Research › Search › Judgment

Madhya Pradesh High Court · body

2006 DIGILAW 712 (MP)

Mohar Singh v. Lakhan Singh

2006-05-16

A.K.GOHIL

body2006
ORDER 1. Petitioner has filed this petition under section 482 CrPC for quashment of the order dated 29.8.2005 passed by the Chief Judicial Magistrate, Vidisha in Criminal Case No. 1666/03, whereby though the trial Court rejected the application filed by the respondent-accused on 15.4.2005 for dismissing the complaint on the ground of barred by limitation, but observed that the complaint ought to have been filed within the period of 15 days from the first notice dated 30.6.2003. Against that observation, the petitioner has tiled this petition because the observation may come in his way at the time of final disposal and may prejudice this case. 2. The brier facts of the case are that the respondent took loan of Rs.222,000/- from the petitioner and for repayment of the said loan he issued a cheque No. 164351 dated 11.6.2003 or Allahabad Bank, Branch Vidisha. The aforesaid cheque was presented for collection to his banker and the said cheque was dishonoured on 21.6.2003 with all endorsement for want of fund and thereafter on 23.6.2003 the Bank intimated about the dishonour of the cheque. First notice was issued to the respondent on 30.6.2003, which returned unserved. Thereafter, second notice was issued on 23.7.2003, which was also returned unserved with endorsement that the respondent is out of station for pilgrimage. Thereafter third notice was issued on 6.9.2003, which was served on 15.9.2003. The intimation of the said service of notice was given by post office to the petitioner on 10.10.2003 and since the amount was not paid despite the service of notice, the petitioner tiled a complaint on 22.10.2003. Therefore, contention or the petitioner is that his complaint is within limitation, therefore the observation of the Court that the complaint should have been filed within one month from the date of 30.6.2003 is contrary to the provisions of law. 3. I have heard the learned counsel for the parties. The contention of the learned counsel for the petitioner was that the service of notice is a mandatory requirement and without service of notice the complaint cannot be filed unless 15 days' time is granted to the respondent after service. Therefore, the petitioner was entitled to repeat the notice and to intimate him about the dishonour of cheque and to make a demand from him. Therefore, the petitioner was entitled to repeat the notice and to intimate him about the dishonour of cheque and to make a demand from him. Petitioner submitted that the provisions of section 138 and section 142 of the Negotiable Instruments Act are very clear and according to the aforesaid provisions the period of limitation of one month will expire after 15 clays from the receipt of the notice and he laid much emphasis on the words "receipt of the said notice" as provided in clause (c) of the proviso to section 138 of the Act. His further contention was that if the notice of 30.6.2003 would have been served or the respondent would have refused, then in that case certainly he could have waited for 15 days and filed complaint within 30 days but when the notice was not served and under section 142 of Negotiable Instruments Act cause of action will arise on receipt of notice which is a mandatory requirement, therefore, it was necessary for the petitioner to serve a repeat notice to the respondent, in which he has not committed any illegality and has tiled the complaint within limitation. Therefore, his contention was that the complaint was within time and the observation of the Court is not legal, therefore, the same is liable to be quashed, as the same may come in his way at the time of final disposal, which ultimately shall adversely prejudice his case. 4. In reply Shri R.K. Sharma, learned counsel for the respondent supported the order and his contention was that if the notice was returned unserved on 30.6.2003, the petitioner was entitled to file complaint treating it as a notice served, therefore, the petitioner has not filed the complaint within time. 5. After hearing the rival contentions of the learned counsel for the parties for resolving the controversy involved in this petition, it would be useful to reproduce the provisions of section 138 and section 142 or Negotiable Instruments Act, which read as under: "138. Dishonour of cheque for insufficiency, etc. 5. After hearing the rival contentions of the learned counsel for the parties for resolving the controversy involved in this petition, it would be useful to reproduce the provisions of section 138 and section 142 or Negotiable Instruments Act, which read as under: "138. Dishonour of cheque for insufficiency, etc. of funds in the account -- 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 from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for (a term which may be extended to two years),or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, which ever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, (within thirty days) of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of cheque, within fifteen days of the receipt of the said notice. 