Delhi District Court
M/S Roy Brothers vs Rakesh Sood on 6 December, 2016
IN THE COURT OF SH. A. K. KUHAR, ASJ/SPECIAL JUDGE;NDPS
SOUTH DISTRICT, SAKET
Criminal Revision No. 8295/2016
CNR No. DLST0100201012016
M/s Roy Brothers ..........Revisionist no. 1
1624, Brahmaputra Apartment,
Sector - 29, NOIDA, UP201301
Rohit Roy ..........Revisionist no.2
s/o late Sh. Deepak Roy,
1624, Brahmaputra Apartment,
Sector29, NOIDA, UP201301
versus
Rakesh Sood ..........Respondent
r/o W4/D5, Western Avenue, Sainik Farms, New Delhi110062 CR No. 8296/2016 CNR No. DLST010021022016 Rahul Deepak Roy ..........Revisionist s/o late Sh. Deepak Roy, r/o 13/14, Ist Floor, Mistry Nagar CoOp Society, 5th Road, Shivaji Park, Dadar West, Mumbai400028 versus Rakesh Sood ..........Respondent r/o W4/D5, Western Avenue, Sainik Farms, New Delhi110062 M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 1 of 15 Date of institution : 20th May 2016 Arguments concluded on : 28th November 2016 Order announced on : 06th December 2016 J U D G M E N T
1. By this common Judgment, I shall dispose of two Criminal Revision Petitions titled as M/s Roy Brothers & anr. Vs Rakesh Sood in CR No. 8295/2016 and Rahul Deepak Roy vs Rakesh Sood in CR No. 8296/2016 as the parties are same and in both the Revision Petitions same order dated 14.03.2016 has been challenged.
2. Both these Criminal Revisions have been filed u/s 397 r/w Section 399 Cr. PC against the impugned order dated 14.03.2016 whereby Ms. Rajat Goyal Learned Metropolitan Magistrate No. 01, (NI Act), South New Delhi has summoned the revisionists for the offence punishable u/s 138 of Negotiable Instruments Act (hereinafter referred as NI Act) in Criminal Complaint no. 665/16 titled as "Rakesh Sood vs M/s Roy Brothers and others".
3. Notice of the Revision Petitions was issued to the respondent, who marked appearance with counsel and submitted a reply to the petition.
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4. The facts, in brief are that respondentRakesh Sood has filed a Criminal Complaint for the offence punishable u/s 138 NI Act alleging therein that on 21.08.2015 an agreement was entered into between respondent/complainant Rakesh Sood on one hand and the accused arrayed in the Criminal complaint on the other. Pursuant to the said agreement, a sum of Rs. Ten lacs was paid to the arrayed accused in the criminal complaint. As per this agreement, the amount paid by respondent/complainant Rakesh Sood was to be returned with interest thereon. Pursuant to this agreement, three cheques were issued on behalf of the arrayed accused in criminal complaint no. 665/2016 i.e. Cheque no. 991994 dated 21.01.2016 for principle amount of Rs. 10 lacs and Cheque no. 991998 dated 05.12.2015 and cheque no. 991999 dated 05.01.2016, both for a sum of Rs. 49,500/ as interest cheques. On presentation, these cheques have been dishonoured on account of "payment stopped by the drawer" and "insufficient funds". On 27.01.2016, legal demand Notice u/s 138 of NI Act was issued by registered AD, speed post and courier. Despite legal demand notice, the payment of the cheque amount was not made. Hence, a criminal complaint was filed and thereafter, pre summoning evidence was recorded. Vide the impugned order dated 14.03.2016, accused arrayed in criminal complaint no. 665/2016 were M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 3 of 15 summoned. Aggrieved with the impugned order, Criminal Revision Petition no. 8295/2016 has been filed by M/s Roy Brothers and Rohit Roy and Criminal Revision Petition no. 8296/2016 has been filed by Rahul Deepak Roy, who was arrayed as accused no. 3 in criminal complaint no. 665/2016. In both the revision petitions, the grounds of challenge of the impugned order are same.
