9911796707
TMI Blog2023 (9) TMI 349X X X X Extracts X X X X X X X X Extracts X X X X ..... nd analogous petitions. Through the judgment, the High Court while allowing the petitions before it, quashed the criminal proceedings against Respondent No. 2, being C.C. No.681 of 2017 and analogous complaints on the file of II Additional Chief Metropolitan Magistrate at Visakhapatnam. The appellant is the complainant in CC No. 681 of 2017 and the other complaints, filed against the accused - respondent no.2 under Section 138 and 142 of the Negotiable Instruments Act ('NI Act' for short). The appellant is therefore before this Court claiming to be aggrieved by the said judgment. 3. The brief facts of the case as narrated in the first of the above appeal are that the appellant and respondent no.2 are known to each other. Due to their acquaintance respondent no.2 approached the appellant to borrow a sum of Rs 20,00,000/- stating that he required the amount to finance his son's higher education to study medicine and for domestic expenses. In order to assure the re-payment, respondent no.2 executed a promissory note on 25.07.2012 wherein it was agreed that the amount was to be repaid in full and along with interest at 2% per month. There was a condition in the promissory note that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d contend that the High Court did not appreciate that the promissory note executed by respondent No.2 has the binding effect of a contract and hence the complaint under Section 138 of NI Act is maintainable when a cheque is drawn to pay wholly or in part, a debt which is enforceable and there is no bar of limitation. The cheque amounts to a promise governed by Section 25 (3) of the Indian Contract Act, 1872. Such promise which is an agreement is an exception to the general rule that an agreement without consideration is void. Though on the date of making such promise by issuing a cheque, the debt which is promised to be paid, even if is time-barred is a legally recoverable one. In view of Section 25 (3) of the Indian Contract Act, the promise/ agreement is valid and therefore the same is enforceable. The learned counsel for the appellant has argued on the principle that the limitation act only bars the remedy and not the right of a party. He has relied upon the decision of this Court in S. Natarajan v. Sama Dharman, (2021) 6 SCC 413 and A.V. Murthy v. B.S. Nagabasavanna, (2002) 2 SCC 642. 7. Mr. Sidharth Luthra, learned senior counsel appearing as Amicus Curiae on behalf of respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erring to certain judgments on the question of legally enforceable debt, the High Court stated that for the purpose of invoking Section 138 read with Section 142 of the NI Act, the cheque in question must be issued in respect of legally enforceable debt or other liability. The High Court then observed that since at the time of issuance of cheque i.e. on 1-2-2011, the alleged debt of the accused had become time-barred, the proceedings deserve to be quashed. 7. In our opinion, the High Court erred in quashing the complaint on the ground that the debt or liability was barred by limitation and, therefore, there was no legally enforceable debt or liability against the accused. The case before the High Court was not of such a nature which could have persuaded the High Court to draw such a definite conclusion at this stage. Whether the debt was time-barred or not can be decided only after the evidence is adduced, it being a mixed question of law and fact." 9. The Learned counsel has further referred to the decision in the case of A.V. Murthy vs. B.S. Nagabasavanna (2002) 2 SCC 642 wherein it is held as hereunder: "5. As the complaint has been rejected at the threshold, we do not pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a perusal of the legal position enunciated, it is crystal clear that this Court keeping in perspective the nature of the proceedings arising under the NI Act and also keeping in view that the cheque itself is a promise to pay even if the debt is barred by time has in that circumstance kept in view the provision contained in Section 25(3) of the Contract Act and has indicated that if the question as to whether the debt or liability being barred by limitation was an issue to be considered in such proceedings, the same is to be decided based on the evidence to be adduced by the parties since the question of limitation is a mixed question of law and fact. It is only in cases wherein an amount which is out and out non-recoverable, towards which a cheque is issued, dishonoured and for recovery of which a criminal action is initiated, the question of threshold jurisdiction will arise. In such cases, the Court exercising jurisdiction under Section 482 CrPC will be justified in interfering but not otherwise. In that light, this Court was of the view that entertaining a petition under Section 482 CrPC to quash the proceedings at the stage earlier to the evidence would not be justified. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Trial Court based on the cheque which was dishonoured cannot be construed as time-barred and as such it cannot be classified as a debt which was not legally recoverable, the details of which we would advert to here below. In that view, we have chosen not to refer to the cases provided as a compilation as it would be unnecessary to refer to the same. 13. In that regard the perusal of the impugned judgment would disclose that the very narration as contained in para 4 of the impugned order would indicate that the consideration therein was predicated only on two facts as noted by the High Court, (i) that the promissory notes are of the year 2012, (ii) that the cheques are issued in the year 2017. It is in that light the High Court has indicated that the date of issuance of the cheque is beyond three years from the date of issuance of the promissory note so as to classify it as a time-barred debt. In this regard, on perusal of the records we note that the High Court has in fact misdirected itself, has proceeded at a tangent and has therefore erred in its conclusion. 14. As already noted, the facts are almost similar in all four cases and as such for the purpose of narration a perusa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt of the Chief Metropolitan Magistrate on 11.07.2017. So is the case in the analogous complaints. Therefore, in the instant case not only the amount was a legally recoverable debt which is evident on the face of it, the complaint was also filed within time. Hence there was no occasion whatsoever in the instant case to exercise the power under Section 482 to quash the complaint. In that view, the order impugned dated 12.02.2019 passed by the High Court in Criminal Petition Nos.12652, 12670, 12675, and 12676 of 2018 is not sustainable. 17. The order impugned is accordingly set aside. 18. The complaints bearing CC No.681 of 2018, CC No.644 of 2018, CC No.250 of 2018, and CC No.254 of 2018 are restored to the file of the Chief Metropolitan Magistrate, Visakhapatnam. Keeping in view that the matter has been pending from the year 2017, the Trial Court shall now proceed with the matters as expeditiously as possible but in any event shall dispose of the matter within six months from the date on which a copy of this judgment is furnished. 19. Before parting with the matter, we would like to place on record and command the usual, able assistance rendered by Mr. Sidharth Luthra, learned s ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
