Murlimal Santram v. Adyar Gate Hotel Ltd. , represented by K. Narayanan
1998-09-17
A.RAMAN
body1998
DigiLaw.ai
Judgment 1. The petitioners are the accused. 2. The petitioners herein filed an application before the XVIII Metropolitan Magistrate, Chennai, to dismiss the complaint as not maintainable and to discharge the accused. Learned XVIII Metropolitan Magistrate, by his order dated 17.11.1997, dismissed the said application, Hence, the Revision. 3. The complaint against the petitioners herein was filed by the complainant, under Sec.138 of the Negotiable Instruments Act, on the following allegations. The 1st accused represented by the 2nd accused received a deposit of Rs.50,00,000 as intercorporate deposit repayable in 90 days together with interest at 18%. To secure the repayment, the accused executed a promissory note for Rs.50,75,000 In spite of repeated demands, the accused paid only a sum of Rs.20,00,000 towards Principal amount. The accused were granted time till 30.11.1996 to pay principal amount and interest. On 30.11.1996, the accused handed over a cheque for Rs.38,87,565 drawn on Bharat overseas Bank Limited, George Town,Chennai. The complainant presented the cheque for payment through his banker M/s.Oriental Bank of Commerce, which was returned unpaid on the ground of insufficiency of funds. Immediately by speed post, the accused were issued notice under Sec.138 of the Negotiable Instruments Act, requiring them to pay the sum of Rs.38,87,565 together with interest and costs of the notice. The complainant had knowledge of service of the notice on the first accused on 9.1.1997 and on the second accused on 26.12.1996. The accused failed to comply with the notice and hence, the complaint. 4. Learned counsel for the petitioner raised only two grounds to contend that the complaint is not maintainable. Firstly, he submitted that the notice has been issued claiming higher amount than the cheque amount, and therefore, the notice is invalid and as there is no proper notice, proceedings under Sec.138 of the Act will not He, The other contention raised by him is that the complaint has not been filed within the period of limitation and therefore, it is not maintainable in law. 5. I will now take up the first contention viz., the invalidity of the notice issued. The notice is dated 23.12.1996. It sets out the fact of depositing of Rs.50,00,000 with the accused. It also mentions the fact of the deposit becoming payable on the expiry of 90 days.
5. I will now take up the first contention viz., the invalidity of the notice issued. The notice is dated 23.12.1996. It sets out the fact of depositing of Rs.50,00,000 with the accused. It also mentions the fact of the deposit becoming payable on the expiry of 90 days. If further refers to the part payment of Rs.20,00,000 alone and about the balance of Rs.38,87,565 towards principal and interest at the rate of 18% The notice also mentioned about the time granted to the accused till 30.11.1996 for payment and of the handing over of the cheque by the accused for Rs.38,87,565, drawn on Bharat overseas Bank Limited, George Town,Chennai. The notice further specifies that the said cheque was presented for collection at M/s.Oriental Bank of Commerce, Adyar Branch, and the same returned on 14.12.1996 with a remark in-suffi-ciency of funds. Finally by way of notice, the complainant has called upon the accused to pay the complaint the sum of Rs.38,87,565, together with interest at the rate of 18% charge of the notice being Rs.2,500. Learned counsel for the petitioners would therefore contend that inasmuch as a claim for further interest at 18% and for payment of Rs,2,500 towards charges of notice are added, this notice becomes invalid and defective. 6. This contention of the learned counsel for the petitioner cannot be accepted as a tenable one. The provisions of an enactment cannot be construed in such a manner as to make it meaningless or ineffective. The spirit of the enactment has to be taken into account. The purpose for which the enactment came to be passed cannot be lost sight of. It is with a view to bring credit-ability in commercial transactions, this Act has been introduced. If the contention of the learned counsel for the petitioners is to be accepted, then it may lead to artificial situation. Sec.138 of the Act especially proviso (b) specifies that a demand for payment of the said amount of money by giving a notice in writing to the drawer of the cheque shall be made within 15 days of receipt of information from the bank regarding the return of the cheque as unpaid, and if the drawer of such cheque fails to make payment of the said amount within 15 days, then the cause of action as contemplated under Sec.142 of the Negotiable Instruments Act would arise. 7.
7. Here a notice has been given. The notice makes mention of the cheque amount, it further says that the cheque when presented at the Bank, was returned with an endorsement of insufficiency of funds. The notice specifically requires the accused to pay the said amount covered by the cheque. By the notice it is also claimed that interest at the rate of 18% along with certain sum of money towards the charges of notice shall be paid. The notice is, therefore, in compliance with the provisions of the Act. Merely because the claim is made for payment of interest and service charges, the notice which is otherwise in conformity with proviso (B) to Sec.138 of the Act, cannot become invalid on that ground. The notice has to be construed as a whole. The purpose and object of the notice has to be taken into account. It is to give an opportunity to the drawer make payment and save himself from criminal liability. The notice has been given only under Sec.138 of the Act on the return of the cheque by the petitioner. Therefore, a part of the notice which requires the claim for payment of certain other amounts cannot be defective. If we are to construe so, then the position will be that a part of the notice is valid while another part of the notice is invalid. Even then that part of the notice which is valid and relevant for the purpose of Sec.138 of the Negotiable Instruments Act, Cannot be ignored. 8. The cardinal principle of interpretation of statute is that it must be construed as to give effect to the object of the Act and not to render any provision of the Act nugatory. If a notice is otherwise valid, inasmuch, as, it refers to the circumstances viz., existence of liability, the issuance of cheque to discharge the liability, the amount for which the cheque was issued, and the return of the cheque, merely because some more claim is added in that notice, one cannot say that notice is in any manner inconsistent or falls shorts of the requirements of Sec.138 of the Negotiable Instruments Act. Sec.138 of the Act Stipulates a notice in writing.
