Delhi District Court
Additional Sessions Judge vs M/S. Jakson Engineers Ltd on 7 December, 2012
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IN THE COURT OF MS. POONAM A. BAMBA
ADDITIONAL SESSIONS JUDGE-01
PATIALA HOUSE COURTS : NEW DELHI
Criminal Revision No. 72/12
1 M/s Ganges Enterprises Pvt. Ltd.
201, Kailash Plaza, Plot No.12,
Opposite Laxmi Industrial Estate,
Link Road, Andheri (West)
Mumbai - 400053
2 Rajesh Sharma
S/o Shri Gokul Chand Sharma
Director,
R/o Shri Krishan Kunj,
Near Bilala Bhawan,
New Radhakrishna Plot
Akola, Maharashtra - 444001 ... Petitioners
Versus
1 M/s. Jakson Engineers Ltd.
626, 6th Floor, DLF Tower A
Jasola, New Delhi-110076
Through Sudershan Kumar Gupta
(Authorized Representative)
2 State of Delhi. ... Respondents
Date of institution of the revision : 20.11.2012
Date of arguments : 05.12.2012
Date of disposal : 07.12.2012
Revision u/s 397 of the Code of Criminal Procedure
against the order of Ld. MM-03/ND,
dated 23.07.2012
ORDER
Cri. Revision No. 72/12 Page No. 1 of 13
M/s Ganges Enterprise Vs. M/s Jakson Engineers -2- 07.12.2012 1.0 The revisionist has challenged the order of Ld. MM-03/ND, dated 23.07.2012, summoning the revisionist in complaint under Section 138 Negotiable Instruments Act, 1881 (NI Act).
2.0 I have heard Ld. counsel for the parties and have considered the record carefully.
3.0 Briefly stating, the facts as per complaint are that the respondent no. 1 / complainant company is the sister concern of M/s Jakson Ltd., having registered office at 626, 6th Floor, DLF Tower A, Jasola, New Delhi-110 076; the complainant company / M/s Jakson Ltd. is part of group of power generation companies. They entered into an agreement dated 25.02.2012 with the revisionist. The contract price as per the agreement was Rs.11.51 Crores. Out of which, Rs.2.01 Crores was to be paid in advance to M/s Jakson Ltd. and balance Rs.9.50 was to be paid by 30.04.2012; the revisionist instead paid only Rs.2.0 Crores; in view of which the agreement stood modified to the extent of providing the remaining amount by way of bank guarantee. But, the revisionist failed to provide the same. On taking up the matter, the accused no. 2 / Director of the revisionist issued and sent nine post dated cheques to the respondent no. 1 at New Delhi; the said cheques, all dated 30.04.2012 and drawn on ICICI Bank, were issued in favour of the complainant company / sister concern of M/s Jakson Ltd., Cri. Revision No. 72/12 Page No. 2 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -3- towards discharge of its obligation under the agreement.
3.1 Complaint further mentions that on presentation of three cheques of Rs.One Crore each, they were returned unpaid with remarks "Insufficient Funds". The accused no. 2 / Director of the revisionist was informed about the dishonour of cheques and was requested to pay the cheques' amount, but the same was refused to be paid; legal notice dated 06.06.2012 was then served on revisionist (accused no. 1) through the accused no. 2 / Director. Despite service of legal notice the cheques' amount was not paid. Consequently, the complaint u/Sec. 138 read with Section 142 NI Act was filed by the respondent no. 1.
4.0 Perusal of the record reveals that the Ld. MM after considering the averments made in the complaint, took cognizance of offence punishable u/s 138 N. I. Act. The Ld. MM then examined the Authorized Representative of the complainant - respondent no. 1. Considering the pre-summoning evidence and after making oral enquiry u/s. 202 Cr.PC, Ld. MM summoned the accused / revisionist herein vide order dated 23.07.2012. The said order of summoning dated 23.07.2012 has been challenged vide present revision petition.
