@JUDGMENTTAG-ORDER
Manindra Mohan Shrivastava, J.@mdashThe aforesaid two petitions are being disposed off by a common order as common issue of law based on similar facts, though in respect of two different cheques, arise for consideration. Relevant facts of the present case, necessary for decision of the petition, are that the respondent filed a complaint alleging commission of offence u/s 138 of the Negotiable Instruments Act, 1881 (In short "the Act of 1881") against the petitioner on the allegation that the petitioner, who happens to be sister of the complainant, sought financial help of Rs. 5 Lakh for purchase of land and the complainant paid an amount of Rs. 3 Lakh in cash on 09-01-2006 and Rs. 2 Lakh cash on 06-02-2006. To wards discharge of the said liability, a cheque dated 01-01-2009 of Rs. 5 Lakh drawn on petitioner''s bank-ICICI Bank, Branch Bhilai was given to the complainant. The said cheque was presented by the complainant to his banker State Bank of India, Branch Manikpur, Korba and the cheque was returned unpaid with an endorsement dated 14-01-2009 that the cheque has been dishonoured due to insufficient funds. Upon receiving communication from his banker, the complainant again approached the petitioner-accused, upon which, the petitioner informed that the complainant may not proceed for encashment till April, 2009, and thereafter, the same may be encashed. Therefore, the complainant again presented the cheque with his banker-State Bank of India, Banch Manikpur, Korba on 13-05-2009. The cheque was again dishonoured with the endorsement of insufficient funds vide endorsement dated 13-06-2009. A registered demand notice with acknowledgment due dated 18-06-2009 was issued, which was returned unserved on 10-07-2009. Thereafter, another registered demand notice with acknowledgement due was issued on 27-07-2009, which was received by the petitioner-accused on 03-08-2009, but neither any reply was given nor amount paid. Taking cognizance of the aforesaid complaint, the learned Magistrate registered offence u/s 138 of the Act of 1881 against the petitioner-accused on 03-10-2009 and issued process. The petitioner moved an application raising objection against the maintainability of the complaint, which was rejected on 18-11-2009 directing issuance of bailable warrant, against which, the petitioner has approached this Court by filing petition u/s 482 of the Cr. P. C.
2. In this case, the respondent-complainant filed a complaint before the Magistrate alleging commission of offence u/s 138 of the Act of 1881. It was alleged in the complaint that the petitioner sought financial help of Rs. 5 Lakh for purchase of land, whereupon the respondent-complainant gave Rs. 2 Lakh cash on 04-03-2007 and Rs. 3 Lakh cash on 13-04-2007. Towards discharge of the aforesaid liability for repayment of loan allegedly borrowed by the petitioner, a cheque dated 01-01-2009 for an amount of Rs. 5 Lakh was given by the petitioner to the complainant. The said cheque was presented by the complainant with his banker State Bank of India, Branch Korba and the said cheque was returned unpaid with the endorsement dated 16-01-2009 that the cheque is dishonoured due to insufficient fund. When the petitioner was contacted, the complainant was informed that he may not encash the same till April, 2009, and thereafter, the cheque may be presented. Thereafter, the complainant presented the cheque again on 12-05-2009, which was again returned unpaid with the endorsement dated 21-05-2009 that the cheque was again dishonoured due to insufficient fund and when the petitioner was contacted for repayment of amount and signature, the petitioner neither signed the cheque nor the amount was returned. A registered demand notice dated 18-06-2009 with acknowledgment due was issued by the complainant making demand of payment of the amount under the cheque, which was returned unserved on 10-07-2009. Thereafter, another registered notice dated 27-07-2009 with acknowledgment due was issued, which was received by the petitioner on 03-08-2009, but thereafter, neither any reply was given nor amount under the cheque was paid. The learned Magistrate took cognizance of offence u/s 138 of the Act of 1881 by registering offence against the petitioner on 03-10-2009 and issued process. The petitioner moved an application raising objection with regard to maintainability of complaint and prayed for dismissal, which was rejected on 18-11-2009, giving rise to the instant petition.
