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2017 DIGILAW 1143 (PAT)

Yashwant Singh @ Yashwnat Singh v. State of Bihar

2017-08-30

MOHIT KUMAR SHAH

body2017
JUDGMENT : Mohit Kumar Shah, J. The opposite party no. 2 i.e. UCO Bank had filed a complaint bearing complaint case no. 2371(C) of 2011 before the court of learned Judicial Magistrate Ist Class, Patna against the petitioners herein inter alia alleging therein that the petitioners had taken loan and promised to repay the same as per the terms and conditions of sanction of loan to them. A term loan to the tune of Rs. 153 lacs was sanctioned to Tirupati Storage & Pvt. Ltd. and another loan, in which Rs. 59 lacs is outstanding upto 31.03.2010, was sanctioned to petitioner no. 1. It has been further alleged that the petitioners gave three cheques totalling to a sum of Rs. 65 lacs which were dated 15.06.2011, 25.06.2011 and 30.06.2011 respectively and were dishonoured on 23.06.2011, 28.06.2011 and 04.07.2011 respectively. Thereafter, notice was issued on 08.07.2011 to the petitioners herein, however they did not repay the amount of the dishonoured cheques. Since, the notice was received by the petitioners on 17.07.2011 and cause of action arose after 15 days i.e. on 01.08.2011, the complaint case was filed on 02.09.2010 after expiry of 30 days since 30.08.2011, 31.08.2011 and 01.09.2011 were holidays. The learned trial court by an order dated 18.05.2013 has been pleased to issue summons to the petitioners herein, finding a prima facie case to have been made out under Section 406 of Indian Penal Code and section 138 of Negotiable Instruments Act. 2. The aforesaid order dated 18.05.2013 is under challenge in the present proceedings. 3. The learned Senior Counsel, by referring to a chart at page no. 6 of the quashing petition, submits that after dishonour of the cheque, the petitioners have already deposited a sum of Rs. 80 lacs approximately, hence have made good the amount of dishonoured cheques as such, no case is made out for the offences punishable under section 138 of Negotiable Instruments Act. No other argument has been advanced on behalf of the petitioners. 4. Per contra, the learned counsel for the opposite party no. 2 has filed a counter affidavit and submitted that a huge sums of money i.e. more than Rs. 3 crores are outstanding to be recovered from the petitioners. No other argument has been advanced on behalf of the petitioners. 4. Per contra, the learned counsel for the opposite party no. 2 has filed a counter affidavit and submitted that a huge sums of money i.e. more than Rs. 3 crores are outstanding to be recovered from the petitioners. It has also been brought to the notice of this Court that the petitioners had challenged the action of the UCO Bank in recovering its outstanding dues from the petitioners by resorting to the procedure under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 by filing a writ petition however, the same was dismissed whereafter, the petitioners had preferred an Appeal before the appellate court bearing L.P.A. no. 1903 of 2012 and the same was also dismissed in limine by an order dated 18.09.2013 on account of lack of bonafide on the part of the petitioners herein. The aforesaid order dated 18.09.2013 was assailed before the Hon'ble Apex Court, which by an order dated 25.10.2013 had directed the petitioners herein to deposit a sum of Rs. 50 lacs but the same was also not deposited hence, the Special Leave Petition was dismissed as withdrawn by an order dated 24.03.2014. 5. It has been next contended that the complaint has been filed in time by the opposite party no. 2 and as far as repayment of the dishonoured cheque amount is concerned, the same has not been repaid till date inasmuch as the petitioners have been making payment in bits and parts, either in lieu of the interest portion or on account of orders passed by various courts. The factum of deposit of money by the petitioners in lieu of dishonoured cheques has been categorically denied by the learned counsel for the opposite party no. 2. 6. The learned counsel for the respondent Bank has relied upon a judgment reported in 2014(4) PLJR SC 498 Pawan Kumar Ralli v. Maninder Singh Narula to contend that the complaint cannot be quashed merely claiming the same to be barred by limitation. 2. 6. The learned counsel for the respondent Bank has relied upon a judgment reported in 2014(4) PLJR SC 498 Pawan Kumar Ralli v. Maninder Singh Narula to contend that the complaint cannot be quashed merely claiming the same to be barred by limitation. The learned counsel has next relied on a judgment reported in 2015 (3) PLJR HMT Watches Ltd. v. M.A. Abida, to contend that the High Court, under section 482 of the Code of Criminal Procedure, 1973 should not express its views on the disputed questions of fact and come to a conclusion that offences are not made out. 7. I have gone through the materials on record and perused the complaint petition as well as considered the submissions of the learned counsel for the parties. A bare perusal of the complaint would show that a prima facie case is definitely made out against the petitioners herein so as to warrant issuance of summons to them by the learned trial court by an order dated 18.05.2013. 