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2017 DIGILAW 1151 (KER)

Leena Thomson v. Reena Jude Thadevous

2017-08-16

ALEXANDER THOMAS

body2017
ORDER : 1. The petitioner is accused for the offence punishable under Section 138 of the Negotiable Instruments Act in S.T.No.174 of 2016 on the file of the Judicial First Class Magistrate Court-IV, Kochi, instituted on the basis of a complaint preferred by the first respondent herein. 2. The main prayer made by the petitioner is for quashment of all further proceedings taken in pursuance of the impugned Annexure-X complaint. In this regard, the main contention urged by the petitioner is that in terms of the proviso (a) to Section 138 of the Negotiable Instruments Act, the cheque is to be presented to the drawee 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 and further that the Reserve Bank of India in exercise of its enabling powers conferred in that regard by provisions as in 35(A) read with Section 56 of the Banking Regulation Act, 1949 has issued notification No.RBI/2011-12/251, DBOA.AML BC No.47/14.01.00/2011-12 dated 4.11.2011 with effect from 1.4.2012 notifying that the validity period of the cheque will stand reduced to three months. It has been held by the Apex Court in the judgment as in Shri Ishar Alloy Steels Ltd. v. Jayaswals Neco Ltd. reported in 2001 (3) SCC 609 and Rameshchandra Ambalal Joshi v. State of Gujarat and another reported in (2014) 11 SCC 759 that the time prescribed for presentation of the cheque within the validity period is to be adjudged at the point of time of the presentation of the cheque at the drawee Bank. It is urged that in the instant case, cheque dated 22.1.2016 for Rs. 3,60,000/- was sent to the collection Bank on 23.4.2016 and that it was presented before the drawee Bank only on 25.4.2016 and that three months' validity period of the cheque dated 22.1.2016 had expired on 22.4.2016 and therefore, the cheque has been presented before the drawee Bank only after the expiry of its three months validity period. Accordingly, it is argued that the impugned decision taken by the learned Magistrate in having taken cognizance is per se illegal and ultravires. Further it is also pointed out that even going by the case set up by the complainant, there is delay of four days in filing the complaint and that the delay in that regard was not condoned by the learned Magistrate. Further it is also pointed out that even going by the case set up by the complainant, there is delay of four days in filing the complaint and that the delay in that regard was not condoned by the learned Magistrate. Application for condonation of delay was not filed before the cognizance was taken and that the learned Magistrate had taken cognizance without examining the issue as to whether there was delay or not and that the decision taken by the learned Magistrate to take cognizance without condoning the delay is ultravires and without jurisdiction. It is also pointed out that an application to condone the delay of 4 days in filing the complaint was later filed by the complainant before the trial court, after a decision was taken by the learned Magistrate to take cognizance of the offence in the complaint and that the said procedure is improper and legally untenable. 3. Heard Sri. K.V. Jayadeep Menon, learned counsel appearing for the petitioner/accused, Sri. S. Rajeev, learned counsel appearing for R1/complainant and Sri. Saigi Jacob Palatty, learned prosecutor appearing for R2/State. 4. It is not in dispute that there was a delay of 4 days in filing the instant complaint and that the application for condonation of delay was never filed by the complainant before a decision was taken by the trial court to take cognizance of the offence in the complaint. It is only after the learned Magistrate had taken cognizance, the complainant had cared to file an application to condone the delay of 4 days and now it is reported by the learned Magistrate that he has dismissed the said application, as it is not maintainable. The said action taken by the learned Magistrate in not ascertaining as to whether or not there was delay in filing the complaint and the consequent action taken by the learned Magistrate in straight away taking cognizance of the offence without condoning the delay is per se illegal and improper. On that ground alone, the impugned decision taken by the learned Magistrate in having taken cognizance in the offence in the complaint is liable to be interfered with by this Court. On that ground alone, the impugned decision taken by the learned Magistrate in having taken cognizance in the offence in the complaint is liable to be interfered with by this Court. The Apex Court while dealing with the similar situation in the judgment in K.S.Joseph v. Phililips Carbon Black Limited and another reported in (2016) 11 SCC 105 has held in paragraph 10 thereof that in such cases the proper course of action would be to set aside the impugned decision taken by the trial court and remitting the matter to the said court for considering the primary question as to whether there was delay and if so whether the delay is to be condoned after granting a reasonable opportunity of being heard to the accused as well. 5. The other aspect to be examined is as to whether the dishonoured cheque dated 22.1.2016 has been presented before the drawee Bank before the expiry of the three months' validity period. It is common ground that with effect from 1.4.2012, the validity period of the cheque has been restricted to three months in view of the