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2008 Supreme(Bom) 1192

IN THE HIGH COURT OF JUDICATURE OF BOMBAY
V.R. KINGAONKAR, J.
The Dadasaheb Rawal Co-op. Bank of Dondaicha Ltd., Dist.- Dhule Appellant
VERSUS
Ramesh s/o Jawrilal Jain & Ors. Respondents
CRIMINAL REVISION APPLICATION NO. 239 OF 2006
Decided on: 22nd August, 2008

Advocates appeared:
Mr. A.H. Kapadia, advocate for the petitioner.
Mr. D.A. Mane, advocate for Mr. Milind Patil, advocate for respondent Nos. 1 and 2.
Mr. N.H. Borade, A.P.P. for respondent No. 3.

Headnote:Negotiable Instruments Act, 1881 - Section 14-Association of individuals.-Consequently, the term "association of individuals" will include Hindu Undivided Family of which the business is said to be a joint concern.

       Negotiable Instruments Act, 1881 - Sections 138 and 141-Issuance of process at initial stage-Quashing of.-Section 138 of the Negotiable Instruments Act, 1881 is enacted in order to safeguard the credibility of commercial transactions and to prevent bouncing of cheques by providing personal liability against the drawer of the cheque. In case of a cheque issued by the firm, the drawer of the cheque is the firm. In case of cheque issued by the business firm of Joint Hindu Family, all the members can be roped into as the drawers of the cheques though signatory is one of them. Under these circumstances, the impugned order is unsustainable. The Sessions Judge failed to see that quashing of the process at the premature stage was not called for in view of the Explanation appended to Section 141 of the Negotiable Instruments Act.

       Negotiable Instruments Act, 1881 - Sections 138 and 141 - Code of Criminal Procedure, 1973, Section 482 - Dishonour of cheque - Issue of process - Respondent not denied the liability - It is premature to quash the process against respondents 1 and 2 at this stage because Section 141 of Act is comprehensive and includes all types of business organisation and term "association of individuals " include a Joint Hindu Family.

       

JUDGEMENT

1. Challenge in this revision petition is to judgement dated 19th June, 2006 rendered by learned Ist Adhoc Additional Sessions Judge, Dhule, in Criminal Revision Application No. 61/2006 whereby and whereunder process issued against respondent Nos. 1 and 2 for offence punishable under section 138 of the Negotiable Instruments Act vide order dated 20th August, 2005 by learned Judicial Magistrate (F.C.), Dondaicha, came to be quashed.

2. The petitioner is a Cooperative Bank. An amount of Rs. 15 lacs was borrowed for and on behalf of M/s New Sheetal Traders. The petitioner - Bank filed a private complaint case (S.T.C. No. 311/2005) in the Court of Judicial Magistrate (F.C.) at Dondaicha against M/s New Sheetal Traders, Sheetal Ramesh Jain and the respondent Nos. 1 and 2. There is no dispute about the fact that original accused No. 2 Sheetal is the son of respondent Nos. 1 and 2. The petitioner asserted that M/s New Sheetal Traders is a firm of Undivided Hindu Family (UHF) of the respondent Nos. 1 and 2 and their son. All the three (3) members of the Undivided Hindu Family are the members of the Cooperative Bank. They gave postdated cheques of Rs. 15 lacs each on 22nd February, 2005. One of the cheques bearing No. 067702 was to be encashed on 15th March, 2005 and another cheque bearing No. 067703 was to be encashed on 24th March, 2005. Both the cheques were signed by accused No. 2 Sheetal for and on behalf of his parents and the business firm. Both the cheques were dishonoured. Though demand notice was issued to the firm or joint family business concern, accused No. 2 Sheetal and the respondent Nos. 1 and 2, yet, the amounts were not paid. The respondent No. 2 gave reply to the notice on 18th May, 2005 wherein the liability was impliedly admitted, but nothing was paid. Consequently, after stipulated period, the criminal complaint case was instituted by the petitioner for offence punishable under section 138 of the Negotiable Instruments Act.

3. The learned Judicial Magistrate considered verified statements of PW Jitendrasing in support of the complaint and heard learned advocate for the petitioner. He issued process for offence under section 138 of the Negotiable Instruments Act against all the four accused, including the respondent Nos. 1 and 2.

4. Aggrieved by the order of issuance of process, the respondent Nos. 1 and 2 preferred Criminal Revision Application No. 61/2006 in the Court of Sessions at Dhule. The learned Ist Adhoc Additional Sessions Judge held that the respondent Nos. 1 and 2 are neither partners of M/s New Sheetal Traders nor are signatories of the cheques in question and, hence, were not liable to be summoned under the order of the learned Magistrate. He held that the respondent Nos. 1 and 2 are not shown to be concerned with the firm styled as M/s New Sheetal Traders. It is only a proprietary firm run by original accused No. 2 Sheetal Jain. So, the issuance of process against the respondent Nos. 1 and 2 was held as illegal and hence, came to be quashed.

5. Heard learned counsel for the parties and learned A.P.P.

6. Mr. Kapadia, would submit that the respondent Nos. 1 and 2 could not be prematurely absolved from the criminal liability. He would point out from copy of the certificate issued by the Shop Inspector, Dhule on 2nd April, 2005 that the shop styled as M/s New Sheetal Traders was closed with effect from 1st April, 2005 as per application submitted by accused No. 2 Sheetal. He would submit that accused No. 2 Sheetal has gone underground to avoid the liability. He would submit further that the demand notice was issued to all the members of the joint family with categorical assertion that it was their joint business and all of them were liable to repay the loan amount. It is contended that the question as to whether joint liability will be established or not is required to be decided after the regular trial. Mr. Kapadia further submitted that the expression "or association of individuals" as appeari



















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