Bombay High Court
M/S. Baroda Ferro Alloys And Industries ... vs M/S. Span Overseas (Pvt.) Ltd. & Another on 24 November, 1998
Equivalent citations: 1999(5)BOMCR249, 1999BOMCR(CRI)~, 1999CRILJ1820, 1999(2)MHLJ220
Author: D.G. Deshpande
Bench: D.G. Deshpande
ORDER D.G. Deshpahde, J.
1. Heard Mr. Vashi for the petitioners and Mr. Jamdar for respondent No. 1 and learned A.P.P. for State/respondent No. 2. This petition is filed by the petitioners/accused for quashing the proceedings under section 138 of the Negotiable Instruments Act which were initiated by respondent No. 1 on bouncing of cheques which were given by the petitioners towards returns of intercoporate deposit of Rs. 25 lacs.
2. It was contended by Mr. Vashi that the cheques were dishonoured as per Bank advice letter dated 4-8-1993. Thereafter complainant gave a notice dated 9-8-1993 about dishonoured of the cheques, but filed a complaint on 30-10- 1993, and therefore, complaint was barred by limitation. He also contended that presenting the cheques at second time and giving notice thereafter on 15-9- 1993 and calculating period of limitation from 15-9-1993 was contrary to the judgment of the Supreme Court Sadanandan Bhadran v. Madhavan Sunil Kumai.
3. On the other hand, it was contended by Mr. Jamdar that after the first dishonoured of the cheques on 1-8-1993 the complainant sent fax to the accused requesting them to make payment, and this fax or subsequent fax message dated 9-8-1993 did not constitute legal notice as contemplated by the aforesaid judgment of the Supreme Court. Secondly, according to Mr. Jamdar after the fax messages were sent one Kirit Vyas entered into Memorandum of Understanding with the complainant on 9-8-1993 agreeing there by to make payment within 30 days of the MOU, and therefore, the complaint was within limitation.
4. As against this, it was contended by Mr. Vashi that fax messages sent by complainant constitute legal notice under section 138 of the Negotiable Instrument Act. Further he contended that MOU allegedly executed by Kirit Vyas was not binding on the accused and that did not give any fresh period of limitation.
5. As against this, Mr. Jamdar for the complainant relied upon a judgment of Nagpur High Court reported in A.I.R. 1954 Nagpur 38 Shamrao Bhagwantrao v. Mst. Saraswatibai Parashrcum, in support of his contention that fax messages did not constitute legal notice for the period of limitation to start.
6. The fax message dated 9-8-93 is at Exhibit A of the petition informing about dishonour of the cheques and with a request to make alternate arrangement and forward a draft for same immediately to enable us to liquidate the I.C.D. This followed by another fax dated 12-8-1993 sent by the complainant and this makes reference to the MOU signed by Kirit Vyas on 9-8-1993. The wordings in that regard in the fax are. "I once again request you to ensure that our amount is paid within 30 days as per the Memorandum signed by you."
7. This fax dated 12-8-1993 Exhibit B of the application, addressed to Kirit Vyas on behalf of the accused, prima facie proves contention of the complainant that the MOU was signed by Kirit Vyas, wherein the accused agreed to make payment of I.C.D. within one month of signing of the MOU.
8. It has to be considered, whether the fax dated 9-8-1993 constitute legal notice under section 138 of the Negotiable Instrument Act. Mr. Vashi relied upon judgment of Madras High Court reported in 1992 Company Cases 372 (75) V,P. Revathi v. Asha Bagre, wherein Madras High Court held that the notice in writing need not be by registered post it can be sent by telegram or by letter calling upon drawer of the cheque to pay the amount due under the dishonoured cheques. However, this judgment of the Madras High Court is of no help to the accused because the Supreme Court in the aforesaid judgment of Sadanandan Bhadran v. Madhavan Sunil Kumar, 1998(4) SCALE 708 (S.C.) has laid down certain conditions which are conditions precedent for creation of the offence and one of these conditions is that payee should have made a demand for payment by registered notice after the cheque is returned unpaid. These observations were made by the Supreme Court while considering the aspect of arising cause of action for filing complaint, and giving a registered notice is considered by the Supreme Court as condition precedent for filing complaint. Therefore, this Madras judgment relied upon by Mr. Vashi does not help the accused.
9. Apart from this, Mr. Jamdar relied upon the judgment of the Nagpur Bench referred to above in which the Court was concerned with the question of limitation in respect of deposits made by the litigant and was also considered Article 60 of the Limitation Act which prescribes that the period of limitation would start from the demand . In that background it was held by Nagpur High Court that in order that period of limitation starts under Article 60, the demand must be unqualified and effective demand and also in a sense peremptory for the whole of the amount, a mere request for money would not be such a demand as to start limitation. In the fax Exhibit A the complainant informed the accused that the cheques have been dishonoured and request is made for making alternative arrangement. It is not therefore a peremptory demand so as to attract the period of limitation.
10. Therefore on both these grounds i.e. because the Supreme Court requires that the notice to drawer must be in writing and by a registered post, and secondly on the ground that fax sent by the complainant does not constitute a demand, the contention of Mr. Vashi regarding limitation holds no water. Thirdly, signing of MOU and giving an undertaking thereby to pay the amount within 30 days of the MOU gave fresh cause of action pursuant to which second notice was given, and therefore, for all these reasons this petition is liable to be rejected.
Hence the order :---
: ORDER;
Petition is dismissed.
Rule is discharged.
Ad interim stay, if any, vacated.
Two weeks stay is granted.
11. Petition dismissed.