TMI Blog2022 (6) TMI 489X X X X Extracts X X X X X X X X Extracts X X X X ..... service of notice upon accused No.2. So far as accused No.1 is concerned, it is found from the copy of the notice that the name and address of accused No.1/company was correctly recorded in the demand notice. The postal track report shows that it was served upon the accused No.1/company. During trial of the case the defacto complainant has proved the copy of notice, postal receipt and the postal track report. The postal track shows that the demand notice was served upon the accused No.1/company on 12th April, 2013. The accused however did not examine any witness to rebut the presumption of due service of notice under Section 27 of the General Clauses Act. In the instant case it is found from the copy of the notice that it was addressed respondent No.1/company in its correct address. The postal track report shows that it was duly served upon the respondent No.1/company. Therefore, the court is free to presume that the notice was duly served upon the accused No.1/company under the provision of Section 27 of the General Clauses Act - The question as to whether it was sent to the accused/company or that it was served or not in correct address is a question of fact to be determined f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exhibited. 4. The learned Magistrate, on completion of trial dismissed the said complaint case and acquitted the respondents under Section 255(1) of the Code of Criminal Procedure holding, inter alia, that the notice demanding payment of the impugned cheque was not legal, valid and sufficient and it was not duly served upon the accused persons. 5. Assailing the said judgment the complainant has filed the instant appeal under the provision of Section 378(4) of the Code of Criminal Procedure. 6. Learned Advocate for the appellant submits before me that the impugned cheque was issued in discharge of legally enforceable liability by the respondent No.2 on 15th March, 2013. It was presented with the banker of the complainant/company, viz., IndusInd Bank, Upper Wood Street Branch, Kolkata on the very date of receipt of the said cheque. However, the cheque was dishonoured on the ground funds insufficient and accordingly the complainant/company issued demand notice upon accused No.1 and accused No.2 on 11th April, 2013 and 16th April, 2013 respectively under registered speed post. From the postal track report it appears that the said notices were served upon the respondents/ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the complainant/company. Under such factual background, the respondent No.2 can be safely assumed to be the alter ego of the company. He is the human agency representing a corporate entity in the transaction which is the subject matter of prosecution. Therefore, notice served upon the respondent No.2 can be attributed to the complainant/company who is the juristic entity as the former is nothing to the alter ego of such corporate entity. 8. Similar question came up for consideration before this Court in M/s Gena Marketing Private Limited vs. Somnath Guin reported in (2016) 2 Cal LT 344. A Coordinate Bench of this Court decided the issue in the following paragraphs:- 11. The principle of alter ego and attribution of intent of the human agency, who is the alter ego of the company, upon the body corporate itself was approved and applied in criminal jurisprudence by the Apex Court in Iridium India Telecom Ltd. Vs. Motorola Incorporated Ors. (2011) 1 SCC 74 as follows:- 55. virtually in all jurisdictions across the world governed by the rule of law, the companies and corporate houses can no longer claim immunity from criminal prosecution on the ground that they are in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lation so as to ensure greater accountability and creditability in commercial transactions relating to cheques. This legislative intention ought to be the guiding principle while construing the validity of notice issued under the aforesaid provision of law. 15. In Standard Chartered Bank Ors. Vs. Directorate of Enforcement Ors. (2005) 4 SCC 530, a Constitution Bench while upholding purposive construction of penal statutes, inter alia, held that 24. The distinction between a strict construction and a more free one has disappeared in modern times and now mostly the question is what is true construction of the statute? A passage in Craies on Statute Law, 7th Edn. reads to the following effect: The distinction between a strict and a liberal construction has almost disappeared with regard to all classes of statutes, so that all statutes, whether penal or not, are now construed by substantially the same rules. All modern Acts are framed with regard to equitable as well as legal principles. A hundred years ago, said the court in Lyons case, statutes were required to be perfectly precise and resort was not had to a reasonable construction of the Act, and ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent No.2. The complainant may be permitted to bring the said fact and documents in evidence and an order of remand with proper direction upon the learned Magistrate may be passed in the instant appeal. 11. Learned Advocate for the respondents, on the other hand, submits that in the instant case no notice was served upon the respondents. The respondent No.1/company is Basukinath Food Processor Limited. Demand notice was sent in the name of one Basukinath F Pero Ltd who is not related with the instant case. Thus, from the face of the documents relied on by the complainant it appears that demand notice was sent to a non-existent entity in a wrong address. Even if the postal track report is considered to be genuine, in such case also, there is no other alternative but to hold that demand notice was not served upon the respondent No.1/company. Demand notice allegedly sent in the name of accused No.2 was not exhibited during trial. Therefore, the appellant cannot be given any liberty under Section 391 of the Code of Criminal Procedure to prove service of notice upon respondent No.2. According to the learned Advocate for the respondents, if notice is not issued under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 138 of the Negotiable Instrument Act cannot be said to have been committed when the period provided in Clause (c) of the proviso to Section 138 has not expired. A bare reading of clause (c) of the proviso makes it clear that no complaint can be filed for an offence under Section 138 of the NI Act unless the period of 15 days has elapsed. Any complaint made before the expiry of 15 days from the date on which the notice has been served on the drawer/accused is no complaint at all in the eye of law. It is not the question of prematurity of the complaint where it is filed before expiry of 15 days from the date on which notice has been served on him, it is no complaint at all under law. As a matter of fact, Section 142 of the NI Act, inter alia, creates a legal bar on the Court from taking cognizance of an offence under Section 138 except upon a written complaint. Since a complaint filed under Section 138 of the NI Act before the expiry of 15 days from the date on which the notice has been served on the drawer/accused is no complaint in the eye of law, obviously, no cognizance of an offence can be taken on the basis of such complaint. 