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TMI Blog2024 (7) TMI 858X X X X Extracts X X X X X X X X Extracts X X X X ..... ale of carpets. The applicant herein is the proprietor of the firm M/s Universal Carpets and used to purchase the carpets from the M/s Evergreen Carpets. The firm M/s Evergreen Carpets and the firm M/s Universal Carpets, both are the sole proprietorship firms. In connection with the aforesaid business transaction between them the firm M/s Universal Carpets has purchased the carpets worth Rs. 1,10,39,676/-. Against the aforesaid purchase the Universal Carpets paid Rs. 71,00,000/- to M/s Evergreen Carpets and the balance of Rs. 39,39,676/- was due against the Universal Carpets. When M/s Evergreen Carpets demanded the balance amount of Rs. 39,39,676/-, a cheque no. 23944651 dated 20.9.2018 of Rs. 12,00,000/- of Jammu and Kashmir Bank, Branch Bhadohi was issued by M/s Universal Carpets in favour of M/s Evergreen Carpets. The said cheque was presented for encashment by M/s Evergreen Carpets in its Bank, which was dishonored on 21.11.2018 for the reason 'insufficient funds'. However, when it was discussed with the proprietor of the M/s Universal Carpets he asked to present the said cheque after five days so that the same can be honoured. Relying upon the aforesaid assurance given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso. 5. With regard to the first submission, learned counsel for the applicant has relied upon the judgment of Apex Court in Raj Kumar Khurana vs. State of (NCT of Delhi) and another, (2009) 6 SCC 72. With regard to the second submission, he has relied upon the judgment of Apex Court in Subodh S. Salaskar vs. Jayprakash M. Shah and another, (2008) 13 SCC 689 and in support of the third submission, learned counsel for the applicant has relied upon the judgment of Apex Court in A.C. Narayanan vs. State of Maharashtra and another, (2014) 11 SCC 790. 6. In view of the aforesaid submissions and the judgments of the Apex Court, learned counsel for the applicant has prayed for quashing of the aforesaid complaint case against the applicant. 7. Per contra, learned counsel for the opposite party No.2 has submitted that once the cheque is issued by the drawer of the cheque and the same is dishonoured by the Bank, the offence under Section 138 of N.I. Act, 1881, is constituted. He further submits that since the notice was sent through the registered post, it has to be presumed to have been served in due course. Further, relying upon the judgment of A.C. Narayanan (supra), he has submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation.- For the purposes of this section, debt of other liability means a legally enforceable debt or other liability." 10. In view of the aforesaid provisions, the offence under Section 138 of N.I. Act, 1881, shall be attracted only when a cheque is returned by the Bank unpaid for the reasons; (i) because of the amount of money standing to the credit of that account is insufficient to honour the cheque, or (ii) it exceeds the amount arranged to be paid from that account by an agreement made with that bank. 11. In Raj Kumar Khurana (supra), the Apex Court has held as under: "11. Section 138 of the Act moreover provides for a penal provision. A penal provision created by reason of a legal fiction must receive strict construction (See R. Kalyani v. Janak C. Mehta and DCM Financial Services Ltd v. J.N. Sareen). Such a penal provision, enacted in terms of the legal fiction drawn would be attracted when a cheque is returned by the bank unpaid. Such non-payment may either be: (i) because of the amount of money standing to the credit of that account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. On issuance of the notice by the payee or the holder in due course after dishonour, to the drawer demanding payment within 15 days from the date of the receipt of such a notice, if he does not pay the same, the statutory presumption of dishonest intention, subject to any other liability, stands satisfied." 13. The aforesaid view has further been affirmed by a Division Bench of the Apex Court in the case of K.K. Sidharthan Vs. T.P. Praveena Chandran and another (1996) 6 SCC 369 and held in paragraph 2 as under: "2. .......... This shows that Section 138 gets attracted in terms if cheque is dishonoured because of insufficient funds or where the amount exceeds the arrangement made with the bank. It has, however, been held by a Bench of this Court in Electronics Trade and Technology Development Corpn. Ltd. v. Indian Technologists and Engineers (Electronics (P) Ltd., that even if a cheque is dishonoured because of " stop payment" instruction to the bank, Section 138 would get attracted." 14. The said view taken by the Apex Court in the case of Electronics Trade and Technology Development Corpn. Ltd. (supra) has further been upheld by a Three Judge Bench of the Apex Court in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17. So far as the other issue with regard to service of notice is concerned, the offence under Section 138 of N.I. Act, 1881, shall be constituted only upon the service of legal notice on the drawer of the cheque and after expiry of 15 days from such service of notice. In the complaint, there is no averment with regard to the fact that when the notice has actually been served on the applicant herein. Therefore, in view of provisions of Section 27 of General Clauses Act, a documents sent through the registered post shall be presumed to have been served after the expiry of 30 days. 18. In Subodh S. Salaskar (supra), the Apex Court has held as under with regard to service of a document through post: "22. In terms of the provisions of the General Clauses Act, a notice must be deemed to have been served in the ordinary course subject to the fulfillment of the conditions laid down therein. Section 27 of the General Clauses Act reads as under: "27. Meaning of service by post. - Where any Central Act or Regulation made after the commencement of this Act authorises or requires any document to be served by post, whether the expression 'serve' or either of the expression 'g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al. We also reiterate that where the payee is a proprietary concern, the complaint can be filed: (i) by the proprietor of the proprietary concern, describing himself as the sole proprietor of the "payee"; (ii) the proprietary concern, describing itself as a sole proprietary concern, represented by its sole proprietor; and (iii) the proprietor or the proprietary concern represented by the attorney holder under a power of attorney executed by the sole proprietor." 21. Since in the instant case, the complaint has been filed by the power of attorney holder in his own name and not as the power of attorney holder of the payee of the cheque and further no offence under Section 138 of N.I. Act, 1881, is constituted in view of the failure of the applicant to make assertion with regard to service of notice and on the basis of presumption of service after expiry of 30 days of its sending through registered post, no cause of action has ever arisen to opposite party No.2 to maintain the instant complaint. 22. Therefore, for all the reasons recorded herein above, the instant application under Section 482 Cr.P.C. is allowed and the entire proceedings of Criminal Complaint Case No.61 of 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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