The Goa State Cooperative Bank Ltd., Through Its B.M. Ramakant J. Parab, Thr. S. V. Lotlikar v. Ashok Mandrekar And ANR.

2025:BHC-GOA:2003 Niti

IN THE HIGH COURT OF BOMBAY AT GOA

CRIMINAL APPEAL NO.33 OF 2016 The Goa State Cooperative Bank Ltd., through its Branch Manager, Mr Ramakant J. Parab, of Mapusa Market Branch, Mapusa, Bardez, Goa.

Presently through Mr S. V. Lotlikar, Managing Director (I/C), Having office at Sahakar Sankul, Patto, Panaji, Goa.

...Appellant

Versus

1. Shri Ashok Mandrekar Major of age, Proprietor of M/s. Ashok Enterprises, Residing at House No.259, Nadorawadi, P.O. Colvale, Bardez, Goa.

2. The State of Goa, Through Public Prosecutor High Court, Panaji-Goa.

... Respondents Mr Rama Rivankar, Advocate for the Appellant. Mr Joaquim Godinho, Advocate for Respondent No.1. CORAM : ASHISH S. CHAVAN, J.

DATE : 10th OCTOBER, 2025 JUDGMENT :

1.

The present appeal assails a judgment dated 30.05.2015, passed by learned JMFC, Mapusa Goa, acquitting Respondent No.1 of the

offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (NI Act, for short). The Appellant herein is the original complainant - Bank.

2.

The case of the Appellant - Bank can be summarised as under: (a) The Respondent No.1 had availed a loan of Rs.15,00,000/- (Rupees Fifteen Lakhs only) from the Appellant-Bank, after complying with all necessary formalities. The Respondent No.1 defaulted in making payment towards the outstanding loan amount. (b) On 09.05.2006, the Respondent No.1 issued a cheque drawn on Indusind Bank, Panaji Branch, in favour of the Appellant-Bank for an amount of Rs.17,85,589/- (Rupees Seventeen Lakhs Eighty Five Thousand Five Hundred and Eighty Nine only) towards the repayment of the loan amount.

(c) On 03.07.2006, the Appellant-Bank deposited the said cheque of Mapusa Branch for clearance. However, Indusind Bank returned the said cheȕue uǿpaid with a ȖeǾaȖk ৚accouǿt closed৛. (d) On 15.07.2006, the Appellant-Bank issued a statutory legal notice calling upon the Respondent No.1 to make the payment of the sum of Rs.17,85,589/- (Rupees Seventeen Lakhs Eighty Five Thousand Five Hundred and Eighty Nine only).

(e) The Respondent No.1, despite receiving the said notice, failed to make payment of the cheque amount.

(f) On 19.08.2006, the Appellant-Bank was constrained to file a complaint under Section 138 r/w 142 of NI Act before the learned JMFC, Mapusa.

(g) The Appellant-Bank has examined four witnesses during the trial. (h) That no evidence was led by the Respondent No.1 in rebuttal. (i) On 30.05.2015, JMFC, Mapusa, acquitted the Respondent No.1 of all charges of the offence under Section 138 of the NI Act. (j) Aggrieved by this acquittal, the Appellant has filed the present appeal against acquittal.

3.

By an order of this Court dated 14.06.2016, the Appellant-Bank was granted leave to file an appeal and the appeal was admitted. 4.

Although there are several grounds raised by the Appellant-Bank in the present appeal, the principal challenge to the judgment rests on whether or not the de facto complainant representing the AppellantBank was authorised to do so in law. 5.

The impugned judgment records a finding that the de facto complainant representing the Appellant-Bank was not duly authorised to represent it, since the letter of authority dated 11.07.2006 was not produced or exhibited before the Trial Court. It further records that even assuming that it was executed and the same could be read in evidence, it was not backed by a resolution of the Board of Directors or

any other material to show that the Managing Director was empowered to issue such letter of authority and hence the complaint under the NI Act was not filed either by the payee or his duly authorised representative as envisaged in Section 142 of the NI Act, hence the complaint is bound to fall on this ground alone. The impugned judgment has not gone into any other arguments and/or defences on the merits of the matter. 6.

Since the impugned judgment records a finding limited only to the authorisation of the de facto complainant representing the Appellant-Bank before the Trial Court and the Appellant-Bank also restricts its challenge in the present Appeal only to this aspect, the question that falls for consideration is extremely narrow in its conspectus. The question is whether or not the individual representing the Appellant-Bank before the Trial Court was duly authorised or not by the Appellant-Bank.

