Karnataka High Court
M Loganathan vs K S Amar (Amer) on 10 March, 2023
Author: K.Natarajan
Bench: K.Natarajan
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 10TH DAY OF MARCH 2023
BEFORE
THE HON'BLE MR. JUSTICE K.NATARAJAN
CRIMINAL PETITION NO.12400 OF 2022
CONNECTED WITH
CRIMINAL PETITION NO.12415 OF 2022
CRIMINAL PETITION NO.12391 OF 2022
BETWEEN
M LOGANATHAN
S/O LATE B MANIKYAM
AGED ABOUT 60 YEARS
R/AT NO. 905/5, 6TH CROSS
BEHIND AYYAPPA TEMPLE
JALAHALLI WEST
BENGALURU-560 015
... COMMON
PETITIONER
(BY SRI A V AMARNATHAN , ADVOCATE)
AND
K S AMAR (AMER)
S/O K A SRINIVASA MURTHY
HINDU TRADER
AGED ABOUT 45 YEARS,
R/AT NO.4-9-52, HINDUPUR,
ANANTAPUR DISTRICT
PROPRIETOR, K A S ENTERPRISES 4-7-52
SREENIVASA NAGAR
NEAR MUNICIPAL OFFICE
HINDUPUR-515201
ANDHRA PRADESH ... COMMON
RESPONDENT
THESE CRIMINAL PETITIONS ARE FILED UNDER SECTION
482 OF CR.P.C PRAYING TO QUASH THE PROCEEDINGS
2
AGAINST THE PETITIONER NO.1 IN C.C.NO.388/2021,
C.C.NO.438/2021, C.C.NO.434/2021 RESPECTIVELY ON THE
FILE OF THE COURT OF THE PRINCIPAL JUDICIAL MAGISTRATE
OF 1ST CLASS, HINDUPUR, ANANTAPUR DISTRICT A.P. STATE.
THESE CRIMINAL PETITIONS HAVING BEEN HEARD AND
RESERVED FOR ORDERS ON 23.02.2023, THIS DAY, THE COURT
MADE THE FOLLOWING:
ORDER
The petitioner-ccused persons filed these petitions under Section 482 of Cr.P.C. for quashing the criminal proceedings in C.C.Nos.388/2021, 438/2021 and 434/2021 on the file of Principal Judicial Magistrate, 1st Class, Hindupur, Anantapur District, Andhra Pradesh State for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short 'N.I. Act').
2. The office has raised objection regarding maintainability of the petition at High Court of Karnataka where the case is pending at Andhra Pradesh.
3. Heard the arguments of learned counsel for the petitioners on the maintainability.
34. The learned counsel submits that under Section 138 of N.I. Act, the complainant can also filed complaint to the Court at Bengaluru where the part of cause of action arose and the petitioner also resides at Bengaluru, therefore, the petition is maintainable and he has relied upon the judgment of the Hon'ble Supreme Court in the case of Dashrath Rupsingh Rathod vs. State of Maharashtra and Another reported in (2014) 9 SCC 129 held in Criminal Appeal No.2287/2009.
5. Having heard the arguments and on perusal of the judgment delivered by the Hon'ble Supreme Court in respect of Section 138 of N.I. Act and Section 177 of Cr.P.C., held at paragraph Nos.31 and 32 as under:
"31. To sum up:
(i) An offence under Section 138 of the Negotiable Instruments Act, 1881 is committed no sooner a cheque drawn by the accused on an account being maintained by him in a bank for discharge of debt/liability is returned unpaid for insufficiency of funds or for the reason that the amount exceeds the arrangement made with the bank.4
(ii) Cognizance of any such offence is however forbidden under Section 142 of the Act except upon a complaint in writing made by the payee or holder of the cheque in due course within a period of one month from the date the cause of action accrues to such payee or holder under clause (c) of proviso to Section 138.
(iii) The cause of action to file a complaint accrues to a complainant/payee/holder of a cheque in due course if
(a) the dishonoured cheque is presented to the drawee bank within a period of six months from the date of its issue,
(b) if the complainant has demanded payment of cheque amount within thirty days of receipt of information by him from the bank regarding the dishonour of the cheque, and
(c) if the drawer has failed to pay the cheque amount within fifteen days of receipt of such notice.
(iv) The facts constituting cause of action do not constitute the ingredients of the offence under Section 138 of the Act.5
(v) The proviso to Section 138 simply postpones/defers institution of criminal proceedings and taking of cognizance by the court till such time cause of action in terms of clause (c) of the proviso
(vi) Once the cause of action accrues to the complainant, the jurisdiction of the court to try the case will be determined by reference to the place where the cheque is dishonoured.