142. Cognizance of offences. 142. Cognizance of offences. -- Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974) -- (a) no Court shall take cognizance of any offence punishable under section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque; (b) such complaint is made within one month or the date on which the cause-of-action arises under clause(c) of the proviso to section 138: Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant satisfies the Court that he had sufficient cause for not making a complaint within such period. (c) no Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence punishable under section 138." 6. In the case of K.Bhaskaran v. Sankaran Vaidhyan Balan and another [ AIR 1999 SC 3762 ], the question before the Supreme Court was whether the notice sent by post on the correct address returned by the accused as unclaimed is valid service. It was held that with the help of the provisions of section 27 of the General Clauses Act, it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Considering the various other circumstances and the provisions and the effect of word "unclaimed" the Supreme Court has found that if the notice is returned with the endorsement of "unclaimed" it should be treated as served and such dale would be the commencement date in reckoning the period of 15 days contemplated in clause (d) to the proviso of section 138 of the Act. The Supreme Court has further held: "The offence under section 138 of the Act can be completed only with the concatenation of a number of acts. Following arc the acts which are components of the said offence: (1) Drawing of the cheque, (2) Presentation of the cheque to the bank, (3) Returning the cheque unpaid by the drawee bank, (4) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (5) Failure of the drawer to make payment within 15 days of the receipt of the notice. It is not necessary that all the five acts should have been perpetrated at the same locality. It is possible that each of those live acts could be done at five different localities. But concatenation of all the above live is a sine qua non for the completion of the offence under section 138 of the Act. Referring section 178(d) of Code it is clear that if the five different acts were done in five different localities anyone of the Courts exercising jurisdiction in one of the five local areas can become the place of trial for the offence under section 138 of the Act. In other words, the complainant jurisdiction over anyone of the local areas within the territorial limits of which anyone of those five acts was done. As the amplitude stands so widened and so expansive it is an idle exercise to raise jurisdictional question regarding the offence under section 138 of the Act." 7. Again in the case of Soil Import v. M/s. Exim Aides Silk Exporters, Bangalore [1999(2) MPLJ 168], the Supreme Court has held that the notice transmitted by fax will be compliance with the legal requirement envisaged in clause (b) of the proviso to section 138. In this case there was no dispute about the receipt of the fax message therefore, it was held that the notice was validly served. 8. In the case of Sadanandan Ehadran v. Madhavan Sunil Kumar [ AIR 1998 SC 3043 ], the Hon'ble Supreme Court has considered and has held that the proviso to section 138 lays down three conditions precedent to the applicability of the above section and, for that matter, creation of such offence and the conditions are: (1) The cheque should have been presented to the bank within six months of its issue or within the period of its validity, whichever is earlier; (2) payee should have made a demand for payment by registered notice after cheque is returned unpaid; and (3) that the drawer should have failed to pay the amount within 15 days of the receipt of notice. 9. The Court has further held that section 142 refers to only one fact which will give rise to the cause of action and that is the failure to make the payment within 15 days from the date of the receipt of the notice. 9. The Court has further held that section 142 refers to only one fact which will give rise to the cause of action and that is the failure to make the payment within 15 days from the date of the receipt of the notice. Though the question involved in this case has not been directly answered by that case but the dictum of that case is useful to consider the question of cause of action for filing a complaint and the Court has held that from the combined reading of above two sections of the Act leaves no room for doubt that cause of action within the meaning of section 138(c) arises and can arise - only once and that is the failure to make the payment within 15 days from the date of the receipt of the notice. 