Case Law Details
Arti Rajesh Karangutkar Vs Anna Rocky Fernandes (Bombay High Court)
Conclusion: No person should accept any loan or deposit of a sum of Rs.20,000/- or more otherwise than by an account payee cheque or account payee bank draft. Where a person advance cash more than Rs.20,000/- to another person, restriction on cash advances was, in fact, on the taker and not on the person who made an advance. The penalty for taking such advance or deposit in contravention of provisions of Section 269-SS was to be suffered by the taker who accepts the advance.
Held: Appellant and respondent were friends and neighbours. Appellant had advanced a friendly loan of Rs.3,00,000/- to Respondent as she was in financial need due to the ailment of her husband who was suffering from blood cancer as well as daughter of respondent was also in need of financial help as she was undergoing a training as an Air Hostess. Appellant, on humanitarian grounds, lent an amount of Rs.3,00,000/- to respondent by way of loan, which she promised to refund by the end of June, 2007. Appellant had initially deposited two cheques of Rs.1,25,000/- each in the Axis Bank on 3rd October, 2007 at it’s Mulund Branch. On 5th October, 2007, she received a memo from the Axis Bank informing her that cheques deposited by her were dishonored for insufficiency of funds. A legal notice was issued to respondent calling upon her to repay the amount of Rs.3,00,000/- within a period of 15 days. The notice was not replied by respondent which resulted in filing of the complaint against her by the appellant-complainant in the Court of Metropolitan Magistrate, Vikhroli under section 138 of the N.I Act in order to enforce the legal liability. The Metropolitan Magistrate, after recording the evidence of the complainant as well as respondent acquitted respondent of the offence punishable under section 138 of the N.I. Act. It was held that no person should accept any loan or deposit of a sum of Rs.20,000/- or more otherwise than by an account payee cheque or account payee bank draft. The provision did not say that a person could not advance more than Rs.20,000/-in cash to another person. Restriction on cash advances was, in fact, on the taker and not on the person who makes an advance. The penalty for taking such advance or deposit in contravention of provisions of Section 269-SS was to be suffered by the taker who accepts the advance. The Magistrate had wrongly invoked the provisions while dismissing the complaint. As such, the provisions of Section 269-SS and 271D had absolutely no bearing over the case in hand and, therefore, the impugned judgment and order of acquittal rendered by the Magistrate was unsustainable and, therefore, need to be quashed and set aside. The Magistrate had rendered the judgment in most cryptic and perfunctory manner, in the sense, neither the facts had been clearly stated nor the evidence had been properly discussed. The Magistrate had also misinterpreted and misread the legal position as envisaged not only under sections 138 and 139 of the N.I. Act but also the provisions of Section 269-SS. Thus, the findings arrived at by the Court below were patently illegal and perverse and, therefore, need to be set aside.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
This appeal is directed against a judgment and order of acquittal rendered by the Metropolitan Magistrate 50th Court, Vikroli, Mumbai on 1st September, 2008 in C.C No.1578/SS of 2007, thereby acquitting respondent No.1-accused of an offence punishable under section 138 of the Negotiable Instruments Act, 1881 (for short “N.I Act”).
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
