TMI Blog2014 (8) TMI 1218X X X X Extracts X X X X X X X X Extracts X X X X ..... subsisting on the date of drawal of the cheque - The very fact that the Respondent has taken repossession of the vehicle and has also sold the said vehicle and the sale value of the said vehicle has also been adjusted for meeting the loan repayment, the agreement on the basis of which the postdated cheques were issued cannot be put for clearance for the reason that the Respondent by virtue of the two acts on their part; firstly, of taking possession of the vehicle and, secondly, of sale/auctioning the said vehicle, stood determined. Therefore, the cheques which have been subsequently put for clearance and got dishonoured would not fall within the ambit of legally enforceable debt or other liability. The Petition under Section 482 of CrP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccount of an alleged default on the part of the Petitioner in paying the installments, suddenly without any intimation/notice, forcefully seized the vehicle which was in the possession of the Petitioner and neither did the Respondent give any intimation of the seizure of the vehicle to the Petitioner. Further it is also suggested and learnt from the letter issued by the Respondent that the Respondent has also further sold the said vehicle and have realized the sale value of the said vehicle towards meeting the loan repayment. Thereafter, it is learnt that the Respondent have filled up the cheque bearing No. 016252 drawn on UTI Bank, Korba, in favour of the Respondent and have presented the said cheque for clearance to its account in Orienta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansaction as the contract between the two parties had come to an end. Learned Counsel for the Petitioner further submits that the initiation of the complaint case under Section 138 of the N.I. Act itself is malicious and is nothing but an abuse of process of law on account of the fact that the Respondent has not filed the said complaint case with clean hands inasmuch as in the said complaint case itself the Respondent has not disclosed the fact to the Court below in respect of the Respondent having forcefully seized the vehicle and also suppressed the material fact about the said vehicle having been sold and sale proceeds also having been realized against the consideration received on account of the loan amount. It is also submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e complaint case cannot be said to be malicious or is vitiated on any of the technicalities. In response to the submissions of the learned Counsel for the Petitioner in respect of the said complaint case not being maintainable on account of the fact that the vehicle has already been seized prior to the filing of the complaint case and that the vehicle also has been sold and the sale proceeds have been recovered, learned Counsel for the Respondent submits that the Respondent has only put the cheque in respect of the amount which now stands outstanding against the Petitioner as unpaid loan, that is to say the difference of the entire loan amount after adjusting the amount recovered by way of sale proceeds of the vehicle and, therefore, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the hire-purchase agreement between the parties stood determined ipso facto . Thus, as a consequence of the seizure of vehicle the financial institution had exercised one of the options available to him under the agreement and as such the cheques in its hands given as a security thereafter becomes instruments for which a consideration had failed and if presented for payment and gets dishonoured, no offence punishable under Section 138 of the N.I. Act would be attracted. It is also pertinent to mention that in order to attract the penal provisions under the N.I. Act debt or other liability must be a legally enforceable debt or liability . If the said instrument is not supported by consideration, there is no question of attracting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tracting the provisions of Section 138 of the N.I. Act. 8. The decisions of the High Courts referred to above is further fortified by the recent decision of the Hon'ble Supreme Court in the case of M/s. Indus Airways Pvt. Ltd. and others v. M/s. Magnum Aviation Pvt. Ltd. and another [2014(3) M.P.H.T. 28 (SC)]. 9. In light of the aforesaid decisions rendered by the different High Courts and in respectful agreement to the ratio laid down in these judgments, in the instant case also, as is evident from the document (Annexure A-3) filed by the Petitioner issued by the Respondent, the Respondent has taken repossession of the vehicle and has also further sold it and realized the sale proceeds and, under the said circumstances, I am ..... X X X X Extracts X X X X X X X X Extracts X X X X
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