7.

Heard Mr Rama Rivankar, the learned counsel for the Appellant-Bank and Mr. J. Godinho, the learned counsel for Respondent No.1. Perused the records and the impugned judgment. 8.

Since the issue revolves around the authorisation of the Appellant-Bank, it is pertinent to note that there are two affidavits of evidence filed on behalf of the Appellant-Bank as provided for by Section 145 of the NI Act.

The first affidavit is affirmed on 22.12.2008, filed on behalf of the Appellant-Bank through its authorised representative, one Satyawan Naik. It is accompanied by a letter of authority dated 16.06.2009 issued by the Managing Director (In-charge) of the Appellant-Bank on the letterhead of the Appellant-Bank.

The second affidavit is affirmed on 24.04.2012, filed on behalf of the Appellant-Bank through its authorised representative, one Mrs. Lingata Vernekar and accompanied by a letter of authority dated 24.04.2012 issued by the Managing Director (In-charge) of the Appellant-Bank on the letterhead of the Appellant-Bank. Interestingly, there is a third letter of authority dated 08.11.2006 issued by the Managing Director (In-charge) of the Appellant-Bank on the letterhead of the Appellant-Bank in favour of one Ranganath Pandurang Pirankar. All three authority letters bear Exhibit numbers. 9.

In the impugned judgment, a controversy is raised as to whether the original letter of authority was either produced or exhibited. However, it is unnecessary to dilate upon this issue since the question of law that arises before me is, assuming that all three letters of authority were properly exhibited and duly marked as exhibits, even then would these letters of authority confer authorisation as envisaged by law on the representatives of the Appellant-Bank.

10.

Since the aforesaid letters of authority are identical in all respects, their legal effect can be considered cumulatively. It is not disputed by the Appellant-Bank that the letters of authority were not backed by any Board resolution or any other document that authorises the Managing Director of the Appellant-Bank to issue such a letter of authority in favour of the representatives. In other words, the Appellant-Bank admits that, save and except for the letters of authority referred hereinabove, there is no other document placed on record by the Appellant-Bank to show that its Representative/s were duly authorised by it before the learned Trial Court.

11.

An identical issue came up for consideration before this Court in the matter where it was observed in para 21 thus:

1 2007 (6) MhLJ 94 2 1995 (82) Company Cases 776 (Madras)

12.

The same view was reiterated by this Court in the matter of 4.

13.

This Court, while dealing with an identical issue in 5 has, after referring to both the aforesaid judgments and noting that the Appellant therein was a multistate cooperative society, proceeded to observe in para 20 as under:

3 (2005) 1 SCC 212 4 2006 SCC OnLine Bom 1323 5 2010 3 MhLJ 297

14.

The proposition of law that emerges from the aforesaid judgments, in essence, is that a multistate cooperative society is also a body corporate and it can act only through resolutions passed by its Board of Directors. In the absence of any Board resolution, merely on the basis of a letter of authority signed by the Managing Director, as in the present case, no authority can be conferred on the representative of the Multi-State Cooperative Society.

15.

Section 52 of the Multistate Cooperative Societies Act, 2002, provides that the Chief Executive is empowered to appoint a person to sue or be sued on behalf of the multistate cooperative society. This does not authorise a Managing Director to authorise any person to initiate criminal prosecution. In any case, the complainant, being a body corporate, could have acted only on the basis of the resolutions passed by it. Since there was no Board resolution passed by the Appellant-Bank in favour of its Managing Director to prosecute the Respondent (accused), Section 52 of the Multistate Cooperative Societies Act cannot be pressed in aid of the Appellant-Bank.

16.

In the wake of the aforesaid facts and the position of law, the letters of authority relied upon by the Appellant-Bank bereft of any Board resolution or any other document to authorise the Managing Director to appoint/authorise a representative on behalf of the

Appellant-Bank cannot be said to fulfil the legal requirements as set out in Section 142 of the NI Act.

The impugned judgment, therefore, cannot be faulted with and hence the present appeal deserves to be dismissed. The Rule is accordingly discharged.

ASHISH S. CHAVAN, J.

Signed by: NITI KISHOR HALDANKAR Designation: Private Secretary Date: 10/10/2025 19:05:05