Jurisdiction for filing of criminal complaint u/s 138 NI Act
Anup Gupta
(Querist) 22 July 2011
This query is : Resolved
Dear Members,
My client is the manufacturing Company (the Company) having it registered office At New Delhi. The Company has entered into consignee agreement with some detail having its office at Noida for trading and selling of products/goods of the Company.
Consignee agent supplied products/goods to some dealer having its office at Kanpur and raised invoice. In the said invoice it is clearly mentioned that “all the disputes are subject to Delhi jurisdiction only and Consignee agent sold the products of the Company”.
The said Dealer issued Cheque in favour of Consignee Agent and the said cheque was presented by the Consignee agent in its banker at New Delhi and same was dishonored.
In short: Products supplied from Noida to Kanpur. The alleged Cheque was given at Noida and presented at New Delhi. I have sent Legal Notice for dishonor of cheque from New Delhi.
Now my question: Whether jurisdiction for filing of criminal complaint under section 138 R/W 142 of NI Act, lies in Delhi or Noida or Kanpur?
DEFENSE ADVOCATE.-firmaction@g
(Expert) 22 July 2011
we are contesting similar cases at higher levels HC AND SC and our basic objection is about locus standi coupled with voiletion of state VAT / SALES TAX liabilities.The resultant state penalties will be heavy and it will cover all similar transactions done by you with others.
The nuisance value will be enormous beyond the imagination now.
So please take expert advice before moving further in the matter.
R.Ramachandran
(Expert) 22 July 2011
Filing the complaint at Noida will be adviseable. This will take away an unnecessary opportunity to the accused to question the jurisdiction.
Ravikant Soni
(Expert) 22 July 2011
K bhaskaran ruling resolved all controversies regarding jurisdiction in NI ACT...
Ravikant Soni
(Expert) 22 July 2011
full text of judgement::
AIR 1999 SUPREME COURT 3762 "K. Bhaskaran v. Sankaran Vaidhyan Balan"
= 1999 AIR SCW 3809
(From : Kerala)*
Coram : 2 K. T. THOMAS AND M. B. SHAH, JJ.
Criminal Appeal No. 1015 of 1999 (arising out of Spl. Leave Petn. (Cri.) No. 146 of 1999), D/- 29 -9 -1999.
K. Bhaskaran, Appellant v. Sankaran Vaidhyan Balan and another, Respondents.
(A) Criminal P.C. (2 of 1974), S.178(d), S.177, S.179 - Negotiable Instruments Act (26 of 1881), S.138 - DISHONOUR OF CHEQUE - Cheque dishonour - Complaint regarding - Whether liable to be dismissed on grounds of want of territorial jurisdiction of Magistrate Court - Raising of such question is an idle exercise - It is difficult to fix up any particular locality as place of occurrence for offence.
The offence under S. 138 of the Act can be completed only with the concatenation of a number of acts. 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. It is not necessary that all the 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 concatenation of all the above five is a sine qua non for the completion of the offence under S. 138 of the Act. Referring S. 178(d) of Code it is clear that 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 under 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 under S. 138 of the Act. (Paras 14, 15, 17)
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Under S. 177 of the Code "every offence shall ordinarily be inquired into and tried in a Court within whose jurisdiction it was committed". The locality where the bank (which dishonoured the cheque) is situated cannot be regarded as the sole criteria to determine the place of offence. Even otherwise the rule that every offence shall be tried by a Court within whose jurisdiction it was committed is not an unexceptional or unchangeable principle. S. 177 itself has been framed by the legislature thoughtfully by using the precautionary word "ordinarily" to indicate that the rule is not invariable in all cases. S. 178 of the Code suggests that if there is uncertainty as to where, among different localities, the offence would have been committed the trial can be had in a Court having jurisdiction over any of those localities. The provision has further widened the scope by stating that in case where the offence was committed partly in one local area and partly in another local area the Court in either of the localities can exercise jurisdiction to try the case. Further again, S. 179 of the Code stretches its scope to a still wider horizon. The above provisions in the Code should have been borne in mind when the question regarding territorial jurisdiction of the Courts to try the offence was sought to be determined. (Paras 11, 12, 13)
(B) Negotiable Instruments Act (26 of 1881), S.138(1), Proviso, Cl.(b), Cl.(c) - General Clauses Act (10 of 1897), S.27 - DISHONOUR OF CHEQUE - Cheque dishonour - Cause of action - Presumption of service of notice - Offence complete on failure of drawer to pay cheque amount within 15 days from date of giving notice - Notice sent by post returned by accused as "unclaimed" - Period of 15 days commences from such date - Notice is presumed to have been served - Failure of accused to rebut presumption - Accused is guilty of offence under S. 138.
