Meraj Khan v. The State Of U.P. Thru. Its Prin. Secy. Home Lko. And Another

Director of the firm “Katyayani Trader Zone Private Limited” and the applicant is the proprietor of Meraj Brick Field and for the purposes of running brick filed, the applicant purchased coal worth Rs.4,26,450/-, but despite several reminders no payment was made. It is alleged that applicant issued Cheque No.000007 drawn on HDFC Bank, Shyama Prasad Mukherji Crossing Branch, Asam Road Chauraha, Near Gupta Petrol Pump dated 06.06.2020 in favour of the firm. The cheque was presented by opposite party no.2 in his bank i.e. ICICI Bank, but the same was returned on 17.08.2020 with endorsement ‘Fund Insufficient”. Thereafter, statement of opposite party no.2 under Section 200 Cr.P.C. was recorded. Statement of one Durgesh Pandey was also recorded under Section 202 Cr.P.C. Thereafter, the Magistrate concerned summoned the applicant under Section 138 of the Act, 1881 vide order dated 05.05.2025. The applicant preferred an application under Section 142 of the Act, 1881 2 A482 No. 9913 of 2025 for dropping of criminal proceedings, in which objections were filed by opposite party no.2 and thereafter, the Magistrate has rejected the said application vide impugned order dated 28.10.2025.

3. Learned counsel for the applicant submits that the cheque in question was given by the applicant to opposite party no.2 as a security in respect of business transactions that were undertaken between them in the year

2016. Opposite party no.2 in order to extort money from the applicant, presented the cheque by filling the amount on 06.08.2020. He further submits that legal notice dated 09.09.2020 was issued to the applicant by opposite party no.2 in his personal capacity even though cheque was issued in the name of the company. The said notice was replied by the applicant on 08.10.2020. He also submits that complaint under Section 138 of the Act, 1881 can only be filed by the payee and holder in due course of the cheque. In the present case, company is the payee, but the complaint was not preferred by the company and neither any resolution by the Board of Directors was filed under Section 200 and 202 Cr.P.C.; thus, the complaint is bad in the eyes of law and is liable to be quashed.

4. The main contention of the learned counsel for the applicant is that since the company is not a party in the complaint, therefore, the complaint cannot be maintained. In support of his contention, learned counsel for the applicant has placed reliance upon the decision of the Supreme Court rendered in the case of Naresh Potteries Vs. Aarti Industries and others, AIR 2025 SC 886:

5. On the other hand, Sri Rao Narendra Singh, learned AGA-I has submitted that similar question has cropped up before the Supreme Court in the case of Bhupesh Rathod Vs. Dayashankar Prasad Chaurasia and another, (2022) 2 SCC 355, wherein Supreme Court held that complaint filed by Managing Director on behalf of company cannot be dismissed only on ground that name of Managing Director is mentioned first followed by post held in company. He has further submitted that since the complainant is looking after the affairs of the company as he has been authorised by the Board of Directors to do pairvi on behalf of the company and the bank account is operated by him including issuance of cheques on behalf of the company, therefore, it can not lie in the moth of 3 A482 No. 9913 of 2025 the applicant that the complaint filed by the complainant on behalf of the company is not maintainable as the company is not a party and the same is liable to be dismissed on that ground alone.

6. I have heard learned counsel for the parties and perused the record.

7. After going through the record, it is apparent that the proceedings is at the final stage and cross-examination is going on. Complainant-Bhagwan Prasad Mishra is the director of the firm Katyayani Trader Zone Private Limited under the Companies Act, 1956. The trial court has already recorded a finding that in the meeting of the Board of Directors, Bhagwan Prasad Mishra-complainant has been authoriesed to do pairvi of the company and he is the Managing Director. The bank account is operated by the complainant on behalf of the firm. The Supreme Court in the case of Bhupesh Rathod (supra) after minutely discussing each and everything regarding the issue involved in this case held as under:- “17. We must say at the inception that the respondent not having disputed his signatures on the cheques, it was for the respondent to show in what circumstances the cheques had been issued, i.e., why was it not a cheque issued in due course. The words of Section 139 of the NI Act are quite clear that unless the contrary is proved, it shall be presumed that the holder of the 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. The respondent has not set up a case that the nature of transaction was of the nature which fell beyond the scope of Section 138. Other than taking a technical objection, really nothing has been said on the substantive aspect.

