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TMI Blog2019 (10) TMI 159X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner-Accused and Respondent No.1-Complainant are the same in all the four Writ Petitions. However the complaints and cheques are different. In Writ Petition No.886 of 2019 the Complainant No. is 2505/SS/2017 and Cheque Nos. are 000043 dated 18/10/2016 and 000044 dated 18/12/2016; in Writ Petition No.887 of 2019 the Complainant No. is 4531/SS/2017 and Cheque No. is 000047 dated 18/04/2017, in Writ Petition No.888 of 2019 the Complainant No. is 3589/SS/2017 and Cheque No. is 000046 dated 18/02/2017 and, in Writ Petition No.889 of 2019 the Complainant No. is 6623/SS/2016 and Cheque No. is 000042 dated 18/08/2016. Therefore, by consent of the learned counsel for the parties, all the four Writ Petitions are heard together and being disposed of by this common judgment and, Writ Petition No.886 of 2019 is being treated as a lead matter. 2. Rule in all the Writ Petitions, with the consent of the learned counsel for the parties made returnable forthwith and heard finally at the admission stage. 3. Writ Petition No.886 of 2019 takes an exception to the order dated 27/04/2018 (actual date is 27/04/2017) passed by the learned Metropolitan Magistrate, 48th Court, Andheri, Mumbai thereby iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inst the accused under Section 138 of the Negotiable Instruments Act which is pending before the learned Metropolitan Magistrate, 44th Court, Andheri for hearing and disposal. The complainant has alleged that the accused had issued Cheques bearing Nos. 000043 and 000044 dated 18/10/2016 and 18/12/2016 respectively each amounting to Rs. 2 Lakhs. When the said cheques were to be deposited by the complainant on due dates for encashment, the accused requested the complainant to wait for little more time, therefore, considering the said request of the accused, the complainant did not deposit the said cheques on the due dates. However, finally the complainant deposited both the cheques on 10/01/2017 in his bank viz. HDFC Bank, Indralok Branch, Lokhandwala Complex, Andheri (W), Mumbai for encashment, but the said cheques were dishonoured due to the reason "Payment Stopped by Drawer", and bank was accordingly informed the complainant about the same vide two separate Bank Memos dated 11/01/2017. Thereafter the complainant issued statutory demand notice to the accused through his advocate's letter dated 08/02/2017 by calling upon the accused to make the payment of both the cheques totally am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the address mentioned in the title. It is further averred that after completing the investigation, the charge sheet was filed before the Trial Court vide CC No.1417/PW/2011 on 25/05/2011 wherein the daughter of the Petitioner was shown as wanted on the basis of the lame allegations. It is further averred that even the daughter of Petitioner used to visit the police station as her parents were detained in the police station, but she was never interrogated. Thereafter the investigating officer arrested the daughter of the Petitioner from her place of work on 16/06/2016, and during her detention in the police station, the police officer Gunmai and the complainant threatened the Petitioner of getting her detained in custody for a long period by opposing the bail application, if they do not agree to settle the matter. It is further averred in the Petition that under the threat of detention of the daughter, the police officer and Respondent extorted pay order of Rs. 2 Lakhs and five cheques for a sum of Rs. 2,00,000/- each from the Petitioner and compelled to sign the documents prepared by them, and the Petitioner and his wife were succumbed to their pressure though they were not liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsent terms that nowhere in the consent terms the accused has admitted his liability. It is submitted that because of arrest of daughter and, the threats given by the police officer and complainant of getting her detained in custody, the Petitioner was compelled to execute the said consent terms and, extorted pay order and cheques from the Petitioner. According to her, the said consent terms were executed under duress and coercion which can be inferred from the fact that the date of consent terms is 17/06/2016 and the date of arrest of the daughter of accused is 16/06/2016. It is also submitted that the Petitioner has been victimized by the complainant with the aid and abetment of the police officer. It is further submitted that admittedly the cheques were not issued towards legally enforceable debt or liability. She submits that the post dated cheques issued in a criminal case in a compromise between the parties cannot be considered as payment of any debt or liability which is legally enforceable. She further submits that, any cheque received in settlement in any criminal case cannot be treated as being issued in discharge of liability unless the said case has been quashed and/or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nted for encashment, were dishonoured. It is also submitted that stopping the payment of the said cheques on the part of the Petitioner is totally contrary to the terms and conditions as mentioned in the consent terms and the said act of the Petitioner amounts to cheating. Petitioner and his wife are the agent, and the Petitioner misappropriated the amount of the complainant and used the said amount for their personal purpose. The learned counsel for the complainant further submits that there are bank statements and records showing that the Petitioner has withdrawn the amount. The learned counsel for the Respondent No.1 submits that by signing the consent terms, the