3. Learned counsel for the petitioner in both the cases raised common submission with regard to the maintainability of the complaint as well as jurisdiction of the Court to take cognizance. Learned counsel for the petitioner contended that in both the cases, even according to the complaint, the money was paid at Bhilai and the cheque was drawn by the petitioner-accused on ICICI Bank at Bhilai. In both the cases, two cheques were dishonoured by the drawee bank i.e. ICICI Bank at Bhilai and the registered demand notice in both the cases is alleged to have been received at Bhilai on 03-08-2009. He further submits that failure to make payment within 15 days also occurred at Bhilai. Therefore, giving of notice from Korba would not get precedent over service of notice. In his submission, though giving of notice is essential, the cause of action for filing of complaint would arise upon failure to make payment within 15 days from the date of receipt of the notice as provided in Clause(c) of Section 138 of the Act of 1881. Learned counsel submits that looking to all these facts disclosed from the complaint itself, the Court at Korba will have no jurisdiction only on the ground that notice was issued from Korba. The other submission made by learned counsel for the petitioner-accused is that in both the cases, first notice of demand is alleged to be given by the complainant on 18-06-2009, whereas the complaint has been filed on 11-09-2009, therefore, the complaint is barred by limitation in view of the provision contained in Section 142(b) of the Act of 1881. It was also contended by learned counsel for the petitioner that the complaint was hopelessly barred by limitation because in Cr. M. P. No. 198/2010, the cheque was first dishonoured with endorsement dated 14-01-2009 and in Cr. M. P. No. 200/2010, the cheque was first dishonoured with endorsement dated 16-01-2009, which was duly communicated to the complainant, but the complainant neither gave any notice demanding payment nor filed complaint, but proceeded to re-submit the cheque again in the month of May, 2009, which was again alleged to be dishonoured, whereafter it is said that the notices were given and complaint filed. In support of his contention, learned counsel for the petitioner placed reliance in the case of
4. On the other hand, learned counsel appearing for the respondent in both the cases submitted that the complaint is neither barred by limitation nor liable to be dismissed on the ground that the Court at Korba had no jurisdiction. Learned counsel for the respondent argued that the provisions contained in Section 138 of the Act of 1881 nowhere mandates that the demand notice should necessarily follow, after receipt of intimation regarding dishonour of cheque. In his submission, there is no bar against presentation of cheque, after it was dishonoured, more than once during the period of validity of the cheque. According to him, the limitation prescribed under the law for filing complaint has to be reckoned with effect from the date after expiry of period of 15 days from the date of receipt of demand notice. Therefore, for the purpose of counting period of limitation, the first dishonour of cheque is not relevant, but what is relevant, is the demand and failure to make payment within 15 days of the receipt of demand notice. Learned counsel for the respondent, in answer to the submissions made by the counsel for the petitioner, submitted that the complainant had presented the cheque with its banker-State Bank of India, Branch at Korba and the petitioner received the intimation from its own banker at Korba regarding dishonour of cheque due to insufficient fund and that the notice demanding payment was issued from the Korba, therefore, the Court at Korba will have territorial jurisdiction to take cognizance of offence. It was also submitted that the first demand notice returned unserved, therefore, a fresh demand of notice was issued, which as per the allegations contained in the complaint, was served on the petitioner only on 03-08-2009. The petitioner failed to make payment within a period of 15 days of the receipt of demand notice, and thereafter, upon such failure to make payment, the complaint was filed within a period of limitation of 30 days as prescribed u/s 142(b) of the Act of 1881. In support of his submission, learned counsel for the respondent relied upon the decision in the case of
5. I have given my anxious consideration to the submission made by learned counsel for the parties and perused the record of both the petitions.
6. In both the cases, following common issues arise for consideration and determination:-
(A) Whether the Court at Korba had territorial jurisdiction to take cognizance of the complaint alleging commission of offence u/s 138 of the Act of 1881 against the petitioner?
(B) Whether the complaint in both the cases are barred by limitation as provided u/s 142(b) of the Act of 1881?