18. The only eligibility criteria prescribed under Section 142(1)(a) is that the complaint must be by the payee or the holder in due course.

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 Cement Co. Ltd. v. Keshavanand2 . If a complaint was made in the name of the Company, it is necessary that a natural person represents such juristic person in the court and the court looks upon the natural person for all practical purposes. It is in this context that observations were made that the body corporate is a de jure complainant while the human being is a de facto complainant to represent the former in the court proceedings. Thus, no Magistrate could insist that the particular person whose statement was taken on oath alone can continue to represent the Company till the end of the proceedings. Not only that, even if there was initially no authority the Company can at any stage rectify that defect by sending a competent person. ……………………….

22. If we look at the format of the complaint which we have extracted aforesaid, it is quite apparent that the Managing Director has filed the complaint on behalf of the Company. There could be a format where the Company’s name is described first, 4 A482 No. 9913 of 2025 suing through the Managing Director but there cannot be a fundamental defect merely because the name of the Managing Director is stated first followed by the post held in the Company.

23. It is also relevant to note that a copy of the Board Resolution was filed along with the complaint. An affidavit had been brought on record in the trial court by the Company, affirming to the factum of authorisation in favour of the Managing Director. A Manager or a Managing Director ordinarily by the very nomenclature can be taken to be the person in-charge of the affairs Company for its day-to-day management and within the activity would certainly be calling the act of approaching the court either under civil law or criminal law for setting the trial in motion.4 It would be too technical a view to take to defeat the complaint merely because the body of the complaint does not elaborate upon the authorisation. The artificial person being the Company had to act through a person/official, which logically would include the Chairman or Managing Director. Only the existence of authorisation could be verified.

24. While we turn to the authorisation in the present case, it was a copy and, thus, does not have to be signed by the Board Members, as that would form a part of the minutes of the Board meeting and not a true copy of the authorisation. We also feel that it has been wrongly concluded that the Managing Director was not authorised. If we peruse the authorisation in the form of a certified copy of the Resolution, it states that legal action has to be taken against the respondent for dishonour of cheques issued by him to discharge his liabilities to the Company. To this effect, Mr. Bhupesh Rathod/Sashikant Ganekar were authorised to appoint advocates, issues notices through advocate, file complaint, verifications on oath, appoint Constituent attorney to file complaint in the court and attend all such affairs which may be needed in the process of legal actions. What more could be said? (emphasis applied) …………….

26. The description of the complainant with its full registered office address is given at the inception itself except that the Managing Director’s name appears first as acting on behalf of the Company. The affidavit and the cross-examination in respect of the same during trial supports the finding that the complaint had been filed by the Managing Director on behalf of the Company. Thus, the format itself cannot be said to be defective though it may not be perfect. The body of the complaint need not be required to contain anything more in view of what has been set out at the inception coupled with the copy of the Board Resolution. There is no reason to otherwise annex a copy of the Board Resolution if the complaint was not being filed by the appellant on behalf of the Company. ……………..

28. We are, thus, of the view that both the impugned orders of the trial court and the High Court cannot be sustained and are required to be set aside. The finding is, thus, reached that the complaint was properly instituted and the respondent failed to disclose why he did not meet the financial liability arising to a payee, who is a holder of a cheque in due course.”

8. There is also one important fact that applicant has challenged the summoning order dated 05.05.2025 before the revisional court, which too was dismissed on 28.10.2025. The complaint has been filed within time under Section 138(c) of the Act within fifteen days. The summoning order 5 A482 No. 9913 of 2025 has been passed by the Magistrate after perusing the complaint and the statements recorded under Sections 200 and 202 Cr.P.C., therefore, no interference is required by this Court while exercising its extraordinary powers under Section 482 Cr.P.C.