The conditions pertaining to the notice to be given to the drawer, have been formulated and incorporated in Cls. (b) and (c) of the proviso to S. 138(1) of the Act. On the part of the payee he has to make a demand by "giving a notice" in writing. If that was the only requirement to complete the offence on the failure of the drawer to pay the cheque amount within 15 days from the date of such "giving", the travails of the prosecution would have been very much lessened. But the legislature says that failure on the part of the drawer to pay the amount should be within 15 days "of the receipt" of the said notice. It is, therefore, clear that "giving notice" in the context is not the same as receipt of notice. Giving is a process of which receipt is the accomplishment. It is for the payee to perform the former process by sending the notice to the drawer in the correct address. No doubt S. 138 of the Negotiable Instruments Act does not require that the notice should be given only by "post". Nonetheless the principle incorporated in S. 27 of General Clauses Act can profitably be imported in a case where the sender has despatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice. (Paras 17, 18, 24, 25, 26)
Thus, when a notice is returned by the sendee as unclaimed such date would be the commencing date in reckoning the period of 15 days contemplated in Cl. (d) to the proviso of S. 138 of the Act. Of course such reckoning would be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice was brought to his address. In the present case, the accused did not even attempt to discharge the burden to rebut the aforesaid presumption, the accused is guilty of the offence under S. 138 of the Act. (Paras 30, 31)
(C) Criminal P.C. (2 of 1974), S.386, Second Proviso, S.29(2), S.357(3) - Negotiable Instruments Act (26 of 1881), S.138 - DISHONOUR OF CHEQUE - APPEAL - Reversal of acquittal in appeal - Jurisdictional limits prescribed under Art. 386 - Sentence of fine for offence of dishonour of cheque - Fine exceeding Rs. 5,000/- besides imprisonment cannot be imposed by Judicial Magistrate 1st Class - High Court in appeal while maintaining conviction cannot impose sentence of fine exceeding said limit.
Though S. 386 confers power on the Court of appeal to reverse an order of acquittal and find the accused guilty and pass sentence on him
@page-SC3764
according to law, even the High Court when it is the Court of appeal has to conform to the second proviso to S. 386 of the Code and therefore shall not inflict greater punishment for the offence which in its opinion the accused has committed, than might have been inflicted for that offence by the Court passing the order or sentence under appeal. The trial in this case was held before a Judicial Magistrate of first class who could not have imposed a fine exceeding Rs. 5,000/- besides imprisonment since S. 29(2) contains a limitation for the magistrate of first class in the matter of imposing fine as a sentence or as a part of the sentence. The High Court while convicting the accused in appeal in the same case, therefore, could not impose a sentence of fine exceeding the said limit. (Paras 26, 27, 28, 29)
It is true, if a judicial magistrate of first class were to order compensation to be paid to the complainant from out of the fine realised the complainant will be the loser when the cheque amount exceeded the said limit. In such a case a complainant would get only the maximum amount of Rupees five thousand. However, the magistrate in such cases can alleviate the grievance of the complainant by making resort to S. 357(3) of the Code. No limit is mentioned in the sub-section and therefore, a magistrate can award any sum as compensation. Of course while fixing the quantum of such compensation the Magistrate has to consider what would be the reasonable amount of compensation payable to the complainant. Thus, even if the trial for cheque dishonour was before a Court of magistrate of first class in respect of a cheque which covers an amount exceeding Rs. 5,000/- the Court has power to award compensation to be paid to the complainant. (Paras 30, 31)
