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2018 DIGILAW 894 (KER)

Areeplavan Finance Thodupuzha v. State of Kerala

2018-11-02

B SUDHEENDRA KUMAR

body2018
JUDGMENT : B SUDHEENDRA KUMAR, J. 1. The petitioner is the complainant in C.M.P. No.3050 of 2018 on the files of the court of the Chief Judicial Magistrate, Thodupuzha. 2. The petitioner filed Ext.P1 complaint against the 2nd respondent herein before the court below alleging offence under Section 138 of the Negotiable Instruments Act (for short 'the N.I. Act'). Along with the said complaint, the petitioner inter-alia produced Ext.P2 dishonour memo issued by of account of the accused. Aggrieved by the said direction of the court below, the petitioner filed this Original Petition praying for a direction to the court below to act upon Ext.P2 dishonour memo instead of the account details from the Bank for taking cognizance of the offence under Section 138 of the N.I. Act. 3. Service is complete. However, there is no appearance for the 2nd respondent. 4. Heard the learned counsel for the petitioner and the learned Public Prosecutor. 5. This court called for a report from the court below. The said report of the court below is extracted hereunder:- “The Hon'ble High Court has directed me to state about the procedure being followed for taking cognizance in 138 Negotiable Instrument Act cases. Hence I am describing the procedure followed by me. 2. As part of 202 Cr.P.C. Inquiry, my learned predecessor used to get a statement of accounts from the drawee bank. Therefore, after taking charge, I also followed the very same procedure:- that is addressing the Bank Manager of the drawee bank to produce the statement of accounts of the accused. But subsequently, I found it inconvenient to address directly the Bank Manager of the drawee bank since the said process was time consuming and many times Bank Managers misunderstanding that it is a summons to appear before court, appeared before court. Hence I used to pass the following order “issue notice to the drawee Bank Manager through complainant to cause production of the statement of account of the accused”. Hence a summons to cause production of the above referred document was used to be handed over to the complainant and the complainant in turn collected the same and produced before court. The said practice was adopted for the purpose of avoiding delay and inconvenience to the parties and banks. Thereafter, after perusing the complaint and available documents, it is decided whether or not there is sufficient ground for proceeding. 3. The said practice was adopted for the purpose of avoiding delay and inconvenience to the parties and banks. Thereafter, after perusing the complaint and available documents, it is decided whether or not there is sufficient ground for proceeding. 3. The said practice became common in 138 of the Negotiable Instruments Act cases. Therefore, when a large number of cases are filed together by financing companies like the petitioner in this case the said order very often was used to be written as “for S/Accounts”.” 6. It is clear from the above report that the court below blindly believed that the common practice being followed is to call for the account statement of the accused from the bank before taking cognizance under Section 138 of the N.I. Act. At this juncture, it is relevant to quote Section 146 of the N.I. Act, which is extracted hereunder:- “Bank's slip prima facie evidence of certain facts. - The Court shall, in respect of every proceeding under this Chapter, on production of bank's slip or memo having thereon the official mark denoting that the cheque has been dishonoured, presume the fact of dishonour of such cheque, unless and until such fact is disproved.” It is very much clear from Section 146 of the NI Act, which came into force with effect from 6.2.2003 by Act 55 of 2002 that the memo or slip issued from the Bank is sufficient for taking cognizance for the offence under Section 138 of the N I Act. Therefore, the account details of the accused need not be called for from the bank at the stage of taking cognizance for the offence under Section 138 of the N.I. Act. It is surprising to note that eventhough Section 146 of the N.I. Act came into force with effect from 6.2.2003, the learned Magistrate, who is a Chief Judicial Magistrate, had no occasion to learn about the said Section till date. It is also distressing to notice that the learned Magistrate did not incline to make any endeavour to learn and understand the law before addressing the High Court that “the said practice became common in Section 138 of the N.I. Act cases.” 7. It is also distressing to notice that the learned Magistrate did not incline to make any endeavour to learn and understand the law before addressing the High Court that “the said practice became common in Section 138 of the N.I. Act cases.” 7. The Hon'ble Apex Court in Indian Bank Association and others v. Union of India and others (2014) 5 SCC 590 issued directions to all the criminal courts in the country dealing with Section 138 cases to follow the procedure mentioned in the said judgment for speedy and expeditious disposal of the cases falling under Section 138 of the N.I.Act. The first direction issued by the Apex Court in Indian Bank Association (supra) is in paragraph 23.1, which is extracted thus:- “23.1 The Metropolitan Magistrate/Judicial Magistrate (MM/JM), on the day when the complaint under Section 138 of the Act is presented, shall scrutinise the complaint and, if the complaint is accompanied by the affidavit, and the affidavit and the documents, if any, are found to be in order, take cognizance and direct issuance of summons.” 8. The ratio in the above said decision of the Apex Court is that the courts dealing with the cases under Section 138 of the N.I. Act shall take cognizance and direct issuance of summons on the itself, if the complaint filed under Section 142 of the N.I.Act, the affidavit filed along with the complaint and the documents produced, are found to be in order. In view of the above ratio of the Apex Court in Indian Bank Association (supra) also, the court below was not justified in adopting the procedures mentioned in the report of the learned Magistrate for taking cognizance of the offence under Section 138 of the N.I. Act. It appears that the above said decision of the Apex Court was also not in the notice of the learned Magistrate. The above fact coupled with the reasons stated in paragraph No.6 of this judgment would impel this court to request the Director of Kerala Judicial Academy to look into the matter seriously and do the needful in accordance with law, to avoid recurrence of any such pitiful situation. 9. The complaint alleging the offence under Section 138 of the N.I. Act is filed under Section 142 of the N.I. Act. The power of the court to take cognizance emanates from Section 142 of the N.I. Act. 9. The complaint alleging the offence under Section 138 of the N.I. Act is filed under Section 142 of the N.I. Act. The power of the court to take cognizance emanates from Section 142 of the N.I. Act. In view of the direction issued by the Apex Court in Indian Bank Association (supra) and also considering the legal position that the court gets power under Section 142 of the N.I. Act to take cognizance of the offence under Section 138 of the N.I. Act, I am of the view that there is no need to conduct enquiry under Section 202 Cr.P.C. in the case of complaints filed under Section 142 of the N.I. Act before taking cognizance. This being the position, the order of the court below directing the complainant to cause the production of the bank account of the accused through the bank Manager concerned cannot be said to be correct and consequently, I set aside the same and direct the court below to take cognizance of the offence if the complaint, affidavit and the documents produced, including the memo issued by the bank, are in order. I also direct all the Criminal courts in the State of Kerala to follow the procedure directed by the Hon'ble Supreme Court in Indian Bank Association (supra) for speedy and expeditious disposal of cases falling under Section 138 of the N.I. Act. In the result, this O.P.(Crl.) stands allowed. Before parting with the case, this court hopes and expects that the learned Magistrate will make an introspection with regard to the manner by which the High Court is to be addressed. I make it clear that the observations made in this order are not intended to be treated as adverse remarks against the officer concerned and hence the said observations shall not be used against the officer concerned in connection with any proceeding.