Calcutta High Court (Appellete Side)
M/S. Sunraj Software Pvt. Ltd vs State Of West Bengal & Anr on 5 April, 2011
Author: Kanchan Chakraborty
Bench: Kanchan Chakraborty
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IN THE HIGH COURT AT CALCUTTA
CRIMINAL REVISIONAL JURISDICTION
APPELLATE SIDE.
Present:
The Hon'ble Justice Kanchan Chakraborty
C.R.R. 2013 of 2006
M/S. Sunraj Software Pvt. Ltd.
-Versus-
State of West Bengal & Anr.
Mr. Sabyasachi Banerjee,
Mrs. Sharmistha Ganguly,
Ms. Arpita Mallick ...............................for the petitioner
Mr. S. Bhattacharya,
Mr. R. Dhara ........................................for the O.P. no. 2
Heard on : 22.2.2011, 22.3.2011, 29.3.2011.
Judgment on : 5th April, 2011.
Kanchan Chakraborty, J. :
The challenge in this revisional application is to the order dated 28th March, 2006 passed by the learned Additional Chief Metropolitan Magistrate, Calcutta in case No. C-483/03 whereby the learned Magistrate decided to continue the prosecution against the petitioner, M/s. Sunraj Software Pvt. Ltd., and directed the complainant-opposite party for taking steps in the matter of 2 prosecuting the Director of Createch Solution Ltd., who issued the cheque in question.
The opposite party, M/s. Adan Traders Pvt. Ltd., initiated a prosecution under Section 138 of the Negotiable Instruments Act, (hereinafter referred to as "the said Act"), against M/s. Sunraj Software Pvt. Ltd., petitioner herein, alleging that the petitioner company issued a cheque of Rs.7,00,000/- on 21.01.2003 in favour of the opposite party company in discharge of debt/liability, which was dishonoured for "Payment stopped by the drawer". A legal demand notice dated 21.4.2003 was sent by the opposite party calling upon the petitioner to pay the cheque amount within 15th days from the date of receipt of the notice. The notice was sent under Registered Post with A/D. On 26.04.2003 the petitioner sent one reply to that notice acknowledging receipt of the demand notice and made some incorrect and misleading statements therein. Since the petitioner failed to pay the cheque amount within 15 days from the date of receipt of the demand notice, the prosecution was launched.
In the Trial Court, an application was taken out by the petitioner challenging the maintainability of the case against the company only. The learned Court by the impugned order dated 28.03.2006 came to the conclusion that the Director, who issued the cheque and was in-charge of the business of the petitioner company, was also liable to be prosecuted. So, the learned Trial Court directed the complainant, i.e., the opposite party herein, for taking steps so that the said Director can be made party to the case.
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The legality, validity and propriety of the said order has been challenged in this revisional application.
Mr. Sabyasachi Banerjee, learned advocate appearing on behalf of the petitioner, has made three-fold contention. His first contention was that while the opposite party, in its petition of complaint, accepted the fact that the petitioner had given reply to the demand notice on 26.4.2003, the period of limitation was to be reckoned from 27.4.2003 for the purpose of Section 138 of the said Act. Therefore, cognizance of offence taken by the Court appears to be premature and beyond jurisdiction. His second contention was that nowhere within four-corners of the petition of complaint, the name of M/s. Createch Solution Ltd. has been mentioned. It is not understood why the learned Court wanted to make the Director of the said Company an accused of the case. That order, on the face of it, is wrong and liable to be set aside. His third contention was that no Director of the petitioner-company has been made an accused to the case. Only company has been made an accused. It is not the duty of the Court in a criminal case to direct the complainant to take steps for adding someone to the case as an accused. The power under Section 319 of the Code of Criminal Procedure cannot possibly be exercised before the trial commenced. Therefore, the order impugned is manifestly bad in law and is liable to be set aside.
Mr. S. Bhattacharya, learned advocate appearing on behalf of the opposite party, has submitted that the period of limitation under Section 138 of the said Act depends on certain facts, mainly, failure on the part of the accused to make payment within 15 days from the date of receipt of the demand notice. Therefore, 4 when the petitioner failed to make payment within 15 days from the date of receipt of the demand notice, prosecution launched immediately thereafter and the learned Court has rightly taken cognizance of the same. Mr. Bhattacharya has submitted that the name of M/s. Createch Solution Ltd. has inadvertently been mentioned in the order and that portion of the order can well be ignored as it has no connection with the actual order passed.
As regards issuing direction on the opposite party-complainant for taking steps in the matter of addition of the Director of the petitioner-company as an accused, Mr.Bhattacharya, learned advocate for the opposite party, has contended that Court, at that stage, was not aware of the name and address of the Director who issued the cheque. Naturally, opposite party-complainant was supposed to furnish the name and whereabouts of the Director in order to facilitate the Court to issue process against him. Therefore, in true sense, the order does not appear to be illegal and incorrect necessitating interference of this Court in this revision.