9. Application is devoid of merit. It is accordingly rejected. November 24, 2025 Rao/- (Brij Raj Singh,J.)

Director of the firm “Katyayani Trader Zone Private Limited” and the applicant is the proprietor of Meraj Brick Field and for the purposes of running brick filed, the applicant purchased coal worth Rs.4,26,450/-, but despite several reminders no payment was made. It is alleged that applicant issued Cheque No.000007 drawn on HDFC Bank, Shyama Prasad Mukherji Crossing Branch, Asam Road Chauraha, Near Gupta Petrol Pump dated 06.06.2020 in favour of the firm. The cheque was presented by opposite party no.2 in his bank i.e. ICICI Bank, but the same was returned on 17.08.2020 with endorsement ‘Fund Insufficient”. Thereafter, statement of opposite party no.2 under Section 200 Cr.P.C. was recorded. Statement of one Durgesh Pandey was also recorded under Section 202 Cr.P.C. Thereafter, the Magistrate concerned summoned the applicant under Section 138 of the Act, 1881 vide order dated 05.05.2025. The applicant preferred an application under Section 142 of the Act, 1881 2 A482 No. 9913 of 2025 for dropping of criminal proceedings, in which objections were filed by opposite party no.2 and thereafter, the Magistrate has rejected the said application vide impugned order dated 28.10.2025.

3. Learned counsel for the applicant submits that the cheque in question was given by the applicant to opposite party no.2 as a security in respect of business transactions that were undertaken between them in the year

2016. Opposite party no.2 in order to extort money from the applicant, presented the cheque by filling the amount on 06.08.2020. He further submits that legal notice dated 09.09.2020 was issued to the applicant by opposite party no.2 in his personal capacity even though cheque was issued in the name of the company. The said notice was replied by the applicant on 08.10.2020. He also submits that complaint under Section 138 of the Act, 1881 can only be filed by the payee and holder in due course of the cheque. In the present case, company is the payee, but the complaint was not preferred by the company and neither any resolution by the Board of Directors was filed under Section 200 and 202 Cr.P.C.; thus, the complaint is bad in the eyes of law and is liable to be quashed.

4. The main contention of the learned counsel for the applicant is that since the company is not a party in the complaint, therefore, the complaint cannot be maintained. In support of his contention, learned counsel for the applicant has placed reliance upon the decision of the Supreme Court rendered in the case of Naresh Potteries Vs. Aarti Industries and others, AIR 2025 SC 886:

5. On the other hand, Sri Rao Narendra Singh, learned AGA-I has submitted that similar question has cropped up before the Supreme Court in the case of Bhupesh Rathod Vs. Dayashankar Prasad Chaurasia and another, (2022) 2 SCC 355, wherein Supreme Court held that complaint filed by Managing Director on behalf of company cannot be dismissed only on ground that name of Managing Director is mentioned first followed by post held in company. He has further submitted that since the complainant is looking after the affairs of the company as he has been authorised by the Board of Directors to do pairvi on behalf of the company and the bank account is operated by him including issuance of cheques on behalf of the company, therefore, it can not lie in the moth of 3 A482 No. 9913 of 2025 the applicant that the complaint filed by the complainant on behalf of the company is not maintainable as the company is not a party and the same is liable to be dismissed on that ground alone.

6. I have heard learned counsel for the parties and perused the record.

7. After going through the record, it is apparent that the proceedings is at the final stage and cross-examination is going on. Complainant-Bhagwan Prasad Mishra is the director of the firm Katyayani Trader Zone Private Limited under the Companies Act, 1956. The trial court has already recorded a finding that in the meeting of the Board of Directors, Bhagwan Prasad Mishra-complainant has been authoriesed to do pairvi of the company and he is the Managing Director. The bank account is operated by the complainant on behalf of the firm. The Supreme Court in the case of Bhupesh Rathod (supra) after minutely discussing each and everything regarding the issue involved in this case held as under:- “17. We must say at the inception that the respondent not having disputed his signatures on the cheques, it was for the respondent to show in what circumstances the cheques had been issued, i.e., why was it not a cheque issued in due course. The words of Section 139 of the NI Act are quite clear that unless the contrary is proved, it shall be presumed that the holder of the 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. The respondent has not set up a case that the nature of transaction was of the nature which fell beyond the scope of Section 138. Other than taking a technical objection, really nothing has been said on the substantive aspect.

