Complaint for dishonour of cheque could be filed through the Power of Attorney #indianlaws

In the light of section 145 of NI Act, it is open to the Magistrate to rely upon the verification in the form of affidavit filed by the complainant in support of the complaint under Section 138 of the NI Act and the Magistrate is neither mandatorily obliged to call upon the complainant to remain present before the Court, nor to examine the complainant or his witness upon oath for taking the decision whether or not to issue process on the complaint under Section 138 of the NI Act.

A complaint alleging offence of dishonour of cheque as punishable under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) if filed by Power of Attorney holder whether would be maintainable or not was the question before the Apex Court.

The Court while answering the question in affirmative clarified and affirmed the legal position that such complaint petition through power of attorney is perfectly legal and competent. The Power of Attorney holder can depose and verify on oath before the Court in order to prove the contents of the complaint. However, the power of attorney holder must have witnessed the transaction as an agent of the payee/holder in due course or possess due knowledge regarding the said transactions. It is required by the complainant to make specific assertion as to the knowledge of the power of attorney holder in the said transaction explicitly in the complaint and the power of attorney holder who has no knowledge regarding the transactions cannot be examined as a witness in the case.

In the light of section 145 of NI Act, it is open to the Magistrate to rely upon the verification in the form of affidavit filed by the complainant in support of the complaint under Section 138 of the NI Act and the Magistrate is neither mandatorily obliged to call upon the complainant to remain present before the Court, nor to examine the complainant or his witness upon oath for taking the decision whether or not to issue process on the complaint under Section 138 of the NI Act.

The functions under the general power of attorney cannot be delegated to another person without specific clause permitting the same in the power of attorney. Nevertheless, the general power of attorney itself can be cancelled and be given to another person.

In the instant matter the power of attorney holder’s sworn statement was recorded and summons was issued. This exercise cannot be faulted and was held to be in complete accord with Section 200 of the Code of Criminal Procedure, 1973. At that stage, the power of attorney holder had stepped in the shoes of the Appellant otherwise, there was no point in the Complainant giving power of attorney to her husband.

[Vinita S. Rao vs. M/s. Essen Corporate Services Pvt. Ltd. & Anr.]
(SC, 17.09.2014)