Delhi High Court
Shri Ashwani Kumar Julka vs Lt. Col. Parthojit Choudhary (Retd.) on 15 November, 2006
Equivalent citations: 2007CRILJ1129, 136(2007)DLT241, AIR 2007 (NOC) 2030 (DEL.) = 2007 CRI. L. J. 1129, 2007 (3) ALJ (NOC) 389 (DEL.) = 2007 CRI. L. J. 1129 2007 (5) AKAR (NOC) 811 (DEL.), 2007 (5) AKAR (NOC) 811 (DEL.), 2007 CRI. L. J. 1129, 2007 (5) AIR KAR R 811, 2007 (3) ALL LJ NOC 389, (2008) 1 CIVILCOURTC 11, (2007) 1 JCC 32 (DEL), 2007 (1) JCC 32, (2007) 1 CHANDCRIC 300, (2007) 136 DLT 241, (2007) 4 RECCRIR 292, (2007) 1 DLT(CRL) 257, (2007) 1 NIJ 526
Author: A.K. Sikri
Bench: A.K. Sikri
JUDGMENT A.K. Sikri, J.
1. The respondent herein is the complainant, who has filed complaint under Section 138 of the Negotiable Instruments Act (in short the 'NI Act') against M/s. Niket Enterprises (accused No. 1), a sole proprietorship concern of Sh. Ashwini Kumar Julka, who has also been imp leaded as accused No. 2. This complaint is filed through Lt. Col. K.B. Sharma (Retd.) as the legally constituted special attorney (hereinafter referred to as the 'Attorney'). It is alleged in the complaint that the attorney and the complainant are friends for over 20 years. The attorney is a freelance export/import consultant and came into contact with the accused person in the course of business. The accused was badly in need of money to honour his personal business orders and requested the attorney for loan. On the recommendation of the attorney the complainant advanced Rs. 3,00,000/- as loan to the accused by means of two bank drafts of Rs. 1,00,000/- and Rs. 2,00,000/- dated 4.5.1996 and 3.6.1996 respectively. The accused executed a promissory note dated 5.6.1996 and also handed over three post-dated cheques of Rs. 1,00,000/- each all dated 4.9.1996. When these cheques were presented for payment on due date, they were returned unpaid with memo dated 7.10.1996 with the remarks "not arranged for." The accused was immediately informed, who requested the complainant to present the cheques again. However, when the cheques were presented the second time on 14.10.1996, they were returned dishonoured with the same remarks. Once again, on the representation of the accused, cheques were presented on 4.11.1996 but were returned unpaid vide returning memo dated 6.11.1996 with same remarks. The legal notice dated 13.11.1996 demanding the accused to make the payment was accordingly sent by registered AD post at his official as well as residential addresses. The registered AD letter sent at the residential address of the accused was returned undelivered on 30.11.1996 with the endorsement "On repeatedly going to him the receiver (addressee) does not meet. Hence being returned." The registered letter sent at the official address of the accused was returned undelivered on 9.12.1996 with the remarks "despite repeatedly going to him and informing him, the receiver (addressee) does not meet." It is further mentioned that on receiving back the aforesaid AD letters, the attorney of the complainant visited the accused at his office on 9.12.1996 and asked him to receive the notices which he refused and on these facts complaint under Section 138 was accordingly filed.
2. Summoning orders were issued after recording the pre-summoning evidence. When the petitioner appeared, he filed an application stating that the complaint was time-barred. The learned MM accepted this plea and vide order dated 26.5.1997 dismissed the complaint being beyond the period of limitation. The learned MM concluded that in the present case cause of action arose on 15.12.1996, i.e. 15 days after the postal endorsement dated 30.11.1996 was received back. The complaint should have been filed up to 15.1.1997, i.e. within 30 days of the cause of action, but it was filed on 16.1.1997 and, therefore, time-barred. Submission of the complainant's counsel that notice sent to the official address of the accused was received back on 9.12.1996 and, therefore, the limitation should be counted from that date was not accepted on the ground that the complainant had the knowledge on 30.11.1996 as the letter addressed had been received back and that would be the date for reckoning the period of limitation. It was also observed that there was no reason to believe that the registered letter sent at the official address was received back on 9.12.1996 inasmuch as endorsement on that letter was one day before that of the registered letter which was sent at the residential address and was received on 30.11.1996.
3. The complainant challenged this order by filing revision petition and vide judgment dated 9.9.1996, this revision petition was accepted, setting aside the order of the learned MM holding that the complaint was filed within the period of limitation. As noted above, the learned MM had held that last date for filing the complaint was 15.1.1997 whereas the complaint was filed on 16.1.1997, i.e. one day after the period of limitation expired. The learned ASJ held that 15.1.1997 was not a working day but a holiday and, therefore, benefit of this had to be given to the complainant under Section 4 of the Limitation Act inasmuch as if the limitation expires on a day which happens to be Court holiday, the application could be filed on the opening day of the Court and, therefore, complaint filed on 16.1.1997 was perfectly valid. Challenging this order of the learned ASJ present petition is filed by Sh. Ashwani Kumar Julka, accused in the said complaint.