Petitioner has admitted his liability to pay the amount of Rs. 12 Lakhs to the Complainant. He submits that the basis for filing the complainant is the consent terms, and the Court has clearly taken a view that cheques issued as a part of consent terms can constitute and/or form the basis of a complaint under Section 138 of the Negotiable Instruments Act. It is also submitted that the instructions on the part of the Petitioner to stop the payment of post dated cheques prior to date of cheques does not absolve the Petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the post dated account payee cheques in favour of the party of the first part towards the above stated payment as defined in sub-clause (b), (c), (d), (e) and (f) of Para (1) of this consent term with an undertaking that the said cheques shall be honoured by his bankers on the due dates as appear on the said cheques, moreover the party of the second part further undertake that they shall not instruct their bankers to stop the payment of the said cheques, nor they shall close their bank account till realization of the said cheques. 3. That in the event of dishonor of the said cheque/s, the party of the second part shall make the payment of the equal amount of the bounced cheque to the party of the first part, failing which the party of the first part shall have rights to proceed legally against the party of the second part in the said case. 4. That the party of the first part shall give his consent and NOC for bail of the said Ms. Samina Nazim Mumbrawala. 5. That the party of the first part shall have no any other and further claim from the party of the second part beyond the said final settlement amount of Rs. 12,00,000/- (Rupees Twelve Lac only), which shall always be paid t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents prepared by them, and they were not liable to pay the amount to the complainant as also the police officer Gunmai was pressurizing the Petitioner to encash the cheques before getting the complaint withdrawn or quashed, and therefore, the Petitioner addressed a letter dated 12/08/2016 to his banker to stop the payment in respect of the cheques,which according to them, were obtained under duress and coercion by the complainant. Admittedly on the instructions of the Petitioner, the payment of the said cheques was stopped though in terms of consent terms the Petitioner has undertaken not to stop the payment of the said cheques. 11. In order to appreciate legal submissions vis-a-vis subject matters involved in the Petitions, it would be apt to advert to the provisions of Sections 138 and 139 of the Negotiable Instruments Act which read as follows :- 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 going returned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scharge of the said liability/debt. According to the learned counsel appearing for the Petitioner, there exists no legally enforceable debt or liability as asserted by Respondent No.1, hence offence under Section 138 of Negotiable Instruments Act is not made out, and nowhere in the consent terms the accused has admitted his liability. In support of the said contention the learned counsel for the Petitioner sought to place reliance on Lalit Kumar Sharma's case (supra), Indus Airways Pvt. Ltd's case (supra) and Rakesh Kumar's case (supra). (i) In Lalit Kumar Sharm's case, the question arose before the Supreme Court was, whether dishonour of second cheque created a new liability? In the said case the cheques issued on 30.11.1999 and 10.11.1999, on their presentation, were returned unpaid with the remarks "insufficient fund". In the said case proceedings under Section 138 were initiated against a company and its directors Manish Arora and Ashish Narula. In that proceedings, consent terms were entered into wherein Manish Arora undertook to repay the entire debt, and when the cheques issued by Manish Arora as part of the consent terms bounced, another 138 proceedings were initiated ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered in discharge of legally enforceable debt or other liability, and, if so whether the dishonour of such cheques amounts to an offence under Section 138 of the Negotiable Instruments Act, 1881. In the said case the purchasers issued two post dated cheques towards two purchase orders for supply of certain aircraft parts with Respondent No.1 therein. The said cheques got dishonoured when they were presented on the ground that the purchasers had stopped payment. However, in the said case, the supplier i.e. Respondent No.1 received letter dated 22/03/2007 from the purchasers i.e. the appellants cancelling the purchase orders and requesting the supplier to return both the cheques. The supplier sent a notice to the purchasers and then filed a complaint against the purchasers under Section 138 of the Negotiable Instruments Act. The magistrate took cognizance and issued summons to the purchasers. The purchasers challenged that order in revision. The Additional Sessions Judge after hearing the parties quashed the order of Magistrate issuing the process against the Purchasers. In the petition before the High Court filed by supplier, the order of the Additional Sessions Judge was quashed an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ility, the learned counsel appearing for the Respondent No.1 complainant invites attention of this Court to the letter dated 10/09/2009 addressed by the mother of the Complainant to the wife of Petitioner Mrs. Zubeda Nazim Mumbrawala. By the said letter the mother of the complainant issued some account payee cheques to his son i.e. the complainant with the consent to hand over the said cheqeus to the wife of the Petitioner to deposit in her account and pay cash on realization of the said cheques, and the said cheques were issued by the mother of the complainant for the needs and requirements during his stay in Mumbai as he does not have any bank account since he was residing in Mumbai as Paying Guest and does not have any residential proof in Mumbai. According to the complainant, the Petitioner misappropriated the amount of the complainant and used the said amount for their personal purpose, and there are bank statements and records showing that the Petitioner has withdrawn the said amount. 