The Himachal Pradesh High Court has ruled that a person cannot file a complaint under Section 138 of the Negotiable Instruments Act without proving proprietorship of the concerned firm. In this case, the complainant, manager of Shirgul Filling Station, filed a complaint against a government contractor who issued a ₹5,00,000 cheque that later bounced. However, the cheque was issued in the name of the filling station, not the complainant. The court noted that the complainant relied only on an authority letter issued after the complaint was filed, which lacked legal weight. He also failed to provide documents proving he was the manager was the sole proprietor of Shirgul Filling Station. The Trial Court had dismissed the complaint, holding that the complainant was not the legal payee under the Act.
The High Court upheld this decision, stating that no valid evidence supported the complainant’s claim of ownership or authorization. This judgment reinforces that only a legally recognized payee can initiate proceedings under Section 138 of the N.I. Act, and mere verbal claims or post-dated authority letters are not enough.