5. I have heard arguments advanced by Sh. Amit P. Deshpandey Learned counsel for the revisionist and Sh. Prosenjeet Banerjee with Ms. Princy Ponna Learned counsels for respondent. I have also gone through the Trial Court Record carefully.
6. The impugned order dated 14.03.2016 has been assailed on the grounds interalia; firstly the impugned order suffers from irregularity and infirmity as the facts alleged in the complaint do not specify the basic ingredients of the offence punishable u/s 138 of NI Act for summoning of an accused. Secondly, the legal demand Notice dated 27.01.2016 was not a valid Notice for the reason that the Notice in question contemplates payment "within the next 15 days" instead of "payment within 15 days from the date of receipt of legal Notice". Further, in the legal Notice there is demand of outstanding amount under various loan agreements. Further, the Notice issued was a composite Notice. Further, there was no M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 4 of 15 legal liability and there was no binding or enforceable agreement between the parties.
7. In reply to the Revision petition, it has been submitted that order dated 14.03.2016 does not suffer from any infirmity or irregularity. The Notice u/s 138 of NI Act, issued by the respondent was as per the law and it is the duty of the drawer of the cheque to make payment within 15 days of the receipt of Notice and the Notice in question has also specified that the payment is to be made within 15 days. It is further submitted that Notice need not be read into piecemeal and has to be considered in its entirety. There is specific demand of payment of cheque amount in the Notice.
8. With regard to the contention that the legal Notice was a Composite Notice, it is submitted that the legal Notice has specific averments with regard to the lender in whose favour the cheques have been issued. The number of cheques which have been dishonoured and the amount of the cheque are specifically mentioned in the legal Notice.
9. Learned counsel for the revisionist has based his arguments on the above stated grounds. Apart from that, he also submitted that in the Notice the specific amount of the cheque is not mentioned and secondly, there was no service of the Notice. Hence, the summoning M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 5 of 15 order could not have been passed. Learned counsel has relied upon the Judgment in "Rahul Builders vs Arihant Fertilizers and Chemical"
2008 (2) SCC 321 and "Dashrath Roop Singh Rathore vs State of Maharashtra" AIR 2014 SC 3519.
10. On the contrary, Learned counsel for the respondent has relied upon following Judgments in support of his contentions: "V. Raja Kumari vs P. Subbarama Naidu and another" (2004) 8 Supreme Courts Cases 774; D. "Vinod Shivappa vs Nanda Belliappa"
(2006) 6 Supreme Courts cases 456; "Samant vs K. G. N. Traders" 1994 SCC OnLine Kar 207; "P. V. R. S Manikumar vs Krishna Reddy" 1999 SCC OnLine Mad 107; "Rallis India Limited vs Poduru Vidya Bhushan and others" (2011) 13 Supreme Court Cases 88; "Gunmala Sales Private Limited vs Anu Mehta and others" (2015) 1 Supreme Courts cases 103; "K. R. Indira vs Dr. G. Adinarayana" (2003) 8 Supreme Courts Cases 300 and "Rahul Builders vs Arihant Fertilizers and Chemicals" 2008 (2) SCC 321.
11. An offence punishable u/s 138 of NI Act require three basic ingredients before an action can be taken against the drawer of the cheque. Firstly, the cheque has been issued by an accused on an account M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 6 of 15 maintained by him with a banker. Secondly, the cheque amount is in discharge of debt or a liability and thirdly, the cheque has been returned unpaid for insufficiency of funds or that the amount exceeds the arranged made with the bank.
12. However, the cause of action for the penal action by way of filing of complaint would arise only when;
(i) the payee or holder in due course has presented the cheque for payment within the period of six months from the date of issue thereof or within period of its validity;
(ii) the payee or holder in due course has made a demand for the payment of the cheque amount from the drawer by issuing a written Notice within 30 days of receipt of information by him from the bank regarding dishonour; and
(iii) the drawer has failed to pay the cheque amount within 15 days of the receipt of the Notice.
