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TMI Blog2022 (5) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 passed below Exh. 17 in Criminal Case No. 1050 of 2018 by the learned 2nd Additional Civil Judge and JMFC, Jambusar, District Bharuch. 5. Brief facts leading to filing of this petition are that, the respondent No.2 herein had preferred Criminal Complaint No. 1050 of 2018 under the provisions of Section 138 of the Negotiable Instruments Act, against the present petitioners as well as respondent Nos. 3 and 4 herein inter alia alleging that a cheque bearing No. 000248 dated 01.08.2018 for an amount of Rs. 1,01,00,000/- had been given by the petitioners and upon complainant presenting the same came to be returned with an endorsement "funds insufficient". Corresponding to the time when the cheque had been dishonoured or thereabouts, the Parliament had enacted the Negotiable Instruments (Amendment) Act, 2018, whereby a new Section namely Section 143-A came to be incorporated in the Negotiable Instruments Act, 1881 (for short "NI Act") whereby a provision for payment of interim compensation was envisaged. 5.1. It appears that upon such provision being incorporated in the NI Act, the respondent No.2 - original complainant preferred an application under Exh. 17 in Criminal Complaint No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt having stated that only in cases where offences were committed after introduction of Section 143-A, the accused would be required to pay interim compensation. Para Nos. 22, 23 and 24 of the said decision being the relevant paragraphs are reproduced hereinbelow for benefit. "22. In our view, the applicability of Section 143A of the Act must, therefore, be held to be prospective in nature and confined to cases where offences were committed after the introduction of Section 143A, in order to force an accused to pay such interim compensation. 23. We must, however, advert to a decision of this Court in Surinder Singh Deswal and Ors. vs. Virender Gandhi, 2019 8 SCALE 445 where Section 148 of the Act which was also introduced by the same Amendment Act 20 of 2018 from 01.09.2018 was held by this Court to be retrospective in operation. As against Section 143A of the Act which applies at the trial stage that is even before the pronouncement of guilt or order of conviction, Section 148 of the Act applies at the appellate stage where the accused is already found guilty of the offence under Section 138 of the Act. It may be stated that there is no provision in Section 148 of the Act whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o pay interim compensation to the original complainant. In support of his submissions, learned Advocate Mr. Pandya has relied upon the decisions of the Hon'ble Apex Court in cases of (1) Dashrath Rupsing Rathod Vs. State of Maharashtra and another reported in (2014) 9 SCC 129, (2) Vinay Kumar Shailendra Vs. Delhi High Court Legal Services Committee and Anr., reported in (2014) 10 SCC 708, and (3) Sandeep Kumar Bafna Vs. State of Maharashtra and Another, reported in (2014) 16 SCC 623. 6.2 Learned Advocate Mr. Pandya relying upon the decision of the Hon'ble Apex Court in case of Dashrath Rupsing Rathod (supra) would submit that the Hon'ble Apex Court, has inter alia observed that Section 138 of the NI Act envisages that the offence is committed no sooner the drawee bank returns the cheque unpaid. Learned Advocate would submit in this regard that as noticed hereinabove, the drawee bank had returned the cheque unpaid on the ground of insufficient funds, more particularly on 13.08.2018 i.e. before the date of Amendment Act coming into force, and therefore the Amendment Act would not have been applicable in the instant case and whereas the Courts below had committed an error in directin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the drawer of the cheque, within a period of 30 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid and the drawer of the cheque, upon receiving the notice, within a period of 15 days thereafter not making the payment to the payee or the holder in due course. Learned Advocate would submit that only upon the requirements mentioned in the provisos to Section 138 of the NI Act, being fulfilled, the offence said to have been taken place. According to the learned Advocate, the date of dishonour of the cheque would not be relevant date, rather the relevant date on which the offence is committed would be the day immediately after expiry of period of 15 days after the drawer of the cheque receives the notice by the payee or holder in due course about the cheque being dishonoured and asking him to make payment thereof and the drawer does not make the payment within the stipulated period. Learned Advocate in this regard would further submit that while the decision of the Hon'ble Apex Court in case of Dashrath Rupsing Rathod (supra), was on the issue of territorial jurisdiction, the aspect of when an offence under Section 138 of the NI Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble Apex Court in case of Dashrath Rupsing Rathod (supra) being a decision on the aspect of territorial jurisdiction i.e. with regard to competent court where a complaint under Section 138 of the NI Act could be filed, therefore the observations of the Hon'ble Apex Court were in the said context and whereas according to learned APP the aspect of when an offence, under Section 138 of the NI Act, is committed, was not an issue which was under consideration of the Hon'ble Apex Court in the said decision. Learned APP would further submit that the decision of Yogendra Pratap Singh (supra) appears to be with regard to the pointing issue. Learned APP relying upon the decision of the Hon'ble Apex Court in case of Yogendra Pratap Singh (supra) would submit that this Court may not interfere with the impugned orders. 