18. The only eligibility criteria prescribed under Section 142(1)(a) is that the complaint must be by the payee or the holder in due course.

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 Cement Co. Ltd. v. Keshavanand2 . If a complaint was made in the name of the Company, it is necessary that a natural person represents such juristic person in the court and the court looks upon the natural person for all practical purposes. It is in this context that observations were made that the body corporate is a de jure complainant while the human being is a de facto complainant to represent the former in the court proceedings. Thus, no Magistrate could insist that the particular person whose statement was taken on oath alone can continue to represent the Company till the end of the proceedings. Not only that, even if there was initially no authority the Company can at any stage rectify that defect by sending a competent person. ……………………….

22. If we look at the format of the complaint which we have extracted aforesaid, it is quite apparent that the Managing Director has filed the complaint on behalf of the Company. There could be a format where the Company’s name is described first, 4 A482 No. 9913 of 2025 suing through the Managing Director but there cannot be a fundamental defect merely because the name of the Managing Director is stated first followed by the post held in the Company.

23. It is also relevant to note that a copy of the Board Resolution was filed along with the complaint. An affidavit had been brought on record in the trial court by the Company, affirming to the factum of authorisation in favour of the Managing Director. A Manager or a Managing Director ordinarily by the very nomenclature can be taken to be the person in-charge of the affairs Company for its day-to-day management and within the activity would certainly be calling the act of approaching the court either under civil law or criminal law for setting the trial in motion.4 It would be too technical a view to take to defeat the complaint merely because the body of the complaint does not elaborate upon the authorisation. The artificial person being the Company had to act through a person/official, which logically would include the Chairman or Managing Director. Only the existence of authorisation could be verified.

24. While we turn to the authorisation in the present case, it was a copy and, thus, does not have to be signed by the Board Members, as that would form a part of the minutes of the Board meeting and not a true copy of the authorisation. We also feel that it has been wrongly concluded that the Managing Director was not authorised. If we peruse the authorisation in the form of a certified copy of the Resolution, it states that legal action has to be taken against the respondent for dishonour of cheques issued by him to discharge his liabilities to the Company. To this effect, Mr. Bhupesh Rathod/Sashikant Ganekar were authorised to appoint advocates, issues notices through advocate, file complaint, verifications on oath, appoint Constituent attorney to file complaint in the court and attend all such affairs which may be needed in the process of legal actions. What more could be said? (emphasis applied) …………….

26. The description of the complainant with its full registered office address is given at the inception itself except that the Managing Director’s name appears first as acting on behalf of the Company. The affidavit and the cross-examination in respect of the same during trial supports the finding that the complaint had been filed by the Managing Director on behalf of the Company. Thus, the format itself cannot be said to be defective though it may not be perfect. The body of the complaint need not be required to contain anything more in view of what has been set out at the inception coupled with the copy of the Board Resolution. There is no reason to otherwise annex a copy of the Board Resolution if the complaint was not being filed by the appellant on behalf of the Company. ……………..

28. We are, thus, of the view that both the impugned orders of the trial court and the High Court cannot be sustained and are required to be set aside. The finding is, thus, reached that the complaint was properly instituted and the respondent failed to disclose why he did not meet the financial liability arising to a payee, who is a holder of a cheque in due course.”

8. There is also one important fact that applicant has challenged the summoning order dated 05.05.2025 before the revisional court, which too was dismissed on 28.10.2025. The complaint has been filed within time under Section 138(c) of the Act within fifteen days. The summoning order 5 A482 No. 9913 of 2025 has been passed by the Magistrate after perusing the complaint and the statements recorded under Sections 200 and 202 Cr.P.C., therefore, no interference is required by this Court while exercising its extraordinary powers under Section 482 Cr.P.C.

9. Application is devoid of merit. It is accordingly rejected. November 24, 2025 Rao/- (Brij Raj Singh,J.)