7. In the complaint filed by Sanjay Kumar Rajwade in Criminal Case No. 1258 of 2009 (Cr.M.P. No. 198/2010), it has been alleged that the loan was advanced by the complainant to the petitioner-accused at Bhilai. The cheque dated 01-01-2009 of Rs. 5 Lakh was drawn on ICICI Bank Branch at Bhilai. The complaint would show that the cheque was dishonoured by the ICICI Bank Branch Bhilai. It has been alleged in the complaint that the complainant''s banker at Korba communicated to the complainant regarding dishonour of cheque by the drawee bank i.e. ICICI Bank Branch Bhilai. On such factual allegations contained in the complaint, it has been contended by learned counsel for the respondent that as cheque was presented by the complainant to its banker at Korba, from whom, the complainant received communication regarding dishonour of cheque by the drawee bank i.e. ICICI Bank Branch Bhilai, therefore, the Court at Korba had territorial jurisdiction to take cognizance of offence in view of the provisions contained in Section 138 of the Act of 1881. The argument is that the requirement of presentation of the cheque to the bank within a period of six months from the date, on which, it was withdrawn or within the period of its validity, as provided under clause(a) of Section 138 of the Act of 1881, would also cover presentation of cheque by the complainant to its banker at Korba, therefore, the Court at Korba will have territorial jurisdiction to try the case.
8. A close analysis of the statutory scheme of Section 138 of the Act of 1881 reveals that the requirement of presentation of the cheque as provided under clause (a) of Section 138 of the Act of 1881 only refers to the drawee bank and none else. Bare reading of the provision shows that it talks of account maintained by a person with banker. In the later part of the provision, it talks about return of that cheque by "the bank" and further followed by the words "that bank". Clause (a) also indicates that the cheque is required to be presented to "the bank". Therefore, the rational and logical interpretation of the aforesaid provision based on usage of article "a" in the beginning and followed by definite article "the" goes to show that the requirement of presentation of cheque to the bank refers to the drawee bank and not to any other bank. Though, the payee may deposit the cheque with its banker situated anywhere for presentation to the drawee bank, such deposit of cheque by the payee to its own banker does not amount to presentation of cheque to the bank within the meaning of Section 138 of the Act of 1881. The payee''s banker, with whom such cheque is deposited, only acts as agent of the payee for the purposes of the presentation of the cheque to the drawee bank and the bank, with whom, the cheque is deposited by the payee does not become the agent of the drawee bank. The payee''s banker only acts as an agent of the payee and present the cheque to the drawee bank for clearance. Dishonour of the cheque under the statutory scheme of Section 138 of the Act of 1881 refers to dishonour of cheque by the drawee bank. In other words, when proposed banker presented the cheque for clearance to the drawee bank and the same was dishonoured by the drawee bank and then, intimation received by the Payee''s bank, is only a communication of such dishonour by the drawee bank. The onward communication to the payee by its banker that the cheque issued in his favour has been dishonoured by the drawee bank would not amount to dishonour of cheque at that stage, but it is merely a communication of dishonour of cheque by the drawee bank. Therefore, dishonour of cheque by the drawee bank necessarily takes place where the drawer of the cheque maintains the account. This Court has no hesitation to hold that the presentation of cheque to the bank, as envisaged under the statutory scheme of Section 138 of the Act of 1881 only refers to and means presentation of cheque to the drawee bank, where the account of the drawer of the cheque was maintained and it would not include the banker of the payee, where the payee deposits the cheque for being sent for clearance to the drawee bank. That is also the view taken in the case of Prabhu Dayal Modi (supra) by the learned single Judge of High Court of Bombay. Therefore, the contention of learned counsel for the respondent has to be rejected in that regard.
9. The next question, which arises for consideration, is whether the Court at Korba had territorial jurisdiction to take cognizance of the offence. The averments made in both the cases would show that the complainant issued notice from Korba. Learned counsel for the respondent placed heavy reliance on the decisions of the Supreme Court in the case of
10. In the case of K. Bhaskaran (supra), the Supreme Court held in paras 14, 15, & 16 of its order--
14. The offence u/s 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) 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 u/s 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 areas,
it may be enquired into or tried by a court having jurisdiction over any of such local areas.
