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2016 DIGILAW 1552 (ALL)

VIRENDRA KUMAR GUPTA v. STATE OF U. P.

2016-04-26

SUNEET KUMAR

body2016
JUDGMENT : Hon'ble Suneet Kumar, J. Heard learned counsel for the applicants and the learned A.G.A. This application under Section 482 Cr.P.C. has been filed for quashing the summoning order dated 23.01.2015 passed by learned Additional Chief Judicial Magistrate, Court No. 9, Aligarh in Complaint Case No. 637 of 2014, Umesh Chandra Garg Versus Virendra Kumar Gupta, under Section 138 N.I. Act, Police Station Delhi Gate, District Aligarh and the revisional order dated 11.12.2015 passed in Criminal Revision No. 156 of 2015, Virendra Kumar Gupta Versus State of U.P. and another. Only point raised by learned counsel for the applicant is that Sections 138 and 142 of the N.I. Act prohibits the successive presentation of cheque. In support of his submission, the learned counsel for the applicant has placed reliance on the judgment of the Supreme Court rendered in Sadanandan Bhadran Versus Madhavan Sunil Kumar, 1998 JIC 1060 (SC), wherein it was held that "on each presentation of the cheque and its dishonour a fresh right and not cause of action accrues in favour of the drawee. But he may, therefore, without taking preemptory action in exercise of his right under Clause (b) of Section 138, go on presenting the cheque so as to enable him to exercise such right at any point of time during the validity of the cheque. But once he gives a notice under clause (b) of Section 138 he forfeits such right for in case of failure of the drawer to pay the money within the stipulated time he would be liable for the offence and the cause of action for filing the complaint will arise." The question is no longer res integra. Sadanandan Bhadran case (supra) has since been overruled by a Three-judge Bench in MSR Leathers v. S. Palaniappan, (2013) 1 SCC 177 . The question for determination that was before the Court is extracted: "Whether payee or holder of cheque can initiate proceeding of prosecution under Section 138 of Negotiable Instrument Act, 1881 for the second time if he has not initiated any action on earlier cause of action?" Proviso to Section 138, however, is all important and stipulates three distinct conditions precedent, which must be satisfied before the dishonour of a cheque can constitute an offence and become punishable. The first condition is that the cheque ought to have 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, whichever is earlier. The second condition is that the payee or the holder in due course of the cheque, as the case may be, ought to make 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. The third condition is that the drawer of such a cheque should have failed to make payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice. It is only upon the satisfaction of all the three conditions mentioned above and enumerated under the proviso to Section 138 as clauses (a), (b) and (c) thereof that an offence under Section 138 can be said to have been committed by the person issuing the cheque. Section 142 of the Negotiable Instruments Act governs taking of cognizance of the offence and starts with a non-obstante clause. It provides that 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, by the holder in due course and such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138. In terms of sub-section (c) to Section 142, no court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class is competent to try any offence punishable under Section 138. What is important is that neither Section 138 nor Section 142 or any other provision contained in the Act forbids the holder or payee of the cheque from presenting the cheque for encashment on any number of occasions within a period of six months of its issue or within the period of its validity, whichever is earlier. That such presentation will be perfectly legal and justified. That such presentation will be perfectly legal and justified. Suffice it to say that there is nothing in the provisions of the Act that forbids the holder/payee of the cheque to demand by service of a fresh notice under clause (b) of proviso to Section 138 of the Act, the amount covered by the cheque, should there be a second or a successive dishonour of the cheque on its presentation. Coming then to the question whether there is anything in Section 142(b) to suggest that prosecution based on subsequent or successive dishonour is impermissible. So long as the cheque is valid and so long as it is dishonoured upon presentation to the bank, the holder's right to prosecute the drawer for the default committed by him remains valid and exercisable. The argument that the holder takes advantage by not filing a prosecution against the drawer is without a legal basis. By reason of a fresh presentation of a cheque followed by a fresh notice in terms of Section 138, proviso (b), the drawer gets an extended period to make the payment and thereby benefits in terms of further opportunity to pay to avoid prosecution. Such fresh opportunity cannot help the defaulter on any juristic principle, to get a complete absolution from prosecution. In paragraph 31 of MSR Leather case (supra) the Court held as follows: "31. Applying the above rule of interpretation and the provisions of Section 138, we have no hesitation in holding that a prosecution based on a second or successive default in payment of the cheque amount should not be impermissible simply because no prosecution based on the first default which was followed by a statutory notice and a failure to pay had not been launched..................... There is in our opinion no real or qualitative difference between a case where default is committed and prosecution immediately launched and another where the prosecution is deferred till the cheque presented again gets dishonoured for the second or successive time." The Court deprecates the conduct of the learned counsel for the applicant for misleading the Court by citing an overruled judgment. For the reasons stated hereinabove, the petition being devoid of merit is accordingly dismissed.