Madras High Court
S.P. Damodaran vs Ramaswamy Naidu on 4 October, 1993
Equivalent citations: [1995]83COMPCAS123(MAD)
Author: Pratap Singh
Bench: Pratap Singh
JUDGMENT Pratap Singh, J.
1. The accused in C. C. No. 631 of 1992, on the file of the Judicial Magistrate No. III, Coimbatore, has filed this petition to quash the said complaint under section 482 of the Criminal Procedure Code.
2. The relevant allegations in the complaint are briefly as follows :
The accused borrowed Rs. 26,850 on April 24, 1987, and Rs. 9,650 on July 16, 1987. Subsequently, on January 30, 1988, the accused requested the complainant to advance some more money and took out two demand drafts for Rs. 16,000 each. On July 16, 1987, the accused executed a bond to the complainant for Rs. 36,500 borrowed. On October 1, 1989, the accused executed a pronote for Rs. 36,500. On March 1, 1990, he borrowed Rs. 20,000 from the complainant. Thus, a sum of Rs. 88,500 was due and payable by the accused to the complainant, by way of principal amount, apart from interest and bank charges. He paid interest periodically. Thus a total sum of Rs. 56,500 was due to the complainant from the accused as on March 16, 1990, together with interest for about five months. The amount together with other hand loans was rounded off to Rs. 1 lakh and the accused executed a pronote for the said sum on March 16, 1990, in favour of the complainant, agreeing to pay interest at 18 per cent. per annum. Despite the demand he did not pay the amount. Finally, the accused issued a cheque dated May 28, 1992, drawn on Canara Bank, Coimbatore, for Rs. 1 lakh in discharge of the liability in favour of the complainant. The complainant presented the cheque to his bank viz., Indian Bank, Coimbatore. It was dishonoured by Canara Bank stating "funds insufficient". It was informed by the complainant's banker by debit advice dated June 16, 1992. On July 1, 1992, the complainant issued legal notice to the accused to settle the account within fifteen days from receipt of the notice, as provided under section 138 of the Negotiable Instruments Act.
3. The accused was informed by the postal authorities on July 13, 1992, about the registered cover and the accused did not receive the notice with ulterior motive and the registered notice is returned on July 26, 1992, as "not claimed". The accused had knowledge of the registered cover and despite that the accused had not settled the amount within fifteen days from the date of knowledge of the registered cover. Thus the accused had committed an offence under section 138 of the Negotiable Instruments Act.
4. Mr. Loganathan, learned counsel appearing for the petitioner, would submit that the requirement of section 138 of the Negotiable Instruments Act was not complied with in this case and hence the complaint is vitiated. He would further submit that on the foot of pronote for Rs. 1 lakh, the complainant had filed a civil suit and so this criminal complaint will not lie.
5. I have carefully considered the submissions made by the learned counsel. To consider the first submission, section 138(a) of the Negotiable Instruments Act needs extraction and it reads as follows :
"138. Dishonour of cheques for insufficiency etc., of funds in the account. - Where any cheque drawn by a person on an account maintained by him with a banker 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, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of cheque, or with both :
Provided that nothing contained in this section shall apply unless -
(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 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. This court had held that even if the notice sent to the accused has been refused by him, it would amount to constructive notice so as to satisfy the requirements of section 138(a). In the instant case, in para 8, the following allegations are made :
"The accused was informed by the postal authorities on July 13, 1992, about the registered cover and the accused did not receive the notice with ulterior motive and the registered notice is returned on July 23, 1992, as 'not claimed'."
7. In case these allegations are proved, that would fall within the ratio of the ruling with regard to "refused notice". That can be gone into only at the time of trial and not at the threshold.
8. Regarding the second submission that the complainant had already filed a suit on the foot of the promissory note and hence this complaint will not lie, I have to say that when a civil remedy as well as a remedy in the criminal law was open to the complainant, his pursuing one remedy will not bar his recourse to the other remedy and taking that view of the matter this second submission also fails.
9. In the result this petition does not deserve admission and shall stand dismissed.