TMI Blog2017 (9) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... to initiate prosecution against DAKSHIN beyond the period of limitation stipulated under the Act. No doubt Section 142 authorises the Court to condone the delay in appropriate cases. We find no reason to condone the delay. The justification advanced by the respondent that it is during the course of the trial, the respondent realized that the cheque in question was drawn on the account of DAKSHIN is a manifestly false statement. On the face of the cheque, it is clear that it was drawn on account of DAKSHIN. Admittedly the respondent issued a notice contemplated under clause (b) of the proviso to Section 138 to DAKSHIN. The fact is recorded by the High Court. The relevant portion is already extracted in para 16. - Criminal Appeal No. 1534 of 2017 (Arising out of SLP(Crl.) No.1439 of 2017) - - - Dated:- 30-8-2017 - Mr. J. Chelameswar And Mr. S. Abdul Nazeer JJ. JUDGMENT Chelameswar, J. 1. Leave Granted 2. M/s. Norton Granites Spinners (P) Ltd. (hereafter NORTON) sold three parcels of land by three separate registered sale deeds dated 14.5.2007 to one M/s. Srivari Exports, a partnership firm (hereafter FIRM). The appellant herein is the managing partner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent during the course of cross-examination of the appellant herein at the trial of the CC No.2925 of 2012 that the cheque in question was drawn on the account of DAKSHIN and the appellant is only a signatory on behalf of the DAKSHIN in his capacity as a Director of DAKSHIN. The respondent had initially failed to lodge the complaint against DAKSHIN by inadvertence and hence the application. 8. The application was contested by the appellant. The learned Metropolitan Magistrate by his Order dated 21.4.2016 allowed the said application. The petitioner carried the matter in Criminal R.C. No. 774 of 2016 to the Madras High Court unsuccessfully. Hence the instant SLP. 9. Xerox copies of the three sale deeds are placed before us and according to the said documents, the sale consideration for the three sale deeds is ₹ 2,80,000/-, ₹ 2,50,000/- and ₹ 1,20,000/-, in all ₹ 6,50,000/-. Nonetheless, the respondent filed the complaint stating that the cheque in question for ₹ 39 lakhs was drawn towards the balance of the sale consideration of the transactions covered by the above-mentioned three sale deeds. Prima facie , it is very doubtful whether the cheque w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the proviso to Section 138 . The application under Section 319 of CrPC by which DAKSHIN is sought to be impleaded (summoned) is in substance a complaint against DAKSHIN which is filed some three years after the expiry of the period of 15 days stipulated under clause (c) of the proviso to Section 138. Therefore barred by the stipulation contained in Section 141(1)(b) of THE ACT. No valid explanation for condoning such a long delay is offered by the respondent. Both the courts below erred in coming to the conclusion that once the offence is taken cognizance of, the question of delay does not arise. (c) Section 138 ( Section 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 p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, (2007) 6 SCC 555 9. .It was further observed that once the payee of the cheque issues notice to the drawer of the cheque, the cause of action to file a complaint arises on the expiry of the period prescribed for payment by the drawer of the cheque. If he does not file a complaint within one month of the date on which the cause of action arises under Clause (c) of the proviso to Section 138 of the Act, his complaint gets barred by time. ) (d) The (instant) application under Section 319 CrPC came to be filed (on 19.08.2015) some three years after the dishonour of the cheque by the bank (on 30.8.2012). If the respondent were to file complaint under Section 138 against DAKSHIN on 19.8.2015, such a complaint would be clearly not maintainable as it would have been far beyond the permissible time within which a complaint could have been filed under Section 138 of THE ACT. Therefore, both the courts below erred in allowing the application. 13. On the other hand, the learned counsel for the respondent submitted that the trial court and the High Court rightly impleaded the appellant. The learned counsel submitted that the proviso to clause (b) of Section 142 of THE ACT en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred against the order passed in Crl.M.P. No. 1257 of 2016 by either side. 16. We say it is an interesting finding because from the translation of the trial court s order placed before us, the trial court is silent about the application for condonation of the delay. On the other hand, the trial court observed Hence as per Section 142(b) no separate petition is required after cognizance of offence. After recording such a finding, the High Court proceeded to say; The Trial Court, after considering the arguments of both sides, came to a conclusion that since the case was already taken on file and cognizance of the offence was taken, in this case, separate petition to condone the delay of 1211 days is not necessary and M/s. Dakshin Granites Private Ltd. was impleaded as an accused. Admittedly, statutory notice under