In generic and wide sense "cause of action" means every fact which it is necessary to establish to support a right or obtain a judgment. Viewed in that context, the following facts are required to be proved to successfully prosecute the drawer for an offence under Section 138 of the said Act:-
(i) drawing of the cheque;
(ii) presentation of the cheque to the bank;
(iii) returning of the cheque unpaid by the bank;
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(iv) giving of notice, in writing, to the drawer of the cheque demanding payment of the cheque amount; and
(v) failure of the drawer to make payment within 15 days of receipt of the notice.
Three provisos to Section 138 of the Act enacted elements (ii), (iv) and (v) as above and for the present purpose (iv) and (v) enacted in provisos (b) and (c) to Section 138 of the said Act are the most important. Proviso (b) to Section 138 of the said Act contains four important aspects. It says that the notice:
(i) must be given by the payee or the holder in due course;
(ii) must be in writing;
(iii) must be given within 30 days of receipt of the information of dishonour; and
(iv) must make a demand for payment of the cheque amount.
Proviso (c ) to Section 138 of the Act contains two important aspects. It speaks of receipt of the notice by the drawer and his failure to make payment within 15 days of such receipt of notice. Only thereafter "cause of action" for institution of a criminal complaint will legally arise.
The period of 15 days envisaged by Section 138(c ) of the said Act will begin to run on the day next to the day on which service of notice has been effected. This view has been taken by the Hon'ble Apex Court in Saketh India Ltd. vs. Indian Securities Ltd., reported in 1999 Cr. L. J. SC 177 and In Haru Das Gupta vs. State of West Bengal, reported in AIR 1972 SC 1293.
The period of one month for filing the application will be reckoned from the day immediately following the day on which the period of 15 days from the date of 6 the receipt of the notice by the drawer expires. When the requirement under Section 138 of the said Act is satisfied, one will be taken to have committed offence. It is only a deeming provision. Offence under Section 138 of the said Act being an offence in the commercial practice cannot be taken as one involving moral turpitude. So, any ground of non-payment shown by the drawer in a case where he written a letter challenging the notice or the money demanded etc. is nothing but a plea which is subject to strict proof and that can only be considered at the time of trial.
Section 138 (c) of the said Act runs as follows:
"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, or 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) ..............................
(b) ..............................
(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."
Section 142 (b) of the said Act runs as follows:
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"142. Cognizance of offence. - Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974)-
(a) ..........................
(b) such complaint is made within one month of the date on which the cause-of-action arises under clause (c ) of the proviso to section 138.
Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant satisfies the Court that he had sufficient clause for not making a complaint within such period."
On perusal of the languages of Sections 138 and 142 of the said Act, set out above, makes it abundantly clear that in order to prosecute anyone under Section 138 of the said Act, the period of limitation is to be reckoned from the date when 15 days time from the date of receipt of the notice expires. After reckoning the period of limitation the person sought to be prosecuted can challenge the notice in any manner. That cannot be the object of the Law. The languages of Sections of 138 and 142 of the said Act leaves no room to doubt that such a letter by the person sought to be prosecuted is immaterial in the matter of reckoning the period of limitation. Therefore, I do not accept the proposition of Mr. Banerjee.
As regards the contention no. 2, it appears peculiar to me that how M/s. Createch Solutions Limited came in the midst of the proceeding. M/s. Createch Solutions Limited was neither the complainant nor the company sought to be prosecuted or had any connection, whatsoever, with the prosecution. It is clear that somehow the Court has made a mistake in mentioning the name of M/s. Createch Solutions Limited in the order. That portion, however, has got no connection, whatsoever, with the direction passed by the learned Trial Court and 8 the petition, which was disposed of by the Court. Therefore, that portion of the order is deleted.
As regards the last contention raised by Mr. Banerjee that Court cannot take action under Section 319 of the Code of Criminal Procedure before examination of any witness. There is no dispute as to the submission of the learned advocate for the petitioner in this matter. However, the question invoking power under Section 319 of the Code of Criminal Procedure has never arisen before the learned Trial Court. The learned Trial Court found that the company sought to be prosecuted, i.e., the petitioner-company, being a juristic person is to be represented by someone. Again in view of Section 141 of the said Act, Director or Directors, who is/are in-charge of the business of the company, can issue a cheque, is/are liable to be prosecuted together with the company. Accordingly, Court passed the order directing the complainant, i.e., the opposite party herein to take proper steps so that Court can prosecute the Director concerned.
I find nothing illegality in the order. It is true that the way order has been written can be interpreted differently, but the ultimate intention of the Court was to bring the co-accused on record. Therefore, that portion of the order is required to be modified instead of setting aside the entire order.
Accordingly, the revisional application fails. However, I modify the order passed by the learned Trial Court in the following manner.
That the complainant, i.e., the opposite party herein is directed to furnish details of the Director of the petitioner company, who is liable for issuing the 9 cheque and in-charge of the business of the company. Upon receipt of such information, the learned Trial Court should issue process against him calling upon to appear before the Court as an accused.
With the directions above, this revisional application is disposed of. Interim order, if any, stands vacated.
There will, however, be no order as to costs.
Let urgent photostat certified copy of this order, if applied for, be given to the learned advocates of the parties upon compliance of necessary formalities.
(Kanchan Chakraborty, J.)