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2011 DIGILAW 710 (JK)

Nalam Nageshwar & Co. v. Fungicides (India) Ltd.

2011-12-17

MOHAMMAD YAQOOB MIR

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1. By medium of this petition quashment of the proceedings as well of the complaint is prayed for. 2. The respondent company has its registered office at 7/1 Sheikh Bagh Srinagar. The said company, among others, is stated to be dealing in trading and manufacture of fungicides/pesticides. The company has its principle administrative office at H-88, Vidya Palace, South Extension, Part-1, New Delhi-110049 and the company has its off ices/representatives/dealers at various places in India. 3. Petitioner (accused) is alleged to be liable to make payments to the respondent company so is stated to have issued cheque bearing No.647394 on 10.8.2001 for an amount of Rs.17,64,826/drawn on Karnataka Bank Limited, Guntur — 522 003. Respondent company claim to have presented the same before the UCO Bank, Budshah Chowk, Srinagar on 10.8.2001, same had been send for clearance to the drawee bank i.e. Karnataka Bank Limited, Guntur which was returned along with a memo dated 04.09.2001 i.e. cheque has been dishonoured for the reasons "account closed". On the same date cheque has been returned to the complainant. 4. The respondent company is stated to have issued demand notice for the payment and send to the petitioner (accused) under registered postal cover on 13.9.2001. When payment was not made within the period specified, the respondent company filed complaint under Section 138 of Negotiable Instruments Act before the Court of Judicial Magistrate 1st Class(Forest Magistrate), Srinagar on 11.10.2001. On the same date trial court has taken cognizance and process has been issued. 5. Perusal of the trial court record would reveal that right from 11.10.2001 till date progress of the case is still at infancy stage as the petitioner (accused) did not appear. Finally warrant has been issued for procuring the presence of petitioner (accused) on 30.03.2011. It is only thereafter instant petition under Section 561-A Cr. P. C has been filed. 6. Learned counsel for the petitioner (accused) first contended that a blank cheque was issued in favour of the respondent (complainant) as a security, same was not for payment, however, the respondent company has filled blanks of the cheque and has thereafter presented the same for its payment. 7. The plea as raised is a question of fact so can be gone into only during trial. Such ground is not available for exercise of power under Section 561-A Cr. P. C. 8. 7. The plea as raised is a question of fact so can be gone into only during trial. Such ground is not available for exercise of power under Section 561-A Cr. P. C. 8. Next learned counsel projected that the respondent company has committed a fraud because notice to the petitioner(accused) has been given in the new name i.e."Fill Industries Ltd" when the complaint has been filed in the old name of the company i.e. Fungicides (India) Ltd. 9. This contention is of no substance because in the notice as has been issued, copy of which is available on the file, it is clearly indicated that the notice has been issued for Fungicides (India) Ltd (now known as Fill Industries Ltd.). Apparently it has got no effect as no element of fraud at this stage is discernible but still it shall be open for the petitioner (accused) to project before the trial court by way of defence. 10. Next it is contended that the petitioner(accused) had closed account in the Karnataka Bank Ltd. Guntur on 27.12.1999 and same was conveyed to the respondent company. 11. Same again is a question to be gone into during trial because at this stage cheque as is available on the records is shown to have been issued on 10.8.2001. If the petitioner (accused) had closed the account, then cheque should not have been issued on 10.8.2001. In the context of first objection as dealt with hereinabove, it again is a matter to be looked into during trial. 12. Next it is contended that the cheque was a security cheque, even otherwise it was drawn on Karnataka Bank Ltd. Guntur, so could be presented to the same bank. 13. Next it is also contended that assuming that the cheque has been issued on 10.8.2001 at Hyderabad, how could it be presented on the same date before the UCO Bank, Budshah Chowk, Srinagar. 14. From the perusal of the cheque, it is not clear that the same has been issued at Hyderabad. Again it is a question to be looked into during trial. 15. Next learned counsel relied on the judgment of the Hon'ble Apex Court rendered in Ishar Alloy Streets Ltd. v. Jayaswals Neco Ltd (2001(2) Civil LJ 59 (SC). 