9. Heard learned Advocates for the respective parties who have not submitted anything further. 10. After hearing the learned Advocates and perusing the record the following admitted position emerges : (1) That the accused had given a cheque valued at Rs. 10,100,000/- to the complainant being cheque No. 000248 dated 01.08.2018 and whereas upon the complaina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. v. Municipal Corporation of Greater Bombay (1999) 8 SCC 577. Accordingly, unless the provisions of the Section clearly point to the contrary, the offence is concerned with the dishonour of a cheque; and in the conundrum before us the body of this provision speaks in the same timbre since it refers to a cheque being "returned by the bank unpaid". None of the provisions of the IPC have been rendered nugatory by Section 138 of the NI Act and both operate on their own. It is trite that mens rea is the quintessential of every crime. The objective of Parliament was to strengthen the use of cheques, distinct from other negotiable instruments, as mercantile tender and therefore it became essential for the Section 138 NI Act offence to be freed from the requirement of proving mens rea. This has been achieved by deeming the commission of an offence de hors mens rea not only under Section 138 but also by virtue of the succeeding two Sections. Section 139 carves out the presumption that the holder of a cheque has received it for the discharge of any liability. Section 140 clarifies that it will not be available as a defence to the drawer that he had no reason to believe, when he issued th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... XXX XXX 58. To sum up: 58.1 An offence under Section 138 of the Negotiable Instruments Act, 1881 is committed no sooner a cheque drawn by the accused on an account being maintained by him in a bank for discharge of debt/liability is returned unpaid for insufficiency of funds or for the reason that the amount exceeds the arrangement made with the bank. 58.2 Cognizance of any such offence is however forbidden under Section 142 of the Act except upon a complaint in writing made by the payee or holder of the cheque in due course within a period of one month from the date the cause of action accrues to such payee or holder under clause (c) of proviso to Section 138. 58.3 The cause of action to file a complaint accrues to a complainant/payee/holder of a cheque in due course if (a) the dishonoured cheque is presented to the drawee bank within a period of six months from the date of its issue. (b) If the complainant has demanded payment of cheque amount within thirty days of receipt of information by him from the bank regarding the dishonour of the cheque and (c) If the drawer has failed to pay the cheque amount within fifteen days of receipt of such notice. 58.4 The facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted. In the considered and humble opinion of this Court, the observations of the Hon'ble Apex Court with regard to Section 138 i.e. when an offence is stated to be committed under Section 138 of the Negotiable Instruments Act, have to be read in context of the issue which was being considered by the Hon'ble Apex Court, more particularly as observed by the Hon'ble Apex Court, with regard to the place where the offence was committed. The Hon'ble Apex Court at Para 19, inter alia observed that the situs or venue of judicial inquiry and trial of the offence must logically be restricted to where the drawee bank is located. In the considered opinion of this Court, the observations of the Hon'ble Apex Court with regard to offence under Section 138 of the Negotiable Instruments Act, were in relation to reaching the conclusion as to where the judicial inquiry and trial of the offence be held and it is in this context the Hon'ble Apex Court has observed that the offence under Section 138 is committed no sooner the drawee bank returns the cheque unpaid and whereas ultimately it is the place where the drawee bank is located, had been decided as the venue of the judic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'ble Apex Court, was with regard to the diverse views take by the Hon'ble Apex Court in case of K. Bhaskaran v. Sankaran Vaidhyan Balan, reported in (1999) 7 SCC 510 and in case of Harman Electronics (P) Ltd. and Anr. Vs. M/s. National Panasonic India Limited, reported in (2009) 1 SCC 720. That the issue which was being considered by the Hon'ble Apex Court, was the territorial jurisdiction aspect, with regard to filing of a complaint under Section 138 of the NI Act and whereas it is in such context the Hon'ble Apex Court has inter alia observed that Section 138 unequivocally states that the offence is committed no sooner the drawee bank returns the cheque unpaid. 16. At this stage it would be relevant to refer to the decision of the Hon'ble Apex Court in case of Yogendra Pratap Singh (supra). In the said decision, the Hon'ble Apex Court was dealing with the question as regards when could cognizance of offence punishable under Section 138 of the NI Act be taken. It appears that initially two questions were formulated at Para 1.1. and 1.2 which are reproduced for benefit. "1.1 (i) Can cognizance of an offence punishable under Section 138 of the Negotiable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fence. Commission of an offence is a sine qua non for filing a complaint and for taking cognizance of such offence. A bare reading of the provision contained in clause (c) of the proviso makes it clear that no complaint can be filed for an offence under Section 138 of the NI Act unless the period of 15 days has elapsed. Any complaint before the expiry of 15 days from the date on which the notice has been served on the drawer/accused is no complaint at all in the eye of law. It is not the question of prematurity of