Section 138(b) of the Negotiable Instruments Act was issued to M/s. Dakshin Granites Private Ltd., and M/s. Dakshin Granites Private Ltd., has not preferred any revision before this Court. Hence, the present petitioner is only the signatory. Even according to the present petitioner, who is an individual person and who signed the cheque represents the compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice. It is only upon the satisfaction of all the three conditions mentioned above and enumerated under the proviso to Section 138 as clauses (a), (b) and (c) thereof that an offence under Section 138 can be said to have been committed by the person issuing the cheque.) under Section 138 of the Act are; (i) that a cheque is drawn, and (ii) that cheque is dishonored by the Bank when presented by the payee. Under the scheme of Section 138 both the drawer of the cheque and the bank upon which the cheque is drawn are parties against whom the payee of the cheque can have various legal rights, which may have either civil or criminal consequences or perhaps both depending upon the facts of a given case. Section 138 prescribes only one of the consequences, i.e. the prosecution and punishment of only the drawer of the cheque. It is possible in a given case that a bank may without any valid justification decline to honor a cheque drawn on it. For which act of the bank, the drawer of the cheque may in no way be responsible either in fact or in law. In such a fact situation, the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the cheque on behalf of the company/drawer of the cheque. If DAKSHIN/drawer of the cheque is sought to be summoned for being tried for an offence under Section 138 of THE ACT beyond the period of limitation prescribed under THE ACT, the appellant cannot be told in view of the law declared by this Court in Aneeta Hada that he can make no grievance of that fact on the ground that DAKSHIN did not make any grievance of such summoning. It is always open to DAKSHIN to raise the defense that the initiation of prosecution against it is barred by limitation. DAKSHIN need not necessarily challenge the summoning order. It can raise such a defense in the course of trial. Coming to the view of the High Court that only the offence is taken cognizance of and there is no need to take cognizance of an offence accused-wise is an erroneous view in the context of a prosecution under THE ACT. Most probably the High Court recorded such conclusion (though not expressly stated) on the basis of the judgment of this Court in Raghubans Dubey v. State of Bihar, AIR 1967 SC 1167, where it was stated: Para 9. In our opinion, once cognizance has been taken by the Magistrate, he takes cogni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the process. Thereafter, the investigating agency is required to collect evidence (investigate) and place the same before the Court under Section 173 CrPC. 23. The scheme of the prosecution in punishing under Section 138 of THE ACT is different from the scheme of the CrPC. Section 138 creates an offence and prescribes punishment. No procedure for the investigation of the offence is contemplated. The prosecution is initiated on the basis of a written complaint made by the payee of a cheque. Obviously such complaints must contain the factual allegations constituting each of the ingredients of the offence under Section 138. Those ingredients are: (1) that a person drew a cheque on an account maintained by him with the banker; (2) that such a cheque when presented to the bank is returned by the bank unpaid; (3) that such a cheque was presented to the bank within a period of six months from the date it was drawn or within the period of its validity whichever is earlier; (4) that the payee demanded in writing from the drawer of the cheque the payment of the amount of money due under the cheque to payee; and (5) such a notice of payment is made within a period of 30 days from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions dealing with taking cognizance contained in the CrPC should give way to the procedure prescribed under Section 142. Hence the opening of non-obstante clause under Section 142. It must also be remembered that Section 142 does not either contemplate a report to the police or authorise the Court taking cognizance to direct the police to investigate into the complaint. 25. The question whether the respondent had sufficient cause for not filing the complaint against DAKSHIN within the period prescribed under THE ACT is not examined by either of the courts below. As rightly pointed out, the application, which is the subject matter of the instant appeal purportedly filed invoking Section 319 CrPC, is only a device by which the respondent seeks to initiate prosecution against DAKSHIN beyond the period of limitation stipulated under the Act. 26. No doubt Section 142 authorises the Court to condone the delay in appropriate cases. We find no reason to condone the delay. The justification advanced by the respondent that it is during the course of the trial, the respondent realized that the cheque in question was drawn on the account of DAKSHIN is a manifestly false stateme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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