(D) Negotiable Instruments Act (26 of 1881), S.138, S.118, S.139 - DISHONOUR OF CHEQUE - Cheque dishonour - Accused denied having issued the cheque although he owned his signature therein - Presumption that cheque was made or drawn for consideration on date which cheque bears, arises - Holder of cheque presumed to have received it for discharge of liability - Burden is upon accused to rebut presumption. (Para 9)
Cases Referred : Chronological Paras
Kunjan Panicker v. Christudas, (1997) 2 Ker LT 539 : (1997) 4 Crimes 477 8
Jagdish Singh v. Nattu Singh, 1992 AIR SCW 1747 : AIR 1992 SC 1604 : 1992 All LJ 620 : (1992) 1 SCC 647 22
Hari Kishan v. Sukhbir Singh, AIR 1988 SC 2127 : 1989 Cri LJ 116 31
Harcharan Singh v. Smt. Shivrani, AIR 1981 SC 1284 : (1981) 2 SCC 535 : 1981 All LJ 504 22
E. M. S. Anam, Advocate, for Appellant; C. N. Sree Kumar, Advocate (for No. 1) and G. Prakash, Advocate (for No. 2), for Respondents.
* Cri. A.No. 234 of 1995, D/- 23-10-1998 (Kerala)
Judgement
THOMAS, J. :- Leave granted.
2. This a case where the complainant and the accused are siblings, being sons of the same parents. They are fighting over a dishonoured cheque. Both must have experienced a roller-coaster ride in this criminal litigation. Fortune favoured the accused in the first round as he scored an acquittal from the trial Court, but it favoured the complainant in the next round when the High Court reversed the acquittal and convicted his brother of the offence under Section 138 of the Negotiable Instruments Act (for short 'the Act'). Perhaps the accused would have remained quiet by then, but for the sentence of imprisonment (six months) which he has now to undergo besides a fine of rupees one lakh which the High Court has imposed on him. So this time it is the turn of the accused to move and hence he has filed this appeal.
3. We thought that the two brothers would settled their disputes over this cheque case and we granted sufficient opportunity to both. But the battle is destined to continue as the expected settlement eludes like a mirage. We do not know at whose fault the parleys went awry. We cannot but proceed with the case and so we heard the counsel for both.
4. Before dealing with the two main points on which the counsel argued in this Court we may set out the facts in brief. The respondent (who will hereinafter be referred to as the 'complainant') presented a cheque which bears the signature of the appellant (hereinafter referred to as the 'accused') before the Syndicate Bank's branch office at Kayamkulam (Kerala) on 29-1-1993 for encashment. The cheque was for an amount of rupees one lakh. The bank bounced the cheque
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due to insufficiency of funds in the account of the accused. Complainant then issued a notice by registered post in the address of the accused on 2-2-1993. The notice was returned to the complainant on 15-2-1993 with the following endorsements inscribed thereon :
3-2-1993 Addressee absent
4-2-1993 Addressee absent
5-2-1993 Addressee absent
6-2-1993 Intimation served on addressee's house
As the postal article remained unclaimed till 15-2-1993 it was returned to the sender with a further endorsement "unclaimed."
5. A complaint was filed by the complainant on 4-3-1993 before the Court of the Judicial Magistrate, 1st Class, Adoor (in Pathanamthitta District in Kerala) against the accused under Section 138 of the Act. Among the contentions which the accused raised, one was regarding the territorial jurisdiction of the said magistrate court to try the case as the cheque was dishonoured at the Syndicate Bank's Branch Office at Kayamkulam (it is situate in another District in Kerala). Accused denied having issued the cheque although he owned his signature therein. According to the accused, his brother (the complainant) had snatched away some signed blank cheque leaves from his possession and utilised one such cheque leaf for the present case. He also contended that he did not receive any notice from the complainant regarding dishonour of the cheque and hence no cause of action would have arisen in this case. The complaint, according to him, is not maintainable on that score also.