16. Thus it is clear, if the five different acts were done in five different localities any one of the courts exercising jurisdiction in one of the five local areas can become the place of trial for the offence u/s 138 of the Act. In other words, 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 those five acts was done. As the amplitude stands so widened and so expansive it is an idle exercise to raise jurisdictional question regarding the offence u/s 138 of the Act.
11. Relying upon the aforesaid decision, in a subsequent decision in the case of
12. However, in a subsequent decision of the Supreme Court in the case of
12. The complaint petition does not show that the cheque was presented at Delhi. It is absolutely silent in that regard. The facility for collection of the cheque admittedly was available at Chandigarh and the said facility was availed of. The certificate dated 24-6-2003, which was not produced before the learned court taking cognizance, even if taken into consideration does not show that the cheque was presented at the Delhi branch of Citibank. We, therefore, have no other option but to presume that the cheque was presented at Chandigarh. Indisputably, the dishonour of the cheque also took place at Chandigarh.
13. The Supreme Court then proceeded to hold:-
13. It is one thing to say that sending of a notice is one of the ingredients for maintaining the complaint but it is another thing to say that dishonour of a cheque by itself constitutes an offence. For the purpose of proving its case that the accused had committed an offence u/s 138 of the Negotiable Instruments Act, the ingredients thereof are required to be proved. What would constitute an offence is stated in the main provision. The proviso appended thereto, however, imposes certain further conditions which are required to be fulfilled before cognizance of the offence can be taken. If the ingredients for constitution of the offence laid down in provisos (a), (b) and (c) appended to Section 138 of the Negotiable Instruments Act are intended to be applied in favour of the accused, there cannot be any doubt that receipt of a notice would ultimately give rise to the cause of action for filing a complaint. As it is only on receipt of the notice that the accused at his own peril may refuse to pay the amount. Clauses (b) and (c) of the proviso to Section 138 therefore must be read together. Issuance of notice would not by itself give rise to a cause of action but communication of the notice would.
14. Relying upon the constitutional Bench judgment of the Supreme Court in the case of
15. The provisions contained in Section 177 of the Code were also examined. In the aforesaid decision, the Supreme Court emphasized with regard to the aspect of the service of notice and failure on the part of the accused to pay the demand amount within a period of 15 days and that giving of notice cannot have any precedent over the service, in following words-
20. Indisputably all statutes deserve their strict application, but while doing so the cardinal principles therefor cannot be lost sight of, A court derives a jurisdiction only when the cause of action arose within its jurisdiction. The same cannot be conferred by any act of omission or commission on the part of the accused. A distinction must also be borne in mind between the ingredient of an offence and commission of a part of the offence. While issuance of a notice by the holder of a negotiable instrument is necessary, service thereof is also imperative. Only on a service of such notice and failure on the part of the accused to pay the demanded amount within a period of 15 days thereafter, the commission of an offence completes. Giving of notice, therefore, cannot have any precedent over the service. It is only from that view of the matter that in
It was finally concluded that the Delhi High Court has no jurisdiction to try the case.
16. In the present case, what has been averred in both the complaints with regard to notice of demand and receipt of notice is that the petitioner-accused received the notice on a particular date and even after expiry of 15 days from that date, the amount under the dishonoured cheque was not paid.
17. In view of the aforesaid decision of the Supreme Court in the case of
18. Therefore, it is concluded that it is the Court at Durg alone will have territorial jurisdiction and therefore, the Court at Korba will have no territorial jurisdiction to take cognizance of offence.
19. In view of the aforesaid conclusion, it is not necessary for this Court to go into the question as to whether the complaint is barred by limitation or not. Both the petitions (Cr. M. P. Nos. 198 & 200 of 2010) are accordingly allowed. The complaint filed before the Judicial Magistrate 1st class at Korba and all connected criminal proceedings pending before the concerned Magistrate are hereby quashed. The respondent-complainant, however, would be at liberty to file complaint before the Court of competent jurisdiction in accordance with law. In case, such complaint is filed by the complainant before the competent Court, he would be at liberty to take recourse to the provisions contained in proviso appended to clause(b) of Section 142 of the Act of 1881. A copy of this order be placed in the connected matter also.