the complaint where it is filed before expiry of 15 days from the date on which notice has been served on him, it is no complaint at all under law. As a matter of fact, Section 142 of the NI Act, inter alia, creates a legal bar on the Court from taking cognizance of an offence under Section 138 except upon a written complaint. Since a complaint filed under Section 138 of the NI Act before the expiry of 15 days from the date on which the notice has been served on the drawer/accused is no complaint in the eye of law, obviously, no cognizance of an offence can be taken on the basis of such complaint. Merely because at the time of taking cognizance by the Court, the period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pex Court has at Para 36, reiterated the view as taken in M/s. Kusum Ingots & Alloys Ltd. Vs. Pennar Peterson Securities Ltd. [(2000) 2 SCC 745], in the case of Yogendra Pratap Singh (supra), that all the five essential features of Section 138 of the Negotiable Instruments Act as noted in the said judgment, must be satisfied for a complaint to be filed under Section 138. 20. What would be important to note in the present context is that the observations of the Hon'ble Apex Court that "If the period prescribed in clause (c) of the proviso to Section 138 has got expired, there is no commission of an offence nor accrual of cause of action for filing of complaint under Section 138 of the NI Act. (emphasis supplied) Thus, in a case where the Hon'ble Apex Court had been called upon to decide whether the learned Magistrate could take cognizance of an offence punishable under Section 138 of the Negotiable Instruments Act on the basis of a complaint filed before expiry of period of 15 days stipulated in the notice required to be served upon the drawer of the cheque in terms of Section 138(c) of the Act, the Hon'ble Apex Court has inter alia laid down that if the period presc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... offence, on the the order hand in Yogendra Pratap Singh (supra), the Hon'ble Apex Court was considering a question as to whether the learned Magistrate could take cognizance of an offence under Section 138 of the NI Act, if the complaint is filed by the complainant before expiry of the period of 15 days from the date of receipt of the notice under proviso (c) to Section 138 of the NI Act. Considering the law laid down by the Hon'ble Apex Court, it appears that in Dashrath Rupsing Rathod (supra), the Hon'ble Apex Court had held that the place where the drawee bank is located would be the place where the offence would be tried, since the offence under Section 138 of the NI Act is committed upon the cheque being dishonoured. That the inquiry by the Hon'ble Apex Court was into the aspect of territorial jurisdiction of a Court to try an offence under Section 138 of the NI Act and it is in context of the inquiry that the observations have been made. On the other hand, in Yogendra Pratap Singh (supra), the Hon'ble Apex Court was considering the aspect of cognizance being taken by the learned Magistrate of an offence under Section 138 of the NI Act. While the term ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the Hon'ble Apex Court are cited at the bar. In the instant case, in the considered opinion of this Court, judgments of the Hon'ble Apex Court in Dashrath Rupsing Rathod (supra) and in Yogendra Pratap Singh (supra) are not mutually irreconcilable. While it is true that Yogendra Pratap Singh (supra) being the later decision, had not referred to decision of the Hon'ble Apex Court in Dashrath Rupsing Rathod (supra), but then what would be required to be noted at this stage is that while the case of Dashrath Rupsing Rathod (supra) had been decided by the Hon'ble Apex Court on 01.08.2014 and case of Yogendra Pratap Singh (supra) had been decided on 19.09.2014, thus, both the decisions are approximately about the same time. 25. It would be further relevant to mention that it is by now a well settled principle of law that a decision has to be read in the context of the issue which was being considered by the Court concerned and whereas it would be the ratio of the decision which would be required to be followed and not the entire judgment as it is. It would further be relevant to mention that observations of the Court in a judgment cannot be read divorced from the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the colour of one case against the colour of another. To decide therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive. * * * Precedent should be followed only so far as it marks the path of justice, but you must cut the dead wood and trim off the side branches else you will find yourself lost in thickets and branches. My plea is to keep the path of justice clear of obstructions which could impede it." The above passage has been quoted with approval by this Court in Sarva Shramik Sanghatana (KV), Mumbai vs. State of Maharashtra and others, (2008) 1 SCC 494. 26. In the Constitution Bench judgment in Islamic Academy of Education and another v. State of Karnataka and others, (2003) 6 SCC 697, Chief Justice V.N. Khare speaking for majority held: "2....The ratio decidendi of a Judgment has to be found out only on reading the entire Judgment. In fact the ratio of the judgment is what is set out in the judgment itself. The answer to the question would necessarily have to be read in the context of what is set out in the judgment and not in isolation. In case of any doubt as regards any observations, reasons and principle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arties which gave rise to the action. Objections to adjudication of the disputes between the parties, on whatever ground are in truth not aids to the progress of the suit but hurdles to such progress. Adjudication of such objections cannot be termed as adjudication of the merits of the controversy in the suit. As we said earlier, a broad view has to be taken of the principles involved and narrow and technical interpretation which tends to defeat the object of the legislation must be avoided." 