Andhra HC (Pre-Telangana)
Shashi Finance Corporation vs Super Shine Abrasives (P) Ltd. And Ors. on 22 August, 2003
Equivalent citations: 2003(2)ALD(CRI)634, II(2004)BC172, [2005]126COMPCAS10(AP)
Author: K.C. Bhanu
Bench: K.C. Bhanu
JUDGMENT K.C. Bhanu, J.
1. This criminal appeal is directed against the judgment of acquittal dated 29.10.1999 in C.C. No. 149 of 1998 on the file of the II Metropolitan Magistrate, Hyderabad.
2. Shashi Finance Corporation represented by its General Power of Attorney filed a complaint against the accused under Section 138 of Negotiable Instruments Act, hereinafter referred as 'the Act', alleging that the accused borrowed a sum of Rs. 50,000/- for their business financial necessities and against which they issued an account payee cheque dated 30.7.1997 drawn on State Bank of Hyderabad, Shapurnagar Branch, towards repayment of the said borrowing. When the cheque was presented to the Bank, it was returned for insufficient funds. Thereafter, the complainant got issued legal notice dated 12.2.1998 to the accused by registered post and also under certificate of posting. But the accused managed to return the notice sent. Therefore, it is deemed service of notice. When the accused failed to pay the amount, the present complaint was lodged. On behalf of the complainant, P.Ws. 1 to 3 were examined and Exhibits P-1 to P-14 were marked. The lower Court after considering the material on record and on hearing both the Counsels came to the conclusion that there was no service of notice as contemplated under Section 138 of the Act and that the complaint as such was not maintainable in law and, therefore, acquitted the accused. Aggrieved by the same, the present appeal is filed by the complainant questioning its legality and correctness.
3. In spite of giving several adjournments, there is no representation on behalf of the appellant. Heard the learned Counsel for the respondents. Perused the entire evidence on record.
4. It is the case of the complainant that the accused borrowed an amount of Rs. 50,000/-on 1.5.1997 and executed Ex. P-1 receipt on the same day. The accused issued Ex. P-2 cheque for the said amount. It was presented in the Union Bank of India. But it was returned for insufficient funds. Ex. P-4 is the returned memo, Ex. P-5 is the debit voucher. Thereupon, P. W. 1 got issued a legal notice dated 12.2.1998. Ex. P-6 is the office copy of the said legal notice. Ex. P-7 is the certificate of posting. Exs. P-8 to P-10 are the postal receipts of Ex. P-6.
5. To constitute an offence under Section 138 of the Act, the following three conditions have to be satisfied--
(a) the cheque has been presented to the Bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in the due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within fifteen 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.
6. Section 139 of the Act prescribed that it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability.
7. From the evidence it is established that A-2 issued Ex. P-2 cheque on behalf of A-1 for the discharge of legally enforceable debt. The important aspect under Section 138(d) of the Act is that notice has to be served on the accused demanding of him to pay the amount due under the Act. Unless it is served on the accused, he has not committed any offence. On a perusal of Section 27 of the General Clauses Act, 1897 it is clear that to draw presumption of deemed service, it must be proved that the notice has been effected by registered post to be served on the respondent properly. Therefore, by virtue of provisions of Section 27 of the General Clause Act service by post should be deemed to have been effected if the following four conditions are fulfilled, namely, (i) the cover is sent by registered post, (ii) the cover being properly addressed, (iii) the cover being prepaid, and (iv) the cover contains the document sought to be sent to the addressee.
8. Exhibits P-11, P-12 and P-13 are the returned postal covers. The endorsement made on Ex. P-11 shows that the factory was closed and whereas the endorsement made on Exs. P-12 and P-13 shows that the addressee left. As seen from the complaint, the accused were residing presently at Door No. 12-1-331/149 (MPL, No. 529), Dattatray a Colony, Asifnagar-South, Hyderabad-500028. But as seen from Exhibits P-12 and P-13, notices were sent to the address bearing H. No. 3-104, Divya Shanti Apartments, Ameerpet, Hyderabad-5000 16. Hence, on the face of the record it is clear that the complainant had not sent the notices to the correct address of the accused. Therefore, presumption under Section 27 of the General Clauses Act cannot be drawn. The lower Court after considering the entire evidence on record rightly held that there was no constructive service of legal notice on the accused as contemplated under Section 138(d) of the Act. It is a mandatory provision and it is not only the duty of the complainant to send the notice, but also see that it is served on the accused. Of course, if the accused refused to receive the same, then it is deemed service of notice. That is entirely a different aspect. The return of a cover by registered post sent to a wrong address cannot be said to be a deemed service. Therefore, the lower Court rightly held that there was no constructive service of legal notice on the accused as contemplated under Section 138(d) of the Act.
9. Coming to the next question with regard to the filing of the complaint by Dr. Vinod Kumar, who is the General Power of Attorney to Shashi Finance Corporation, it is pertinent to refer to the decision of a Division Bench of this Court reported in S.P. Sampathy v. Manju Gupta, III (2002) BC 77 (DB)=2002(1) ALT (Crl.) 497 (D.B.) (A.P.), wherein this Court held that complaint cannot be filed by a power of attorney holder on the behalf of payee under Section 138 of the N.I. Act. The complaint can only be filed in writing by the payee or the holder in due course. Admittedly, in this case the complaint is filed by Dr. Vinod Kumar who is neither a payee nor a holder in due course. Therefore, on this ground the complaint is liable to be dismissed. However, it is brought to the notice of this Court that an appeal is filed against the said judgment before the Supreme Court. There is no material to show that the appeal is pending before the Supreme Court. However, on this aspect it is pertinent to refer to the decision reported in Smt. S. Vanaja v. The Secretary, State Transport Authority, (FB), wherein it is held by a Full Bench of this Court as follows: "to express firm disinclination to go into the factual aspects of the reference order. The fact remains that the order made in Civil Appeal No. 4126 of 1988 has been referred to a Constitution Bench. Until the Constitution Bench goes into the question and authoritatively lays down the law, we arc of the view that the decision in Civil Appeal No. 4126 of 1988 holds the field". Unless the Supreme Court goes into the question and lays down the law in accordance with Article 141 of the Constitution, the decision rendered by the Division Bench of this Court in S.P. Sampathy's case (supra) holds good.
10. In view of the said decision, the complaint as such is not maintainable as it is filed through the General Power of Attorney holder, which is not permissible under law. Hence, there arc no grounds to interfere with the order of acquittal.
The criminal appeal is, accordingly, dismissed.