IMPORTANT POINT
By virtue of the provisions of chapter 17 of the Negotiable Instruments Act. particularly in view of Sec. 142. when a complaint is filed by the payee or the holder in due course of the cheque which was dishonoured the Magistrate has necessarily to take cognizance if the other ingredients are satisfied.

Headnote:(i) Criminal Procedure Code, 1973 Section 482 - Negotiable Instruments Act, Sections 138, 141 & 142 as added by Amendment Act 66 of 1988 - Application to quash the proceedings - Complaint for the offence u/s. 138 - The cheque issued was dishonoured Complainant gave notices by registered post as well as under certificate of posting - Petitioners evaded receiving the notices - Complaint filed within one month - There is sufficient compliance with the provisions of Sec. 138 of the Act - The questions of fact will have to be determined after the evidence is recorded - Proceedings cannot be quashed at this stage.
       Held: It is an admitted fact that the first petitioner, who is one of the Managing Directors of the company, issued the cheque for an amount of Rs. 2,85,700/-. Though in the Crl. P. No. 3891 91 it is alleged that the cheque is forged, no basis is given as to how the complainant could forge a cheque, especially on a cheque leaf of a cheque book of the personal account of the petitioner No. 1. Obviously, this theory of forgery appears to have been introduced only with a view to evade prosecution under the amended Law of the Negotiable Instruments Act It should be remembered that Chapter 17 of the Negotiable Instruments Act has been introduced by Act 66 of 1988 and it came into force with effect from 1.4.1989. For the first time the mere dishonouring of a cheque is made a punishable offence by reason of sections 138 to 142 of the Negotiable Instruments Act. A perusal of the record reveals that the cheque was dishonoured on 16.6.1989 when it was presented by the defacto-complainant and immediately on 19.6.1989 registered notices were issued through advocate to the three petitioners who claim to be the Managing Directors of the company. They managed to evade the notices and the normal presumption is that the notices sent under certificate of posting must have been received by them The copies of the notices are produced along with the Crl. M.P. No. 1066/91. It is crystal clear that repeated efforts were made to serve them and that ultimately the were returned on the ground that the party left without instructions and hence they were returned. The registered notices were returned after making efforts for seven days to serve them. The notices sent under certificate of posting must have been received by the present petitioners. The normal presumption is that they were received in due course of time. (Para 6)
       Further held: As things now stand, the complaint given in this case fully satisfies the ingredients of section 138 of the Negotiable Instruments Act. The cheque issued towards salary payable by the company by one of the Managing Directors was dishonoured. The complaint complied with all the three conditions laid down in the proviso to section 138 of the Negotiable Instruments Act. It should also be remembered that under section 141 of the said Act, if the offence is committed by a company, the persons who are in charge of the conduct of the business of the company as well as the company will be liable. The three petitioners, all of whom are the Managing Directors, are certainly liable to be proceeded against. The ingredients of section 142 of the Act are also fully satisfied as the complaint was made by the payee; and as the complaint was made within one month of the date on which the cause of action arose under clause (c) of the proviso to section 138 of the Act and the complaint was filed in the court of the First Class Magistrate, clause (c) of the proviso to section 138 of the Act is also satisfied. (Para 7)
       (ii) Practice & Procedure - Negotiable Instruments Act, 1881 - Sections 138, 141 &. 142 - When a complaint is filed by the payee or the holder in due course of the cheque which was dishonoured, the Magistrate has necessarily to take cognizance if the other ingredients are satisfied - He has no right or power to refer it for investigation to the police just like a private complaint. (Paras 3 & 9)
       Result: Petition dismissed.

JUDGMENT

Jagannadha, Raju, J. - Criminal Petition No. 389/91 is a petition under section 482, Cr.P.C. to quash the proceedings in CC.No. 424/89 on the file of the II Additional J.F.C.M., Kakinada, Criminal M.P. No. 1066/91 is an application by the defacto-complainant who originally gave a complaint to the Magistrate regarding the offences for which charge-sheet was filed in C.C. No.424/89. Criminal MP. No. 505/91 is on application for stay of further proceedings in C.C. No. 424189 pending Crl. P. No. 389/91. That petition was ordered and stay of further proceedings was granted on 11.3.1991. To vacate the stay granted, Crl. MP. No. 1067/91 is filed.

2. The three accused in C.C. No. 424/89 -have come up with this application to quash the proceedings in C.C. No. 424/89. Sri K. Harinath, the learned counsel appearing for the petitioners, contends that the cheque, regarding the dishonour of which the case has come up, is not a cheque issued on behalf of the company or P. 1 in his capacity as Managing Director of the company. It, is Claimed that the cheque is a forged cheque. In the alternative it is claimed that as the cheque is a cheque issued by the petitioner NO.1 against his own personal account, when the liability to pay the amount is that of the company, no offence under section 138 of the Negotiable Instruments Act is made out against the accused persons. He further contends that the ingredients of Section 138 are not satisfied. The charge-sheet docs not allege that the cheque was issued on behalf of the complainant. There is no proof of notices alleged to have been issued being received by the petitioners. He claims that the ingredients of sect ion 138 of the Negotiable Instruments Act as well as the ingredients of the offence under section 420 I.P.C. are not satisfied and hence, the prosecution should be quashed. He also contends that Crl. M.P. No. 1066/91 is not maintainable. As the charge-sheet was filed in this case, the dc-facto complainant cannot, at best only seek a right to assist the Public Prosecutor and he cannot claim a right to be impleaded as a party. There is no provision in the Cr.P.C for impleading the defacto-complainant as a party.

3. On behalf of the defacto-complainant who is the petitioner in Crl. M. P. 1066/91 and 1067/91, Mr. T. Gopala Krishna, contends that he is fully alive to the limitation prescribed under section 301, Cr.P.C. He claims that according to section 138 and section 142 of the Negotiable Instruments Act, there is no provision for referring a complaint filed by the payee of the cheque to the police for purpose of investigation and it is a bounden duty of the Magistrate to take cognizance of the complaint if the complaint satisfies the requirements of section 138 and sections 141 and 142 of the Negotiable Instruments Act. In such circumstances, the defacto complaint is the person who is certainly entitled to prosecute tile case. Even otherwise defacto-complainant does have the right to assist the prosecution and he has also the right to submit written arguments after the evidence is closed in a case. Hence in this particular proceedings, the papers filed by him Crl. MP. 1066/91 may be treated as the Write arguments to supplement the arguments of the Public Prosecutor. Subject to the objections of the petitioners advocate, he argued both on merits and on legality. He contends that all questions regarding the cheque being forged, the cheque being issued on the personal account of the petitioner No. 1 and not on the account of the company and the factum of issuing of notices and refusal of the notices are all questions of fact which can only be decided after evidence is recorded. In a proceedings under section 482, Cr. P.C., it is not open to this court to go into the questions of fact. The complaint has been given in a very elaborate manner by the complainant. Without jurisdiction and without any legal necessity, the Magistrate referred the matter to the police for purposes of investigati

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