Padma Polychem PVT LTD vs. M/S Shilpi Cable Technologies LTD And Ors

Facts

The petitioner, Padma Polychem Pvt Ltd, sought leave to appeal against an acquittal judgment dated August 25, 2023, by the Judicial Magistrate. The original complaint was filed under Section 138 of the Negotiable Instruments Act, 1881, by Padma Polychem against Shilpi Cable Technologies Ltd and its Directors. The petitioner alleged that Shilpi Cable Technologies Ltd owed Rs. 51,16,768/- for goods supplied between June 2-6, 2017. In discharge of this liability, Shilpi Cable Technologies Ltd issued four cheques. These cheques were dishonoured with the remark 'payment stopped by the drawer'. A legal demand notice was issued, and upon failure to pay, the complaint was filed. Respondent No. 4 was dropped, and proceedings against Respondent No. 1 were stayed due to NCLT insolvency proceedings. Respondent No. 2, who admitted signatures on the cheques, passed away during the trial. The trial court directed the proceedings to continue only against Respondent No. 3, who was subsequently acquitted.

Held

The High Court held that it found no ground to grant leave to appeal, dismissing the petition. Regarding the first issue, the Court agreed with the trial court's observation that invoices presented were mere printouts without original signatures or stamps, rendering them unauthentic. Furthermore, reliance on printouts of bills, purchase orders, ledgers, GST forms, and emails was deemed misplaced as these electronic records were not accompanied by the requisite Section 65B certificate of the Evidence Act, making them inadmissible. The Court cited Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal and Samsung India Electronics Pvt Ltd vs MGR Enterprises and Others in support. Concerning the second issue, while the Court noted the trial court's observation that Respondent No. 3 was not assigned a specific role, was not a signatory, and no evidence showed him in charge of day-to-day affairs, it also highlighted that the petitioner's case suffered from material irregularities. The trial court had also noted that payments were made till June 2017, and the exact amount received in June 2017 was unclear, creating doubt. The Court concluded that the petitioner failed to establish its case beyond reasonable doubt, and the trial court's view was plausible and possible, thus not warranting interference with the acquittal.

Key Issues

1. Whether the trial court erred in disallowing documents (invoices, ledger, GST forms, emails) on the basis that they were not supported by a Section 65B of the Evidence Act certificate, thereby causing a miscarriage of justice? 2. Whether the trial court wrongly noted that Respondent No. 3 was neither a signatory to the cheques nor the whole-time Director or Managing Director, when he was, in fact, responsible for the day-to-day affairs of the company? Petitioner's Arguments: The petitioner argued that the acquittal of Respondent No. 3 resulted in a miscarriage of justice. They contended that the trial court erred by disallowing documents solely because they lacked Section 65B certification. The petitioner also asserted that the trial court was mistaken in its observation that Respondent No. 3 was not a signatory or responsible for the company's day-to-day affairs, presenting MCA Master Data Form No. 1 and other documents to show Respondent No. 3 was the Managing Director. The petitioner further argued that the admission of signatures by the deceased Director and the non-filing of a Section 65B certificate should not be the sole basis for rejecting evidence. Revenue/State's Arguments: No arguments were recorded for the revenue or State in the provided judgment.