Md. Siraj Vs State of Jharkhand & Another (Jharkhand High Court)
SEO Title: Premature Cheque Bounce Complaint Quashed for Lack of Notice Service Proof: Jharkhand HC
Summary: The Jharkhand High Court considered a petition under Section 482 of the Code of Criminal Procedure challenging the cognizance order dated 2 May 2017 in Complaint Case No. 1277 of 2016 under Section 138 of the Negotiable Instruments Act. The complainant alleged that a cheque for ₹3,15,500 issued by Md. Siraj was dishonoured for insufficient funds when presented again on 3 August 2016. A written demand notice was issued on 12 August 2016, and the complaint was filed on 2 September 2016. However, there was no evidence on record establishing whether or when the accused had received the notice.
The petitioner contended that, in the absence of evidence of service, the complainant was required to allow the period for presumed service of notice and the further statutory payment period before filing the complaint. Reliance was placed on Subodh S. Salaskar v. Jayprakash M. Shah and Another, (2008) 13 SCC 689, as well as two other Jharkhand High Court decisions identified by their case numbers. The State and complainant opposed quashing but acknowledged that the record did not establish the date of service of the demand notice.
The High Court held that the complaint filed on 2 September 2016 was premature because there was no material demonstrating receipt of the notice and expiry of the required 15-day payment period. Applying the principle concerning deemed service and referring to Gajanand Burange v. Laxmi Chand Goyal, 2022 SCC OnLine SC 1711, it set aside the cognizance order. The complainant was permitted to institute a fresh complaint and seek condonation of delay under the proviso to Section 142(b) of the NI Act. The petition was allowed, with an observation concerning expeditious disposal if a fresh complaint was filed within two months.
Cases Discussed
- Subodh S. Salaskar v. Jayprakash M. Shah and Another, (2008) 13 SCC 689
- Gajanand Burange v. Laxmi Chand Goyal, 2022 SCC OnLine SC 1711
FULL TEXT OF THE JUDGMENT/ORDER OF JHARKHAND HIGH COURT
2. This criminal miscellaneous petition has been filed invoking the jurisdiction of this Court under Section 482 Cr.P.C. with a prayer for quashing the entire criminal proceeding including the order taking cognizance dated 02.05.2017, by which, learned SDJM, Giridih took cognizance against the petitioner for having committed the offence punishable under Section 138 of NI Act in connection with the Complaint Case no. 1277 of 2016.
3. The brief facts of the case is that the petitioner issued a cheque of Rs. 3,15,500/- to the opp. party no. 2 – the complainant. The same was presented for the second time for encashment on 03.08.2016 but the same was dishonored for insufficiency of fund. The opp. party no. 2 -complainant made demand for payment of the cheque amount by giving a notice in writing through his advocate on 12.08.2016. The undisputed fact remains that there is no material in the record to suggest that as to whether the said notice was ever received by the petitioner- the accused person of the case but the complaint was filed on 02.09.2016.
4. Learned counsel for the petitioner submits that since the notice was not received by the petitioner, undisputedly so the complainant- opp. party no. 2 ought to have waited for 30 days for drawing the presumption that on 30th day, the petitioner received notice and in this respect, learned counsel for the petitioner, relies upon the judgment of the Hon’ble Supreme Court of India in the case of the Subodh S. Salaskar v. Jayprakash M. Shah and Another reported in (2008) 13 SCC 689. It is further submitted that thus presuming that the notice has been received by the petitioner on 11.09.2006, the cause of action for filing the complaint ought to have been arose after 30 days from the date of issue of the notice that is on 11.09.2016 but the complaint having filed on 02.09.2016, the same is premature. Learned counsel for the petitioner also relies upon the judgment of a co-ordinate Bench of this court in Cr. Revision no. 389 of 2016 dated 27.09.2023 in this respect as also the judgment of this court in the case of Acq. Appeal (C) no. 48 of 2019 dated 20.06.2019, hence, it is submitted that the entire criminal proceeding including the order taking cognizance dated 02.05.2017 passed by learned SDJM, Giridih in connection with the Complaint Case no. 1277 of 2016 be quashed and set aside.
