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TMI Blog2001 (9) TMI 993X X X X Extracts X X X X X X X X Extracts X X X X ..... n. It is of course open to the respondents to rebut the presumption in the trial but till then the High Court could not say that the complainant is not a holder in due course at all. - CRIMINAL APPEAL NO. 949 OF 2001 - - - Dated:- 17-9-2001 - K.T. THOMAS AND S.N. VARIAVA, JJ. N.S. Sistani, G.S. Sistani, Arun K. Sinha and Rakesh Singh for the Appellant. Shree Prakash, Surya Kant, Shekar Naphde, Mahesh Agarwal, E.C. Agrawala and Rishi Agarwal for the Respondent. JUDGMENT Thomas, J. Leave granted. 2. This case involves a queer situation when a Pay Order was dishonoured by the drawer bank. The holder thereof (Punjab and Sindh Bank) filed a complaint under section 138 of the Negotiable Instruments Act, 1881 ( the Act ). The drawer bank and its officials have been arraigned as accused in the complaint. But a single Judge of the High Court of Bombay quashed the complaint mainly on the premise that the instrument (described as the "pay order") is not a cheque. The Punjab Sindh Bank has filed this appeal in challenge of the aforesaid order of the High Court. Besides the premise stated above, learned single Judge of the High Court adopted two more ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a cheque within the meaning of section 138. Mr. Shekar Naphde, the learned senior counsel who argued for some of the respondents contended that the Pay Order is only a draft issued by the bank and it may at best be a promissory note and is not a cheque. 6. For deciding the said question we have to know what is a cheque. Section 6 of the Act defines a cheque as this: "A cheque is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand". Now we have to look at the definition of Bill of Exchange. It is contained in section 5 of the Act. The first paragraph of this section is enough for the purpose of this case and hence it is extracted below: "A bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument." 7. The maker or the drawer of a Bill of Exchange must direct a certain person to pay a particular sum of money. This is the quintessence of a Bill of Exchange. The learned senior counsel for the respondent contended that in every Bill of E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t were a cheque". The learned counsel for the first respondent contended that the said section is more in favour of the position that a draft is otherwise not a cheque and it is declared to be a cheque only for the limited purpose of Chapter XIV which deals with crossed cheques . We are unable to agree with the said contention that section 131A is intended to limit the operation of a draft as a cheque only for crossing purposes. In our view, the said section is intended to widen the scope of crossed drafts as to contain all incidences of a crossed cheque. This is for the purpose of foreclosing a possibility of holding the view that draft cannot be crossed. 11. Even if it is possible to construe the draft either as a promissory note or as a Bill of Exchange, law has given the option to the holder to treat it as he chooses. This can be discerned from section 17 of the Act which says "where an instrument may be construed either as a promissory note or bill of exchange, the holder may at his election treat it as either and the instrument shall be thenceforward treated accordingly". This means once the holder, which in this case is the complainant-bank, has elected to treat the ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever that might be, there is no denying that a demand draft is nothing more or less than a negotiable instrument governed by the provisions of the Negotiable Instruments Act; and on the face of it, the obligations it creates are nothing more than ordinary debts. . . ." (p. 212) We are of the opinion that the High Courts have taken the correct view in the above decisions. However, Mr. Shekar Naphde, the learned senior counsel for the respondents, invited our attention to the decision of a Single Judge of the Bombay High Court in Maturi Sanyasilingam v. Exchange Bank of India Africa Ltd. AIR 1948 Bom. 1 wherein it was held that the demand draft issued by the branch of a bank to its head office or vice versa is not a cheque nor a Bill of Exchange. But learned Single Judge expressed the opinion that a demand draft may be a Bill of Exchange if it is issued by one bank drawn on another. The said observation was made in the wake of the contention that the collecting bank could claim protection under section 131. The said decision of the Bombay High Court cannot hold good because the Negotiable Instruments Act was amended by incorporating section 131A in the said Act. 15. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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