6. The complainant examined himself as PW-1 and two more witnesses for the prosecution. (PW-2 is the Manager of Syndicate Bank's branch office and PW-3 Devarajan who claimed to have seen the accused issuing the cheque at his shop). Accused examined his wife as DW-1.
7. The trial magistrate repelled the defence contention that the cheque leaf was stolen by the complainant. It was held that the cheque was actually issued by the accused to the complainant. However, the magistrate upheld the contention that his Court had no territorial jurisdiction to try the case as the cheque was dishonoured by the branch office of the bank situated in a different district. The magistrate further held that as the accused did not receive the notice no cause of action has arisen. As a corollary thereof the magistrate acquitted the accused.
8. The High Court of Kerala, on the appeal preferred by the complainant, set aside the order of acquittal and convicted him and sentenced him as aforesaid. Learned single Judge of the High Court accepted the version of the complainant that cheque was issued at the shop of PW-3 which is situated within the territorial limits of the trial Court's jurisdiction. Regarding notice, learned single Judge relied on the decision of a Division Bench of the same High Court (Kunjan Panicker v. Christudas, (1997) 2 Kerala LT 539) wherein it was held that "refusal and even failure to claim in circumstances as here will tantamount to service of notice."
9. As the signature in the cheque is admitted to be that of the accused, the presumption envisaged in Section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date which the cheque bears. Section 139 of the Act enjoins on the Court to presume that the holder of the cheque received it for the discharge of any debt or liability. The burden was on the accused to rebut the aforesaid presumption. The trial Court was not persuaded to rely on the interested testimony of DW-1 to rebut the presumption. The said finding was upheld by the High Court. It is not now open to the accused to contend differently on that aspect.
10. Learned counsel for the appellant first contended that the trial Court has no jurisdiction to try this case and hence the High Court should not have converted the acquittal into conviction on the strength of the evidence collected in such a trial. Of course, the trial Court had upheld the plea of the accused that it had no jurisdiction to try the case.
11. We fail to comprehend as to how the trial Court could have round so regarding the jurisdictional question. Under Section 177 of the Code "every offence shall ordinarily be inquired into and tried in a Court within whose jurisdiction it was committed." The locality where the bank (which dishonoured the cheque) is situated cannot be regarded as the sole criteria to determine the place of offence. It must be remembered that offence under Section 138 would not be completed with the dishonour of the cheque. It attains
@page-SC3766
completion only with the failure of the drawer of the cheque to pay the cheque amount within the expiry of 15 days mentioned in Clause (c) of the proviso to Section 138 of the Act. It is normally difficult to fix up a particular locality as the place of failure to pay the amount covered by the cheque. A place, for that purpose, would depend upon a variety of factors. It can either be at the place where the drawer resides or at the place where the payee resides or at the place where either of them carries on business. Hence, the difficulty to fix up any particular locality as the place of occurrence for the offence under Section 138 of the Act.
12. Even otherwise the rule that every offence shall be tried by a Court within whose jurisdiction it was committed is not an unexceptional or unchangeable principle. Section 177 itself has been framed by the legislature thoughtfully by using the precautionary word "ordinarily" to indicate that the rule is not invariable in all cases. Section 178 of the Code suggests that if there is uncertainty as to where, among different localities, the offence would have been committed the trial can be had in a Court having jurisdiction over any of those localities. The provision has further widened the scope by stating that in case where the offence was committed partly in one local area and partly in another local area the Court in either of the localities can exercise jurisdiction to try the case. Further again, Section 179 of the Code stretches its scope to a still wider horizon. It reads thus :
"179. Offence triable where act is done or consequence ensues.- When an act is an offence by reason of anything which has been done and of a consequence which has ensued, the offence may be inquired into or tried by a Court within whose local jurisdiction such thing has been done or such consequence has ensued."