4. It is not disputed that 15.1.1997 was a holiday. However, the finding of the learned MM to the effect that complaint could be filed by 15.1.1997 itself is challenged on the ground that limitation period could not have been counted from 30.11.1996, when the postal envelope containing the notice dated 13.11.1996 had been returned. It is submitted, in the first instance, that it was not open for the Court below to hold that service of notice dated 13.11.1996 had been effected and in fact, there was no service on the petitioner in the eyes of law and, therefore, the complaint was not maintainable. In the alternative, it is contended that as per the endorsement on the envelope containing notice dated 13.11.1996, the postman had visited last on 21.11.1996 and that would be the date from which the refusal should be inferred and 15 days are to be counted from that date and not from 30.11.1996.
5. In so far as the contention of the petitioner is concerned, it merits no consideration simply because the case of the petitioner himself before the Court below was that the complaint filed was beyond limitation and it is only this issue which was decided. It was not the case of the petitioner that there was no service of notice in the eyes of law. Such an argument raised for the first time in these proceedings cannot be allowed.
6. The issue is as to from which date period of 15 days is to be counted. Is it the date on which the notice is served/deemed served or the date on which the complainant gets back the acknowledgment, or the registered letter containing the notice, as the case may be. Section 138 of the NI Act, which deals with the dishonour of cheque and limitation in filing the complaint, 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 provision of this Act, be punished with imprisonment for a term which may extend 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 months from the date on which it is drawn or within the period of its validity, whichever is earlier.
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee 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 purpose of this section, 'debt or other liability' means a legally enforceable debt or other liability.
7. As per clause (b) of proviso, notice of demand for payment of the amount in writing is to be sent to the drawer within 15 days of "receipt of information by him from the bank regarding the return of the cheque as unpaid." Thus, this period of 15 days starts from the date when the drawee of the cheque receives information from the bank. After this notice is sent, a period of 15 days is to be allowed to the drawer of the cheque for making the payment and clause (c) of proviso states that cause of action would arise in favor of the drawee if the drawer of the cheque fails to make payment "within 15 days of the receipt of the said notice." Thus, here 15 days' period is to start from the date of receipt of the notice and it is not from the date when the drawee receives the information about the receipt of the notice by the drawer.
8. While holding that period of 15 days is to start when payee acquires knowledge of receipt of notice, the learned MM has relied upon two judgments-one is of Madras High Court in the case of A.B. Steels and Anr. v. Coramandal Steel Products I-1992(1) Crimes 60 and other is of Calcutta High Court in the case of Santa Priya Engineers Pvt. ltd. and Anr. v. Uday Shankar Dass and Anr. 1993 (3) Recent Criminal Reports 542. The Madras High Court has held that 15 days' period is to be reckoned from the date when information is received by the complainant/drawee. However, perusal of the judgment would show that clause (c) of proviso to Section 138 is not discussed and, therefore, this judgment would be of no assistance for deciding the issue at hand. The Calcutta High Court in Santa Priya Engineers (supra), however, addressed this issue. In that case, notice sent by the complainant was received by the accused No. 1 on 1.1.1991 and accused No. 3 on 3.1.1991. If 15 days' period is to be counted from 3.1.1991, cause of action would be deemed to arise on 18.2.1991. However, the complaint was filed on 27.2.1991. The Court held that it was not time-barred as the knowledge of the sender about the date of receipt of notice by the addressee was material and once the period of 15 days is to be counted from the said knowledge, complaint was within limitation. Para 6 laying down this principle after detailed discussion, needs to be reproduced:
6. Under the provisions of clause (c) of Section 138 of the Act the cause of action for such-like complaint arises on the failure of the drawer "to make payment of the said amount of money to the payee, as the case may be, to the holder in due course of the cheque, within 15 days of the receipt of the said notice" given under clause (b) thereof and not before that. No such complaint can, therefore, legally be filed before the aforesaid period. That being so, the material and relevant date for accrual of cause of action for such like complaint is the date of receipt of notice by the drawer. The complainant being the sender of the notice cannot clearly receive the same. The receipt of the notice under clause (b) of Section 138 of the Act must invariably be the drawer of the cheque, to whom it is given. Knowledge of the sender about the date of receipt of the notice by the drawer is, therefore, very much material as regards accrual of the cause of action for making such-like complaint. The sender of the notice could clearly have no personal knowledge about the date of receipt of the same, unless the notice is sent by messenger and the receipt thereof is duly acknowledged by the person to whom it is sent. But in cases 9as in the instant case0, where notice is sent by registered post A/D, which is the usual mode of service, which could, in particular, hardly be avoided if the parties do not belong to the same place or near about place, the knowledge of the sender (complaint) about the date of receipt of such notice would invariably be dependent upon other agencies, namely, the Postal Department, which is obliged to return back the A/D card to the sender of the registered notice. But the promptitude and efficiency of the Postal Department is a matter which is an everybody experience for the people at large. More often that not, A/D card is hardly returned