13. Needless to say that all the three conditions are to be specified simultaneously and after the expiry of 15 days on the receipt of Notice by the drawer, the payee will get a right to file a criminal complaint u/s 138 of NI Act, if the payment of the cheque amount is not made. M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 7 of 15
14. The legal demand Notice is the basic requirement to initiate action u/s 138 NI Act. Therefore, the legal demand Notice must satisfy the statutory requirements. Meaning thereby, it must specify the cheque number and the amount of the cheque, it should be issued within 30 days from the date of dishonour of the cheque and there should be a demand for payment of the cheque amount.
15. Learned counsel for the revisionist had submitted that legal demand Notice dated 27.01.2016 mentions demand of payment "within the next 15 days" instead of "payment within 15 days from the date of receipt of legal Notice", therefore, it is not valid Notice.
16. I have gone through the legal demand Notice dated 27.01.2016 in the Trial Court Record. It interalia, reads that "our Clients hereby notify you that they would be constrained to initiate proceedings under the Negotiable Instruments Act, 1881, if the amounts due thereunder are not cleared within the next fifteen (15) days".
17. The language used in the Notice does not make a difference so long as the addressee/drawer of the cheque is made aware about the details of the cheque, which has been dishonoured, the amount of the cheque, an intimation that the cheque has been dishonoured for a M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 8 of 15 particular reason and finally a demand of payment of cheque amount. Once, the Notice is received by the drawer of the cheque, then it is for him to make payment within the fifteen days from the date of receipt of the Notice. The complainant need not even specify when the drawer of the cheque of the cheque has to make payment. His only duty is to 'demand' the payment of the cheque amount from the drawer of the cheque. Even otherwise, the expression "within the next fifteen days" also logically convey that the fifteen days would start from the date of the receipt of the Notice by addressee/drawer of the cheque.
18. The day the drawer of the cheque gets the knowledge of dishonour of the cheque by way of legal Notice, the limitation of fifteen days would start. Therefore, the use of expression "next fifteen days" in other words would mean "fifteen days from the date of receipt of Notice".
19. Learned counsel for revisionists has also relied upon Rahul Builder's case (supra) wherein entire outstanding amount was claimed in the legal Notice, which was held to be not a valid Notice. The perusal of the judgment would show that facts are distinguishable. In Rahul Builder's case (supra) by way of the Notice, the outstanding amount was M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 9 of 15 claimed and the cheque amount was not claimed. While in the present case, by way of Notice the drawer of the cheque has been informed about the cheque number, the amount and the date of presentation and the ground of dishonour of cheque. Thereafter, the payment of the cheque amount has been sought u/s 138 of NI Act 1881. The language of the legal Notice leaves no room for doubt that the payment of the cheque which has been dishonoured, has been sought. If in addition to that reference is also made to details of agreement and other fact, that will not invalidate the demand Notice.
20. Another ground for challenging the legal Notice is that it is a Composite Notice, therefore, it is not a valid legal Notice. Learned counsels for both the parties have placed reliance on K. R. Indira's case (supra) in support of their rival contentions. Perusal of this judgment would leave no room for doubt that if composite Notice clearly specify the particulars of the cheque and the amount with a specific demand for the payment of the amount of the cheuqe, it would be a valid legal Notice despite being a composite Notice. Thus, a Composite Notice by itself is not an invalid Notice, so long as it satisfies statutory requirement.
21. There may be cases where more than one payee or holder in due course having different dishonoured cheques come together and M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 10 of 15 issue a signal Notice to the same drawer, who had issued all those cheques. In the K. R. Indira's case (supra), it has been observed that, If consolidated Notice provides sufficient information envisaged by the statutory provision and contains the said specific demand, mere fact that it was a consolidated notice and/or that further demands in addition to the statutorily envisaged demand were also made, would not invalidate the same.
22. Coming to the facts of the case, the contents of the legal Notice are unambiguous and clearly give the information which is required as per Section 138 of NI Act.
