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TMI Blog2022 (9) TMI 671X X X X Extracts X X X X X X X X Extracts X X X X ..... e ground that she was a joint account holder along with her husband. She has neither drawn nor issued the cheque in question and, therefore, according to her, the complaint against her was not maintainable. It was observed that the complaint was only under section 138 of the Act and nothing was elicited from the complaint to the effect that the petitioner was responsible for the cheque in question and accordingly proceedings were quashed. The Supreme Court in Aparna A. Shah V M/s Sheth Developers Pvt. Ltd. another, [ 2013 (7) TMI 718 - SUPREME COURT ] endorsed views expressed by the Madras, Delhi and Punjab Haryana High Courts and held that it is only the drawer of the cheque who can be prosecuted under section 138 of the Act. The case of the respondent no 2 is that the petitioner and Amrit Sandhu Coster in discharge of their liability towards the respondent no 2 handed over cheque in question and promised that the said cheque would be obliged on presentation to discharge their legally enforceable debt - The petitioner is not holder of account bearing no 90112010051035 in Syndicate Bank and is not operational in the name of the petitioner but is operational in name of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt Stopped by Drawer as intimated vide return memo dated 11.04.2017. The petitioner and Amrit Sandhu Coster did not pay cheque amount despite notice dated 10.05.2017. The respondent being aggrieved filed the present complaint. 3. The trial court vide impugned order summoned the petitioner and Amrit Sandhu Coster. The impugned order is reproduced as under:- 03.06.2017 Present: Complainant .along with Sh. Sanjay Kothiyal, Adv. Heard. Record perused. Cognizance of offence u/s 138 Nl Act taken. PSE has been led by the complainant. Vide a separate statement of the complainant, PSE has been closed. Heard on issuance of process. In view of the submissions made and documents tendered, this Court is satisfied that there is sufficient material on record to proceed against all the accused. Let summons be Issued against all the accused vide PF/RG/AD/Courier returnable on 09.08.2017. Pf be filed within 02 weeks. 4. The petitioner being aggrieved filed the present petition and challenged the impugned order. The petitioner pleaded that the petitioner at present is residing at USA and never had any dealing with the respondent No 2. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sister of the petitioner namely Amrit Sandhu Coster. It was prayed that impugned order be set aside. 6. Section 138 of the Negotiable Instruments Act, 1881 deals with dishonour of cheque. It reads as under:- 138 Dishonour of cheque for insufficiency, etc., of funds in the account. - Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cheque can be deemed to have committed an offence under Section 138 of the Act. 8. The counsel for the petitioner argued that the trial court committed a grave error while passing the impugned order as the petitioner is not the drawer and signatory of the cheque in question. The account from which cheque in question was issued does not belong to the petitioner. The petitioner has been wrongly impleaded as an accused. The petitioner cannot be made liable vicariously with Amrit Sandhu Coster. The petitioner was arrayed as accused No. 2 as per sections 141 and 142 of the Negotiable Instruments Act, 1881which are not applicable in present case. Amrit Sandhu Coster who is the petitioner in Crl.M.C. bearing no 556/2019 has admitted in notice given under section 251 of the Code that she was the signatory of the cheque and has handed over the cheque in question to the respondent no 2 in the year 2011 and issued stop payment instructions to the banker in the year 2011. The counsel for the petitioner relied on Alka Khandu Avhad V Amar Syamprasad Mishra and another, AIR 2021 SC 1616 and Aprna A Shah V M/s Sheth Developers Pvt. Ltd. another, (2013) 8 SCC 71. 9. The counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f cheque from joint accounts, a joint account holder cannot be prosecuted unless the cheque has been signed by each and every person who is a joint account holder. The said principle is an exception to Section 141 of the N.I. Act which would have no application in the case on hand. The proceedings filed under Section 138 cannot be used as an arm twisting tactics to recover the amount allegedly due from the appellant. lt cannot be said that the complainant has no remedy against the appellant but certainly not under Section 138. Extend the culpability attached to dishonour of a cheque can, in no case except in case of Section 141 of the N.I. Act: to those on whose behalf the cheque is issued. This Court reiterates that it is only the drawer of the cheque who can be made an accused in any proceeding under Section 138 of the Act. Even the High Court has specifically recorded the stand of the appellant that she was not the signatory of the cheque but rejected the contention that the amount was not due and payable by her solely on the ground that the trial is in progress. lt is to be noted that only after issuance of process, a person can approach the High Court seeking quashing of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liability and the said cheque has been returned by the bank unpaid, such person can be said to have committed an offence. Section 138 of the NI Act does not speak about the joint liability. Even in case of a joint liability, in case of individual persons, a person other than a person who has drawn the cheque on an account maintained by him, cannot be prosecuted for the offence under Section 138 of the NI Act. A person might have been jointly liable to pay the debt, but if such a person who might have been liable to pay the debt jointly, cannot be prosecuted unless the bank account is jointly maintained and that he was a signatory to the cheque. 8. Now, so far as the case on behalf of the original complainant that the appellant herein original accused No. 2 can be convicted with the aid of Section 141 of the NI Act is concerned, the aforesaid has no substance. 8.1 Section 141 of the NI Act is relating to the offence by companies and it cannot be made applicable to the individuals. Learned counsel appearing on behalf of the original complainant has submitted that Company: means anybody corporate and includes, a firm or other association of individuals and therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rms but also reflects lack of application of judicial mind to the facts of the case. However a Magistrate is not required to consider the defense of the proposed accused or to evaluate the merits of the material collected during investigation at time of taking cognizance. It is not necessary to pass a detail order giving detailed reasons while taking cognizance. The Supreme Court in Fakhruddin Ahmad V State of Uttaranchal, (2008) 17 SCC 157 also held as under:- Nevertheless, it is well settled that before a Magistrate can be said to have taken cognizance of an offence, it is imperative that he must have taken notice of the accusations and applied his mind to the allegations made in the complaint or in the police report or the information received from a source other than a police report, as the case may be, and the material filed therewith. It needs little emphasis that it is only when the Magistrate applies his mind and is satisfied that the allegations, if proved, would constitute an offence and decides to initiate proceedings against the alleged offender, that it can be positively stated that he has taken cognizance of the offence. Cognizance is in regard to the offence ..... X X X X Extracts X X X X X X X X Extracts X X X X
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