Jammu & Kashmir High Court
Rozy Kukreja vs Finance Associates on 26 February, 2004
Equivalent citations: 2005(1)ALD(CRI)7, I(2005)BC492, 2004CRILJ3700, 2004(2)JKJ256
JUDGMENT Y.P. Nargotra, J.
1. The petitioner through this petition is seeking the quashment of the proceedings initiated on the complaint of the respondent filed Under Section 138 of the Negotiable Instruments Act by invoking the provisions contained in Section 561.A. Cr.PC. The brief facts requiring notice need to be stated.
2. The complainant has alleged in the complaint that the accused received Rs. 3.00 lacs on 17.1.1997 as loan from the complainant-firm and agreed to repay the same along with interest after three years from the date of receipt thereof. He executed the necessary documents. The husband of the accused stood as guarantor. The accused made the payment of interest from month to month but defaulted w.e.f. 1.4.2002. Then the accused issued a cheque for a sum of Rs. 3.00 lacs in favour of the complainant drawn on Union Bank of India, Branch Gandhi Nagar Jammu on 15.5.2002. The complainant presented the cueque with his bankers, Oriental Bank of Commerce, Ragunath Bazar Jammu, however, the same was received back on 25.5.2002 through registered post accompanied by a memo of the Bank of the accused dated 17.5.2002 with the endorsement that the cheque has been dishonoured on account of having kept insufficient amount by the account-holder in his account. The complainant issued a notice of demand on 2.6.2002 and sent the same to the accused on the address, 143 Sector 5, Chhani Himmat Jammu through registered post but the notice was received back without service with the endorsement "addressee left without address, returned to the sender" In para 8 of the complaint the complainant has further alleged that "this fact of dishonouring of the cheque as well as the fact that the envelope containing the notice dated 2.6.2002 was received back was brought to the notice of the accused at her residence i.e. Ist Floor House No. 379/5 Chhani Himmat Jammu. The accused on attaining this information assured the complainant that by all means the amount of the cheque on being further presented in mid of November 2002 well before the date of the expiry of the cheque shall be duly realized. The cheque was further presented by the complainant on 15.11.2002 on believing on the assurance given by the accused but the cheque was again dishonoured and the bankers of the accused issued a memo dated 16.11.2002 with the endorsement "account closed on advice". After the cheque was again dishonoured, the complainant sent a notice of demand dated 30.11.2002 through registered post to the accused demanding payment of Rs. 3.00 lacs within a period of 15 days from the date of receipt of notice. Same notice was also sent through courier service, which was received by the accused on 5.12.2002. As the accused did not meet the demand, the complainant filed the instant complaint against the accused in the court of Sub-Judge Judicial Magistrate Jammu. Learned trial court has taken the cognizance upon the complaint and issued process to the accused.
3. Mr. Sethi, learned counsel for the petitioner has argued that the complaint is not maintainable in view of the fact that it was not filed within the statutory period on the cause of action which arose to the petitioner somewhere in the month of June 2002 in view of the averments made in para 8 of the complaint. He has further argued that the complainant was not legally entitled to revive the same cause of action by issuing a fresh notice of demand upon the accused through the notice served on the accused on 5.12.2002.
4. Per contra learned counsel for the respondent-complainant has argued that as the first notice of demand had not been served upon the accused, therefore, he was well within his powers to have issued the second notice. The cause of action for filing the complaint has arisen to him on the basis of service of the second notice. Since the complaint had been filed within the statutory period, after service of the second notice, the plea put forth by counsel for the petitioner is without any merit.
5. I have considered the respective contentions raised at the Bar by learned counsel for the parties.
6. Admittedly the first notice of demand issued by the complainant to the accused had not been served on the accused. It also cannot be disputed that if second notice is held to be a valid notice then the complaint would be within the statutory period and would not be time barred. Therefore, the vital question arising for consideration is as to whether the facts stated in para 8 of the complaint quoted above constitute a service upon the accused so as to afford the complainant cause of action for filing the complaint against the accused, by assuming, for the sake of argument, that the complainant had not issued a second notice.
7. The requirement for sending a notice after the cheque is returned by the bank unpaid, is set out in Clauses (b) &(c) of the proviso to Section 138 of the Act. They read thus: --
XX XX XX XX "(b) the payee or the holder in due course of the cheque, as the case may be, make a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque within 15 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."