5.0 The impugned order has been challenged by the revisionist inter alia, on the grounds that :-
(i) the Ld. Trial Court committed an error having exercised jurisdiction not vested in him by issuing Cri. Revision No. 72/12 Page No. 3 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -4- the process without recording the satisfaction about the existence of prima face case in favour of complainant / respondent herein;
(ii) Ld. MM failed to consider the fact that he had no jurisdiction as neither the accused persons are residing nor the cause of action arose within the jurisdiction of the Ld. Trial Court;
(iii) the accused is resident of Akola (Maharashtra) and is carrying on business at Mumbai (Maharashtra) and the cheques were issued from Mumbai of the ICICI Bank at Mumbai, and also the EPC agreement between the parties provides jurisdiction of Mumbai;
(iv) the complainant i.e. the respondent no. 1 has no concern with the revisionist as there was no transaction between the parties;
(v) the complaint and the documents placed on record do not show as to how the respondent no. 1 is entitled to receive the cheque or to the honour of the same;
(vi) respondent no. 1 could not have filed the complaint merely alleging itself to be the sister concern of M/s Jakson Ltd.;
(vii) there is no existing liability against the petitioners or in favour of the respondent no. 1;
(viii) the EPC agreement clearly demonstrates that till completion of the work, M/s Jakson Ltd. could not have encashed the cheques which were given as Cri. Revision No. 72/12 Page No. 4 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -5- security / interim arrangement; thus, proceedings u/s 138 N. I. Act are not attracted in the present case.
5.1 On the other hand, the respondent sought dismissal of this petition mainly on the grounds that no revision petition is maintainable against the summoning order; (reference to case law was made) and that even otherwise, the jurisdiction of the Delhi Court is duly made out as the cheque was given in Delhi and was presented in Delhi and was returned unpaid by the service branch of drawee bank at Delhi.
6.0 It may be mentioned that three Judges Bench of Hon'ble Supreme Court in Adalat Prasad Vs. Rooplal Jindal & Ors., (2004) 2 SCC 338, held that if Magistrate takes cognizance of an offence and issues process without there being any allegation against the accused or any material implicating the accused, the remedy lies in invoking inherent jurisdiction of High Court, under Section 482 of the Code of Criminal Procedure, 1973 (The Code). The law laid down in Adalat Prasad's case was reiterated in subsequent cases i.e Subramanium Sethuraman Vs. State of Maharashtra, (2004) 13 SCC 324 and in a recent case titled as Bholu Ram Vs. State of Punjab & Anr., (2008) 9 SCC 140. However, in Dhariwal Tobacco Products Limited & Ors. Vs. State of Maharashtra & Anr., (2009) 2 SCC 370, the Bench of Hon'ble Supreme Court consisting of Hon'ble Mr. Justice S. B. Sinha and Cri. Revision No. 72/12 Page No. 5 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -6- Cyriac Joseph [Hon'ble Justice S. B. Sinha was also part of the Bench in Adalat Prasad's case (supra)] observed that :-
"6. Indisputably issuance of summons is not an interlocutory order within the meaning of Section 397 of the Code. This Court in a large number of decisions beginning from R. P. Kapur Vs. State of Punjab to Som Mittal Vs. Govt. of Karnataka has laid down the criterion for entertaining an application under Section 482.
Only because a revision petition is
maintainable, the same by itself, in our
considered opinion, would not constitute a bar for entertaining an application under Section 482 of the Code."
6.1 In view of above, I proceed to consider this revision petition.
7.0 The main thrust of the arguments advanced on behalf of the revisionist was that the Ld. Trial Court / Ld. MM could not have taken cognizance of the matter in view of lack of jurisdiction and placed reliance upon the judgment of Hon'ble Supreme Court in Shri Ishar Alloy Steels Ltd. Vs. Jayaswals Neco Ltd., 2001 (3) SCC 609. Ld. counsel also argued that the Ld. MM faulted in taking cognizance placing reliance upon the judgment of Hon'ble High Court in GE Capital Transportation Financial Cri. Revision No. 72/12 Page No. 6 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -7- Services Ltd. Vs. Rahisuddin Khan, 182 (2011) DLT 385 (Delhi High Court) because vide his subsequent decision, Hon'ble Single Judge in Vijay Ghai & Anr. Vs. Bon Mart International Ltd, dated 01.12.2011 in Crl. M. C. 3977/2011 has requested for reference of the matter to larger Bench, in view of contradictory opinion held by two single Judges in Shri Raj Travels & Tours Ltd. & Ors. Vs. Destination of the World, 2011 DLT Criminal IV Page 398 and GE Capital Transportation Financial Services Ltd.'s case (supra).
