2014 (7) TMI 1323 - HC - Indian Laws

Maintainability of complaint - Dishonor of Cheque - insufficiency of funds - Section 138 Negotiable Instruments Act - case of appellant is that the date of filing of complaint has not been mentioned in the complaint and the date of service of notice has not been mentioned in the complaint - HELD THAT - In the light of the language used in Section 138, this court finds five components in section 138, namely, 1. Drawing the cheque, 2. presentation of the Cheque to the bank, 3. returning the cheque unpaid by the drawer bank, 4. given the notice in writing to the drawer of the cheque demanding payment of the amount and 5. failure of the drawer to make payment within fifteen days of the receipt of the notice. Thus, the offence under Section 138 of the Act would be completed only with the concatenation of all the above components - In the present case, the complaint was maintainable as it was filed satisfying all the above ingredients as laid down in Section 138 and 142 of the N.I. Act. It is evident that the registered notice was given on 13.10.2006 through his counsel Sri Satish Chandra Kohil, Advocate, through registered post A.D. calling upon the applicant to make payment of the disputed cheques total amounting to ₹ 1,85,000/- to the complainant within fifteen days of the receipt of the said notice. The applicant even after the service of notice did not pay the amount of the impugned cheques as such the complainant is left with no other alternative remedy but to file the present complaint - Thus it is an admitted fact that the cheque was given by the applicant in favour of the complainant and when the cheque was presented for encashment the same was returned by the bank with the endorsement of insufficient fund on 4.10.2006. The complainant given the notice to the applicant on 13.10.2006 through his counsel within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid. The applicant failed to make the payment in due course of the cheque amount within fifteen days of the receipt of the said notice and after expiry of the statutory period of notice as provided under Section 138-C, the cause of action accrued to the complainant to file the complaint thus the offence is complete and the complainant had the right to institute criminal proceedings against the drawer of the cheque. The order summoning the applicant has been passed after adhering to the provision of law, even otherwise the factual dispute, if any, cannot be decided in exercise of power under Section 482 Cr.P.C. which is the subject matter of trial - neither there is any illegality or perversity in the judgement and order passed by the court below summoning the applicant to face trial under Section 138 N.I. Act nor there is any abuse of the process of law is discernible from the order of the learned Magistrate. Petition dismissed.

Summary

Issues:
Challenge to quash proceedings of complaint case under Section 138 N.I. Act; Consideration of Stay Vacation Application; Compliance with statutory provisions under Section 138 and 142 of the Act; Legality of summoning order; Adherence to legal provisions in passing the summoning order; Abuse of process of law.

Analysis:

The case involved a challenge to quash the proceedings of a complaint case under Section 138 of the Negotiable Instruments Act. The applicant had filed a petition seeking to quash the proceedings, citing issues related to the absence of specific dates in the complaint and notice. The court noted that the Stay Vacation Application was pending, and no rejoinder affidavit had been filed. The court decided to list the case peremptorily and warned that if no rejoinder affidavit was filed, the case would be decided on merits.

The court delved into the statutory provisions under Section 138 and 142 of the Act to analyze the legality of the summoning order. The court highlighted the five components required under Section 138 for the offense to be completed. It emphasized that in this case, all the necessary components were satisfied, allowing the complaint to be maintainable under the Act.

The court examined the details of the case, where the complainant had issued a notice demanding payment after the cheques were dishonored by the bank due to insufficient funds. The court found that the complainant had followed the statutory requirements, and the applicant failed to make the payment within the stipulated time, leading to the completion of the offense under Section 138.

Further scrutiny of the order passed by the Magistrate Court revealed that the summoning of the applicant was done in accordance with the law. The court emphasized that any factual disputes should be addressed during the trial and not under Section 482 Cr.P.C. The judgment concluded that there was no illegality in summoning the applicant for trial under Section 138 N.I. Act, and there was no abuse of the legal process discernible from the Magistrate's order.

In the final decision, the court dismissed the petition, vacated the interim order, and directed the office to communicate the order to the lower court for further proceedings. The judgment upheld the legality of the summoning order and affirmed the complainant's right to institute criminal proceedings against the drawer of the cheques.