J.
Mr. Sai Chougule a/w Mr. S.S. Deshmukh i/b/ Mr. Uday Malte for the appellant; Mr. Meghnath Navlani i/b A.Kumar & Associates for respondent Nos. 1 to 3; Ms. P.P.Shinde, APP for the State
M/s. Hindustan Computers through Upendra Devendra Lad
M/s. Dart Computers Ltd., Rajesh @ Baldev s/o Mohanlal Hirani, Rina @ Rita Baldev Hirani, State of Maharashtra
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Nature of Litigation
Criminal appeal against dismissal of complaint under Section 138 of Negotiable Instruments Act, 1881.
Remedy Sought
Appellant sought to set aside the dismissal of his complaint and to convict the accused for cheque dishonour.
Filing Reason
Appellant filed complaint alleging dishonour of cheques issued by respondents.
Previous Decisions
The learned JMFC, Malegaon, had issued process against the accused. The accused filed application Exhibit 171 seeking dismissal on ground of lack of locus standi.
Issues
Whether the appellant had locus standi to file the complaint under Section 138 of the Negotiable Instruments Act, 1881, when he was not the proprietor of the firm or the holder in due course of the cheques.
Submissions/Arguments
Appellant argued that he was the proprietor of Hindustan Computers and thus entitled to file the complaint.
Respondents argued that the appellant was not the proprietor; the proprietor was Mrs. Neeta Lad, and the appellant was neither the holder in due course nor the authorized power of attorney holder.
Ratio Decidendi
A complaint under Section 138 of the Negotiable Instruments Act, 1881, must be filed by the holder in due course of the cheque or the authorized power of attorney holder of the payee. A person who falsely claims to be the proprietor and is not the actual holder in due course has no locus standi to maintain the complaint.
Judgment Excerpts
The appellant herein is the original complainant in SCC No.1419 of 2004.
The accused had executed the agreements with Upendra Lad.
Upendra Lad was not the proprietor of Hindustan Computers. The proprietor was Mrs. Neeta Lad.
Procedural History
The appellant filed a complaint under Section 138 of the Negotiable Instruments Act, 1881, in SCC No.1419 of 2004 before the JMFC, Malegaon. Process was issued against the accused. The accused filed an application Exhibit 171 seeking dismissal on the ground that the appellant was not the proprietor. The trial court dismissed the complaint. The appellant appealed to the High Court of Bombay.
Acts & Sections
- Negotiable Instruments Act, 1881: 138
- Code of Criminal Procedure, 1973 (Cr.P.C.): 313