(vii) The general rule stipulated under Section 177 CrPC applies to cases under Section 138 of the Negotiable Instruments Act. Prosecution in such cases can, therefore, be launched against the drawer of the cheque only before the court within whose jurisdiction the dishonour takes place except in situations where the offence of dishonour of the cheque punishable under Section 138 is committed along with other offences in a single transaction within the meaning of Section 220(1) read with Section 184 of the Code of Criminal Procedure or is covered by the provisions of Section 182(1) read with Sections 184 and 220 thereof.
32. Before parting with this aspect of the matter, we need to remind ourselves that an avalanche of cases involving dishonour of cheques has come upon the Magistracy of this country. The number of such cases as of October 2008 were estimated to 6 be more than 38 lakhs by the Law Commission of India in its 213th Report. The result is that cases involving dishonour of cheque are in all major cities choking the criminal justice system at the Magistrate's level. Courts in the four metropolitan cities and other commercially important centres are particularly burdened as the filing of such cases is in very large numbers. More than five lakh such cases were pending in criminal courts in Delhi alone as of 1-6-2008. The position is no different in other cities where large number of complaints are filed under Section 138 not necessarily because the offence is committed in such cities but because multinational and other companies and commercial entities and agencies choose these places for filing the complaints for no better reason than the fact that notices demanding payment of cheque amounts were issued from such cities or the cheques were deposited for collection in their banks in those cities. Reliance is often placed on Bhaskaran case to justify institution of such cases far away from where the transaction forming basis of the dishonoured cheque had taken place. It is not uncommon to find complaints filed in different jurisdiction for cheques dishonoured in the same transaction and at the same place. This procedure is more often than not intended to use such oppressive litigation to achieve the collateral purpose of extracting money from the accused by 7 denying him a fair opportunity to contest the claim by dragging him to a distant place. Bhaskaran case could never have intended to give to the complainant/payee of the cheque such an advantage. Even so, experience has shown that the view taken in Bhaskaran case permitting prosecution at any one of the five different places indicated therein has failed not only to meet the approval of other Benches dealing with the question but also resulted in hardship, harassment and inconvenience to the accused persons. While anyone issuing a cheque is and ought to be made responsible if the same is dishonoured despite compliance with the provisions stipulated in the proviso, the court ought to avoid an interpretation that can be used as an instrument of oppression by one of the parties. The unilateral acts of a complainant in presenting a cheque at a place of his choice or issuing a notice for payment of the dishonoured amount cannot in our view arm the complainant with the power to choose the place of trial. Suffice it to say, that not only on the principles of interpretation of statutes but also the potential mischief which an erroneous interpretation can cause in terms of injustice and harassment to the accused the view taken in Bhaskaran case needs to be revisited as we have done in foregoing paragraphs.
8On perusal of the judgment of the Hon'ble Supreme Court, it clearly held at paragraph No.31(vi) and (vii) stating that the complainant can file the complaint under Section 138 of N.I. Act, where the cheques were dishonoured when it was presented by the complainant.
The respondent complainant presented the cheque at ICICI Bank at Hindupur Branch, Andhra Pradesh and cheques were dishonoured, therefore, the complaint came to be filed at JMFC Court, Hindupur, where the cause of action arose and the Bank where the cheque was presented by the complainant and dishonored. Admittedly, the JMFC Court at Hindupur is at Andhra Pradesh State, but not in Karnataka.
6. The contention of the learned counsel for the petitioners is not sustainable and the petition under Section 482 is not maintainable before this Court at Karnataka for the reasons that as per the judgment passed by the this Court in the case of Vihaan Direct Selling India Private Limited vs. The Assistant Director, ED 9 and another in Writ Petition No.2576/2023 (GM-
RES), by relying upon the judgment of the High Court of Madras in the case of S. Ilanahai vs. The State of Maharashtra in Criminal.O.P.No.22498/2014 and M.P.No.1/2014 reported in 2015 (1) MWN (Cr.) 618, where at Paragraph Nos.38, 39 and 40 are held as under:
"38. From the above judgment of the Larger Bench, now it is crystal clear that what is relevant for the High Court to entertain a Petition under Section 482, is not the cause of action as the term "cause of action" is foreign to Criminal law. In Navinchandra N. Majithia v. State of Maharashtra, 2000 (4) CTC 60 (SC), the Hon'ble Supreme Court had not dealt with the question as to whether the power of the High Court under Section 482 of the Code could be exercised beyond the territorial limits of the High Court. As I have already pointed out, the Court only held that Writ jurisdiction could be exercised beyond the territorial limits provided either the cause of action in full or in part has occurred outside the jurisdiction of the High Court concerned.10
39. As we have already noticed, before the introduction of Clause (2) of Article 226 of the Constitution of India, as per the Constitution Bench Judgment in Election Commission, India v. Saka Venkata Subba Rao, AIR 1953 SC 210, the jurisdiction was based only on the situs of the person or Authority concerned against whom Writ or Order is to be issued. The jurisdiction was extended beyond the territorial limits by the introduction of Clause (2) to Article 226 of the Constitution of India based on the cause of action. So far as the Territorial jurisdiction under Section 482 of the Code of Criminal Procedure is concerned, it is akin to Article 226 of the Constitution of India as it stood prior to the introduction of Clause (2) of Article 226. When Parliament thought it fit, after the above Constitution Bench Judgment, to extend the Writ Jurisdiction of the High Court beyond the territorial limits of the said High Court, it did not think it appropriate, similarly to amend Section 482 of the Code of Criminal Procedure so as to add provision like Clause (2) of Article 226 of the Constitution of India extending the inherent power of the High Court under Section 11 482 of the Code of Criminal Procedure beyond the territorial limits of the said High Court based on the fact that the part of offence is committed outside the territorial limits of the said High Court.
