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2002 DIGILAW 168 (PNJ)

Urjit Singh v. State Of Punjab

2002-02-06

R.C.KATHURIA

body2002
Judgment R.C.Kathuria, J. 1. Urjit Singh petitioner seeks quashing of complaint dated 5.3.1991 (Annexure-P. 1) filed by respondent No. 2 under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as the Act) as amended by the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 read with Sections 417, 418 and 420, I.P.C., summoning order dated 19.12.1993 (Annexure-P.2) and the subsequent proceedings taken therein. 2. Urjit Singh, Director and A.P. Singh, Managing Director of M/s. Hotel Nidhi Private Limited, Dehradun had availed the facility of overdraft from the Punjab and Sind Bank, Nabha. A criminal case was registered in this regard with Central Bureau of Investigation. A sum of Rs. 9,04,853.03 were found due from the aforesaid persons. A compromise was effected by the above named accused with the complainant, for the payment of the aforesaid amount. It was agreed between them that the liability shall be discharged by the accused by paying Rs. 30,000/- per month. In terms of the agreement, petitioner-accused had issued five Cheques No. CP/62/029658 dated 17.5.1990 for Rs. 30,000/-, No. 029659 dated 17.6.1990 for Rs. 30,000/-, No. 029660 dated 17.7.1990 for Rs. 30,000/-, No. 029661 dated 17.8.1990 for Rs. 30,000/- and No. 029662 dated 17.9.1990 for Rs. 30,000/- drawn in favour of Punjab & Sind Bank, Madhuban Hotel, Dehradun Branch as the accused had Account No. 485 with the said Bank at Dehradun. The cheques were sent for encashment to the Branch of the complainant Bank at Dehradun on 22.9.1990 but the same were returned with the memo dated 12.1.1991 which was received by the complainant on 24.1.1991. In the memo it was stated "refer to drawer" (to be asked from the payee) which means that the amount found credited in Account No. 485 of the petitioner with the Debradun Branch of the aforesaid Bank was not sufficient to encash the cheques. As the complainant had been defrauded by the accused notice dated 7.2.1991, as required under Section 138 of the Act, was served upon the accused but the same was ignored by the accused. Thereafter, the present complaint was instituted in the Court of learned Judicial Magistrate 1st Class, Nabha, 3. In support of the allegations made in the complaint, two witnesses were examined by the complainant. Thereafter, the present complaint was instituted in the Court of learned Judicial Magistrate 1st Class, Nabha, 3. In support of the allegations made in the complaint, two witnesses were examined by the complainant. Taking into account the evidence led by the complainant, the Magistrate, as per the order dated 19.12.1991 found sufficient ground for proceedings against the accused under Section 138 of the Act. The accused has filed the present petition for quashing of the complaint and the aforesaid summoning order. 4. In pursuance of the notice issued to the respondents, respondent No. 2 filed written reply wherein it was pleaded that petitioner-Urjit Singh and A.P. Singh, accused were Director and Managing Director respectively, of M/s : Hotel Nidhi Private Limited and had opened a Joint Account No. 918 with the complainant Bank. It was further stated that account was overdrawn by the accused and loan documents were executed by the petitioner acknowledging his liability towards the amount due to the Bank. As the accused had defrauded in payment of the amount, a civil suit was also filed in the Court which was decreed by the Additional Senior Sub-Judge, Nabhaon 4.2.1994 against the company of the petitioner and an execution was pending in the Debts Recovery Tribunal against them. Filing of the complaint under Section 138 of the Act was justified because the cheques issued by the petitioner accused had been dishonoured by his banker i. e. Branch Office of the complainant at Dehradun for want of sufficient funds to his credit in the above account. 5. I have heard learned Counsels representing the parties at length. 6. Learned Counsel representing the petitioner-accused has taken the following grounds in order to seek quashing of the complaint and the summoning order : (i) Firstly, that in the complaint, it had not been pleaded specifically that the petitioner was in charge of and was responsible for conduct of business of M/s. Hotel Nidhi Private Limited and for that reason no complaint could be filed against the petitioner. (ii) Secondly, that notice dated 7.2.1991 making demand of payment after dishonour of the cheques by the Punjab & Sind Bank located at Madhuban Hotel, Dehradun Branch served upon the petitioner-accused was vague, inasmuch as, amount demanded through this notice was more than the amount of the cheques. (ii) Secondly, that notice dated 7.2.1991 making demand of payment after dishonour of the cheques by the Punjab & Sind Bank located at Madhuban Hotel, Dehradun Branch served upon the petitioner-accused was vague, inasmuch as, amount demanded through this notice was more than the amount of the cheques. Reliance was placed on the observations made in Gopa Debi Ozha v. Sujit Paul, II (1995) BC 515=1995(3) RCR 640, and Suman Sethi v. Ajay K. Churiwaia and Anr., I (2000) SLT 605-I (2000) CCR 163 (SC) (2001) BC 144 (SC)=JT 2000(1) SC 493. 7. These submissions have been countered from the side of the respondents. 