10. Learned counsel for the parties also cited judgment in the case of Prem Chand Vijay Kumar v. Yashpal Singh [2005(II) MPWN 90=2005 SCC (Cri) 1153], but that decision is again on the question of cause of action, in which it has been held that on dishonour of cheque cause of action to file complaint on non-payment despite issue of the notice, held, arises but once. In this case the Hon'ble Supreme Court placing reliance on the judgment of SOIL Import (supra) has held that another cause of action would not arise on repeated dishonour on presentation of same cheque again subsequent to non payment after the first notice. Payee is free to present the cheque repeatedly within its validity period but once notice has been issued and payment not received within 15 days from the date of notice, payee has to avail the very cause of action arising thereupon and file the complaint. Dishonour of cheque on each presentation gives a fresh right to present it again during the period of its validity, but held, it does not give rise to a fresh cause of action - Complaint has to be filed within one month from the day immediately following the day on which the period of 15 days from the date of receipt of the first notice by the drawer expires. In this case also the emphasis is on receipt of notice. In this case also the emphasis is on receipt of notice. The word "Receipt" indicates service of notice, therefore, unless notice is validly served, it cannot be held that notice was received and cause of action will not arise. 11. In the case in hand question under consideration before this Court is whether the service of notice is a necessary requirement and if the two earlier notices are not served, whether non service can be treated as a cause of action for payment of the amount of cheque. In the case of K.Bhaskaran (supra) the Supreme Court has held that the unclaimed notice is a valid service, but in other cases though it has been held that the service of notice is a necessary ingredient for starting the limitation of 15 days for payment but if the notice is not validly served or returned unserved whether it should be held that the complaint should be filed within 30 days after the expiry of the period of 15 days during which amount was to be paid. If I hold that without valid service of notice or without the receipt of the notice the period of 15 days should be reckoned for the purpose of cause-of-action or for starting limitation, it would not be proper as per the spirit of the law. The cause-of-action certainly will start from the date of service or receipt of notice. No doubt in certain circumstances there can be presumption of service of notice when it is refused or returned unclaimed, but when even no evidence is available about the presumption that notice has been validly served or has been received, then certainly the first cause-of-action would arise on receipt of notice, it may be first, second or third notice. The Magistrate has to record his finding whether the evidence of presumption of the service of the notice is available or not. If the evidence of presumption of service is not available, then the Court may consider the date of the receipt of notice as the first date for cause-of-action. Admittedly, in this case the two earlier notices returned unserved on the respondent and the third notice was served on 15.9.2003. Its intimation was given by the post office on 10.10.2003 and the complaint has been tiled on 22.10.2003. Admittedly, in this case the two earlier notices returned unserved on the respondent and the third notice was served on 15.9.2003. Its intimation was given by the post office on 10.10.2003 and the complaint has been tiled on 22.10.2003. Therefore, prima facie it appears that the complaint has been tiled within 45 days from the date of the receipt of the third notice. Service of demand notice is an essential ingredient of an offence under section 138 of Negotiable Instruments Act. Proof of the service of the demand notice is also necessary. If the notice is returned unserved with an endorsement that addressee is not available at station, such endorsement cannot be taken as service of notice on the accused sufficient to satisfy the requirement of section 138. Under the facts and circumstances of the case, it is clearly held that the cause of action to the petitioner will arise on the receipt of notice or on drawing presumption that the notice has been served on a particular date and the limitation will start from that date not from the date when the notice is not validly served or received by the accused. Therefore, the contrary observation of the trial Court at this stage cannot be said to be legal and it will not have binding effect on the final decision of the case. After recording the evidence of the parties at the time of final disposal of the case, if some evidence comes to the effect that notice was validly served earlier to 15.9.2003, trial Court may record a different finding. At the preliminary stage when trial Court found that prima facie the complaint is within time and rejected the objection regarding limitation, then it was not necessary for the Court to record any other contrary observation in the order. 12. Considering the aforesaid circumstances of the case, prima facie it does not appear that complaint is barred by limitation. Consequently, this petition is allowed and observation is set aside as indicated above. The Court may proceed with the complaint, in accordance with law.