23. During arguments, Learned counsels for revisionist has taken plea that the Notice was not served upon revisionist, although this ground was not taken in the petition. So far as the service of the Notice is concerned, there is averment in the complaint that the Notice has been sent by way of registered post, speed post and courier. The reports thereof are already on Trial Court Record. This question of fact whether Notice has been duly served on the revisionist or not can only be decided at the time of trial.
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24. In the case of V. Raja Kumari's case (supra), it has been observed that, "question whether Notice as required u/s 138 of NI Act 1881 has been served has to be decided during trial and the complaint ought not to be dismissed at the threshold on the purported ground that there was no proper service of Notice".
Thus, this ground of Learned counsel for revisionist during the course of arguments, can be taken care of only at the trial.
25. In the case of D. Vinod Shivappa's case (supra), it was held that, it is not "giving" but it is the "failure after receipt" of the Notice by drawer which gives the cause of action to the complainant to file the complaint within the statutory period. Receipt of the Notice has to be proved and the presumption u/s 27 of the General Clauses Act would operate in case Notice had been issued at the correct address. The presumption so raised u/s 27 of the General Clauses Act would be rebuttable which can be rebutted by the drawer of the cheque at the trial.
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26. Learned counsel for the revisionist has also taken additional plea that M/s Roy brothers is not a proprietorship firm and not a partnership firm, as stated in the complaint. Learned counsel for the revisionist has relied upon judgment "Raghu Lakshminarayanan vs Fine Tubes 2007 AIR (SC) 1634 wherein it has been held that "proprietory concern" is not a "company". Therefore, the revisionist Rahul Deepak Roy in Criminal Revision petition no. 8296/16 cannot held liable by invoking Section 141 of NI Act.
27. Learned counsel for respondent has countered this argument and relied upon Judgment in Rallis India Limited's (supra) wherein it was held that vicarious liability can be inferred against partners of the firm when it is specifically averred in the complaint about the status of the partners qua the firm. In the Criminal complaint in paragraph one itself there is specific reference that M/s Roy Brothers (accused no. 1) is a partnership firm and Rohit Roy and Rahul Deepak Roy are its partners and persons incharge and responsible for the conduct of the business of M/s Roy Brothers (accused no. 1).
28. Once, these "specific averments" have been made then the burden of proof would be on the petitioners herein to establish that M/s Roy Brothers is not a partnership firm and therefore, Rahul Deepak M/s Roy Brothers & anr. Vs Rakesh Sood (CR No. 8295/2016) Rahul Deepak Roy vs Rakesh Sood (CR No. 8296/2016) Page no. 13 of 15 Roy has no liability. Once "basic averments" have been made in the complaint with regard to the liablility of the petitioners, then it is a matter of trial to decide whether M/s Roy Brothers is a partnership firm or a proprietorship firm.
29. Learned counsel for revisionist also argued that there was no legal liability and no binding or enforceable agreement, or the agreement in question is not signed by respondent. In this regard suffice it would be to say that issuance of cheque and signature of drawer thereon is not denied, nor it is denied that this agreement bear signatures of one of the partner of the firm, thus a presumption would arise that cheque has been issued in discharge of legal debt or liability. It would remain a question of fact and a matter of trial whether cheques were issued in discharge of legal debt or liability.
30. Therefore, in view of above discussion, I am of the considered view that impugned order dated 14.03.2016 does not suffer from any illegality, irregularity or any impropriety. Accordingly, Criminal Revision petition no. 8295/2015 and 8296/2016 stand dismissed. Copy of this Judgment be placed in the respective file of both the Criminal Revision petitions.
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31. Trial Court Record be sent back to the Trial Court concerned alongwith copy of this order for perusal .
32. Revision file be consigned to record room, after compliance of all other necessary formalities.
(announced in the (Ajay Kumar Kuhar)
open Court on ASJ/Special Judge (NDPS)
06 December 2016)
th
South District: Saket
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