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1999 Supreme(Kar) 601

Karnataka High Court
A.Sathyanarayana - Appellant
Versus
C.Nagaraj - Respondent
Decided On : 12-10-99

Headnote:Negotiable Instruments Act, 1881 - Section 138 - Prosecution for offence of dishonour of Cheque Conviction set aside by lower appellate court holding that statutory notice issued after dishonour of cheque was not served on respondent - Appeal - Postal cover had been returned unserved with endorsement "not found" on all seven days notice was taken for service - Notice had been sent on correct address of respondent furnished in an agreement between parties - Presumption of deemed service of notice was rightly drawn by trial court - Conviction and sentence awarded by Magistrate was liable to be restored. (Paras 10 to 12)

       Result: Appeal allowed.

       

K. R. PRASADA RAO, J.

( 1 ) THIS appeal is filed by the complainant against the order of acquittal of the respondent-accused in respect of the offence under Section 138 of the Negotiable Instruments Act (hereinafter referred to as 'the Act'), in Crl. A. No. 10004/98 on the file of the Court of the IV Addl. Sessions Judge, Mayo Hall, Bangalore by the judgment dated 4-7-98 by allowing the appeal and setting aside the order of conviction and sentence passed by the learned X Addl. CMM, Bangalore in C. C. No. 22669/97.

( 2 ) THE appellant-complainant filed the complaint in the trial Court in C. C. No. 22669/97 under Section 138 of the Act alleging that the respondent-accused has issued a cheque for Rs. 5,00,000/- dated 15-3-97 by way of refund of the advance amount received under an agreement of sale transaction for the purchase of the land, when it was ultimately found that the said land does not belong to the respondent. When the said cheque was presented for the payment to the Bank, the same was returned dishonoured with Bank endorsement on 31-3-96 as 'insufficient funds'. Thereafter, the appellant issued notice dated 12-4-96 to the accused calling upon the respondent to pay the said cheque amount within 15 days from the date of receipt of the same. Since the respondent has not complied with the said demand made in the notice, the appellant filed the complaint in the trial Court within one month from the date on which the cause of action arose.

( 3 ) THE respondent pleaded not guilty to the accusation read over to him in the trial Court and claimed to be tried.

( 4 ) THE Trial Court after recording the evidence adduced by both parties and on appreciation of the said evidence, came to the conclusion that the respondent is guilty of the offence under Section 138 of the Act and convicted him for the said offence and sentenced him to undergo 3 months S. I. and to pay a fine of Rs. 8,00,000/-, in default, of payment of fine, to undergo S. I. for six months. The trial Court gave further direction that out of the fine amount to be paid by the respondent, a sum of Rs. 5,00,000/- will be paid to the complainant by way of compensation.

( 5 ) AGGRIEVED of the said order of conviction and sentence passed, the respondent filed the Criminal Appeal No. 10004/98 on the file of the IV Addl. Sessions Judge, Mayo Hall, Bangalore and the said appeal came to be allowed by the judgment dated 4-7-98 setting aside the order of conviction and sentence passed by the Trial Court. On re-appreciation of the evidence, the 1st appellate Court found that the notice of dishonour of the cheque issued by the complainant has not been served on the respondent and so, there is no cause of action for filing the complaint against the respondent.

( 6 ) I have heard the arguments advanced by the learned counsel appearing on both sides.

( 7 ) THE learned counsel for the appellant-complainant vehemently argued that the notice of the dishonour of the cheque has been sent by registered post with the correct address furnished by the respondent himself in the memorandum of understanding signed by him. The said disposal cover has been returned unserved with the postal endorsement as 'not found' on all the seven days on which the notice was taken for service. It is therefore, contended by him that the Trial Court rightly construed the service as "deemed service" and the lower appellate Court has wrongly interpreted that there is no service of the said notice on the respondent and that he has no knowledge about the dishonour of the cheque issued by him and the demand made for payment of the cheque amount. It is further contended by him that the appellant has also sent the same notice under certificate of posting, Ex. P5 to the same correct address furnished by the respondent himself, and the Trial Court has rightly drawn the presumption that the said notice under certificate of posting must have been served on the respondent in the ordinary course within a day or two. It is furth








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