Madhya Pradesh High Court
Anil Das Bairagi vs Smt. Nidhi Jain on 30 April, 2019
1
M.Cr.C.No.982/19, 987/19, 991/19, 994/19
1000/19, 1026/19, 1028/19, 1031/19
HIGH COURT OF MADHYA PRADESH, PRINCIPAL SEAT
AT JABALPUR
(SINGLE BENCH : HON'BLE SHRI JUSTICE J.P.GUPTA)
Misc. Criminal Case No.982/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Misc. Criminal Case No.987/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Misc. Criminal Case No.991/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Misc. Criminal Case No.994/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Misc. Criminal Case No.1000/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Misc. Criminal Case No.1026/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
2
M.Cr.C.No.982/19, 987/19, 991/19, 994/19
1000/19, 1026/19, 1028/19, 1031/19
Misc. Criminal Case No.1028/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Misc. Criminal Case No.1031/2019
Anil Das Bairagi
Vs.
Smt.Nidhi Jain and two others
Shri Ankit Saxena, Advocate for the petitioner.
Shri Akshay Namdeo, Advocate for respondents No.1 and 2.
O R D E R
(30/04/2019) The aforesaid petitions under Section 482 of the Cr.P.C. have been preferred by the petitioner seeking quashment of the order dated 24.4.2018 passed by JMFC Bhopal in separate criminal complaint cases registered under section 138 of the Negotiable Instruments Act, 1881, (hereinafter referred to as 'the Act') whereby cognizance of the offence punishable under section 138 of the Act has been taken on the complaint filed by the respondents as legal heirs of Narendra Kumar Jain, who was the payee of the cheques in question.
2. In all the aforesaid petitions, a common question is involved viz. :-
I) Whether the legal heirs of the payee are competent or eligible to file complaint against the petitioner/accused as they are not payee or holder in due course, therefore, the complaints are not maintainable.
3. The petitioner has placed reliance on the Single Bench judgment of the Bombay High Court in the case of Vishnupant Vs. Kailash, 3 M.Cr.C.No.982/19, 987/19, 991/19, 994/19 1000/19, 1026/19, 1028/19, 1031/19 reported in 2010 Cr.L.J. 2166, wherein it is held that the legal representatives of payee can file a complaint after getting succession certificate, letters of administration or probate granted by the Court. In absence thereof, he/she or they would be entitled to give full discharge and indemnity to the drawer of the cheque as required under section 82 of the Act and sections 211, 273 and 381 of the Indian Succession Act. Unless he can give such indemnity it cannot be said that he/she/they has/have authority to issue notice and non-payment of amount mentioned in the notice within 15 days as required under section 138 of the Act.
4. Petitioner has further placed reliance upon the Single Bench judgment of the Gujrat High Court in the case of Jyotindra Motibhai Thakkar Vs. State of Gujarat, in Special Criminal Application No.956/2013 wherein after relying on the judgments of various High Courts, the learned Single Judge has held as under :-
"6.1 The legal connotation "holder in due course" has twin important essentials to carry. A person in order to become a holder in due course within the meaning of Section 9 of the Act must be in possession of a promissory note, bill of exchange or cheque, as is in the present case; at the same time, mere becoming possessor of the cheque etc., would not suffice. A person to the possessor of the instrument has to be for a consideration. It is indispensible ingredient for being clothed with the legal capacity of "holder in due course" is that the person in possession of the instrument, must have been in the possession for some consideration.
6.2 Therefore, it logically falls that merely being an heir of payee, though may be in possession of instrument, would not automatically make such heir or legatee a 'holder in due course' within the meaning of Section 9 of the N.I. Act. The concept of holder in due course does not recognize such position, besides which the ingredient of being a possessor for consideration has to exist. Respondent No.2 wife, in absence of possessing such ingredient-capacity, cannot claim locus standi in law to become a complainant under Section 138 of the Act.
6.3 The claimed capacity of heir or legatee or right to inheritance by themselves would not attract or invest the person in possession of the instrument with the capacity as 'holder in due course' under the N.I. Act. Therefore upon death of the payee, heir of legatee thereof does not step into the shoe of the deceased payee merely because he happens to be an heir or a relative or a legatee. Such person unless is in possession of the instrument and unless such possession is for 4 M.Cr.C.No.982/19, 987/19, 991/19, 994/19 1000/19, 1026/19, 1028/19, 1031/19 consideration, cannot file a complaint posing himself or herself as legal heir".