142. In Rajeshwar Prasad Mishra v. The State of West, Bengal, AIR 1965 SC 1887, it was held: "Article 141 empowers the Supreme Court to declare the law and enact it. Hence the observation of the Supreme Court should not be read as statutory enactments. It is also well known that ratio of a decision is the reasons assigned therein." (See also Amar Nath Om Prakash and Ors. v. State of Punjab[1985] 1 SCC 345 and Hameed Joharan v. Abdul Salam, 2001 (7) SCC 573). 143. It will not, therefore, be correct to contend, as has been contended by Mr. Nariman, that answers to the questions would be the ratio to a judgment. The answers to the questions are merely conclusions. They have to be interprete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 26. The law laid down by the Hon'ble Apex Court as referred to in the decision of M. Siddiq (supra), more particularly earlier decisions of the Hon'ble Apex Court are referred to and whereas the law in this regard has been explained in detail. That it could be stated that a case is an authority for what it actually decides and whereas the case should not be quoted for a proposition that may seem to follow logically from the same. Ratio of a judgment is what is set out in the judgment itself and whereas the observations in a judgment would necessarily have to be read in context of what is set out in the judgment and not in isolation by reading a line here and there from the judgment, the entire ratio decidendi of a judgment cannot be found out. A sentence or observation from a decision cannot be read in isolation and whereas the intent and purport of a decision has to be judged not only from the text of the judgment but also in the context of which the observations had been made. The Hon'Apex Court has further observed that a judgment should be understood in the light of the facts of the case and whereas it would not be desirable or permissible to pick out a word or a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith Section 177 etc. of the CrPC and therefore the place or situs where the Section 138 Complaint is to be filed is not of his choosing. The territorial jurisdiction is restricted to the Court within whose local jurisdiction the offence was committed, which in the present context is where the cheque is dishonoured by the bank on which it is drawn." 27. A plain reading of the Para 21 of the said decision leads to a very clear conclusion that the observations by the Hon'ble Apex Court with regard to offence being committed upon the cheque being dishonoured, is in context of the question that had arisen for consideration of the Hon'ble Apex Court. The observations at Para 21 quoted hereinabove makes it abundantly clear that the Hon'ble Court had made all the observations in context of deciding where a complaint under Section 138 of the Negotiable Instruments Act could be filed. In the considered opinion of this Court, all the observations of the Hon'ble Apex Court including observations at Para 58 quoted hereinabove, have to be read in context of the question which was under consideration of the Hon'ble Apex Court. 28. It would be further profitable to mention he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be taken by the Court concerned, more particularly whether cognizance could be taken even before period of 15 days under clause (c) to Section 138 had elapsed. In the considered opinion of this Court, the observations of the Hon'ble Apex Court in Yogendra Pratap Singh (supra), more particularly the observations referred to hereinabove leave nothing to doubt that the intent of the Hon'ble Apex Court was to clarify on the issue and whereas the aspect of the offence under Section 138 being committed upon all the five ingredients being satisfied was clearly clarified. Under such circumstances, in the considered opinion of this Court, while at first blush, it appears that the decisions in Dashrath Rupsing Rathod (supra) and Yogendra Pratap Singh (supra), are mutually irreconcilable, but viewed from the perspective of the issue in consideration before the Hon'ble Apex Court in both the judgments, it becomes clear that the decisions, are in separate spheres and there is no mutual irreconcilability of the said decisions. 30. At this stage, it would be pertinent to mention here that even in a recent decision of the Hon'ble Apex Court in case of M/s. Gimpex Private Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urning the cheque unpaid by the drawee bank, (4) giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (5) failure of the drawer to make payment within 15 days of the receipt of the notice."" Thus, it appears that the view taken by the Hon'ble Apex Court in Yogendra Pratap Singh (supra) is taken by a later bench of the Hon'ble Apex Court consisting three Hon'ble Judges and whereas while decision of Yogendra Pratap Singh (supra) has not been expressly referred to or followed but at the same time, as observed hereinabove, the same view about when an offence is committed under Section 138 of the NI Act as has been taken in Yogendra Pratap Singh (supra), has been taken in the later decision also. 31. Thus, having regard to the discussion, observations and findings and more particularly viewed from the perspective of the observations of the Hon'ble Supreme Court in case of Yogendra Pratap Singh (supra), in the considered opinion of this Court, the issue in question i.e. when does the offence under Section 138 of the Negotiable Instruments Act, be stated to be committed, is an issue explained in decision of the Hon'ble Apex Cou ..... 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