13. The above provisions in the Code should have been borne in mind when the question regarding territorial jurisdiction of the Courts to try the offence was sought to be determined.
14. The offence under Section 138 of the Act can be completed only with the con-catenation of a number of acts. 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 5 different localities. But concatenation of all the above five is a sine qua nonfor the completion of the offence under Section 138 of the Act. In this context a reference to Section 178(d) of the Code is useful. It is extracted below :
"Where the offence consists of several acts done in different local areas, it may be inquired 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 under Section 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 under Section 138 of the Act.
17. The more important point to be decided in this case is whether the cause of action has arisen at all as the notice sent by the complainant to the accused was returned as "unclaimed." The conditions pertaining to the notice to be given to the drawer, have been formulated and incorporated in Clauses (b) and (c) of the proviso to Section 138(1) of the Act. The said clauses are extracted below :
"(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 fifteen 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
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course of the cheque within fifteen days of the receipt of the said notice."
18. On the part of the payee he has to make a demand by "giving a notice" in writing. If that was the only requirement to complete the offence on the failure of the drawer to pay the cheque amount within 15 days from the date of such "giving", the travails of the prosecution would have been very much lessened. But the legislature says that failure on the part of the drawer to pay the amount should be within 15 days "of the receipt" of the said notice. It is, therefore, clear that "giving notice" in the context is not the same as receipt of notice. Giving is a process of which receipt is the accomplishment. It is for the payee to perform the former process by sending the notice to the drawer in the correct address.
19. In Black's Law Dictionary, "giving of notice" is distinguished from "receiving of the notice." (vide page 621) "A person notifies or gives notice to another by taking such steps as may be reasonably required to inform the other in the ordinary course, whether or not such other actually comes to know of it." A person "receives" a notice when it is duly delivered to him or at the place of his business.
20. If a strict interpretation is given that the drawer should have actually received the notice for the period of 15 days to start running no matter that the payee sent the notice in the correct address, a trickster cheque drawer would get the premium to avoid receiving the notice by different strategies and he could escape from the legal consequences of Section 138 of the Act. It must be borne in mind that Court should not adopt an interpretation which helps a dishonest evader and clips an honest payee as that would defeat the very legislative measure.
21. In Maxwell's "Interpretation of Statutes," the learned author has emphasized that "provisions relating to giving of notice often receive liberal interpretation." (vide page 99 of the 12th Edn.). The context envisaged in Section 138 of the Act invites a liberal interpretation for the person who has the statutory obligation to give notice because he is presumed to be the loser in the transaction and it is for his interest the very provision is made by the legislature. The words in Clause (b) of the proviso to Section 138 of the Act show that payee has the statutory obligation to "make a demand" by giving notice. The thrust in the clause is on the need to "make a demand". It is only the mode for making such demand which the legislature has prescribed. A payee can send the notice for doing his part for giving the notice. Once it is despatched his part is over and the next depends on what the sendee does.
22. It is settled that a notice refused to be accepted by the addressee can be presumed to have been served on him, (vide Harcharan Singh v. Smt. Shivrani, (1981) 2 SCC 535 : (AIR 1981 SC 1284), and Jagdish Singh v. Natthu Singh, (1992) 1 SCC 647 : (1992 AIR SCW 1747 : AIR 1992 SC 1604).
23. Here the notice is returned as unclaimed and not as refused. Will there be any significant difference between the two so far as the presumption of service is concerned ? In this connection a reference to Section 27 of the General Clauses Act will be useful. The section reads thus :
"27. Meaning of service by post.- Where any Central Act or Regulation made after the commencement of this Act authorizes or requires any document to be served by post, whether the expression "serve" or either of the expressions "give" or "send" or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post, a letter containing the document, and unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post."
