Calcutta High Court
Gopa Debi Ozha vs Sujit Paul on 8 May, 1995
Equivalent citations: (1995)2CALLT94(HC)
JUDGMENT Nripendra Kumar Bhattacharyya, J.
1. By this revision the accused petitioner has challenged the order dated 26.7.94 passed in complaint case No. C/314/94 by the learned Chief Metropolitan Magistrate, Calcutta under Section 138 of the Negotiable Instrument Act, 1881 whereby the learned Magistrate took cognizance of the offence and directed issuance of process against accused No. 1, the petitioner herein.
2. A, short conspectuous of the case is that the petitioner and her husband Ghanashyamlal Oza held 620 shares of Messers. Nazareth Engineering Company Private Limited and they agreed to transfer 50% of such shares of the said company to the opposite party herein and her wife Smt. Shauli Paul. The consideration was fixed at Rs. 6,50,000/- for transfer of such shares and the opposite parties paid Rs. 5,00,000'/- in cash and the balance of Rs. 1,50,000 by bank draft.
3. The petitioner herein and her husband failed and neglected to transfer the said shares in favour of the opposite party herein and her wife nor did the petitioner and her husband return the said sum or any part thereof to them.
4. On 11-6-94 the petitioner issued a cheque for an amount Rs. 5,79,000/drawn on United Bank of India, Lansdowne Branch, Calcutta in favour of the opposite party and her wife and on the same date, the said cheque was deposited by the opposite party herein and his wife in their bank account at Fariapukur Branch, Calcutta but the cheque was returned' with the Bank endorsement "insufficiency of funds into the account."
5. On 24-6-94 the opposite party herein through his learned Advocate sent a notice demanding payment of money of Rs. 5,79,000/- within 13 days from the date of receipt of the said notice.
6. From the record it appears that actually a demand was made for a payment of amount not 5,79,000/- but 6,50,000/-.
7. The petitioner and her husband alleged that the said legal notice was not received on 1-7-94 and in fact they received it on 29.6.94 and replied that notice. However, they failed and neglected to pay the said sum to the opposite party and her wife hence the petition of compliant by the opposite party.
8. Mr. Sunit Deb, the learned Advocate appearing with Advocate Mr. A. K. Ghosh contended for the petitioners in reference to Section 142 of the Negotiable Instruments Act, 1881 that no court shall take cognizance of any offence punishable under Section 138 except upon a complaint in writing, made by the payee or, as the case may be, the holder in due course of the cheque. He contended that in the instant case the cheque was drawn in the name of the opposite party No. 1 herein and his wife Smt. Shouli Paul and that the meaning of 'Payfee' as appears in Section 142 of the Negotiable Instrument Act should be read in reference to Section 13(2) of the General Clauses Act, 1887 which means that the words in singular shall include the plural, and vice versa.
9. According to him as the cheque was drawn in the name of opposite party No. 1 and his wife Smt. Shouli Paul a complaint by both of them is competent and not by either of them and upon such complaint by either of them the court was not competent to take cognizance of the offence.
10. That was also the argument in reference to Section 138 of the Negotiable Instrument Act where the term 'person' has been used in that Section.
11. From the record it appears that the notice was issued under Section 138 only on behalf of the opposite party No. 1 herein by his lawyer.
12. According to Mr. Deb the said notice is also illegal as the notice was not given by the opposite party No. 1 and his wife but by the opposite party No. 1 alone.
13. His second contention was that the amount claimed in the notice was Rs. 6,50,000;/- but the complaint has been made for a sum of Rs. 5,79,000/- and as such either the complaint is bad or the notice is bad.
14. The third contention of Mr. Deb was that though all the papers were not before the Court but as the papers have been filed as annexure in this revision the court can take notice of the same.
In support of his submission of Mr. Deb relied, upon a single bench decision of this Court in the case of N. C. Nag Pal v. The State reported in 1979 (II) CHN 198.
He also referred to a single bench decision of the Madras High Court in the case of Babu Xavier v. Lal Chand Munoth 1900 TLNZ (Crl.) 121 to point out that Section 138 of the Negotiable Instalment Act being a penal provision, Proviso (b) to that Section, is mandatory. Non-Compliance of its requirements make the entire Section 138 nugatory.