statutory notification in that regard issued by the Reserve Bank of India as stated hereinabove. The petitioner would place reliance on Annexure 6 letter dated 17.5.2017 issued by the drawee Bank concerned (Federal Bank, Palluruthy), wherein it is stated as follows: "Date: 17.05.2017 To Smt.Leena Thomson, C/o. Adv. K.V.Jayadeep Menon, JR Associates, II Floor, Kolatheri Shopping Complex, Chittoor Road, Valanjambalam, Ernakulam, Pin-682 016. Dear Madam, Ref: your letter dated 24.03.2017. Kindly refer to your letter dated 24.03.2017 seeking information regarding the status of a cheque bearing no.10064754 presented in clearing. On verifying our system it is understood that the cheque bearing no.10064754 for Rs.360000/-, payee name as Reena Jude Thadeous, was presented for clearing and returned on 25.04.2016 for the reason "Funds insufficient". Yours faithfully, Ajitha.B., Senior Manager" 6. On the basis of the statements in Annexure 6 that "the cheque ......was presented for clearing and returned on 25.4.2016 ....", it is urged by the petitioner that both the presentation of the cheque before the drawee Bank as well as its return by the drawee Bank was on 25.4.2016 and that therefore, the cheque dated 22.1.2016 has been presented beyond the three months' validity period which was only up to 22.4.2016. Both sides have also placed reliance on the judgment of the Apex Court in Rameshchandra Ambalal Joshi v. State of Gujarat and another reported in (2014) 11 SCC 759 , wherein it has been held in paragraph 22 thereof as follows : "22. Drawing a conclusion from the abovementioned authorities, we are of the opinion that the use of word "from" in Section 138(a) requires exclusion of the first day on which the cheque was drawn and inclusion of the last day within which such act needs to be done. In other words, six months would expire one day prior to the date in the corresponding month and in case no such day falls, the last day of the immediate previous month. Hence, for all purposes, the date on which the cheque was drawn i.e. 31.12.2005 will be excluded and the period of six months will be reckoned from the next day i.e., from 1.1.2006 ; meaning thereby that according to the British calendar, the period of six months will expire at the end of the 30th day of June, 2006. Since the cheque was presented on 3.0.6.2006. We are of the view that it was presented within the period prescribed." 7. Sri. S. Rajeev, learned counsel appearing for the second respondent/complainant, would urge that Annexure 6 letter given by the Federal Bank, Palluruthy, (drawee Bank) does not actually reflect the date on which the cheque was presented before that Bank and it would only shows that the presented cheque was later returned on 24.5.2016 and that as a matter of fact the cheque dated 22.1.2016 was actually presented before the Federal Bank, Palluruthy, on 22.4.2016 and not on 25.4.2016 as alleged by the petitioner/accused. In order to resolve this controversy, this Court had called for a report from the said drawee Bank who has issued a report dated 3.8.2017 to the Registry of this Court, which reads as follows: "The Federal Bank Ltd., Br. Palluruthy represented by its Principal Officer and Branch Manager, Smt. Ajitha. B., submits the following report with regard to Cheque No.064754 dated 22.01.2016 drawn from A/c No.11830100212247 as per the Order of Hon'ble High Court of Kerala in Crl. M.C. No.4644/2017. The cheque no.064754 drawn from A/c No. 11830100212247 was presented to Federal Bank Ltd. on 22.04.2016. Palluruthy represented by its Principal Officer and Branch Manager, Smt. Ajitha. B., submits the following report with regard to Cheque No.064754 dated 22.01.2016 drawn from A/c No.11830100212247 as per the Order of Hon'ble High Court of Kerala in Crl. M.C. No.4644/2017. The cheque no.064754 drawn from A/c No. 11830100212247 was presented to Federal Bank Ltd. on 22.04.2016. The said cheque was returned on 25.04.2016 (as 23.04.2016 & 24.04.2016 were holidays on account of fourth Saturday & Sunday)." The said report dated 3.8.2017 discloses that the cheque dated 22.1.2016 was actually presented before the Federal Bank, Palluruthy, on 22.4.2016 which was later returned on 25.4.2016 to the collection Bank. The petitioner further contended that he had made a complaint before the RBI in the action of the Federal Bank, Palluruthy, in accepting the said cheque which was presented beyond its validity period and that the Federal Bank had given a report to the RBI stating that the cheque was a stale one. In response to this, the Federal Bank, Palluruthy, (drawee Bank) has given another report to the Registry of this Court stating that it has been intimated to the RBI as follows: "A cheque bearing No.064754 for Rs.3.60 lakhs drawn by Leena Thomson in favour of Reena Jude Thadeous was presented to the Bank for CTS clearing through SBT, Thoppumpady Branch. Since the funds in the account of M/s. Leena Thomson were insufficient to honour the subject cheque, the cheque was returned unpaid by the Bank with endorsement `funds insufficient' on 25.4.2016 which was the valid and sufficient reason for refusing payment". The said papers now made available by the Federal Bank does not anyway disclose with any clarity and precision as to when exactly the cheque dated 22.1.2016 was presented before the said Bank, etc. Anyway, as of now, the report dated 3.8.2017 furnished by that Bank as mentioned hereinabove would disclose that the said cheque dated 22.1.2016 was presented to that Bank on 22.4.2016. 