5. In the present case, the respondents have no such authority, therefore, the complaints are not maintainable.
6. On the other hand, learned counsel for the respondents has contended that being legal representatives of the payee, they are holder in due course of the cheques, therefore, they are competent to file the complaint. In this regard, he has placed reliance unpon a Single Bench judgment of the Bombay High Court in the case of Anup Jagdish Agarwal Vs. Nilkunj Lalit Shah & Ors. reported in 2010 SCC Online Bom 120, in which after considering the provisions of sections 7, 9, 53, 75 and 78 of the Act has held that a holder deriving title from the holder in due course has all the rights of a holder in due course. Therefore, legal representative of a holder in due course has all the rights of the holder in due course. Here, in this case, if the original payee is a holder in due course, his representative has all his rights. Therefore, rights under sections 138 and 142 are applicable to the legal representative also if he derives title from the holder in due course."
7. Reliance has further been placed on a Single Bench judgment of Karnataka High court in the case of Smt.Bhagava Vs. Sri Kadasiddeshwara Trading, reported in ILR 2004 KAR 367, wherein it has been held as under :-
"12. Having regard to the factual aspects and the settled principles of law in this regard, in the opinion of this Court, on the death of the payee, his legal heirs steps into the shoes of the payee for all practical purposes and such a person can also file and prosecute the complaint after completing the legal formalities. It is also necessary to mention that it would be incumbent upon the Complainant to prove that the Complainant is the legal representative of the deceased payee, in the event of accused disputing the same. In the case on hand, the payee had died and the wife of the payee, as the legal heir, had presented the cheque in question and on the cheque being dishonoured, legal notice had also been issued and thereafter, the proceedings had been initiated under Section 138 of the NI Act.
13. In view of the facts and circumstances of the case and the law stated above, in the opinion of this Court, the complaint as filed before the learned Magistrate had been in accordance with law. The learned 5 M.Cr.C.No.982/19, 987/19, 991/19, 994/19 1000/19, 1026/19, 1028/19, 1031/19 Magistrate was totally justified in taking cognizance of the case and proceeding in the matter........
8. Learned counsel for the respondents has further placed reliance on the Single Bench Judgment of the Andhra Pradesh High Court in the case of M/s Sri Sai Mourya Estates & Projects Pvt. Ltd. and others Vs. State of A.P. reported in 2018 SCC Online Hyd 44, wherein it has held that complainant being legal representative of his deceased mother, who was payee or holder in due course, can file a complaint under section 138 read with section 142 of the Act.
9. Learned counsel for the respondents has further placed reliance upon the Division Bench judgment of Kerala High Court in the case of Chembazhanthi Chandra Babu Vs. Remani, reported in 2003 SCC Online Ker 428 : (2003)2 KLJ 60, after considering the provisions of sections 75, 78 and 53 of the Act has held as under :-
"20. Apart from the above, in this case, complainant holds the cheque after the death of the payee as a legal heir and she is entitled to possess the same in her own name and in view of section 53, being a legal heir, she is a holder in due course and he can get a full discharge. The party was free to pay the amount to her and to get back the cheque. In view of Section 53 of the Act, legal heir of the payee or holder in due course can maintain a complaint under section 138 of the Act.
21. Next contention is that there may be other legal heirs and, therefore, complaint by the one legal heir/representative is not maintainable. That is a matter for evidence. Further, they arc all curable defects and that is not a matter to be considered for quashing a complaint at the initial stage. (See: M.M.T.C Ltd. v. Medchil Chemicals land Pharma (P) Ltd. ((2002) 1 SCC 234) : 2001 AIR SCW 4793).
22. In the above circumstances we are of the view that the complaint is perfectly maintainable. A legal representative of the payee or holder in due course can file a complaint under section 138 read with section 142 of the Act if other conditions in the above sections are satisfied...........".
10. Both the parties have cited judgments of other High Courts having inconsistent views. However, this court has noticed a Single Bench judgment of this Court Indore Bench on the same point in the case of Kishore Goyal Vs. Hanif Patel, reported in 2010 SCC 6 M.Cr.C.No.982/19, 987/19, 991/19, 994/19 1000/19, 1026/19, 1028/19, 1031/19 Online MP 607, wherein a complaint filed by son of the deceased payee was quashed with the following observation :-
"9. In the present case, cheque is in favour of deceased/Kudrat Patel. In the complaint it is nowhere stated that when Kudrat Patel has died. Similarly, except in title nowhere it has been stated by the respondent that how the respondent is entitled for the cheque amount. It is also not mentioned in the complaint that who are the legal representatives of deceased/Kudrat patel and prior to his death any Will was executed by the deceased or not? Since the complaint has been filed by a person in whose favour no cheque was issued by the petitioner, therefore, in the opinion of this Court no cognizance could have been taken against the petitioner for an offence alleged to have been committed by the petitioner keeping in view sub-section (1) of section 142 of the N.I. Act. In view of this, the petition filed by the petitioner is allowed and the impugned order passed by learned Trial Court and also the complaint filed by the respondent stands quashed. Petition stands discharged".
