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Allahabad High Court · body

2004 DIGILAW 519 (ALL)

PRAMOD KUMAR SETHI v. STATE OF U P

2004-03-10

IMTIYAZ MURTAZA

body2004
IMTIYAZ MURTAZA, J. ( 1 ) THE present application has been filed for quashing of complaint case No. 823/2002 pending in the Court of Vth a. C. J. M. , Ghaziabad. ( 2 ) THE opposite party No. 2 filed a complaint in the Court of learned magistrate on the allegation that the complainant is proprietor of M/s siddhbali Traders and is engaged in the business of purchasing and selling pipes and scrapes and it is alleged that there was a business transaction between the parties and payments were made sometimes in cash and sometimes through cheques. It is alleged that during the course of business a sum of 9,05,000/- become due towards the applicants. The aforesaid cheque was presented for encashment, but it was dishonoured on 28th May, 2001 and again it was presented on 8th October, 2001 and again it was dishonoured and opposite party No. 2 complainant received information from the bank on 15th October, 2001. On 24th October, 2001 a notice was sent and no payment was made in compliance of the notice and complaint was filed on 5th December, 2001. ( 3 ) IT is submitted by the applicants Counsels that the allegations of the complaint are false and frivolous and no offence is made out against the applicants. It is further submitted that there was business transactions between the parties and there is no allegation of dishonest intention or any element of cheating against the applicants. The allegation discloses only civil dispute and no offence under Section 138 of Negotiable Instruments Act is made out. It is not disputed that the cheque was issued by the applicants and the said cheque was dishonoured and notice was given and despite the service of the notice no payment was made by the applicants. ( 4 ) I have heard learned Counsel for the applicant and the learned A. G. A. for the State. It is not disputed that the cheque was issued by the applicants and the said cheque was dishonoured and notice was given and despite the service of the notice no payment was made by the applicants. ( 4 ) I have heard learned Counsel for the applicant and the learned A. G. A. for the State. ( 5 ) THE offence is committed when aggrieved party presents the cheque to the Bank within a period of six months for the date on which it is drawn or within the period of its validity, whichever is earlier and the payee or the holder in due course of the cheque makes a demand for payment if the cheque amount by giving a notice in writing to the drawer of the cheque within stipulated days of the receipt of the information by him from the bank regarding the return of the cheque as unpaid and drawer of such cheque fails to make the payment of the amount within stipulated days of the receipt of the said notice. ( 6 ) THE dishonest intention or. the part of the drawer is not a necessary ingredient of the offence under Section 138 of the Negotiable Instruments act. ( 7 ) SECTIDN 138 of the Negotiable instruments Act makes a civil transaction to be an offence by fiction of law. In the case of Dalmia Cement (Bharat) Ltd. v. Galazy Traders Agencies ltd. reported in 2001 S. C. C. (Crl.) 1163 it was oberved as under : "4. Section 138 of the Act makes a civil transaction to be an offence by fiction of law. Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person is returned by the bank unpaid either because of the amount or money standing in the credit of that person being insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account, such person, subject to the other conditions, shall be deemed to have committed an offence under the Section and be punished for a term which may extend to one year or with fine which may extend to twice the amount to cheque or with both. To make the dishonour of the cheque as an offence, the aggrieved party is required to present the cheque to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier and the payee or the holder in due course of the cheque makes a demand for payment of the cheque amount by giving a notice in writing to the drawer of the cheque within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid and drawer of such cheque fails to make the payment of the amount within 15 days of the receipt of the said notice. Section 139 refers to presumption that unless the contrary is proved, the holder received the cheque of the nature referred to under Section 138 for the discharge in whole or in part of any debt or other liability. Section 140 restricts the defence in any prosecution under Section 138 of the Act and Section 141 refers to such offence committed by the companies. Section 142 provides that, notwithstanding anything contained in the Code of criminal Procedure, no Court shall take cognizance of an offence under the section except upon a complaint in writing made by the payee or, as the case may be, the holder of the cheque and that such complaint is made within one month of the date on which the cause of action arose under clause (C) of proviso to Section 138 of the Act. " ( 8 ) IN the case of Goa Plast (P) Ltd. v. Chico Ursula Dsouza reported in (2004) 2 Supreme Court Cases 235 it has been held in paragraph 26 as under : "26. The object and the ingredients under the provisions in particular sections 138 and 139 of the Act cannot be ignored. Proper and smooth functioning of all business transactions, particularly, of cheques as instruments, primarily depends upon the integrity and honesty of the parties. In our country, in a large number of commercial transactions, it was noted that the cheques were issued even merely as a device not only to stall but even to defraud the creditors. The sanctity and credibility of issuance of cheques in commercial transactions was eroded to a large extent. In our country, in a large number of commercial transactions, it was noted that the cheques were issued even merely as a device not only to stall but even to defraud the creditors. The sanctity and credibility of issuance of cheques in commercial transactions was eroded to a large extent. Undoubtedly, dishonour of a cheque by the bank causes incalculable loss, injury and in-convenience to the payee and the entire credibility of the business transactions within and outside the country suffers a serious setback. Parliament, in order to restore the credibility of cheques as a trustworthy substitute for cash payment enacted the aforesaid provisions. The remedy available in a civil Court is a long-drawn matter and an unscrupulous drawer normally takes various pleas to defeat the genuine claim to the payee. ( 9 ) THE dishonest intention of the accused is not necessary. The offence is committed when the cheque presented in the bank is dishonoured and notice for payment was made as stipulated in the Act. ( 10 ) THE application is devoid of merit and the same is accordingly dismissed. .