24. No doubt Section 138 of the Act does not require that the notice should be given only by "post". Nonetheless the principle incorporated in Section 27 (quoted above) can profitably be imported in a case where the sender has despatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice.
25. Thus when a notice is returned by the sendee as unclaimed such date would be the commencing date in reckoning the period of 15 days
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contemplated in Clause (d) to the proviso of Section 138 of the Act. Of course such reckoning would be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice was brought to his address. In the present case the accused did not even attempt to discharge the burden to rebut the aforesaid presumption.
26. The High Court is, therefore, right in holding the accused is guilty of the offence under Section 138 of the Act. Still there is one more aspect, though neither side has argued about it before us, which requires elucidation. We will deal with that aspect now.
27. The High Court has imposed a sentence of imprisonment for 6 months and a fine of Rs. one lakh on the accused. Section 138 of the Act provides punishment with "imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of cheque or with both." But the Court cannot obviate the jurisdictional limit prescribed in Section 386 of the Code. Though the said provision confers power on the Court of appeal to reverse an order of acquittal and find the accused guilty and pass sentence on him according to law, even the High Court when it is the Court of appeal has to conform to the second proviso to Section 386 of the Code. It reads thus :
"Provided further that the Appellate Court shall not inflict greater punishment for the offence which in its opinion the accused has committed, than might have been inflicted for that offence by the Court passing the order of sentence under appeal."
28. In this context a reference to Section 29(2) of the Code is necessary as it contains a limitation for the magistrate of first class in the matter of imposing fine as a sentence or as a part of the sentence. Section 29(2) reads thus :
"The Court of a Magistrate of the first class may pass a sentence of imprisonment for a term not exceeding three years, or of fine not exceeding five thousand rupees, or of both."
29. The trial in this case was held before a Judicial Magistrate of first class who could not have imposed a fine exceeding Rs. 5,000/- besides imprisonment. The High Court while convicting the accused in the same case could not impose a sentence of fine exceeding the said limit.
30. It is true, if a judicial magistrate of first class were to order compensation to be paid to the complainant from out of the fine realised the complainant will be the loser when the cheque amount exceeded the said limit. In such a case a complainant would get only the maximum amount of Rupees five thousand.
31. However, the magistrate in such cases can alleviate the grievance of the complainant by making resort to Section 357(3) of the Code. It is well to remember that this Court has emphasized the need for making liberal use of that provision, (Hari Kishan v. Sukhbir Singh, AIR 1988 SC 2127 : 1989 Cri LJ 116). No limit is mentioned in the sub-section and therefore, a magistrate can award any sum as compensation. Of course while fixing the quantum of such compensation the Magistrate has to consider what would be the reasonable amount of compensation payable to the complainant. Thus, even if the trial was before a Court of magistrate of first class in respect of a cheque which covers an amount exceeding Rs. 5,000/- the Court has power to award compensation to be paid to the complainant.
32. The question of sentence and award of compensation must be considered by the trial Court. We deem it feasible that the magistrate shall hear the prosecution and the accused on those aspects. Of course, if the complainant and accused settle their disputes regarding this cheque, in the meanwhile, that fact can certainly be taken into consideration in determining the extent or quantum of sentence.
33. We, therefore, uphold the conviction of the offence under Section 138 of the Act, but we set aside the sentence awarded by the High Court for enabling the trial Court to pass orders on the question of sentence and the compensation, if any, payable.
Order accordingly.
DEFENSE ADVOCATE.-firmaction@g
(Expert) 22 July 2011
Please read the question , he says the goods were billed by third party. HIS NOIDA party has billed to Kanpur so how this citation is applicable.
AND HOW THE GOODS SOLD BY AGENT TO DEFFERENT STATE CAM GIVE RIGHT TO PRIMCIPAL TO SUE DIRECTLY TO THE BUYER.
When you refer SC cases you must go through recent ones also. SC HERMANN case has over ruled all earlier citations.