8. It is apparent from the stand taken in the petition that the plea raised by the petitioner is that the account had been in the name of M/s. Hotel Nidhi Private Limited and the cheques were signed by the Managing Director as well as the petitioner and the said amount was the liability of the Hotel but the complainant had not impleaded the Hotel which is a registered body under the Registration of Companies Act as party. It was contended that all the Directors and Managing Director were responsible for the acts of the company. It was also stated that though the petitioner had signed the cheques, the other Directors were also necessary parties and since they had not been impleaded as accused in the complaint, the complaint cannot be sustained in the eye of law. It was also stated in the petition that the petitioner was not in any way in charge of the affairs of the Hotel and since there was no allegation in the complaint that he was responsible for the affairs of the Hotel, he alone could not have been arrayed as accused in the complaint. 9. Obviously, contradictory stand had been taken by the petitioner in the petition. On the one hand the petitioner claimed that all Directors and Managing Director were required to be impleaded as accused and on the other hand he had pleaded that he was not in charge of the affairs of the Hotel, and for that reason he alone could not have been impleaded as the accused in this case. This contention is without any force because it had been admitted by the petitioner himself that cheques in question were signed by him as well as by A.P. Singh, Managing Director. This contention is without any force because it had been admitted by the petitioner himself that cheques in question were signed by him as well as by A.P. Singh, Managing Director. Therefore, he cannot avoid the liability for the amounts for which the cheques in question had been issued which had been dishonoured on presentation to Punjab & Sind Bank located in Madhuban Hotel, Dehradun Branch. In the complaint itself it had been clearly mentioned that it was the petitioner and A.P. Singh as Director and Managing Director respectively, who had opened Current Account No. 918 in the name of M/s. Hotel Nidhi Private Limited with the complainant Bank and they had initially obtained the facility of overdraft from the complainant Bank. It is also stated that after the case was registered with the C.B.I., the matter was settled and it was agreed that outstanding amount of Rs. 9,04,853.03 shall be paid by the accused in instalments amount of Rs. 30,000/- per month. It is in pursuance of this agreement that five cheques, details of which have been noticed earlier, signed by the petitioner and A.P. Singh were issued in favour of the complainant Bank, which were relumed on presentation as no amount was found deposited in Account No. 485 of the accused with the complainant Bank at Dehradun Branch. The petitioner despite service of notice had failed to pay the amount in question. Thus, it cannot, prima facie, be said that the petitioner was not, in any manner, responsible for the discharge of this liability and he had not been correctly arrayed as an accused in the complaint. 10. Coming to the other plea rais :d, no doubt, it has been laid down in Gopa Debi Ozha v. Sujit Paul (supra), that where notice was sent to the drawer of the cheque demanding a sum which was more than the amount of the cheque, the notice is vague and insufficient and on the basis of said notice prosecution could not be allowed. Same principle flows from the observations made in Suman Sethi v. Ajay K. Churiwala and Anr. (supra). 11. However, the observations made in the above mentioned cases would not come to the help of the petitioner-accused because in the present case the only plea raised with regard to the notice in para 6 of the petition is as under : "6. (supra). 11. However, the observations made in the above mentioned cases would not come to the help of the petitioner-accused because in the present case the only plea raised with regard to the notice in para 6 of the petition is as under : "6. That it has further been alleged in the complaint Annexurc-I that notice was served upon the petitioner through Counsel on 7.2.1991 which has been received by the petitioner and there is no acknowledgement on the file that the said notice was ever received by the petitioner. Further the complaint was of date 11.3.1991 that too was after the period 01 one month. Thereafter, the learned Magistrate summoned the petitioner in the above said complaint under Section 138 of the Negotiable Instruments Act vide order dated 19.12.1991, acopy of which is being attached herewith as Annexure-P.2." 12. It is apparent that the contention raised at the time of arguments has nowhere been stated in the petition. Rather, the plea taken in the petition was that no notice was served upon the petitioner because no acknowledgement has been placed on record. This being a dispute on facts can only be decided during the trial of the case. It has nowhere been stated by the petitioner that in the notice the excess amount has been claimed than the liability for which cheques had been issued by the petitioner-accused. Therefore, this submission is without any foundation and has to be rejected. 13. For the aforesaid reasons, there is no merit in the petition. Consequently, the same is dismissed. The parties through their Counsels are directed to appear in the Trial Court on 7.3.2002.