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2000 DIGILAW 721 (MAD)

Mahar Banu v. N. Justin

2000-07-25

B.AKBAR BASHA KHADIRI

body2000
ORDER: The petitioner herein seeks to quash the proceedings in S.T.C.No.2575 of 1998 pending on the file of the Judicial Magistrate, Eraniel. 2. This Criminal Original Petition has arisen in this way: The petitioner was running a provisional store under the name and style of ‘Banu Stores’, at Gopala Pillai Building, Monday Market, Eraniel Village. She had incurred debts with the respondent herein. She could not clear the entire debts. Therefore, on 2.7.1998,she instituted proceedings to have herself adjudicated as insolvent by filing I.P.No.3 of 1998 on the file of the Subordinate Judge, Padmanabhapuram. According to the petitioner, once when the insolvency proceedings are instituted, no other legal proceedings can be instituted against her, but the respondent preferred a complaint under Sec.138 of the Negotiable Instruments Act, alleging that she had issued a cheque on 29.7.1998, and when the cheque was presented in the bank, it was returned on 19.8.1998, regarding which a statutory notice was sent to the petitioner on 2.9.1998, and that the respondent /complainant had alleged that notice was returned unserved on 4.9.1998, and after expiry of the statutory period, the respondent preferred the complaint on 25.9.1998, which the learned Judicial Magistrate, Eraniel, had taken on file in S.T.C.No.2575 of 1998. According to the petitioner, the complaint is not maintainable after filing of the insolvency proceedings. 3. She had also stated that the cheque was issued as security for the debt due to M/s.Hema Finance. 4. Lastly, the petitioner had contended that there had been no service of the notice to her. Even otherwise, the notice has been taken to her erstwhile address only with the mala fide intention to see that she did not receive the notice. 5. Heard both sides. The first objection is that the complaint is not maintainable by virtue of institution of I.P.No.3 of 1998 and the insolvency proceedings is a bar for a criminal complaint. This position had been elaborately considered by my learned brother M.Karpagavinayagam, J. in Bharath N.Mehta v. Mansi Finance (Chennai) Ltd., (1999)1 C.T.C. 687. I feel, it would be sufficient to cull out certain paragraphs from that judgment to make the position clear. Paragraph No.13 recites as under: 13. This position had been elaborately considered by my learned brother M.Karpagavinayagam, J. in Bharath N.Mehta v. Mansi Finance (Chennai) Ltd., (1999)1 C.T.C. 687. I feel, it would be sufficient to cull out certain paragraphs from that judgment to make the position clear. Paragraph No.13 recites as under: 13. As per Sec.17 of the Act, no creditor to whom the insolvent is indebted in respect of any debt shall have any remedy against the property of the insolvent in respect of the debt shall commence any suit or other legal proceedings except with the leave of the Court. Paragraph No.14 of the judgment recites as under: 14. The wordings “any suit or other legal proceedings’ would mean the suit or other legal proceedings relating to the property of the insolvent and not with reference to the personal act committed by the accused constituting the offence liable to be proceeded in a criminal court.” Paragraph No.17 of the judgment recites as under: 17. The offence under Sec.138 of the Negotiable Instruments Act is a statutory offence and these proceedings are totally different from that of the insolvency proceedings and by any stretch of imagination, it cannot be said that Sec.17(2) prohibits the continuation of criminal proceedings initiated for dishonour of the cheque under Section 138 of the Negotiable Instruments Act. Paragraph No.18 of the judgment recites as under: 18. Similarly, the wordings in Sec.18(1) referring about “stay any suit or other proceedings pending against the insolvent before any judge or judges of the Court subject to the superintendence of the Court” would definitely mean only civil proceedings and not criminal proceedings, as criminal courts are not subject to the superintendence of the Insolvency Court. I feel, further elucidation is not necessary. As referred to by the learned Judge, as per the provisions of Sec.17 of the Presidency-Towns Insolvency Act, any suit or legal proceedings only mean the proceedings relating to the property and not to personal commitment made by the petitioner herein. Sec.17 of the Presidency Towns Insolvency Act as in pari materia to the provisions of Sec.28(2) of the Provincial Insolvency Act. What is stated with respect to Sec.17 of the Presidency Towns Insolvency Act applies in all force to a matter involving Sec.28(2) of the Provincial Insolvency Act. 6. Sec.17 of the Presidency Towns Insolvency Act as in pari materia to the provisions of Sec.28(2) of the Provincial Insolvency Act. What is stated with respect to Sec.17 of the Presidency Towns Insolvency Act applies in all force to a matter involving Sec.28(2) of the Provincial Insolvency Act. 6. The next point urged by the learned Counsel for the petitioner is that the cheque was issued by the petitioner only as a security and as per the provision of Sec.118 (a) of the Negotiable Instruments Act, once when the maker of the cheque admits his signature, then a presumption under this section would arise that the cheque is supported by consideration. The question whether the cheque was issued in discharge of the debt or as a security, is a matter of evidence - a question of fact, which has to be gone into at the time of the trial and this question cannot be considered in a proceedings under Sec.482 of the Code of Criminal Procedure. 7. The last contention of the petitioner is that the notice purported to have been sent to her on 2.9.1998 had not been received by her, but it had been returned unserved. The petitioner contends that only with a mala fide intention, the respondent had sent the notice to her erstwhile address. Careful perusal of the typed set of papers would go to show that in her insolvency petition, the petitioner had given her address as “Mahar Banu, wife of Malik Mohamed, .....residing at Rose D Illam, Kallukottam, Lakshmipuram Village, Kalkulam Taluk, Kanniyakumari District”. Though in the complaint, her address is given as Mahar Banu, W/ o. Malik Mohamed, ....residing at Rose Illam, Kallukottam Post, Lakshmipuram Village, Kalkulam Taluk, Kanniyakumari District, which address is contained in the summons issued by the learned Judicial Magistrate, the postal cover in which the summons were sent reads thus: “Mahar Banu, C/o. A.M. Rafel Contractor, Eathen Thottathu Veedu, Rajakumai, and P.O., Idukki District, Kerala State”. According to the petitioner, knowing fully well that she is not residing in Kallukottam, Lakshmipuram Village, Kalkulam Taluk, Kanniyakumari District, notice was purposefully addressed to that address. Even here, it should be mentioned that the question whether or not notice had been issued to her to a wrong address, that too, with a mala fide intention has to be gone into at the time of the trial of the matter. Even here, it should be mentioned that the question whether or not notice had been issued to her to a wrong address, that too, with a mala fide intention has to be gone into at the time of the trial of the matter. It cannot be said that intention of parties can be assessed in the proceedings under Sec.482, Cr.P.C. I do not find any merits in the contentions of the petitioner. 8. In the result, this Criminal O.P. is dismissed. Consequently, Crl.M.P.Nos.10925 and 10926 of 1998 are also dismissed.