14. In support of the contention that the settlement terms can constitute the basis of proceedings under Section 138 of the Negotiable Instruments Act, the learned counsel for Respondent No.1 s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount, even the sale agreement mentioned with reference to compromise in the statutory notice when it is clear of the cheque issued for Rs. 5,00,000/- returned dishonoured in which demand to pay also if other amounts mentioned the notice no way invalid therefrom as rightly concluded by the Courts below." The learned counsel for Respondent No.1 also placed reliance on the judgment of the Supreme Court in Goaplast Pvt. Ltd. in support of his contention that instructions on the part of the Petitioner to stop the payment of post dated cheques prior to date of cheques does not absolve the Petitioner of the liability under Section 138 of the Negotiable Instruments Act as the presumption under Section 139 is attracted. Paragraph 6 of the said judgment is relevant and, for the sake of ready reference the same is reproduced herein under :- In the present case the issue is very different. The issue is regarding payment of a post-dated cheque being countermanded before the date mentioned on the face of the cheque. For purpose of considering the issue, it is relevant to see Section 139 of the Act which creates a presumption in favour of the holder of a cheque. The said Section provides tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 of the Act, it will shake the confidence which a cheque is otherwise intended to inspire regarding payment being available on the due date." In the aforesaid judgment, the Supreme Court considering the provisions of Sections 138 and 139, held that the presumption can be rebutted by adducing evidence and the burden of proof is on the person who wants to rebut the presumption. It is also held by the Supreme Court that this presumption coupled with the object of chapter XVII of the Act which is of promote the efficacy of banking operation and to ensure credibility in business transactions through banks persuades us to take a view that by countermanding payment of post dated cheque, a party should not be allowed to get away from the penal provision of Section 138 of the Act. It is also held that once a cheque is issued by a drawer, a presumption under Section 139 must follow and merely because the drawer issued notice to the drawer or to the bank for stoppage of payment it will not preclude an action under Section 138 of the Act by the drawee or the holder of the cheque in due course. 15. Though it is the case of the Petitioner that they have documentary proof of having paid the en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore the Trial to find out whether the case would end in conviction or acquittal. If it appears on a reading of the complaint and consideration of the allegations therein, in the light of the statement made on oath that the ingredients of the offence are disclosed, there would be no justification for the High Court to interfere. 6. Defences that may be available, or facts/aspects which when established during the trial, may lead to acquittal, are not grounds for quashing the complaint at the threshold. At that stage, the only question relevant is whether the averments in the complaint spell out the ingredients of a criminal offence or not. 9. Having heard the learned Senior Counsel and examined the material on record, we are of the considered view that the High Court ought not to have set aside the order passed by the Trial Court issuing summons to the Respondents. A perusal of the complaint discloses that prima facie, offences that are alleged against the Respondents. The correctness or otherwise of the said allegations has to be decided only in the Trial. At the initial stage of issuance of process it is not open to the Courts to stifle the proceedings by entering into the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were not issued for any debt or existing liability, and the onus to prove the non-existence of a debt or liability lay on the drawer and had to be discharged at the trial. The Supreme Court in Paragraph 17 of the said judgment observed as under :- "There is therefore no requirement that the complainant must specifically allege in the complaint that there was subsisting liability. The burden of proving that there was no existing debt or liability was on the respondents. This they have to discharge in the trial. At this stage merely on the basis of averments in the Petitions filed by them the High Court could not have concluded that there was no existing debt or liability." In the present case, prima facie it appears that the cheques were signed by the Petitioner and issued in favour of the complainant in discharging his debt. Admittedly when the cheques were presented by the complainant, they were dishonoured on the instructions of the Petitioner to stop payment. The Petitioner in clause (2) has given an undertaking that the said cheques shall be honoured by his bankers on the due dates as appear on the said cheques. The Petitioner has given further undertaking that they shall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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