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1999 DIGILAW 516 (KER)

Adril D Couth v. Premier Auto Electric Ltd.

1999-10-22

T.M.HASSAN PILLAI

body1999
Judgment :- T.M. Hassan Filial, J. The short ground to invoke the inherent power of this Court under S.482 Cr.P.C. to axe annexure- i complaint filed by the respondent against the petitioner accusing him of having committed the offence under S.138 of the Negotiable Instruments Act, 1881 (for short the N.I. act) is issuing of originals of Annexures II and III respectively by the respondent when the cheque issued by the petitioner was returned by the drawee bank unpaid on the ground of insufficiency of fund in the account of the petitioner maintained with the drawee bank on two earlier occasions and non-filing of complaint against the petitioner by the respondent alleging commission of offence under S.138 of the N.I. Act within one month of arising of cause of action. 2. Undisputed facts are that petitioner used to purchase electrical and mechanical items from the complainant company on credit and Rs. 71207/- was owned by the petitioner to the complainant company under the credit sales made. In partial discharge of the liability the petitioner issued the cheque in question (cheque dated 31.3.1997 for Rs. 30,000/- drawn on the Canara Bank, Palarivattom branch) to the respondent and that cheque was dishonoured by the drawee bank when presented for encashment. By means of original of annexure- II complainant requested the petitioner to send to it a "demand draft for Rs. 30,985/- in lieu of the returned cheque immediately". Cheque dishonoured was again presented for encashment and when presented on the second occasion also the same was returned unpaid with the remark insufficient fund. After bouncing of the cheque again i.e., after presented it for encashment second time, the complainant threatened petitioner that legal action would be initiated against him if payment was not received by it by 25th of April 1997 (annexure- III). Cheque in question was again presented by the complainant company for encashment and on the third occasion also that cheque was returned unpaid with the endorsement insufficient fund. The complainant when issued a lawyer notice demanding payment of the amount covered by dishonoured cheque and it is not the case of the petitioner that he had paid the amount covered by that cheque within fifteen days of receipt of that lawyer notice. The complainant when issued a lawyer notice demanding payment of the amount covered by dishonoured cheque and it is not the case of the petitioner that he had paid the amount covered by that cheque within fifteen days of receipt of that lawyer notice. The proceeding sought to be stalled has been instituted before the Chief Judicial Magistrate Court, Ernakulam and the learned Magistrate took cognizance of the offence and issued process (C.C. No. 2380/97). The Chief Judicial Magistrate Court, Ernakulam made over the case to the Addl. Chief Judicial Magistrate Court (EO), Ernakulam and the case is renumbered as C.C. No. 248/98. 3. Respondent's counsel contended that criminal proceedings initiated at the instance of the respondent (complainant company) are not liable to be stultified at the threshold and according to him annexure- II and III are not statutory notices envisaged under S.138 of the N.I. Act as contended by the petitioner and they are only intimations given by the respondent to the petitioner whereby he was informed of the fact of returning of the cheque in question by the drawee bank unpaid on the ground of insufficient fund. 4. The controversy is centering round the question whether Annexures II or III satisfies the requirement of the statutory notice envisaged under S.138 of the N.I. Act and the contention of the counsel for the petitioner vehemently urged before me is that as the respondent demanded the money covered by the cheque in question by issuing original of annexure- II requirement of issuing of statutory notice as contemplated under proviso (b) to S.138 has been complied with and as no complaint was filed within one month of arising of cause of action criminal proceeding sinstuted against the petitioner are legally unsustainable and ex facie the allegations in the complaint do not disclose commission of an offence under S.138 of N.I. Act. 5. There is merit in the contention made on behalf of the petitioner by his learned counsel. It is abundantly clear from annexures- II and III that demand for money covered by dishonoured cheque was made by sending Annexures- II and III and the learned counsel for respondent fairly not disputed that fact before me. Feeble attempt made by her as a last straw is that Annexures II and HI are only intimations regarding the bouncing of cheque when presented for encashment by the drawee bank. Feeble attempt made by her as a last straw is that Annexures II and HI are only intimations regarding the bouncing of cheque when presented for encashment by the drawee bank. That demand was made for the return of money covered by the dishonoured cheque is ex-facie evident from annexure- II and demand made for sending a demand draft for Rs. 30985/-in lieu of returned cheque immediately indicates nothing but demand for payment of the amount covered by cheque issued by the petitioner. By sending annexure- III the complainant company (respondent) threatened to take legal action if the amount covered by dishonoured cheque was not paid by 25th of April, 1997. A cursory glance at annexure- III also reveals clearly the fact that demand for payment of money covered by the dishonoured cheque was made by the respondent. 