40. Thus, in my considered opinion, so far as the power under Section 482 of the Code of Criminal Procedure for the purpose of quashing the F.I.R. is concerned, the only criteria is the situs of the Authority who has registered the case and not the place of commission of the crime either in full or in part. Similarly, the Writ jurisdiction of the High Court under Article 226 of the Constitution to quash a Criminal case also does not extend beyond the territorial limits of the said High Court if the case is pending on the file of an Authority, who is located outside the territorial limits of the said High Court. This conclusion is inescapable, in view of the authoritative pronouncement of the Larger Bench of the Hon'ble Supreme Court in Dashrath Rupsingh Rathod v.
State of Maharashtra, 2014 (2) MWN (Cr.) DCC 145 (SC), wherein the Court has held that the concept of "cause of action" which is 12 relevant to Civil Law cannot be imported to Criminal Law".
7. The Delhi High Court has also taken similar view in the case of Sayed Mohd. Masood vs. Union of India and Another reported in 2013 SCC OnLine Del 4510 and has held at paragraph No.18 as under:
"18. Mr. V.P. Singh, learned senior counsel for petitioner's submission that since arrest order was issued in Delhi and subsequently, the petitioner was also arrested in Delhi constitutes a cause of action is misplaced. Going by the petitioner's logic, in all criminal cases, where an accused is arrested in a State different from where FIR is lodged, two High Courts would have jurisdictions under Article 226 of the Constitution, namely, one under whose territorial jurisdiction the FIR had been registered and the other where the accused had been arrested. But in law, two High Courts cannot simultaneously exercise jurisdiction. In our view the mere fact that the summons dated 14th December, 2012 whereby the petitioner was asked to appear in person in the office of Directorate of Enforcement, Delhi 13 Zonal Office and the arrest order was issued from the Delhi Zonal Office are not facts which by themselves would confer territorial jurisdiction on this Court. A perusal of both the summons and the arrest order reveal that they were issued by Mr. D. Shanmugam, Assistant Director, Directorate of Enforcement, Mumbai, Camp at Delhi Zonal Office at 10-A, Jam Nagar House, Akbar Road, New Delhi-110011. This Court is of the opinion that this would imply that Mr. D. Shanmugam, at the relevant time, had only camped at the Delhi Zonal Office for the sake of convenience and it cannot be inferred that the Delhi Zonal Office was directly related to the affairs of the case against the petitioner under PMLA, 2002. Further, the present petitioner was arrested in Delhi because he was available in Delhi. In the present case, the prosecution presented the petitioner before the concerned Duty Magistrate on the same day, i.e., 14th December, 2012 itself and obtained transit remand. The very next day he was produced before the Mumbai Court. At no point of time, the present petitioner was detained in Delhi, more than what was logistically required.14
Consequently, this Court is of the opinion that the material and substantial part of cause of action had arisen within the jurisdiction of the Mumbai High Court alone."
8. In the case of S. Ilanahai stated supra, the Madras High Court has relied upon the judgment of the Hon'ble Supreme Court in the case of Election Commission, India v. Saka Venkata Subba Rao, AIR 1953 SC 210.
9. In view of the decisions mentioned above, when the cause of action arose at Hindupur, Andhra Pradesh and case is also pending at Hindupur, Andhra Pradesh which comes under the jurisdiction of High Court of Andhra Pradesh to entertain the petition under Section 482 of Cr.P.C. but not the High Court of Karnataka, merely, it is situated within 100 km from Hindupur and Andhra Pradesh High Court is situated far away from Hindupur. Therefore, I am of the view, all these three petitions are not maintainable before this Court on the point of territorial jurisdiction.
1510. Accordingly, all the three petitions are dismissed as not maintainable and liberty granted to approach the concerned Court.
Sd/-
JUDGE GBB