11. On minute scrutiny of the aforesaid enunciations of law of this Court as well as other High courts, in view of this Court, the law laid down by the Single Judge of this Court in the case of Kishore Goyal (supra) requires reconsideration as majority of decisions of other High Courts have held that legal representatives of a payee can file a complaint under section 138 of the Act against the drawer considering the provisions of sections 7, 8, 9, 53, 78 and 80C of the Act. However the Bombay High Court in the case of Vishnu Pant (supra) has held that legal representatives merely on the ground that they are legal representatives of the deceased payee or holder in due course cannot file a complaint under section 138 of the Act unless they have possessed legal authority such as succession certificate, letters of administration or probate granted by the Court under the Indian Succession Act as only on the basis of having such authority they are entitled to give full discharge and indemnity to the drawer of the cheque. Unless he can give such indemnity it cannot be said that he or she or they has/have authority to issue notice as required under the Act. However, in the aforesaid judgment it is expected that before giving notice to the drawer of the cheque, such authorisation under the Indian Succession Act is must; but, it is not considered that it will take lot of time to get aforesaid authority from the competent court, in the meanwhile statutory stipulated time period would be over and there is 7 M.Cr.C.No.982/19, 987/19, 991/19, 994/19 1000/19, 1026/19, 1028/19, 1031/19 no provision to condone the aforesaid delay. Then after getting the aforesiad authority the legal representatives cannot file complaint under section 138 of the Act as under section 138 of the Act, the time is fixed for presentation of the cheque before the Bank and further time has been fixed for issuance of notice to the drawer of the cheque and time is also fixed for filing of the complaint on non-payment of the amount after receiving of notice by the drawer. However, after arising of the cause of action, failure in filing of the complaint satisfying the court about the cause of delay, the court may condone the delay; but, this delay can be condoned with regard to the delay after arising of the cause of action. But, before arising of the cause of action in step no.1 and step no.2, if there is any delay, the same cannot be condoned and no cause of action will arise. In such circumstances, if the legal representatives are compelled to get succession certificate, or letters of administration or probate granted by the Court, in most of the cases they would not be able to take recourse of section 138 of the Act with a view to recover the cheque amount through criminal proceedings and it would cause grave injustice to them. Therefore, all these aspects are to be considered to clarify the law on the point.
12. In the circumstances, looking to the involvement of substantial questions of law of general importance and with a view to settle the law, this Court is of the opinion that the aforesaid earlier decision of Single Bench of this Court needs reconsideration and for this purpose following questions are formulated :-
i) Whether the Single Bench judgment of this Court in the case of Kishore Goyal (supra) laid down the correct law on the point of capability or eligibility of the legal representatives to file complaint under section 138 read with section 142 of the Act ?
ii) Whether any legal representative or all legal representatives of the deceased payee can file a complaint under section 138 read with section 142 of the Act without having succession 8 M.Cr.C.No.982/19, 987/19, 991/19, 994/19 1000/19, 1026/19, 1028/19, 1031/19 certificate, letters of administration or probate under the Indian Succession Act ? If not, then,
iii) What would be the affect of delay in obtaining the aforesaid authorities, which would frustrate the cause of action to file complaint under section 138 of the Act on account of not taking steps within time, as required under proviso (a) and
(b) of section 138 of the Act as the aforesaid delay cannot be condoned under section 142(1)(b) of the Act ?
13. Accordingly, as per the provision of Rule 8 of Chapter IV of the High Court of Madhya Pradesh Rules, 2008, the matter is referred to Hon'ble the Chief Justice with a recommendation that the same be placed before a Larger Bench for decision on the aforesaid substantial questions of law.
14. Interim order, if any, shall remain in operation.
(J.P.Gupta) JUDGE HS Digitally signed by HEMANT SARAF Date: 2019.05.03 12:14:15 +05'30'