back to the sender (of registered notice in time. Not infrequently, A/D card never reaches back the sender, necessitating correspondence with the Postal Department as to the delivery/service of the registered notice or the date of delivery/service of such notice. Not unoften, the somnolence of the postal Authority could hardly be shaken within reasonable time in answering such query when the A/D card does not reach back the sender. In such cases, such-like complaint is likely to fail for no fault of the complainant, but for the failure/laches on the part of the Postal Department. The purpose of the Act is, therefore, likely to be frustrated, in such circumstances, which could never possibly have been intended by the makers thereof. The question which thus naturally arises for consideration is whether the literal and mechanical way of construing clause (c) of Section 138 of the relevant Act would be justified in law, in such circumstances. The knowledge of the sender of the notice about the date of receipt of the same being an essential requirement of fair play and natural justice, the expression "within 15 days of the receipt of the said notice," used in the aforesaid provision, should clearly mean the date when the sender acquires the knowledge about the receipt date of the said notice given by him under Clause (b) of the relevant provision. If a person is given a right to resort to a remedy within a prescribed time, limitation should not be computed from a date earlier than on which the party aggrieved actually knew about the date of accrual of cause of action for making a complaint before the competent court for seeking redress therefore, or else, it might be an absurd and unreasonable application of law. On the analogy of the decision of the Supreme Court in K.P. Varghese v. Income Tax Officer, Ernakulam and Anr. , we must, therefore, eschew literalness in the interpretation which avoids such absurdity and mischief and makes provision rational and sensible, unless, of course, our hands are tied and we cannot find any escape from the tyranny of literal interpretation." It is now well settled rule of construction that where the plain literal interpretation of a statutory provision produces a manifestly absurd and unjust result, which could never have been intended by the legislature, the Court may modify the language used by the legislature, or even "do some violence" to it, so as to achieve the obvious intention of the legislature, the Court may modify the language used by the legislature and produce a rational construction (vide Luke v. Inland Revenue Commissioner 1963 AC 557). The Court may also in such a case read into the statutory provision a condition which though not expressed, is implicit as constituting the basic assumption underlying the statutory provision. It, therefore, seems to me that having regard to this well recoginzed rule of interpretation, a fair and reasonable construction of clause (c) of Section 138 of the Act, should be read into it so that the expression therein "within 15 days of the receipt of the said notice" should be made to mean within 15 days from the date of knowledge of the sender about the receipt of the notice so that such-like complaint may not fail for default on the part of the Postal Department-without any fault on the part of the complainant. On such construction, cause of action for such complainant, so far as the complainant is concerned, would accrue on the failure of the drawer to make payment within fifteen days from the date of knowledge of the complainant about the receipt of the Notice by the former (drawer), which would neither be prejudicial to him (drawer/accused), rather beneficial to him as he would get longer time to make payment of the amount and thus avoid criminal liability for non-payment. It would, indeed be in the interest of such-like complainant to file complaint for such offences within the prescribed period so that the same may not be turned down for having been filed beyond the prescribed period resulting in failure of the remedy available to him under the law on such technical ground. Such-like complainant would invariably be interested in seeing that the court takes cognizance of the offence and issues process because that would be the culmination of the petition of complaint filed by him on the allegations made and could hardly allow his petition of complaint to be time barred to his own prejudice. At the same time, however, the complaint should exhibit due diligence and promptitude in securing knowledge within a reasonable period about the date of receipt of the notice, sent by registered post A/D, without sleeping over the matter for an unreasonable period, in case of failure of the Postal Department to send back the A/D card and/or intimate the date of receipt of notice by the addressee within a reasonable period.
9. Learned Counsel for the petitioner has cited two judgments in support of his submission that the above view of the Calcutta High Court is not correct and should not be accepted. Interestingly, one judgment is of Calcutta High Court itself in the case of Darshan Singh v. State reported as 2001 DCR 275. In this judgment, earlier judgment in the case of Santa Priya Engineers (supra) is specifically taken note of. Perusal of this judgment would show that while holding that 15 days' period is to be counted from the date of receipt of notice by the drawer of the cheque and not when the sender of the notice received the intimation, the High Court relied upon the judgment of the Supreme Court in the case of SIL Import USA v. Exim Aides Silk Products Silk Exporters, Bangalore 1999 ISJ (Banking) 441 and para 19 from the said judgment of the Supreme Court, which reads as under, was quoted:
Para 19. The High Court's view is that the sender of the notice must know the date when it was received by the sendee, for otherwise he would not be in a position to count the period in order to ascertain the date when cause of action has arisen. The fallacy of the above reasoning is that it erases the starting date of the period of 15 days envisaged in clause (c). As per the said clause the starting date is that date of "the receipt of the said notice". Once it starts, the offence is completed on the failure to pay the amount within 15 days there from. Cause of action would arise if the offence is committed.