Sec.138 of the Act Stipulates a notice in writing. The purpose of the notice is to make known to the drawer of the cheque of her liability and about his act on issuing the cheque in discharge of his liability and the factum of the dishonour of the cheque so issued. When these conditions have been satisfied by this notice in the given case merely because the notice includes a claim for payment of interest at 18% and definite amounts towards the cost of notice, it cannot make the notice bad in law. Such a narrow and strait-jacketed interpretation is not warranted nor it would justify the object of the enactment. Therefore, in such circumstances, I am to reject the contention raised by the learned counsel for the petitioners and hold that the notice is not bad in law and it is a notice which conforms to the conditions set out in proviso (B) to Sec.138 of the Act. 9. Now coming to the question of limitation urged by the learned counsel for the petitioner, the following facts become relevant in that context, A notice was issued by speed post by the complainant to the accused, paragraph No.5 of the complaint is to the effect that the complainant had knowledge of service of the notice on the first accused on 9.1.1997 and on the second accused on 26.12.1996, which was a Friday. The 1st accused is M/s.Murlimal Santram & Co., (Madras) LimitedNo.46,Sermbudas Street,Chennai-1. The 2nd accused is Mohanlal Futanani, Director, M/s.Murlimal Santram & Co., (Madras) Ltd., No.46Chembudas Street,Chennai-1. The acknowledgement for service on the second accused was on 24.12.1996. The same has been received by the complaint on 26.12.1996. As regards the 1st accused, apparently the acknowledgement was lost and Xerox copy of the certificate issued by the Deputy Manager (CS). Speed Business office, Greams Road, Chennai-6 to the effect that it was received on 24.12.1996 was produced and the said certificate is dated 9.1.1997. Therefore, the position is clear that though the 1st accused was served on 24.12.1996, the complainant had the knowledge if it only on 9.1.1997. As regards the 2nd accused, the same was served upon the 2nd accused on 24.12.1996 and the acknowledgement was received by the complainant on 26.12.1996. 10.
Therefore, the position is clear that though the 1st accused was served on 24.12.1996, the complainant had the knowledge if it only on 9.1.1997. As regards the 2nd accused, the same was served upon the 2nd accused on 24.12.1996 and the acknowledgement was received by the complainant on 26.12.1996. 10. Sec.142 of the Negotiable Instruments Act provides that a complaint shall be made within one month of the date on which the cause of action arises under Sec.138(c) of the Act provides that if the drawer of the cheque fails to make payment of the said amount to the payee within 15 days of the receipt of said notice, complaint can be made. It has been unanimously held by the courts that cause of action would arise only after the expiry of 15 days i.e., on the 16th day. The provisions of the General Clause Act also would apply as pointed out already. 11. As regards the 2nd accused, the acknowledgment was received on 26.2.1996. As regards A-1, it was received only on 9.1.1997. If we calculate, it, it would be clear that the complaint having been filed on 10.2.1996 which is a Monday, is in time. The Calcutta High Court, has held in the decision reported in Santa Priya Engineers Private Ltd. v. Uday Sankar Das and another Santa Priya Engineers Private Ltd. v. Uday Sankar Das and another , 1993 M.W.N. 296 that the expression, “within 15 days of the receipt of the said notice” in clause (c) of Sec.138 of the Act clearly mean the date when the sender acquires the knowledge about the date of the receipt of the notice by the drawer. This Court has held in G.Vasudevan v. Rajammal G.Vasudevan v. Rajammal, (1992)1 M.W.N. (Crl.) 241 thatwhile computing the period of 15 days, the date of service should be excluded, and one month should be calculated after the expiry of 15 days thereof. Therefore, if we calculate accordingly it would be clear that the complaint having been filed on Monday, is within time and there is no limitation at all. If we taken 26.12.1996 being the date of knowledge of service, then there is no question of limitation. 24.12.1986, being the date of service, the accused had time to make payment till 9.1.1997.
Therefore, if we calculate accordingly it would be clear that the complaint having been filed on Monday, is within time and there is no limitation at all. If we taken 26.12.1996 being the date of knowledge of service, then there is no question of limitation. 24.12.1986, being the date of service, the accused had time to make payment till 9.1.1997. Therefore, if there is non-payment, the complaint has to be filed within a month i.e., 30 days, If 30 days are calculated, from 10.1.1997, then it would be clear that the complaint must be preferred on 9.2.1997. Admittedly, 9.2.1997 was a Sunday and hence, the complaint having been filed on 10.2.1997, is in order. Therefore, it would be clear that there is no bar of limitation affecting the Presentation of the complaint in this case, learned counsel for the petitioner did not raise any other point. 12. In the above circumstances, the revision is liable to be dismissed. Hence, it is dismissed, confirming the order passed by the XVIII Met-ropolitan Magistrate, Chennai in Crl.M.P.No.2472 of 1997. Consequently, Crl.M.P.No.199 of 1998 shall stand dismissed.