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2002 (8) TMI 577

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..... into a manifest error and as such the judgment impugned cannot obtain our concurrence. - CRL. APPEAL NO. 797 OF 2002 SLP (CRL.) NO. 4095 OF 2000) - - - Dated:- 12-8-2002 - UMESH C. BANERJEE AND Y.K. SABHARWAL JJ. S. Balakrishnan, Vijay Sondhi, M.K.D. Namboodiri and Subramonium Prasad for the Appellant. K.R. Sasiprabhu and Romy Chacko for the Respondent. JUDGMENT Umesh C. Banerjee, J. Leave granted. 2. A short but an interesting question falls for consideration in this appeal to the effect as to the maintainability of a proceeding under section 138 of the Negotiable Instruments Act, 1881, vis-a-vis, a guarantor. The High Court negated it and, hence, the matter before this Court under article 136 of the C .....

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..... 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. Explanation. For the purpose of this section, debt or other liability means a legally enforceable debt or other liability." It is on the basis of the provision as above, the High Court came to a conclusion when a cheque was issued as security, no complaint will lie under section 138 since the cheque issued cannot be said to be for the purpose of discharging any debt .....

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..... the amount. So it cannot be construed that the respondent had issued the cheque voluntarily for discharge of any debt or legal liability as envisaged under section 138." 4. Having, however, the support of the Andhra Pradesh High Court judgment, the Kerala High Court in Sreenivasan s case ( supra ) observed: "A comparative reading of the principle laid down by the Andhra Pradesh High Court and the mandatory provisions laid down in section 138 of the Negotiable Instruments Act is crystal clear that when a cheque has been issued as a security, no complaint will lie under section 138 of the Negotiable Instruments Act." After having noted the interpretation of the High Court as regards section 138, time has, thus, now come for us to as .....

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..... ief Judicial Magistrate s Court, Thiruvananthapuram. The complaint has been registered as S.T. No. 141/1999 in the Court of the Addl. Chief Judicial Magistrate, Thiruvananthapuram and, subsequently, the case was taken on file for the purposes of the complaint and immediately thereafter, the respondents herein moved a petition under section 482 of the Code of Criminal Procedure, 1973 for quashing of the complaint and the proceedings noticed above pending before the Addl. Chief Judicial Magistrate s Court, Thiruvananthapuram. 6. The High Court, as noticed above, did allow the petition upon a categorical finding that being a cheque from the guarantor it could not be said to have been issued for the purpose of discharging any debt or liabil .....

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..... aspect of the matter has not been appreciated by the High Court, neither been dealt with or even referred to in the impugned judgment. 9. The issue as regards the co-extensive liability of the guarantor and the principal debtor, in our view, is totally out of the purview of section 138, neither the same calls for any discussion therein. The language of the statute depicts the intent of the law-makers to the effect that wherever there is a default on the part of one in favour of another and in the event a cheque is issued in discharge of any debt or other liability, there cannot be any restriction or embargo in the matter of application of the provisions of section 138 Any cheque and other liability are the two key expressions which .....

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