6. The fact that annexure- II was issued within fifteen days of bouncing of cheque when it was presented for the first time i s not disputed before me. It i s al so not disputed before me that annexure- III was issued within fifteen days when the cheque presented again i.e., on second occasion, was returned unpaid. No form of notice is prescribed under Clause (b) of S.138 and requirement is only that notice shall be given in writing within fifteen days of receipt of information from the bank regarding return of the cheque unpaid. Apex Court has held in SIL Import, USA v. Exim Aides Silk Exporters, Bangalore (1999 (2) KLT 275 (SC) =1999 SCC (Crl.) 600 thus: "The duty cast on the payee on receipt of information regarding the return of the cheque unpaid is mentioned in clause (b) of S.138. Within 15 days he has to make a demand for payment. The mode of making such a demand is also prescribed in the clause, that it should be "by giving notice in writing to the drawer of the cheque". Nowhere is it said that such notice must be sent by registered post or that it should be despatched through a messenger." 7. In the decision cited supra the Apex Court held that fax message sent by the respondent for his own safeguard boomeranged and he is forked in a catch 22 situation. If the notice envisaged in clause (b) of the proviso to S.138 was transmitted by fax it would be in compliance with the legal requirement. In the decision cited supra the Apex Court held that fax message sent by the respondent for his own safeguard boomeranged and he is forked in a catch 22 situation. If the notice envisaged in clause (b) of the proviso to S.138 was transmitted by fax it would be in compliance with the legal requirement. So, I entertain no doubt that annexure- II and III are notices envisaged in Clause (b) of proviso to S.138 of the N.I. Act and there was compliance of the legal requirement of sending notice in writing. 8. There is no case for the respondent that either within fifteen days of receipt of annexure- II or within fifteen days of receipt of annexure- III petitioner paid the amount covered by dishonoured cheque and it is also not the case of the respondent that complaint was filed within one month of arising of cause of action i.e., complaint was filed within one month after the expiry of 15 days of receipt of annexure- II or annexure- III notice by the petitioner. The starting date of period of fifteen days envisaged in clause (c) of S.138 is the date of receipt of the said notice. It is settled position of law that once it starts the offence is completed on the failure to pay the amount within fifteen days thereafter. Cause of action would arise if the offence is committed. Here the facts of the case on hand disclose that after issuing of annexure- II notice without filing a complaint within 45 days of receipt of that notice by the petitioner respondent presented the cheque again and again for encashment and issued annexure- III and lawyer notice. It is settled position that cause of action can arise only once. The law is laid down by the apex Court in Sadanandan Bhadran v. Madhavan Sunil Kumar (1988(2) KLT 765 (SC) =1998 SCC (Cri) 1471). Apex Court has stated the law in that case as follows: "Consequent upon the failure of the drawer to pay the money within the period of 15 days as envisaged under clause (c) of the proviso to S.138, the liability of the drawer for being prosecuted for the offence he has committed arises, and the period of one month for filing the complaint under S.142 is to be reckoned accordingly. The combined reading of the above two Sections of the Act leaves no room for doubt that cause of action within the meaning of S.142(c) arises - and can arise - only once." 9. The following statement of law has been clearly adumbrated by the Apex Court in para 7 thereof: 7. Besides the language of Ss.138 and 142 which clearly postulates only one cause of action, there are other formidable impediments which negate the concept of successive causes of action. One of them is that for dis honour of one cheque, there can be only one offence and such offence is committed by the drawer immediately on his failure to make the payment within fifteen days of the receipt of the notice served in accordance with clause (b) of the proviso to S.138. That necessarily means that for similar failure after service of fresh notice on subsequent dis honour, the drawer cannot be liable for any offence nor can the first offence be treated as nonest so as to give the payee a right to file a complaint treating the second offence as the first one. At that stage, it will not be a question of waiver of the right of the payee to prosecute the drawer but of absolution of the drawer of an offence, which stands already committed by him and which cannot be committed by him again." 10. annexure- i complaint was filed after bouncing of the cheque by the drawee bank when it was presented for encashment on the third occasion. The allegation in the complaint was that drawee bank dishonoured the cheque on the ground of insufficiency of fund and information regarding the dishonouring of the cheque was received by it on 19.7.1997. Complainant further alleged that after receipt of that information it sent a registered lawyer notice dated 26.7.97 demanding payment of the amount covered by the cheque within 15 days from the date of receiving of information by it that cheque was returned unpaid and statutory notice was received by the petitioner on 9.8.97. It is common ground that within 15 days of receipt of the lawyer notice the petitioner had not paid the amount covered by the dishonoured cheque. The complaint was filed on 23.9.97. 11. It is common ground that within 15 days of receipt of the lawyer notice the petitioner had not paid the amount covered by the dishonoured cheque. The complaint was filed on 23.9.97. 11. As pointed out earlier, cause of action arises only once and in the instant case cause of action arose within 45 days of receipt of annexure- II by the petitioner. It is clear from Annexure I complaint that complaint was filed not within one month of the arising of cause of action. There is, thus, ground to axe the criminal proceedings initiated against the petitioner by the respondent and invoking the powers of this Court under S.482 Cr.P.C. criminal proceedings in C.C. No. 248/98 on the file of Addl. Chief Judicial Magistrate Court (EO), Ernakulam are quashed. Crl. M.C. is allowed.