8. section 138 of the Negotiable Instruments Act, 1881 prescribes the events and the circumstances under which a person shall be deemed to have committed an offence under section 138 of the Negotiable Instruments Act as well as prescribes the punishment for commission of the said offence and further enumerates the time line for presentation of the cheque, for making demand of payment of the amount of dishonoured cheque by giving a notice, for making good the payment of the dishonoured cheque etc. section 142 of the Negotiable Instruments Act, 1881 deals with "cognizance of offences" and clause (b) thereof prescribes the time period for making complaint i.e. within one month of the date on which the cause of action arose under clause (c) of the proviso to sections 138 of the Negotiable Instruments Act, 1881. It would be useful to reproduce sections 138 and 142 of the Negotiable Instruments Act, 1881 herein below : 138. It would be useful to reproduce sections 138 and 142 of the Negotiable Instruments Act, 1881 herein below : 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, either 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 and shall, without prejudice to any other provision 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 whichever is earlier; (b) the payer 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 day) 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 the cheque within fifteen days of the receipt of the said notice. Explanation For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability. 142. Explanation For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability. 142. Cognizance of offences (1) 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 of 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;] (d) 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. [2] The offence under Section 138 shall be inquired into and tried only by a Court within whose local jurisdiction- (a) if the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated; or (b) if the cheque is presented for payment by the payee or holder in due course, otherwise through an account, the branch of the drawee bank where the drawer maintains the account, is situated. Explanation For the purposes of clause (a), where a cheque is delivered for collection at any branch of the bank of the payee or holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or holder in due course, as the case may be, maintains the account.] 9. Now coming back to the present case, it is clear from the averments made in the complaint petition, the quashing application and the counter affidavit filed by the opposite party no. 2 that there is a serious dispute with regard to payment/ repayment of the amount of dishonoured cheques. On one hand, the petitioners state that in between the period 21.05.2011 to 04.02.2013, they had made a total payment of Rs. 2 that there is a serious dispute with regard to payment/ repayment of the amount of dishonoured cheques. On one hand, the petitioners state that in between the period 21.05.2011 to 04.02.2013, they had made a total payment of Rs. 80,53,709/- i.e. more than the amount of the dishonoured cheques whereas the learned counsel for the opposite party no. 2 has stated that the notice was sent to the petitioners herein on 08.07.2011 and the same was received by them on 17.07.2011, however they failed to make good the amount of dishonoured cheque and only after the bank did not receive any response from the petitioners regarding payment of the amount of the dishonoured cheques totalling to Rs. 65 lacs, the opposite party no. 2 had proceeded to file the complaint bearing complaint case no. 2371(C) of 2011 before the learned court of Chief Judicial Magistrate, Patna. It is further contended by the learned counsel for the opposite party no. 2 that the contention of the petitioners that they have paid the entire amount of dishonoured cheques is also incorrect and the fact is that petty amounts have been paid during a period of about two years, as shown in the chart and that too, towards the interest portion of the loan or in compliance of orders of the High Court etc. and the said payments are not against dishonoured cheques. 10. The contention of the learned counsel for the opposite party no 2 appears to be well founded inasmuch as the materials on record do not show that the amount of three dishonoured cheques i.e. Rs. 25 lacs (cheque no. 066002), Rs. 20 lacs (cheque no. 066003) and Rs. 20 lacs (cheque no. 066004) have been paid in one go or otherwise according to the respective amounts of the dishonoured cheques much less there being any relatable materials on record to connect the dishonoured cheques with the payment of the amount involved therein having been made subsequently. As such, the said aspect of the matter can be determined only pursuant to a full fledged trial. 11. As such, the said aspect of the matter can be determined only pursuant to a full fledged trial. 