8. The duty caused on the payee on receipt of information regarding return of the cheque unpaid is mentioned in Clause (b) of Section 138. Within 15 days he has to make a demand for payment. The mode of making such a demand is also prescribed in the clause that it should be by giving a notice in writing to the drawer of the cheque. Nowhere it is said that such a notice must be sent through registered post or that it should be dispatched through a messenger. In the present case the complainant had sent the notice of demand within 15 days from the date of information of dishonouring of the cheque on 2.6.2002 but the notice was not served, so there was no cause of action available to the complainant to institute a complaint against the accused on the basis of the said notice. The complainant approached the accused personally thereafter as alleged in para 8 and apprised him of the fact that the envelope containing the notice of demand dated 2.6.2002 had been received back by him unserved, whereupon the accused assured the complainant that by all means the amount of the cheque on being further presented in mid of November 2002 shall be duly honoured. However, the accused when again presented the cheque on 15,11.2002 it bounced and was returned to the bankers of the accused with memo dated 16.11.2002.
9. Mr. Sethi, learned counsel for the petitioner argues that the facts stated in para 8 of the complaint as noticed above would constitute a notice of demand within the meaning of Clauses (b) and (c) to proviso to Section 138 and thereby giving a cause of action to the complainant to file a complaint but he did not file any complaint, therefore, the cause of action accrued had been lost.
I cannot agree with the submission of Mr. Sethi for the reason that the penal provisions of a statute under law is required to be construed strictly. The necessary ingredient of the offence of Section 138 of the Act is that within fifteen days from the date of receipt of information of the dishonouring of the cheque a notice is to be issued in writing to the drawer of the cheque. It is only after receipt of notice if the drawer of such cheque fails to make payment of the said amount within the stipulated period that a complaint Under Section 138 can be filed. Therefore, the contention of Mr. Sethi that the facts alleged in para 8 of the complaint constitute service of notice within the meaning of Clauses (b) of the proviso to Section 138 so as to afford the complainant cause of action is not tenable. Mr. Sethi further contends that first notice was sent by the complainant on the correct address of the accused as such presumption of service can be drawn. According to him such service of notice would constitute a cause of action.
10. The argument of Mr. Sethi merits rejection because the said notice was not served and returned with the endorsement that the addressee had left without address which is indicative of the fact that accused was not residing at the address on which notice was sent. That address thus was not the correct address of the accused. Therefore, no presumption of service of notice is available. The authorities, 1992(1) Crimes 60, 1997 Cr.LJ 4275 and 2000 Cr.LJ 122 relied upon by Mr. Sethi are distinguishable and have no application to the facts in issue. In the present case the complainant again presented the cheque on 15.11.2002, as has been alleged in the complaint but the same was dishonoured and was returned to the complainant by the bankers of the accused on 16.11.2002. The question arises, could the cheque be re-presented before the bank for encashment by the complainant? There is no restriction as to how many numbers or times a cheque can be presented to the bank. The cheque can be presented any number of times within the period of its validity and the only requirement for filing a complaint Under Section 138 of the Act is that a notice has to be given about the cheque having been dishonoured within fifteen days of such dishonour.
11. The Apex Court in Sadanandan Bhadran v. Madhawan Sunil Kumar, Cr.L.J. 1998 page 4066 has held as under: --
"On each presentation of the cheque and its dishonour a fresh right -and not cause of action - accrues in his favour. He may, therefore, without taking pre-emptory action in exercise of such right under Clause (b) of Section 138, go on presenting the cheque so as to enable him to exercise such right at any point of time during the validity of the cheque. But once he gives a notice under Clause (b) of Section 138 he forfeits such right, for, in case of failure of the drawer to pay the money within the stipulated time he would be liable for the offence and the cause of action for filing the complaint will arise"
12. The complainant has also alleged in the complaint that notice of demand was issued on 23.11.2002 through registered post and through courier service but it was served through courier service on the accused on 5.12.2002. When the accused did not make payment within 15 days after service of the notice he had filed the complaint. Therefore the cause of action for instituting the complaint arose to the complaint only for the first time when notice of demand was received on 5.12.2002 by the accused and payment was not made within 15 days thereafter. The complaint is therefore within time and it cannot be said that by representing the cheque the complainant had revived the cause of action for instituting the complaint Under Section 138.
13. For the aforesaid reasons, there is no merit in the petition of the petitioner. It is accordingly dismissed.