1. This criminal revision is directed against the order dated 6-6-2017 passed by the learned Chief Judicial Magistrate, Belonia dismissing the complaint filed by the petitioner against the respondent U/s 138, Negotiable Instruments Act, 1881 ("the Act" for short) on the ground that the petitioner is neither the payee nor the holder in due course.
2. The facts giving rise to this revision are that the original holder of the cheque in question, namely, the late Sankar Prasad Sarkar died whereinafter his wife i.e. the petitioner deposited the cheque with the Bank which dishonoured it. This prompted her to send a demand notice to the respondent (Sri Milan Pal) for payment of the due amount, but the respondent refused to do so. It was the case of the petitioner that she and her children succeeded to the properties left behind by the deceased. The trial court, however, questioned the locus standi of the petitioner to file the application under the Act and passed the impugned order. Aggrieved by this, the criminal revision is filed by the petitioner.
3. Both Mr. D. Bhattacharjee, the learned counsel for the petitioner, and Mr. P. Sahu, the learned counsel for the respondent, were heard at some length. The question as to whether the legal heir of a payee can file a complaint under Section 138 of the Act is no longer res integra. This Court in Smt. Rikta Pal Sarkar v. Milan Pal (Crl. Rev. P. No. 33 of 2017) vide the judgment dated 9-8-2017 following the decision of the Apex Court in AC Narayanan v. State of Maharashtra & another, (2014) 11 SCC 790, held that the legal heir of the deceased is the "holder in due course" of the cheque and could, therefore, maintain a complaint under Section 138 of the Act. The only rider is that the legal heir should have knowledge about the transaction in question so as to enable him/her to bring on record the truth of his/her grievance. Two more decisions of various High Courts can also be cited in this connection, namely, Ajay Kumar Agarwal and another v. State of Jharkhand and another, 2003 Cri LJ 3088 and Chandra Babu v. Remani, 2003 (2) KLT 750(DB). The learned Chief Judicial Magistrate has overlooked the decision of this Court and has in the process improperly exercised his jurisdiction in dismissing the complaint. The observations of the Division Bench of the Kerala High Court in Chandra Babu (supra), with which I am in respectful agreement, succinctly explained the legal position:
"8. There is no dispute that the proposition that legal representative can file a suit for realising the amount. A Full Bench of the Punjab and Haryana High Court after considering large number of decisions in Padam Parshad v. Lok Nath Ishwar Sarup and Ors., (AIR 1964 P&H 497 FB) held as follows:"(5)....... It will be apparent from the definition of holder'' that it means a person entitled in his own name to the possession of the negotiable instrument and to receive or recover the amount due thereon from the parties thereto. Section 78 provides as to whom payment should be made of the amount due on the promissory note in order that the maker or acceptor thereof is discharged from liability thereon. On the interpretation of the aforesaid two sections, a plethora of case law has grown up, but it appears to us that so far as the case of an heir of a deceased holder is concerned, the rule of law seems to be well settled. The preponderance of judicial opinion is for the view that an heir of a deceased holder can bring a suit on the basis of the promissory note though such an heir cannot be said to be a holder within the meaning of Section 8. The decided cases, which will be noticed hereafter, are almost unanimous that there is no bar created by the aforesaid two sections in the way of such an heir to sue on the basis of the promissory note and recover the debt due to the deceased holder".After quoting the decision of the Allahabad High Court in Rai Ram Kishore v. Ram Parshad, : AIR 1952 All. 245 - FB, the Full Bench of the Punjab High Court further held that:"(8)...... The legal representatives of the holder "would appear to us to be clearly entitled to recover upon the instrument and Section 78 or anything else in the Negotiable Instruments Act cannot and does not stand in the way of such a suit being brought by the legal representatives of the holder against the person liable on the instrument............(10) It will appear from the authorities that have been quoted above that the rule seems to be fairly well settled that an heir of a deceased holder can bring a suit on the basis of the promissory note to recover the amount due thereon to the deceased holder by reason of the fact that he succeeds to the estate of the deceased holder by inheritance. No decision taking the contrary view has been brought to our notice."Even though Chapter XVII of the Negotiable Instruments Act, 1881 (Sections 138 to 142) was inserted by Act No. 66 of 1988, there is no indication in the Act that other provisions in the Act including definition Sections and Section 53 are only to civil suits and not on complaints instituted as per the provisions in Chapter XVII.9. One contention raised by the petitioner is that once he received the notice in view of proviso (b) to Section 138, he can get a discharge if the amount is paid to the holder in due course or payee within fifteen days of the receipt of notice. When complainant is a legal heir, by paying the amount, to her, he will not get a complete discharge as the complainant is not the payee or holder in due course. But, Section 78 clearly provides that making payment to holder, maker of the cheque will get discharge. Section 78 reads as follows:"78. To whom payment should be made:- Subject to the provisions of Section 82, clause (c), payment of the amount due on a promissory note, bill of exchange or cheque must, in order to discharge the maker or acceptor, be made to the holder of the instrument".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.10. 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 are 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. and Anr. v. Medchil Chemicals & Pharma (P) Ltd. and Anr., : 2002 (1) SCC 234 = 2001 AIR SCW 4793).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. We direct the Judicial Magistrate of the First Class-III, Thiruvananthapuram to dispose of the matter as expeditiously as possible after considering the rival contentions raised by the parties."
4. In the premises set forth above, this revision petition succeeds. The impugned order dated 6-6-2017 is, accordingly, set aside. The complaint is restored to the file of the learned Chief Judicial Magistrate, Belonia, for further proceedings and disposal in accordance with law without unnecessary delay. Transmit the L.C. record forthwith. No cost.
5. Circulate this judgment to all the courts below.