11. Yet another aspect of the matter is that issuance of cheque and signature thereon as also the legally enforceable debt in favour of the holder of the cheque is admitted in the present case, hence dishonour of cheques in the present case being for discharge of existing liability, is definitely covered by section 138 of the Negotiable Instruments Act, 1881. However, the defence of the accused cannot be considered at this stage and this Court cannot adjudicate upon a disputed question of fact. In this connection, it may be useful to refer to a judgment of the Hon'ble Apex Court reported in 2016(10) SCC 458 , Sampelly Satyanarayan Rao v. Indian Renewable Energy Development Agency Ltd. paragraph 16 whereof is quoted herein below :- "16. As is clear from the above observations of this Court, it is well settled that while dealing with a quashing petition, the court has ordinarily to proceed on the basis of averments in the complaint. The defence of the accused cannot be considered at this stage. The court considering the prayer for quashing does not adjudicate upon a dispute question of fact." 12. In the case of HMT Watches Ltd v. M.A. Abida & Anr. reported in (2015) 11 SCC 776 , the Hon'ble Apex Court has held as follows :- "10. Having heard the learned counsel for the parties, we are of the view that the accused (respondent no. 1) challenged the proceedings of criminal complaint cases before the High Court taking factual defences. Whether the cheques were given as security or not, or whether there was outstanding liability or not is a question of fact which could have been determined only by the trial court after recording evidence of the parties. In our opinion, the High Court should not have expressed its view on the disputed questions of fact in a petition under section 482 of the Code of Criminal Procedure, 1973 to come to a conclusion that the offence is not made out. The High Court has erred in law in going into the factual aspects of the matter which were not admitted between the parties. The High Court has erred in law in going into the factual aspects of the matter which were not admitted between the parties. The High Court further erred in observing that section 138(b) of the NI Act stood uncomplied with, even though Respondent 1 (accused) had admitted that he replied to the notice issued by the complainant. Also, the fact, as to whether the signatory of demand notice was authorized by the complainant company or not, could not have been examined by the High Court in its jurisdiction under section 482 of the Code of Criminal Procedure, 1973 when such plea was controverted by the complainant before it. 11. In Rallis India Ltd. v. Poduru Vidya Bhushan, this Court expressed its view on this point as under : (SCC p. 93, para 12)" 12. At the threshold, the High Court should not have interfered with the cognizance of the complaints having been taken by the trial court. The High Court could not have discharged the respondents of the said liability at the threshold. Unless the parties are given opportunity to lead evidence, it is not possible to come to a definite conclusion as to what was the date when the earlier partnership was dissolved and since what date the respondents ceased to be the partners of the firm." 13. In view of the law laid down by this Court as above, in the present case the High Court exceeded its jurisdiction by giving its opinion on disputed questions of fact, before the trial court. 15. For the reasons as discussed above, we find that the High Court has committed grave error of law in quashing the criminal complaints filed by the appellant in respect of the offence punishable under section 138 of NI Act, in exercise of powers under section 482 of Cr.P.C., 1973 by accepting factual defences of the accused which were disputed ones. Such defences, if taken before the trial court, after recording of the evidence, can be better appreciated. 16. Therefore, for the reasons, as discussed above, these appeals deserve to be allowed. Accordingly, the appeals are allowed. The impugned order dated 25.02.2014 passed by the High Court of Kerala in M.A. Abida v. HMT Watches Ltd. is hereby quashed. The trial court shall proceed with trial in the criminal complaint cases. 16. Therefore, for the reasons, as discussed above, these appeals deserve to be allowed. Accordingly, the appeals are allowed. The impugned order dated 25.02.2014 passed by the High Court of Kerala in M.A. Abida v. HMT Watches Ltd. is hereby quashed. The trial court shall proceed with trial in the criminal complaint cases. It is clarified that we have not expressed our opinion as to correctness of the defence pleas taken by Respondent 1. No order as to costs." 13. In the case of T.N. Newsprint & Papers Ltd. v. Lakshmi & Anr., reported in (2004) 13 SCC 366 , this Hon'ble Court has again held that the question as to whether the complaint was barred by limitation or not, being a matter of evidence, could not be the basis for quashing the proceedings by holding that the complaint was barred by time. 14. From the aforesaid judgments rendered by the Hon'ble Apex Court, it is clear that this Court, while dealing with quashing application would not done upon itself the role of the learned trial court and would not enter into disputed question of facts and adjudicate upon the veracity of the complaint without the evidence being led. In such view of the matter, since the present petition gives rise to disputed question of facts, it would be expedient that evidence is led before the trial court and only then the defences of the petitioners can be better appreciated. 15. It is a trite law that while dealing with a quashing petition, this Court has ordinarily to proceed on the basis of averments made in the complaint and the defence of the accused cannot be considered without recording of the evidence, more so if disputed question of facts are involved and arise for consideration. 16. For the reasons stated hereinabove, there is no merit in the present petition, hence the same is dismissed, however without any order as to costs.