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2008 DIGILAW 1351 (PNJ)

Wangyuth Konyak v. Yadav Sales

2008-08-11

AJAI LAMBA

body2008
Judgment Ajai Lamba, J. 1. This petition has been filed under Section 482 Cr.P.C. on behalf of the petitioner who is the accused in a complaint (Annexure P-2) titled M/s. Yadav Sales v. W. Wangyuh Konyak lodged for commission of offence under Section 138 of the Negotiable Instruments Act (for short The Act). Challenge is also to the proceedings pending as a consequence of the complaint before Addl. C.J.M., Rewari. 2. The argument of the learned counsel for the petitioner in the context of the provisions of the Act is that the petitioner allegedly issued cheque bearing No. 172566 dated 16.11.2004 for a sum of Rs. 66,000/- drawn on State Bank of India, Parliment House, Sansad Marg, New Delhi (for reference the drawee bank) in favour of the respondent-complainant in discharge of legal liability. The cheque was presented by the respondent complainant in his account of HDPC Bank i.e. the collecting bank, Bahadurgarh for encashment on 13.05.2005. 3. The collecting bank informed the complainant vide memo dated 16.05.2005 that the cheque was sent for clearance to the drawee bank, however, the same has not been honoured with the remarks "out dated". 4. The respondent served a legal notice dated 30.06.2005. Payment was not made and hence complaint Annexure P-2 has been lodged. A pure question of law has been raised by the learned counsel for the petitioner that it was the duty of the complainant to present the cheque to the drawee bank within 6 months i.e. the State Bank of India. Learned counsel has referred to (2001(1) RCR(Crl.) 834 (SC) : (2001)3 Supreme Court Cases 609, Shri Ishar Alloy Steels Ltd. v. Jayaswals Neco Ltd. 5. Learned counsel for the respondent has contended that the petitioner has not challenged the order of summoning by way of a revision petition. The petition under Section 482 Cr.P.C. under the circumstances is not maintainable. The respondent was duty bound to present the cheque in his bank during the validity period which had been done as is evident from the facts. If the bank collecting caused delay in sending the cheque to drawee bank, the complaint filed by the complainant (respondent) cannot be quashed. 6. I have considered the facts and circumstances of the case and also the law as cited by the learned counsel. Reference to para Nos. If the bank collecting caused delay in sending the cheque to drawee bank, the complaint filed by the complainant (respondent) cannot be quashed. 6. I have considered the facts and circumstances of the case and also the law as cited by the learned counsel. Reference to para Nos. 6 (relevant), 7, 8, 9 & 10 is required to the judgment in Shri Ishar Steels Ltd. which reads as under : 6. "Before adverting to the various provisions of law as applicable in the case, it has to be kept in mind that the law relating to negotiable instruments is the law of the commercial world which was enacted to facilitate the activities in trade and commerce making provision of giving sanctity to the instruments of credit which could be deemed to be convertible into money and easily passable from one person to another. In the absence of such instruments, the trade and commerce activities were likely to be adversely affect as it was not practicable for the trading community to carry on with it the bulk of the currency in force. The introduction of negotiable instruments owes its origin to the bartering system prevalent in the primitive society. The negotiable instruments are, in fact, the instruments of credit being convertible on account of the legality of being negotiated and thus easily passable from one hand to another. The source of Indian law relating to such instruments is admittedly the English common law. The main object of the Act is to legalise the system by which instruments contemplated by it could pass from hand to hand by negotiation like any other goods. The purpose of the Act was to present an orderly and authoritative statement of the leading rules of law relating to the negotiable instruments. The Act intends to legalise the system under which claims upon mercantile instruments could be equated with ordinary goods passing from hand to hand. To achieve the objective of the Act, the legislature in its wisdom thought it proper to make provision in the Act for conferring such privileges to the mercantile instruments contemplated under it and provide special procedure in case the obligation under the instrument was not discharged. To achieve the objective of the Act, the legislature in its wisdom thought it proper to make provision in the Act for conferring such privileges to the mercantile instruments contemplated under it and provide special procedure in case the obligation under the instrument was not discharged. It has always to be kept in mind that Section 138 of the Act creates offence and the law relating to the penal provisions has to be interpreted strictly so that no-one can ingeniously or insidiously or guilefully or strategically be prosecuted. 