13. In the instant case, no notice w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion should be applied. The difficulty which may be faced by the complainant is of no consequence. In support of his contention learned Counsel for the respondents refers to the following decisions:- (i) Commissioner, Central Excise and Customs Mumbai Ors vs. ITC Ltd Ors. reported in (2007) 1 SCC 62. (ii) SSS Loha Marketing Private Limited and Bibby Financial Services India Private Limited : 2013 SCC Online Cal 2027. (iii) Opto Circuit India Limited vs. Axis Bank Ors : (2021) 6 SCC 707. (iv) Taylor vs. Taylor Taylor vs. Keily : (1875) 1 ChD 426. (v) S.L Kapoor vs. Jagmohan Ors : (1980) 4 SCC 379. (vi) Harilal Shaw vs. State of West Bengal : 89 CWN 557. (vii) Martin burn Ltd vs. The Corporation of Kolkata : AIR 1966 SC 529. (viii) Ahmedabad Municipal Corporation vs. Ahmedabad Green Belt Khedut Mandal : (2014) 7 SCC 357. 16. Section 138 of the Negotiable Instrument Act is a penal provision 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 different or other liability and the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation.- For the purposes of this section,- (a) company means any body corporate and includes a firm or other association of individuals; and (b) director , in relation to a firm, means a partner in the firm.] 18. Section 142 lays down the circumstances when court can take cognizance of offence under Section 138 of the Negotiable Instruments Act. According to Section 142 (1) no court shall take cognizance of any offence punishable under section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque. Clause (b) of sub-Section 1 of Section 142 states that such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to section 138. Thus, cause of action for lodging a complaint under Section 138 of the Negotiable Instruments Act arises when the drawer of cheque fails to make payment of the said amount of money to the payee within 15 days of the receipt of said n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistrate ought not to have held that no notice was served upon the respondent No.1/company. It is contended on behalf of the appellant that a copy of demand notice was also sent to the accused No.2 under registered speed post with acknowledgement. The accused No.2 duly received the said notice. However, during trial the copy of the said notice and the postal report were not brought in evidence by the complainant. Therefore, the learned Advocate for the appellant has prayed for remanding the case for fresh trial giving opportunity to the complainant to prove service of notice upon accused No.2. 21. Learned Advocate for the appellant refers to a series of judgments where the Hon ble Supreme Court held that any complaint filed before expiry of 15 days as mentioned in proviso (c) of Section 138 is held to be nonest. In the instant case, the respondent never urged that a premature complaint was filed by the complainant. On the other hand, on facts it is found that impugned cheque was issued on 15th April, 2013. The said cheque was dishonoured due to insufficient fund in the account of the drawer of the cheque and the complainant received such information on 16th March, 2013. Demand n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n cases of doubt the courts inclining to mercy. 25. Hon ble Supreme Court further held that even in interpretation of penal statutes the mischief Rule or Heydon s Rule may be resorted to:- 36. The rule of interpretation requiring strict construction of penal statutes does not warrant a narrow and pedantic construction of a provision so as to leave loopholes for the offender to escape (see Murlidhar Meghraj Loya v. State of Maharashtra). A penal statute has to also be so construed as to avoid a lacuna and to suppress mischief and to advance a remedy in the light of the rule in Heydon s case. A common-sense approach for solving a question of applicability of a penal statute is not ruled out by the rule of strict construction. (See State of A.P. v. Bathu Prakasa Rao and also G.P. Singh on Principles of Statutory Interpretation, 9th Edn., 2004, Chapter 11, Synopsis 3 at pp. 754 to 756.) 26. The issue as to whether a notice issued upon the director/authorized signatory of the company can be deemed to be a valid notice under Section 138(b) of the Negotiable Instruments Act fell for consideration in Bilakchand Gyanchand Co. Vs. A. Chinnaswami reported in (1999) 5 SCC 693 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether prosecution of a director could be maintained in the absence of prosecution of the accused/company. The Apex Court held that the prosecution of an accused/company was sine qua non for prosecution of a director save and except where prosecution of the company is a legal impossibility. 28. In the instant appeal, however, it is not the question to be decided as to whether service of notice upon the director and authorized signatory of the company is sufficient to bind the company for liability under Section 138 of the Negotiable Instrument Act. Unlike Himanshu (supra) the appellant/complainant issued notices to both the respondent/company and accused No.2 being the authorized signatory on behalf of the respondent/company. The respondent during trial of the case failed to prove service of notice upon accused No.2. So far as accused No.1 is concerned, it is found from the copy of the notice that the name and address of accused No.1/company was correctly recorded in the demand notice. The postal track report shows that it was served upon the accused No.1/company. During trial of the case the defacto complainant has proved the copy of notice, postal receipt and the postal trac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he question as to whether it was sent to the accused/company or that it was served or not in correct address is a question of fact to be determined from the copy of the notice and the postal track report. The copy of the notice, it is recorded hereinabove contains correct address of the accused No.1/company. The postal track report shows that it was duly served upon the accused/company. 31. Therefore, I have no alternative but to hold that the demand notice was duly served on 12th April, 2013 to the accused No.1/company. 32. In view of the service of demand notice upon accused No.1/company, it is not necessary to find out as to whether demand notice was actually served upon accused No.2 or not. The accused person who is in charge of the affairs of the company and running its affair must naturally be aware of notice of demand under Section 138 of the Act issued to such company. It is precisely for the reason that no notice is additionally contemplated to be given to directors of the company. The decision of the Hon ble Supreme Court in Krishna Texport and Capital Markets Ltd. vs. Ila Agrawal reported in (2015) 8 SCC 28 may be relied on in support of my observation and decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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