Ravikant Soni
(Expert) 22 July 2011
k bhaskaran ruling subsequently refered in so many apex court judgments. but nowhere it is overruled.
I would like to ask my dear ld friend to quot the relevant para of judgement in which the K BHASKARAN judgement has been overruled............ --
Ravikant Soni
(Expert) 22 July 2011
Get this judgement:::\
AIR 2009 SUPREME COURT 1355 "Shamshad Begum v. B. Mohammed"
(From : Karnataka)*
Coram : 2 Dr. A. PASAYAT AND Dr. MUKUNDAKAM SHARMA, JJ.
Criminal Appeal No. 1715 of 2008 (arising out of SLP (Cri.) No. 73 of 2006), D/- 3 -11 -2008.
Smt. Shamshad Begum v. B. Mohammed.
Negotiable Instruments Act (26 of 1881), S.138 - DISHONOUR OF CHEQUE - CRIMINAL COURT - Dishonour of Cheque - Trial of offence - Jurisdiction of Court - Notice in writing to drawer of cheque demanding payment of cheque amount was sent from place 'M' - Court at 'M' has jurisdiction to try case.
Criminal P.C. (2 of 1974), S.178.
The offence under S. 138 can be completed only with the concatenation of a number of acts. The acts which are components are as follows :
(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.
It is not necessary that 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 concatenation of all the above five acts is sine qua non for the completion of the offence under S. 138. One of the components of the offence under S. 138 was giving notice in writing to the drawer of the cheque demanding payment of the cheque amount. The said action took place within jurisdiction of court at 'M'. Therefore, Court at 'M' had jurisdiction to try the case.
1999 AIR SCW 3809, Foll. (Paras 7, 8, 9)
Cases Referred : Chronological Paras
1999 AIR SCW 3809 : AIR 1999 SC 3762 : 1999 Cri LJ 4606 (Foll.) 6, 7
Shakil Ahmed Syed, for Appellant; S.N. Bhat, for Respondent.
*Cri. Petn. No. 939 of 2005, D/-08-11-2005 (Kant).
Judgement
1. Dr. ARIJIT PASAYAT, J. :- Leave granted.
2. Challenge in this appeal is to the judgment of a learned Single Judge of the Karnataka High Court dismissing the petition filed under Section 482 of the Code of Criminal Procedure, 1973 (in short the 'Code'). Prayer in the petition was to quash all proceedings in CC No. 1042 of 2004 on the file of learned Vth JMF Court, Mangalore. Appellant is the accused in the aforesaid case in relation to an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (in short the 'Act'). The petition was filed before the High Court on the ground that the Mangalore Court has no jurisdiction to try the case. It was stated that the agreement between the parties was entered into Bangalore and the parties live in Mangalore and the cheque were returned from the banks at Bangalore and therefore the Bangalore Court has jurisdiction to try the case.
3. In response, the respondent had submitted that before issuing notice to the appellant he had shifted his residence to Mangalore and therefore he had issued the notice from Mangalore which was received by the appellant and the reply was sent by her to the complainant to the Mangalore address. Therefore, as one of the components of the said offence i.e. notice in writing to the drawer of the cheque demanding
@page-SC1356
payment of cheque amount was sent from Mangalore, Court at Mangalore had jurisdiction to try the case. The High Court noted that one of the components of the offence was giving notice in writing to the drawer of the cheque demanding payment of the cheque amount. The said action took place within Mangalore jurisdiction and, therefore, the petition was without merit. It was however stated that if the presence of the appellant was not very necessary for continuation of the proceeding, on appropriate application being filed, the court can grant exemption from appearance.
4. In support of the appeal learned counsel for the appellant submitted that the Court at Mangalore had no jurisdiction.
5. Learned counsel for the respondent on the other hand supported the judgment of the High Court.
6
. In K. Bhaskaran v. Sankaran Vaidhyan Balan and Anr. [1999 (7) SCC 510], it was inter alia observed as follows : 1999 AIR SCW 3809
"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 acts is a sine qua non for the completion of the offence under Section 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 under Section 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 under Section 138 of the Act.