7. It has further to be noticed that to make an offence under Section 138 of the Act, it is mandatory that the cheque is 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, whichever is earlier. It is the cheque drawn which has to be presented to "the bank" within the period specified threrin. When a postdated cheque is written or drawn, it is only a bill of exchange. The post dated cheque become a cheque under the Act on the date which is written on the said cheque and the six months period has to be reckoned, for the purposes of Section 138 of the Act, from the said date. 8. Section 138 provides that where any cheque drawn by a person on an account maintained 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, because of the amount of money standing to 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 punishable with imprisonment as prescribed therein subject to the conditions mentioned in clauses (a), (b) and (c) of the proviso. Section 3 of the Act defines the "banker" to include any person acting as a banker and any post office savings bank. Section 3 of the Act defines the "banker" to include any person acting as a banker and any post office savings bank. Section 72 of the Act provides that a cheque must, in order to charge the drawer, be presented at the bank upon which it is drawn before the relations between the drawer and his banker has been altered to the prejudice of the drawer. 9. The use of the words "a bank" and the "the bank" in the section is an indicator of the intention legislature. The former is an indirect (sic indefinite) article and the latter is prefixed by a direct (sic definite) article. If the legislature intended to have the same meanings for "a bank" and "the bank", there was no cause or occasion for mentioning it distinctly and differently by using two different articles. It is worth noticing that the word "banker" in Section 3 of the Act is prefixed by the indefinite articles "a" and the word "bank" where the cheque is intended to be presented under Section 138 is prefixed by the definite article "the". The same section permits a person to issue a cheque on an account maintained by him with "a bank" and makes him liable for criminal prosecution if it is returned by "the bank" unpaid. The payment of the cheque is contemplated by "the bank" meaning thereby where the person issuing the cheque has an account. "The" is the word used before nouns, with a specifying or particularizing effect as opposed to the indefinite or generalizing force of "a" or "an". It determined what particular thing is meant; that is, what particular thing we are to assume to be meant. "The" is always mentioned to denote a particular thing or a person. "The" would, therefore, refer implicitly to a specified bank and not any bank. "The bank" referred to in clause (a) to the proviso to Section 138 of the Act would mean the drawee bank on which the cheque is drawn and not all banks where the cheque is presented for collection including the bank of the payee, in whose favour the cheque is issued. 10. It, however, does not mean that the cheque is always to be presented to the drawers bank on which the cheque is issued. 10. It, however, does not mean that the cheque is always to be presented to the drawers bank on which the cheque is issued. The payee to cheque has the option to present the cheque in any bank including the collecting bank where he has his account but to attract the criminal liability of the drawer of the cheque such collecting bank is obliged to present the cheque in the drawee or payee bank on which the cheque is drawn within the period of six months from the date on which it is shown to have been issued. In other words a cheque issued by (A) in favour of (B) drawn in a bank named (C) where the drawer has an account can be presented by the payee to the bank upon which it is drawn i.e. (C) bank within a period of six months or present it to any other bank for collection of the cheque amount provided such other bank including the collecting bank presents the cheque for collection to (C) bank. The non- presentation of the cheque to the drawee bank within the period specified in the section would absolve the person issuing the cheque of his criminal liability under Section 138 of the Act, who shall otherwise may be liable to pay the cheque amount to the payee in a civil action initiated under the law. A combined reading of Sections 3, 72 and 138 of the Act would leave no doubt in our mind that the law mandated the cheque to be presented at the bank on which it is drawn if the drawer is to be held criminally liable. Such presentation is necessarily to be made within six months at the bank on which the cheque is drawn, whether presented personally or through another bank, namely the collecting bank of the payee." 7. When the facts of the present case are considered in conjunction with the law as settled by the Honble Supreme Court of India, I find that undisputedly the cheque is dated 16.11.2004. Under the circumstances, it was to be presented before the drawee bank by 15.05.2005. The respondent rather presented it to the collecting bank on 13.05.2005 i.e. HDFC Bank. By the time the collecting bank sent the cheque to the drawee bank i.e. State Bank of India, the cheque had become out dated. 8. Under the circumstances, it was to be presented before the drawee bank by 15.05.2005. The respondent rather presented it to the collecting bank on 13.05.2005 i.e. HDFC Bank. By the time the collecting bank sent the cheque to the drawee bank i.e. State Bank of India, the cheque had become out dated. 8. The provisions of Section 138 have been considered and it has been held that the term "the bank" used in Section 138 of the Act means that it has to be presented to the drawee bank within the stipulated period of six months. "The Bank" in the case in hand would be the drawee bank i.e. State Bank of India, Parliament House, Sansad Marg, New Delhi. There is no dispute that the `collecting bank of the respondent complainant presented the cheque for encashment to the drawee bank when it was not valid and was "out dated". This having not been done, the petitioner cannot asked to face criminal prosecution as no offence, per se, can be said to have been committed. In view of the mandate of law, this petition is allowed and the complaint case No. 53 titled M/s Yadav Sales v. Wangyuh Konyak under Section 138 of the Negotiable Act filed at Rewari and consequent proceedings are hereby quashed.