8. In the nature of the orders proposed to be passed in this petition, this Court need not adjudicate on the issue as to whether or not the cheque was presented before the drawee Bank within the validity period of three months. 8. In the nature of the orders proposed to be passed in this petition, this Court need not adjudicate on the issue as to whether or not the cheque was presented before the drawee Bank within the validity period of three months. In the light of the judgment of the Apex Court in the case as in K.S.Joseph v. Philip Carbon Black Limited and another reported in (2016)11 SCC 105 , it is only to be held that the impugned decision taken by the learned Magistrate in entertaining a complaint and taking cognizance of the offence disclosed therein without examining the crucial issue as to whether or not there was delay in filing the complaint is illegal and ultravires. On this ground alone, the impugned decision taken by the learned Magistrate in having taken cognizance of the offence in the impugned complaint is liable to be set aside. 9. Accordingly, all the decisions taken by the learned Magistrate in pursuance thereof like issuance of summons, etc. will also stand set aside. The complaint along with the delay condonation application will stand restored to the file of the trial court concerned. The complainant is given liberty to file an additional affidavit to explain the reasons for the delay, if he so chooses. Learned Magistrate will issue fresh notice to the accused on the delay condonation application and grant him sufficient time to file counter affidavit thereto. Thereafter, learned Magistrate will take a decision on the application for delay condonation after granting a reasonable opportunity of being heard to both the complainant as well as the accused. In case the learned Magistrate decides to condone the delay, then the learned Magistrate should conduct a proper preliminary enquiry under Section 200 Cr.P.C. stage and the complainant will be at liberty to file his proof affidavit in lieu of sworn statement. Apart from that the learned Magistrate will also conduct a proper and effective enquiry as contemplated in Section 202(2) of the Cr.P.C. and should summon documents and if necessary witnesses from the complainant's collection Bank as well as drawee Bank, more particularly from the drawee Bank and ascertain as to whether the cheque has been presented before the drawee Bank within the validity period of three months having due regard to the legal principles laid down by the Apex Court in the decision as in Rameshchandra Ambalal Joshi's case (supra), etc. The parties may produce a certified copy of this order before the trial court for information and necessary action. It is made clear that this Court has not examined the merits of any of the contentions issued by either side as to whether the cheque was actually presented before the drawee Bank within the validity period of three months, etc. and all those issues are best left to be determined by the trial court as directed hereinabove. With these observations and directions, the Crl. Miscellaneous Case stands finally disposed of. ORDER : 1. It is pointed out that Annexure-I is the dishonoured cheque dated 22.1.2016 issued by the petitioner/accused for Rs.3,60,000/- drawn from his account maintained at the Federal Bank, Palluruthy. It is further pointed out that the said cheque was presented before the drawee Bank (Federal Bank, Palluruthy), only on 25.4.2016 as evidenced from Annexure-VI letter dated 17.5.2017 issued by the Federal Bank and that the presentation of the cheque before the drawee Bank is beyond three months validity period and therefore, the condition envisaged in proviso (a), Section 138 of the Negotiable Instruments Act is not fulfilled in the instant case. Per contra, Sri. S. Rajeev, learned counsel appearing for the first respondent/complainant, would submit that as per his instructions, the said cheque was presented before the Federal Bank, Palluruthy, on 22.4.2016 and therefore, it is within the three months' validity period. 2. In order to resolve this controversy, it is ordered that the Registry will call for a report from the Federal Bank, Palluruthy, Ernakulam District, to furnish a report stating as to when exactly cheque No.064754 dated 22.1.2016 (Annexure-I) drawn from account No.11830100212247 has been presented before that Bank. So also, the date on which the said cheque has been returned by the Federal Bank, Palluruthy, should also be stated. In other words, the date of presentation of the cheque as well as the date of return of the cheque should be separately mentioned in the report to be furnished by the Federal Bank, Palluruthy. The Report in this regard should be made available by the said Bank within a period of three days from the date of receipt of a copy of this order. 3. The Registry will forward a copy of this order to the said Bank. The Report in this regard should be made available by the said Bank within a period of three days from the date of receipt of a copy of this order. 3. The Registry will forward a copy of this order to the said Bank. The petitioner as well as the first respondent/complainant are also given liberty to produce copy of this order to the Federal Bank, Palluruthy Branch, upon which the said Bank will ensure that the report on the above said points should be furnished directly to the Registry of this Court and copy of the said report may also be given to the petitioner/accused and the first respondent/complainant. List the matter on 7.8.2017 at 10:15 A.M. for orders.