10. The Calcutta High Court thereafter observed as under:
9. Once the cause of action has started running, it cannot remain suspended subsequently. Under Clause 'C' to the proviso to Section 138 the cause of action will start running from the date of receipt of the notice but not from the date of receipt of the 'acknowledgment due card.' It is true that in the above case the notice, was sent in two ways, one by fax message and the other by registered post with A/D. In that case the date of notice was taken from the date of receipt of the fax message and the limitation act accordingly, allowed to run from the date of receipt of the fax message. The Karnataka High Court was under erroneous view that the limitation shall run from the date of receipt of the 'acknowledgment due card' by the complainant. The receipt of the 'acknowledgment due card' by the complainant is not material for the purpose of computation of limitation. Only the receipt of notice by the drawer is an important factor from which day the cause of action shall accrue and within 30 days there from the complaint has to be filed failing which it would be barred by limitation under Section 142 of the Act.
11. The Court specifically held that in view of Supreme Court's judgment in SIL Import USA (supra), its earlier judgment in Santa Priya Engineers (supra) was no longer good law and impliedly overruled.
12. At this stage, it would be also of significance to refer to another judgment of the Supreme Court in the case of K. Bhaskaran v. Sankaran Vaidhyan Balan and Anr. . Clauses (b) and (c) of proviso to Section 138 specifically came up for discussion in the said case. Notice sent to the drawer had been returned "unclaimed"-almost similar position as in the instant case. The Court held that when such a notice sent to the addressee at correct address is received back unclaimed, notice can be deemed to have been served on sendee unless he proves that it was never actually served and that he was not responsible for non-service. The Court held that the expression "receiving of the notice" as occurring in clause (c) of proviso to Section 138 would not be construed to mean actually received inasmuch as strict interpretation would give a handle to trickster cheque drawer and the principle incorporated in Section 27 of the General Clauses Act could be imported in a case where the sender had dispatched the notice by post with correct address written on it. The Court held that such an interpretation would lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to subterfuge by avoiding to receive the notice. While deciding this issue of deemed service of notice when the notice has been returned unclaimed, the Court also made, in the process, following observations relating to the reckoning of the period of 15 days contemplated in clause (c) to the proviso of Section 138 and as we are concerned with precisely this issue, let us see what the Supreme Court opined on this aspect:
Thus, when a notice is returned by the sendee as unclaimed such date would be the commencing date in reckoning the period of 15 days contemplated in clause (c) to the proviso of Section 138 of the Act. Of course such reckoning would 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. In the present case the accused did not even attempt to discharge the burden to rebut the aforesaid presumption.
13. It is clear from the above that 15 days' period is to be reckoned from the date when a notice is returned by the sendee as unclaimed. A conjoint reading of the two judgments of the Supreme Court in SIL Import USA (supra) and K. Bhaskaran (supra) would clearly establish that 15 days' period is to be counted from the date when the notice is received by the drawer of the cheque and not when intimation of receipt of this notice is received by the sender of the notice. In case the notice is actually received by the addressee (drawer of the cheque) 15 days' period would be reckoned from that date. In those cases, where it is a case of deemed service, namely, where the notice is dispatched at correct address but returned by the addressee and not accepted, it would be from the date when the addressee returned the notice as unclaimed. Applying these principles, it is clear that as per the endorsement on the envelope, registered envelope was lastly taken by the postman at the residential address of the accused on 29.11.1996 and at his official address on 28.11.1996 and thereafter made his endorsement to the effect that on repeatedly going to him the receiver (addressee) does not meet, hence, being returned. The period of 15 days cannot be calculated from 30.11.1996 when envelopes were received back by the respondent/complainant. If the limitation is to be counted from 28.11.1996/29.11.1996, the last date for filing the complaint would be 13/14.1.1997. The complaint was filed on 16.1.1997, which would be beyond the period of limitation, though by two days only. Unfortunately, at that time there was no provision for condensation of delay. The result may be harsh to the complainant but that cannot be held in view of the legal position laid down by the Supreme Court and extracted above. The Courts would generally be liberal in condoning the period of limitation, particularly in such cases. But in the absence of provision authorising the Court to condone the delay, the Court would be helpless. Upshot of the discussion would be that the complaint filed by the respondent is time-barred. This petition accordingly succeeds. The summoning orders are quashed and the complaint is dismissed as time-barred.
No costs.