7.1 On the other hand, Ld. counsel for respondent no. 1 emphatically argued that the Ld. MM was well within his jurisdiction and placed reliance upon the judgments of Hon'ble Supreme Court in K. Bhaskaran Vs. Shankaran Vaidhyan Balan & Anr, 1999 (7) SCC 510 and Harman Electronics Private Limited Vs. National Panasonic India Pvt. Ltd., (2009) 1 SCC 720, etc. 8.0 It is the settled position of law that the Magistrate taking cognizance of an offence must not necessarily have the territorial jurisdiction to try the case as well. At the pre- cognizance stage, the Magistrate has only to examine the averments, as set out in the complaint and not more, for prima facie arriving at a decision as to whether some of the acts essential for completing an offence under Section 138 of the Act were done in the territorial jurisdiction of that Court. (Trisuns Chemical Industry Vs. Rajesh Aggarwal & Ors., 1999 (8) SCC 686, Religare Invest Ltd. Vs. State & Anr., 173 (2010) DLT Cri. Revision No. 72/12 Page No. 7 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -8-
185). Same position was reiterated by the Hon'ble High Court in para 56 in GE Capital Transportation Financial Services Ltd.'s case (supra).
8.1 Thus, the Magistrate was empowered to take cognizance irrespective of the jurisdiction. The revisionist could have placed before Ld. MM, the material to demonstrate lack of jurisdiction. But, the revisionist chose to file the present revision petition.
9.0 However, even if the said argument of the revisionist is considered. Le me examine the jurisdictional aspect whether prima facie, jurisdiction of Delhi Court was made out. It would be relevant to refer here to the judgment of three Judges Bench of Hon'ble Supreme Court in K. Bhaskaran's case (supra). While dealing with the territorial jurisdiction of the Courts in offence u/s 138 N. I. Act, the Hon'ble Court held that there are five components which constitute offence u/s 138 N. I. Act. The observations of the Hon'ble Supreme Court in this regard in paras no. 14 and 15 are reproduced hereunder for ready reference :
"14. The offence under Section 138 of the Act can be completed only with the concatenation of a number of acts. The following are the acts which are components of the said offence : (1) drawing of the cheque, (2) Cri. Revision No. 72/12 Page No. 8 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers -9- presentation of the cheque to the bank, (3) returning the cheque unpaid by the drawee bank, (4) giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (5) failure of the drawer to make payment within 15 days of the receipt of the notice.
15. It is not necessary that all the above five acts should have been perpetrated at the same locality. It is possible that each of those five acts could be done at five different localities.
But a concatenation of all the above five is a sine qua non for the completion of the offence under Section 138 of the Code. In this context a reference to Section 178(d) of the Code is useful. It is extracted below :
"178. (a) - (c) * * *
(d) where the offence consists of several acts done in different local area, it may be enquired into or tried by a court having jurisdiction over any of such local areas."
9.1 The Hon'ble Court discussed Sections 177, 178 and 179 Cr.PC to emphasize that the jurisdiction of the court which Cri. Revision No. 72/12 Page No. 9 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers
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shall try an offence, is not an unexceptional or unchangeable principle. it is clear from Section 178 (d) Cr.PC that the complainant can choose any one of those courts having jurisdiction over any one of the local areas within the territorial limits of which any one of the five acts, the components of the offence (under Sec. 138 N. I. Act) took place.