14. From the perusal of the cheque, it is not clear that the same has been issued at Hyderabad. Again it is a question to be looked into during trial. 15. Next learned counsel relied on the judgment of the Hon'ble Apex Court rendered in Ishar Alloy Streets Ltd. v. Jayaswals Neco Ltd (2001(2) Civil LJ 59 (SC). The said judgment is of no help to the petitioner because in the said judgment it has been held that 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 otherwise may be liable to pay the cheque amount to the payee in a civil action initiated under the la w. A combined reading of Sections 2,72 and 138 of the Act would leave no doubt in our mind that the law mandates the cheque to be presented at the bank on which the cheque is drawn, whether presented personally or through another bank, namely, the collecting bank of the payee. 16. In the reported case, the cheque was not presented before the drawers bank within the statutory period of six months and it is in that fact situation it has been held that the criminal court had no jurisdiction to issue the process. 17. In the case in hand the cheque is dated 10.8.2001, same as per complaint is shown to have been presented before the collecting bank of the payee i.e. UCO Bank on the same date. Same has been presented through the collecting bank to the drawer bank i.e. Karnataka Bank Ltd. Guntur and the said drawer has in the memo dated 27.8.2001 mentioned that the cheque is returned for the reason "account closed". The said memo is stated to have reached to the collection bank of the payee on 4.9.2001 and complaint has been lodged on 11.10.2001 which would mean mat the cheque has been presented to the drawers bank within one month of the date of issue of the cheque, so the bar of statutory period of six months does not operate. Therefore, contention raised by the learned counsel that the cheque was necessarily to be presented not through the collecting bank but to the drawers bank directly, is not tenable. Therefore, contention raised by the learned counsel that the cheque was necessarily to be presented not through the collecting bank but to the drawers bank directly, is not tenable. However, it is clear that the cheque must be presented to the drawers bank through whatever mode but within six months from the date of issue of the cheque. 18. Lastly learned counsel contended that the Court at Srinagar has no jurisdiction to entertain the complaint. This submission is also to be rejected in view of the judgment rendered by the Hon'ble Apex Court in the case K. Bhaskaran v. Sankaran Vaidhyan Balan and another ( AIR 1999 SC 3762 ). Para 14 and 15 are quoted here-under: "14. The offence under Section 138 of the Act can be completed only with the con-catenation of a number of acts. Following are 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. 15. It is not necessary that all the above five acts should have been perpetrated at the same locality. It is possible that each of those five acts could be done at 5 different localities. But concatenation of all the above five is a sine qua non for the completion of the offence under Section 138 of the Act." 19. In the instant case cheque has been presented by the payee in his collecting bank at Srinagar, notice of demand has also been issued from Srinagar, so the concatenation which are not exhaustive for fixing the jurisdiction are satisfied, therefore, trial court has jurisdiction. 20. Enough is enough. The complaint is pending for last 11 years. Expeditious disposal of the same shall be in-keeping with the canons of justice. Trial court shall proceed in the matter with convenient speed by scheduling the case in a manner so as to ensure disposal within the shortest possible period. 21. The petitioner (accused) has to come from Andra Pradesh, it may not be convenient for him to appear before the trial court on each and every date of hearing. Trial court shall proceed in the matter with convenient speed by scheduling the case in a manner so as to ensure disposal within the shortest possible period. 21. The petitioner (accused) has to come from Andra Pradesh, it may not be convenient for him to appear before the trial court on each and every date of hearing. The trial court shall consider their motion for dispensing with personal appearance subject to appearance through counsel or authorized agent and subject to the condition that when the presence shall be indispensable, they shall remain present in the court. 22. While summing up what emerges is that the petition is found to be devoid of merit, as such, dismissed along with connected CMP. 23. Copy of the order along with trial court record be sent back forthwith where the learned counsel for the parties shall advise the parties to be present on 21st of December, 2011.