1997 (1) TMI 561 - HC - Income Tax

Summary

Issues:
- Whether the court should only issue process under section 138 of the Negotiable Instruments Act or also under section 420 of the Indian Penal Code when the complaint discloses material ingredients for both offenses?

Analysis:
1. The complaint filed by the payee of a bounced cheque alleged offenses under sections 138 of the Negotiable Instruments Act and section 420 of the Indian Penal Code. The complainant sold goods to the accused, who issued three cheques that bounced due to insufficient funds. Despite repeated demands and a notice, the accused failed to pay the outstanding amounts, leading to the complaint. The court examined compliance with sections 138 and 142 of the Act, finding that all requirements were met, including timely presentation of cheques and notice to the drawer. The court rejected the petitioner's argument that re-depositing a bounced cheque was an attempt to bypass legal provisions.

2. The court emphasized that even if a cheque is returned once with "refer to drawer," the payee can re-deposit it, especially if assured by the drawer of payment. The court dismissed the petitioner's claim that re-depositing cheques was a ploy to avoid timely criminal complaints. The complaint was filed within the statutory period, and there was no legal basis to quash the process under sections 138 and 142 of the Act.

3. The court noted that the complaint not only alleged an offense under section 138 of the Act but also met the requirements for an offense under section 420 of the Indian Penal Code. It emphasized that a person committing such offenses should face charges for all alleged offenses. The court directed the Magistrate to include section 420 of the Indian Penal Code in the trial proceedings and ensure expeditious proceedings.

4. Consequently, the petition was dismissed, and the Magistrate was instructed to proceed with the trial, including charges under section 420 of the Indian Penal Code. The court highlighted that ensuring justice is not a mere formality but a substantive duty, especially when multiple offenses are involved.