15. Fourthly, Mr. Deb contended in reference to that Single Bench decision of Madras High Court (Supra) that the proviso to Section 138 of the N.I. Act being penal in nature the provision of the Sections are to be construed very strictly. In this connection, he also relied on a single bench decision of this Court in the case of Ancon Engineering Co. (P) Ltd. v. Sri Amitava Goswami reported in 1993(1) CAI LT (HC) 479 : 1993 (1) CHN 298 and he particularly relied on paragraph 7 of that decision to point out that the requirement of the provisions under Section 138 of the Negotiable Instrument Act are to be followed to its letter and spirit/
16. In this connection, he also referred to Section 138 read with Clause (b) to the proviso of that section and particularly laid stress upon the wording of that section to point out that where any cheque has been 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, cither 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 by an agreement made with that bank then a proceeding under Section 138 of the Act is maintainable. He also laid special stress to the wording payee or the holder in due course of the cheque, as the case may be, as appearing in Clause (b) to the proviso to that Section to contend that the payment of the said amount of money can be demanded by such 'payee or holder' in due course by given notice in writing.
17. According to Mr. Deb the said, amount connotes the amount mentioned in the cheque otherwise the notice of demand would be invalid.
18. Mr. Sekhar Basu, for the opposite party on the other hand, contended, in reference to the defination of 'Payee' as contends in Section 7 of the Negotiable Instrument Act, 1881, that payee is the person named in the instrument, to whom or to whose order the money is by the instrument directed to be paid.
19. Mr. Basu submitted that in the instant case the petitioner is the 'payee' as because at his instance the money mentioned in the cheque can be directed to the paid and as such, the petition of complaint filed by the opposite party No. 1 is maintainable.
20. In the second place he contended, by; referring to Section 8 of the Negotiable Instrument Act, 1881, that the meaning of the 'holder' is the 'holder' of a promisory note, bill of exchange or cheque means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto.
21. Where the note, bill of exchange or cheque is lost or destroyed, its holder is the person so entitled at the time of such loss or destruction.
22. Mr. Basu contended that the opposite party is a holder of the cheque within the meaning of the defination of "Holder" and as such, the complaint filed by opposite party herein is maintainable.
23. Both sides argued on limitation. In the instant case everything was done within time and that argument has become irrelevant and need no discussion.
24. In the fourth place Mr. Basu contended that rigid construction of the words in Section 138 of the Negotiable Instlument Act is not warranted though that was the view taken by the Madras High Court in the case of Babu Xavier (Supra), because that decision has been overruled by the Supreme Court in the case of Anil Kumar Sawhney v. Gulshan Rai reported in Crimes XII-1993 (3) 1064.
25. Mr. Basu contended in reference to a Single Bench decision of Madras High Court in the case of S. Kiran v. L. C. Corporation reported in All India Criminal Law Reporter 1994 (2) 644 that if some more amount than the cheque amount is claimed in the notice than that would be a superflous one but it will not invalidate the notice.
26. Having heard the learned Advocates for the parties and considering the materials on record I agree with the submission of Mr. Basu that the complainant-Opposite party No. 1 herein is competent to file the petition of complaint as he is a "payee" within the definition in Section 7 of the Negotiable Instruments Act, 1881 or "a holder" as appearing in Section 8 of the said Act. But I disagree with the submission that demand of a more amount than the amount mentioned in the cheque in the notice will not invalidate the notice.
Section 138 on the Negotiable Instrument Act, 1881 contamplates that 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, eithe 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 clause (b) of the proviso of that Section contemplates that 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, (under secoring is by me)
27. So the wording in clause (b) to the proviso of Section 138 "a demand for payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque", refers to the cheque amount and not any other amount either smaller or higher than the amount mentioned in the cheque. So the notice need to be given demanding the cheque amount. If any bigger amount or smaller amount than the cheque amount is mentioned, in my view, that will create difficulty to the drawee to know how much amount he has to pay or she has to pay, as the case may be, and that makes the notice insufficient and vague and the notice will become illegal. This view has found support in a single bench decision of this court in the case of A neon Engineering Company Private Limited (supra).
28. In the instant case the cheque amount was 5,79,000/- whereas a demand was made from the petitioner herein by the opposite party No. 1 for a sum of Rs. 6,50,000/-. That was not the cheque amount, and as such, the notice is vague and insufficient and the said notice cannot be sustained in law.
29. The ratio in N. C. Nagpal's case (supra) has been overruled in principle by the Supreme Court in the case of Smt. Chand Dhawan v. Jawahar Lal reported in 1992 Crl. LJ SC 1956.
30. As I find that the notice is wrong taking cognizance of the offence on such notice is also wrong and illegal.
31. Accordingly, the revisional application is allowed. The order impugned is hereby set aside.