Jammu & Kashmir High Court - Srinagar Bench
M/S Neelkiran Agencies And Others vs Punjab Tractors Limited on 23 May, 2012
IN THE HIGH COURT OF JAMMU AND KASHMIR AT SRINAGAR 561A No. 59 of 2009 IA(Cr.) No. 131 of 2009 M/s Neelkiran Agencies and others Petitioners Punjab Tractors Limited Respondents !Mr. Gurvinder Singh, Advocate ^Mr. S. Ali Khan, Advocate Honble Mr. Justice J. P. Singh, Judge Date:23/05/2012 : J U D G M E N T :
M/s Neelkiran Agencies, its outgoing and continuing partners, have filed this petition seeking quashing of Punjab Tractors Limiteds Complaint filed for disnonour of Cheque No.0567790 dated 14.08.2008 drawn on the Bank of Rajasthan Limited Gate Bikanar Branch for Rs.20 lac, and the process issued thereon by the learned Judicial Magistrate Ist Class (Ist Additional Munsiff) Srinagar.
I have heard learned counsel for the parties.
Although number of submissions were made by the petitioners learned counsel to question the sustainability of respondents Complaint, and the process issued thereon by the learned Judicial Magistrate, but there may not be any necessity to deal therewith, for, this Petition succeeds on a short point. The learned Magistrate is found to have issued process against the petitioners without taking into consideration the material placed on records by the respondents along with their Complaint which included the Memo of Dishonour, issued by the Bank of Rajasthan Limited indicating therein the reason for which the cheque in question was dishonoured.
In view of the provisions of Section 138 of the Negotiable Instruments Act, 1881, proceedings for dishonour of a cheque may be initiated, if the cheque drawn by a person on an Account maintained by him with a Bank 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, 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.
The learned Magistrate does not appear to have noticed the endorsement appearing in the Memo of Dishonour issued by the Bank of Rajasthan wherein at Item No.23, it is indicated as follows:-
Khata Band kar diya gaya hai/A/c has been closed on 04.01.2002. and its effect on the sustainability or otherwise of the Complaint and justifiability or otherwise of issuance of process thereon in the light of the provisions of Section 138 of the Negotiable Instruments Act, 1881, in terms whereof proceedings for commission of offence under Section 138 may be issued only if the cheque had been drawn by a person on an account maintained by him with the Bank.
Before issuance of the process, the learned Magistrate was required to satisfy as to whether or not there was any account maintained by the person issuing the dishonoured cheque with the Bank, in that, in view of the phraseology used in the Section, such consideration becomes mandatory particularly when the material placed on records by the Complainant itself indicate the account to have been closed on 04.01.2002, i.e., more than six years before the date of the issuance of the cheque. The omission of the learned Magistrate to address the above question has, therefore, resulted in mechanical exercise of discretion in issuing process against the petitioners which in turn has resulted in failure of justice.
Not only this, the learned Judicial Magistrate has issued process against the partners of petitioner No. 1 without being satisfied regarding the role attributed to each one of them in the day-to-day business of petitioner no. 1.
In a Complaint where Partners of a firm or Directors of a Company, or functionaries thereof are impleaded as accused, process against the Directors, Partners or Functionaries, is warranted only if it was not only shown; but prima facie proved that the Partners/Directors/Functionaries sought to be proceeded against for acting on behalf of the Firm or Company were connected with the day- to-day affairs of the business of the Firm or Company and thus responsible for the acts or omissions thereof.
The learned Magistrate has not considered this aspect of the matter too before issuance of process against the petitioners.
The order passed by learned Magistrate on 19.12.2008 whereby the process was issued against the petitioners cannot, therefore, for all what has been said above, be sustained.
This Petition, accordingly, succeeds and is, therefore, allowed quashing learned Judicial Magistrates Order dated 19.12.2008.
The respondents Complaint is remitted for its consideration afresh by the learned Magistrate in accordance with law and in the light of the observations made hereinabove.
( J. P. Singh ) Judge N Ahmad Srinagar 23.05.2012