17. The more important point to be decided in this case is whether the cause of action has arisen at all as the notice sent by the complainant to the accused was returned as "unclaimed". The conditions pertaining to the notice to be given to the drawer, have been formulated and incorporated in clauses (b) to (c) of the proviso to Section 138 of the Act. The said clauses are extracted below :
"(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 fifteen 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."
7
. As was noted in K. Bhaskar's case (supra) the offence under Section 138 of the Act can be completed only with the concatenation of a number of acts. The acts which are components are as follows : 1999 AIR SCW 3809
(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.
8. It is not necessary that 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 concatenation of all the above five acts is sine qua non for the completion of the offence under Section 138 of the Act.
9. In view of the aforesaid, the judgment of the High Court does not suffer from any infirmity to warrant interference.
10. The appeal is dismissed.
prabhakar singh
(Expert) 23 July 2011
Expert YOUR ADVOCATE !
In reply to Expert Ravikant soni ,you agitate his understanding about the query,but in your own reply,you do not so far replied
to the queries t as to which of the three places he should choose to file his complaint,NOIDA/DELHI/KANPUR.
Even queries t is aware of the fact that all three places have jurisdiction,but he was desirous to get the fact confirmed by us,fortunately,he had an answer only from Expert R.Ramachandran .
I wish to know your opinion in a clear cut way as you claim your self to be an overweight ,against a senior expert at LCI,Mr. Dhingra.
DEFENSE ADVOCATE.-firmaction@g
(Expert) 23 July 2011
Mr Prabhakar singh before jumping to find fault with my opinion you should read the question and other replies.
The original question says that the agent of the principal has supplied goods out of state so who the principal get title of the cheque.
Regarding Dhingra if he is genuine he should declare what companies he is heading.
Devajyoti Barman
(Expert) 23 July 2011
I think we should maintain a decorum amongst ourselves.
We should only support or oppose the view of fellow experts than making any comment personally.
For the last so many months here I have not seen any body sustain for long giving false information about himself.
Anup Gupta
(Querist) 25 July 2011
Dear Members,
Thanks for reply!
But before reply see the facts are:
1. Consignee agent supplied products/goods to some dealer having its office at Kanpur.
2. Consignee agent on its letter head has raised invoice for the supplied products/good to the Dealer (Kanpur).
3. In the said invoice it is clearly mentioned that “all the disputes are subject to Delhi jurisdiction only and Consignee agent sold the products of the Company”.
4. The said Dealer issued Cheque in favour of Consignee Agent.
5. Consignee Agent was presented the said cheque in its banker at New Delhi and same was dishonored.
6. Alleged cheque was not issued in the favour of the Company and the Company has not issued the said invoice.
7. I have served legal notice for dishonour of cheque from New Delhi on behalf of the Consignee Agent.
Now reply my question on considering the above said facts: Whether jurisdiction for filing of criminal complaint under section 138 R/W 142 of NI Act, lies in Delhi or Noida or Kanpur?
Ravikant Soni
(Expert) 25 July 2011
You can file complaint in delhi. Dont forget to mention the fact that the cheque was received in delhi in the complaint.
Anup Gupta
(Querist) 25 July 2011
Thanks
But Office of the Consignee Agent is in Noida, Only Bank Account is in Delhi.
Anup Gupta
(Querist) 25 July 2011
Dear members,
In this case i am going to file criminal complaint under section 138 R/W 142 of NI Act on behalf of the Consignee Agent on the basis of the following:
1. As the products supplied by the Consignee Agent,
2. bill raised by the Consignee Agent,
3. Cheque issued in favour of Consignee Agent,
4. Cheque in question was presented for encashment in New Delhi,
5. Legal Notice sent from New Delhi,
If any further observations please reply soon...................
