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SUPREME COURT OF INDIA
Abhay S. Oka, Ujjal Bhuyan, JJ.
Rekha Sharad Ushir – Appellant
Versus
Saptashrungi Mahila Nagari Sahkari Patsansta Ltd. – Respondent
Criminal Appeal No. 724 of 2025
Decided On : 26-03-2025
(A) Criminal Procedure Code, 1973 – Section 200[Bhartiya Nagarik Suraksha Sanhita, 2023 – Section 223] – Negotiable Instruments Act, 1881 – Section 138 – Dishonour of cheque – Court of Judicial Magistrate can take cognizance of an offence punishable under Section 138 of N.I. Act based on a complaint filed under Section 200 of Cr.P.C. – After a complaint is filed under Section 200 of Cr.P.C., Magistrate is duty-bound to examine complainant on oath and witnesses present and reduce substance of such examination into writing – What is reduced into writing is required to be signed by complainant and witnesses – Recording complainant's statement on oath under Section 200 of Cr.P.C. is not an empty formality – Object of recording complainant's statement and witnesses is to ascertain truth – Magistrate is duty-bound to put questions to complainant to elicit truth – Setting criminal law in motion is a serious matter – Accused faces serious consequences in the sense that he has to defend himself in trial. (Paras 9 and 10)
(B) Negotiable Instruments Act, 1881 – Sections 138 and 139 – Criminal Procedure Code, 1973 – Section 200[Bhartiya Nagarik Suraksha Sanhita, 2023 – Section 223] – Dishonour of cheque – This was a case where very material documents in the form of two letters addressed by appellant were suppressed in complaint and statement on oath under Section 200 – In statement on oath, respondent-complainant vaguely referred to a ‘false notice reply’, but a copy of reply was not produced by respondent along with complaint – While filing complaint under Section 200 of Cr.P.C. and recording his statement on oath in support of complaint, as complainant suppresses material facts and documents, he cannot be allowed to set criminal law in motion based on complaint – Setting criminal law in motion by suppressing material facts and documents is nothing but abuse of process of law – High Court ought to have interfered and quashed complaint – Impugned order of High Court set aside and complaint and order of cognizance quashed and set aside. (Paras 20, 21 and 22)
(C) Administration of Justice – Litigant who, while filing proceedings in court, suppresses material facts or makes a false statement, cannot seek justice from court – Facts suppressed must be material and relevant to controversy which may have a bearing on decision making – Cases of those litigants who have no regard for truth and those who indulge in suppressing material facts need to be thrown out of court. (Para 11)
Facts of the case:
Appellant is accused in Criminal Case pending before Judicial Magistrate. Complaint was filed by respondent before JMFC alleging commission of an offence punishable under Section 138 of Negotiable Instruments Act, 1881 on the basis of dishonour of a cheque, which was allegedly issued by appellant in favour of respondent, a Credit Co-Operative Society.
Findings of Court:
Other remedies of respondent to file proceedings for recovery of the amount allegedly due and payable by appellant in accordance with law will remain open.
Result : Appeal allowed.
Key Points: - Recording complainant's statement on oath under Section 200 Cr.P.C. is not an empty formality; its object is to ascertain truth by examining complainant and witnesses (!) (!) . - Magistrate must examine complainant on oath under Section 200 Cr.P.C., reduce statement to writing, and apply mind to check sufficient grounds before issuing process under Section 204(1) (!) (!) . - Litigant suppressing material facts or making false statements cannot seek justice; such cases must be thrown out of court (!) . - Complainant suppressed letters dated 28th November 2016 and 13th December 2016 demanding loan documents, making false claim of no reply to demand notice (!) (!) (!) . - Suppression of material documents in complaint and Section 200 statement constitutes abuse of process; complaint and cognizance order quashed (!) (!) (!) . - Respondent's later claim of supplying documents via additional affidavit is afterthought, not pleaded in complaint (!) . - High Court's order dismissing challenge to process issuance set aside; appeal allowed (!) (!) . - Respondent's civil remedies for recovery remain open (!) .
JUDGMENT :
ABHAY S. OKA, J.
FACTUAL ASPECTS
1. The Appellant is the accused in Criminal Case No. 648 of 2016 pending before the Judicial Magistrate First Class, Kalwan (for short, ‘the JMFC’). The complaint was filed by the respondent before the JMFC alleging the commission of an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the NI Act’) on the basis of the dishonour of a cheque, which was allegedly issued by the appellant in favour of the respondent, a Credit Co-Operative Society.
2. It is alleged by the respondent that the appellant had obtained a loan of Rs. 3,50,000/- from the respondent on 3rd July 2006 through an overdraft facility. At the time of obtaining the loan, she issued two security cheques bearing Nos. 010721 and 010722. Due to a default in repayment, the respondent deposited the first cheque (No.010721) drawn on 10th February 2007 for the amount of Rs.3,75,976/-, which was dishonoured. Following a legal demand notice from the respondent’s advocate, the respondent filed Criminal Case No. 135 of 2007 under Section 138 of the NI Act on 4th April 2007. The appellant paid the cheque amount before the JMFC, Kalwan Court, on 23rd September 2016, following which the respondent withdrew the prosecution, and the appellant was acquitted on the same date.
3. In the interregnum, the appellant was allegedly granted another loan of Rs. 11,97,000/- on 25th July 2008 by the respondent. Due to an alleged default in repayment of the loan amount and interest accrued thereon, the respondent deposited the second cheque (No. 010722) drawn on 3rd October 2016 for the amount of Rs. 27,27,460/- which was dishonoured on 14th October 2016. The respondent issued a legal notice dated 11th November 2016, claiming that the cheque was issued towards repayment of an overdraft facility of Rs.11,97,000/- allegedly taken by the appellant on 25th July 2008.
4. While disputing the case made out in the demand notice, through her advocate’s reply on 28th November 2016, the appellant sought the supply of the loan documents from the respondent to enable her to give a reply to the statutory notice. By writing another letter through her advocate on 13th December 2016, she informed the advocate for the respondent that the documents had not been supplied to her.
5. The respondent filed the complaint bearing Criminal Case No. 648 of 2016 before JMFC, Kalwan, alleging the commission of an offence punishable under Section 138 of the NI Act on 15th December 2016 in relation to dishonoured Cheque No.010722. The JMFC issued the process on 2nd March 2017. Challenging the issuance of process, the appellant filed a Criminal Writ Petition No. 2316 of 2017 before the Hon’ble High Court of Bombay, which was dismissed by the impugned order dated 18th December 2023. The High Court found no infirmities in the order of the JMFC issuing process and held that the contentions raised by the appellant could only be decided at trial.
SUBMISSIONS
6. The learned counsel appearing for the appellant submitted that she had already paid the first loan of Rs. 3,88,077/- on 30th March 2007, and the said loan account was subsequently closed. Yet, the respondent chose to prosecute her wrongly and was forced to repay the entire loan again as she did not have the loan statement then and could not prove her earlier payment. It was further contended that the respondent, despite having full knowledge of the repayment, maliciously misused the second security cheque (No. 010722) to initiate false proceedings by depositing the said cheque within 10 days after the appellant had paid the entire amount pertaining to the first loan. The learned counsel emphasized that such an act amounted to a clear abuse of the process of law. The learned counsel pointed out that while filing the complaint, the respondent suppressed the most material letters dated 28th November 2016 and 13th December 2016 addressed by the advocate for the appellant to the advocate for the responden
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