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2024 (11) TMI 46 - HC - Indian LawsDishonor of Cheque - Validity of the summoning order and framing of notice under Section 138 of the Negotiable Instruments Act, 1881 - Exercise of inherent powers under Section 482 of the CrPC by the High Court - HELD THAT - The instant petition has been filed under Article 227 of the Constitution of India read with Section 482 of the CrPC (now Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023). It has been already settled in a catena of judgments that although the High Court has inherent powers under Section 482 of the CrPC (now Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023) while adjudicating a petition, however, the said power has to be exercised sparingly and with caution wherein the High Court must bear in mind that it does not interfere unnecessarily, unless there is some material irregularity or illegality. Section 138 of the NI Act is a quasi criminal remedy available to a party aggrieved by the dishonor of a cheque, who may initiate such proceedings against the issuer of a cheque - This Court is of the view that summons issued in a complaint case under Section 138 of the NI Act may be quashed if it is prima facie apparent from the complaint that the complainant has not presented even an iota of evidence for filing the said complaint which shows occurrence of an offence. In the case of HMT Watches Limited v. M.A. Abida, 2015 (5) TMI 280 - SUPREME COURT , the Hon'ble Supreme Court held ' 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 uncompiled 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 authorised 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 when such plea was controverted by the complainant before it.' Upon perusal of the aforesaid judgment, it is made out that it has been emphasized time and again by the Hon be Supreme Court that the High Court while exercising powers under Section 482 CrPC must bear in mind that whenever a proceeding under the NI Act has been challenged under the said provision, it should not express its view on the disputed question of facts to arrive at a conclusion that the offence is not made out as the same would amount to error of law. As per the settled principle of law, summons can be issued only, when, prima facie, a case is made out on the basis of documents alongwith the complaint, its contents and the evidences filed alongwith the affidavit - This Court is of the view that the Court concerned has taken into consideration the submissions made as well as the contents of the petition, and thereafter, rejected the revision petition by way of passing a detailed and reasoned order, by upholding the summoning order passed by the learned Trial Court. This Court does not find any material on record which can be stated to be of sterling quality warranting invocation of the jurisdiction of this Court under Section 482 CrPC at this stage when the learned Trial Court has issued summons and framed notice of charge against the petitioners - this Court deems it imperative to state that in contemporary practice, a complainant in proceedings under Section 138 of the NI Act often endures greater procedural hardship than the accused. This stems primarily from the trend wherein every summoning order issued by the Magistrate is challenged on various grounds. Such challenges compel the complainant to defend the validity of the Magistrate s orders at the preliminary stages of the case. There is no illegality in the order dated 14th March, 2023 passed by the learned ASJ in CR No. 627/22 and the same is hereby upheld - Petition dismissed.
Issues Involved:
1. Validity of the summoning order and framing of notice under Section 138 of the Negotiable Instruments Act, 1881. 2. Whether the statutory notice under Section 138 of the NI Act was served. 3. Applicability of Section 223 of the Code of Criminal Procedure regarding joint trials. 4. Exercise of inherent powers under Section 482 of the CrPC by the High Court. 5. Procedural fairness and efficiency in handling complaints under Section 138 of the NI Act. Issue-wise Detailed Analysis: 1. Validity of the Summoning Order and Framing of Notice: The petitioners challenged the summoning order dated 8th April 2021 and the framing of notice against them under Section 138 of the NI Act, asserting that the learned Trial Court issued these without considering the records properly. The petitioners argued that the cheques in question were from different banks and signed by different individuals, related to separate transactions, and thus should not have been consolidated into a single complaint. The Court, however, upheld the Trial Court's decision, noting that the summons were issued based on a detailed and reasoned order after reviewing the complaint, supporting documents, and evidence. 2. Service of Statutory Notice: The petitioners contended that the statutory notice required under Section 138 of the NI Act was not served on them, which was a crucial procedural lapse. The Court, however, found that the learned ASJ had reviewed the records and determined that the respondent had indeed sent a demand notice after the cheques were dishonored, and the petitioners failed to respond by paying the cheque amount. 3. Applicability of Section 223 CrPC: The petitioners argued against being tried jointly, claiming the cheques were part of different transactions. The Court referred to Section 223 CrPC, which allows for joint trials if offenses arise from the same transaction. The learned ASJ found that both cheques were issued as part of the same transaction, justifying the joint trial. The Court agreed with this interpretation, emphasizing that separate notices under Section 251 CrPC were framed for each petitioner, ensuring no prejudice to their rights. 4. Exercise of Inherent Powers under Section 482 CrPC: The Court reiterated the principle that inherent powers under Section 482 CrPC should be exercised sparingly and with caution. It emphasized that the High Court should not engage in assessing disputed factual questions at the summoning stage, as doing so would constitute an error of law. The Court found no material irregularity or illegality in the lower courts' orders to warrant interference under Section 482 CrPC. 5. Procedural Fairness and Efficiency: The Court expressed concern over the trend of challenging every summoning order, which burdens the complainant and delays proceedings under Section 138 of the NI Act. It noted that such tactics undermine the summary trial process intended for swift redressal of dishonored cheques. The Court highlighted the need to avoid unnecessary legal battles that detract from the legislative intent and increase the burden on litigants and courts. In conclusion, the Court found no illegality in the order dated 14th March 2023 by the learned ASJ and upheld it, dismissing the instant petition and any pending applications. The judgment emphasized adherence to established legal principles and procedural efficiency in handling cases under Section 138 of the NI Act.
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