5. Learned Addl. PP and the learned counsel for the opp. party no. 2 on the other hand, vehemently opposes the prayer for quashing the entire criminal proceeding including the order taking cognizance dated 02.05.2017 passed by learned SDJM, Giridih, in connection with the Complaint Case no. 1277 of 2016 but fairly submits that there is no material in record to suggest; as to on which date the demand notice in writing given by the complainant-opp. party no. 2 was served upon the petitioner-accused person. The learned Addl. PP, lastly submits that this criminal miscellaneous petition being without any merit be dismissed.
6. Having heard the submissions made at the Bar and going through the materials in the record, it is pertinent to refer to Section 138 of the NI Act, which reads as under :-
“138. Dishonour of cheque for insufficiency, etc., of funds in the account. —Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless —
(a) the cheque has been presented to the bank within a period of six months* from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice.
Explanation. — For the purposes of this section, “debt or other liability” means a legally enforceable debt or other liability. (Emphasis supplied)
7. It is crystal clear from plain reading of Section 138 of the NI Act, that the drawer of a cheque if fails to make the payment of the amount of the cheque to the payee, within 15 days of the receipt of the said notice, then the cognizance of the offence can be taken by learned Judicial Magistrate for the offence punishable under Section 138 of the NI Act. The question arises, what if, there is no document to suggest that the demand notice in writing given by the complainant-opp. party no. 2 has been served upon the drawer of the cheque, as has been held by the Hon.’ble Supreme Court of India in the case of the Subodh S.Salaskar vs. Jayprakash M. Shah & Anr. (supra), the law is settled that in case there is no material to suggest that such notice was ever served upon drawer of the cheque or any material that such demand notice has returned unserved, within the period of 30 days from the date of the issue of such notice, such demand notice is deemed to have been served within the period of 30 days from the date of issue of such notice and the cognizance of the offence punishable under Section 138 of the N. I. Act, can be taken, if the drawer of cheque fails to pay the amount as per cheque within 15 days of such deemed service of notice. So considering the undisputed fact that the notice was sent on 12.08.2016 and the complaint was filed on 02.09.2016 without any material to suggest that during that period, the petitioner had received notice of demand and 15 days elapsed after receipt of such notice of demand on or before 02.09.2016, this court has no hesitation in holding that the complaint is pre-mature, hence, the cognizance is bad in law. The Hon’ble Supreme Court of India in the case of the Gajanand Burange vs. Laxmi Chand Goyal reported in 2022 SCC Online SC 1711, para 10 and 11 of which, reads as under:-
“10. Hence, the following order:
The impugned judgment and order of the Single Judge of the High Court of Chhattisgarh dated 28 November 2018 shall stand set aside; and
The respondent would be at liberty to institute a fresh complaint and since the earlier complaint could not be presented within the time prescribed by Section 142(b) of the NI Act, the respondent would be at liberty to seek the benefit of the proviso by satisfying the trial court of sufficient cause for the delay in instituting the complaint.
11. In the event that the second complaint is filed within a period of two months from the date of this order, we request the trial court to dispose of the complaint within a period of six months.”
as in similar matter, given liberty to the respondent of that case, who was complainant, to institute a fresh complaint and as the earlier complaint could not be presented within time prescribed as per Section 142(b) of the NI Act, observed that the respondent of that case, would be at liberty to seek the benefit of the proviso by satisfying the trial court of sufficient cause for the delay in instituting the complaint.
8. Considering the aforesaid facts, since the complaint was filed prematurely, the order dated 02.05.2017, by which, learned SDJM, Giridih took cognizance against the petitioner for having committed the offence punishable u/s 138 of NI Act, in connection with Complaint Case No. 1277 of 2016, being not sustainable in law is set aside.
9. It is further ordered that the opp. party no. 2 will be at liberty to institute a fresh complaint and may seek benefit of proviso of Section 142(b) of the NI Act, 1881, by satisfying the court concerned, of sufficient cause of the delay in institution of the complaint.
10. In the event, the second complaint is filed within a period of two months, from the date of this order, the trial court may dispose of the complaint within a period of six months from the date of filing of such complaint.
11. In the result, this criminal miscellaneous petition is allowed and in view of the disposal of this criminal miscellaneous petition, the interim order, if any, passed earlier, stands vacated.
