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TMI Blog2022 (2) TMI 1163X X X X Extracts X X X X X X X X Extracts X X X X ..... nce. While so, akin to the Lernaean Hydra of Herculean lore, tricky questions of procedure and jurisdiction in relation to this offence continue to raise their troublesome heads before the Courts despite the lapse of over three decades. The case on hand is an instance. [2] By way of this petition filed under Section 482 Cr.P.C., the petitioner seeks quashing of Criminal (N.I.) Case No.12 of 2021 filed against him before the learned Chief Judicial Magistrate, Imphal West, along with the orders dated 09.02.2021 and 04.03.2021 passed therein, whereby process was issued against him. The said complaint case was filed by respondent No.1 through respondent No.2, her power of attorney holder, under Sections 138 and 141 of the Negotiable Instruments Act, 1881 (hereinafter, 'the Act of 1881'). The case of the complainant was that the respondent therein, the petitioner in this criminal petition, had issued in her name cheque bearing No.000156 dated 04.03.2020, drawn on RBL Bank at New Delhi, for a sum of Rs. 5 lakh but when she deposited the said cheque at the Yes Bank Branch at Naraina Vihar in New Delhi for being credited to her bank account bearing No.05499300000605 in the Yes Bank Branc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt thereof, the complaint case was liable to be rejected straightaway. He would assert that the entire exercise was engineered by respondent No.1 to harass the petitioner, a resident of Delhi, and that the subject complaint case and the orders passed therein are liable to be quashed by this Court in exercise of inherent power under Section 482 Cr.P.C. [6] Per contra, Mr. Mangsatabam Rarry, learned counsel, would assert that the subject cheque was issued by the petitioner herein in discharge of a legal liability and the same was deposited by respondent No.1 for being credited to her bank account in the Yes Bank Branch at Thangal Bazar, Imphal, situated within the jurisdiction of the Trial Court. He would assert that, in terms of the legal position obtaining under the provisions of the Act of 1881 and the law declared in that regard by the Supreme Court, the Trial Court has territorial jurisdiction to adjudicate the complaint case. He would further assert that two demand notices were sent to the petitioner's known addresses at New Delhi and Delhi and the same would be sufficient in law. He would point out that the address of the petitioner in the cause title of this criminal petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... complaint, in writing, made by the payee or the holder in due course of the cheque; (b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138; and (c) no Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the First Class shall try an offence punishable under Section 138. Be it noted that Section 142(1) was originally Section 142 in the Act of 1881. However, the statute was amended by the Negotiable Instruments (Amendment) Act, 2015 (Act 26 of 2015), and, inter alia, Sections 142(2) and 142A were also inserted therein. These amended provisions came into effect from 15.06.2015. After such amendment, the original Section 142 was renumbered as Section 142(1). The newly added Section 142(2) states that the offence under Section 138 shall be inquired into and tried only by a Court within whose local jurisdiction - (a) if the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated; or (b) if the cheque is presented for payment by the payee or holder in due course, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayee through a notice and the thrust in the provision is on the need to make a demand and once a notice is dispatched, his part is over. The Bench held that if a strict interpretation is given that the drawer should have actually received the notice for the period of 15 days to start running, a trickster cheque drawer would get the premium to avoid receiving the notice by different strategies and could escape from the legal consequence of Section 138. Thus, when a notice is returned by the sendee as unclaimed such date, per the Supreme Court, would be the commencement date for reckoning the period of 15 days contemplated in clause (c) to the proviso in Section 138. Such reckoning was held to be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice was brought to his address. [11] In Harman Electronics Private Limited and another vs. National Panasonic India Private Limited [(2009) 1 SCC 720], another 2-Judge Bench of the Supreme Court again considered territorial jurisdiction of a Court to try an offence under Section 138 of the Act of 1881. In that case, the cheque was issued at Chandigarh and was presented at Chandigarh. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch of the Supreme Court considered the issue of territorial jurisdiction of Courts to try offences under Section 138 of the Act of 1881. This decision followed K.Bhaskaran (supra) on the point that a complaint could be filed in a Court that had jurisdiction over the place of presentation of the cheque though the drawer did not reside there. Significantly, the Bench went on to hold that the commission of the offence would be complete only on service of the demand notice and consequent failure on the part of the drawer to pay the demanded amount within the stipulated 15 days. In effect, the Bench held that issuance of the demand notice would not, by itself, give rise to a cause of action but communication of the notice would. Harman Electronics Private Limited (supra) was also considered and affirmed. [14] In M/s Escorts Limited vs. Rama Mukherjee [(2014) 2 SCC 255], the same 2-Judge Bench had occasion to again consider the question of territorial jurisdiction of Courts in relation to Section 138 of the Act of 1881. Relying on its earlier decision in Nishant Aggarwal (supra), the Bench held that Courts within whose jurisdiction the cheque is presented and dishonoured would also have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of judicial enquiry and trial of the offence must logically be restricted to where the drawee bank is located as the dishonour of the cheque takes place when the said bank returns the cheque unpaid. [16] The curial wisdom expressed in the aforesaid decisions was in the context of the Act of 1881 prior to the amendments effected therein by the Negotiable Instruments (Amendment) Act, 2015. In Bridgestone India Private Limited vs. Inderpal Singh [(2016) 2 SCC 75], a 2-Judge Bench of the Supreme Court considered the amended provisions of the Act of 1881 and more particularly, the newly added Sections 142(2) and 142A, in the context of territorial jurisdiction in relation to an offence under Section 138 of the Act of 1881. In that case, the cheque was issued by Inderpal Singh at Chandigarh and was presented by Bridgestone India Pvt. Ltd., the company, for being credited to its bank account in Indore. Upon dishonour of the cheque on account of 'exceeding arrangement', the company issued a demand notice but Inderpal Singh failed to pay the amount within the stipulated period. The company thereupon initiated proceedings against Inderpal Singh before the Court at Indore under Section 138 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cheque is delivered for collection (through an account of the branch of the bank where the payee or holder in due course maintains an account). The Bench also recorded satisfaction, based on Section 142A(1), that Dashrath Rupsingh Rathod (supra) would not stand in the way of the company in so far as territorial jurisdiction for initiating proceedings was concerned. The appeal was accordingly allowed. The view expressed in Bridgestone India Pvt. Ltd. (supra) finds affirmation in the later judgment of the Supreme Court in M/s Himalaya Self Farming Group and another vs. M/s Goyal Feed Suppliers [Transfer Petition (Criminal) No.273 of 2020, decided on 16.09.2020]. [17] In the case on hand, it is not in dispute that respondent No.1 has a bank account at the Yes Bank Branch in Thangal Bazar, Imphal. The date of opening of the said account does not have bearing on that irrefutable fact. The subject cheque was deposited at a Delhi Branch of Yes Bank for being credited to the said account. Mere presentation of the cheque at a Delhi Branch has no impact whatsoever in the light of the 'Explanation' to Section 142(2)(a), which categorically states that even if the cheque is delivered in any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to the complainant to file a complaint within the statutory period. In this regard, the Court observed that it is no doubt true that the receipt of the demand notice has to be proved but if the notice is refused by the drawee, it may be presumed to have been served. Elaborating further, the Supreme Court observed that in a case where the demand notice is not claimed, even though served by registered post, the drawer of the cheque may be called upon to rebut the presumption which arose in favour of service of the notice with the aid of Section 27 of the General Clauses Act, 1897 (hereinafter, 'the Act of 1897'). The Supreme Court however cautioned that no rule of universal application can be laid down that in all cases where notice is not served on account of non-availability of the addressee, the Court must presume service of notice. These observations were made in the context of a person who dodges the postman for about a month or two or a person who can get a fake endorsement made regarding his non-availability and can successfully avoid his prosecution, as the payee is bound to issue notice to him within a period of 30 days from the date of receipt of information about the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he notice unserved. It was further held that once a notice is sent by correctly addressing the drawer of the cheque, service of notice is deemed to have been effected. Reference was made by the Bench to Section 27 of the Act of 1897, which gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post, and it was held that once this act has been referred to in the complaint, it is unnecessary for the complainant to further aver that it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Per the Bench, unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. It was observed that any drawer who claims that he had not been served with the notice can, within 15 days of the receipt of the summons from the Court in respect of the complaint filed under Section 138 of the Act of 1881, make payment of the cheque amount and submit to the Court that he had made such payment within 15 days of the receipt of the summons and, therefore, the complai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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