9.2 Ld. counsel for the respondent no. 1 argued that the cheque was given to them in Delhi, presented to the bank in Delhi and that it was returned unpaid by the service branch of the drawee bank at Delhi; the cheque was never sent to Mumbai. Thus, the jurisdiction of Delhi Court is clearly made out as three of the components of the offence, as contemplated by the Hon'ble Supreme Court, took place at Delhi.
9.2.1 On the other hand, the Ld. counsel for the revisionist argued that the bank referred to in components no. 2 and 3 as described in Bhaskaran's judgment, is the drawee bank, as clarified by the Hon'ble Delhi High Court in Shri Raj Travels & Tours Ltd.'s case (supra). Ld. counsel also made reference to the judgment of the Hon'ble Supreme Court in Shri Ishar Alloy Steels Ltd.'s case (supra) for meaning of the word "the bank". It was also pleaded that reliance placed by Ld. MM on judgment in GE Capital Transportation case (supra) is faulty as the Hon'ble Judge has himself requested for reference of the matter to larger Bench.
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9.2.2 In response, the Ld. counsel for the respondent no.1 pleaded that till the law as laid down by the Hon'ble Supreme Court in Bhaskaran's case (supra), which was followed in GE Capital Transportation's case (supra), is set aside, it holds the field; Merely because a request for reference to larger bench is made by the Hon'ble Single Judge, the present position of law is not altered. Respondent no. 1, in this regard has placed reliance upon the judgment of Hon'ble High Court in Sohan Lal Vs. State, 2012 (3) AD (Delhi) 147, in support.
9.2.3 Settled position of law as reiterated in Sohan Lal's case (supra) that unless and until the decision of the Hon'ble Supreme Court is set aside or altered by the larger Bench of Supreme Court, such decision holds the field and is a binding precedent, is not contested.
9.3 So far as the contention of the revisionist's counsel that the bank referred to at point no. 2 in Bhaskaran's case (supra) is the drawee bank in view of the judgment of the Hon'ble Supreme Court in Shri Ishar Alloy Steels Ltd.'s case (supra), is concerned. It may be mentioned that in Ishar Alloy's case (supra), meaning of the term "the bank" as referred to in Clause (a) of proviso to Section 138 N. I. Act, was deliberated upon by the Hon'ble Supreme Court. The same was in the context of determining the period of limitation for presentation of the cheque as prescribed in Clause (a) of proviso to Sec. 138 N. I. Act. In that reference it was held that to attract criminal Cri. Revision No. 72/12 Page No. 11 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers
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liability u/s 138 N. I. Act, the term "the bank" means "the drawee bank"; and the cheque must reach "the drawee bank"
within a period of six months. It was not in the context of jurisdiction.
9.4 As mentioned above, the Hon'ble Supreme Court in Bhaskaran's case has laid down that court within the jurisdiction of which any of the above five components of the offence u/s 138 N. I. Act take place, would have jurisdiction in the matter. In the instant case, the cheque was delivered at Delhi; it was payable at par anywhere in India; the cheque was presented by the respondent in Delhi; It was presented through clearing house at the service branch of drawee bank at New Delhi and was never sent to Mumbai; it was returned unpaid on account of "insufficient funds" by the service branch of drawee bank at Delhi, which facts are not disputed. Thus, prima facie part of cause of action arose in Delhi.
10.0 The revisionist also argued that the cheques were not issued towards any liability. As mentioned in para 3.0 (supra), the complaint mentions about issuance of cheques towards liability and complainant has placed material alongwith his complaint.
11.0 For the aforesaid reasons, I find no irregularity or illegality in the impugned order of the Ld. MM summoning the accused.
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12.0 The revisionist may raise before the Ld. MM, the issues of fact and law / lead defence / produce documents as sought to be done / raised before this Court.
It is, hereby, clarified that any observation made in preceding paras would not tantamount to expression of opinion on merits of the case.
Trial Court Record be sent back along with the copy of this order.
Revision file be consigned to the Record Room.
Announced in open Court (Poonam A. Bamba) Date : 07th December, 2012 ASJ-01/PHC/New Delhi Cri. Revision No. 72/12 Page No. 13 of 13 M/s Ganges Enterprise Vs. M/s Jakson Engineers