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(NAGPUR BENCH)
R.K. Batta, J.
Ramesh Ratilal Tanna .... Applicant.
Versus
Gautam Jayantilal Nagarwala .... Non-applicant.
Criminal Application Nos. 561 562 of 1998, decided on 4-9-2001.
Advocates appeared :
R.S. Sundaram with Ms. U.R. Tanna, in Cri.A. Nos. 561 562/1998, for applicant.
J.P. Kothari, in Cri.A. Nos. 561 562/1998, for non-applicant.
The presumption under section 139 of the Negotiable Instruments Act is rebuttable, and the power of judicial review under section 482 Cri.P.C. can be used to prevent abuse of the process of any Court or otherwise to secure the ends of justice.
Headnote:
Negotiable Instruments Act - Quashing of Proceedings - Section 138, Section 141, Section 420 - Summary of Acts and Sections: The court discussed the presumption under section 139 of the Negotiable Instruments Act and its rebuttal, as well as the guidelines for quashing of proceedings laid down by the Apex Court in State of Haryana and others v. Bhajanlal and others. The court also highlighted the importance of specific clauses in the sale deed in determining the legal liability of the accused.
Fact of the Case:
The accused filed for discharge after a complaint was filed against them under section 138 of the Negotiable Instruments Act and section 420 of I.P.C. The accused argued that the cheques were not towards any legal liability as the entire interest had already been paid at the time of execution of the sale deed.
Finding of the Court:
The court found that the presumption under section 139 of the Negotiable Instruments Act stands rebutted based on specific clauses in the sale deed, and that the proceedings were required to be quashed.
Issues: The issues revolved around the legal liability of the accused in relation to the cheques issued and the interpretation of specific clauses in the sale deed.
Ratio Decidendi: The court's decision was based on the rebuttal of the presumption under section 139 of the Negotiable Instruments Act and the guidelines for quashing of proceedings laid down by the Apex Court.
Final Decision: The applications were allowed, and the proceedings as well as the process issued by the Magistrate were quashed.
2. The non-applicant had filed a complaint under section 138 read with section 141 of the Negotiable Instruments Act and under section 420 of I.P.C. After examining the complainant, the Magistrate issued process on 10-6-1997. The present applicant filed an application on 9-12-1997 for discharge and the Magistrate vide order dated 10-2-1998 dismissed the said application for discharge. The applicant, namely the accused, has approached this Court for quashing the prosecution as well as issuance of process under section 138 of the Negotiable Instruments Act.
3. Learned Advocate for the applicant argued before me that on the face of the complaint and the sale deed, it is crystal clear that the entire interest whatever was due had already been paid by the present applicant to the non-applicant at the time of execution of the sale deed as is clear from Clause 22 of the sale deed. Therefore, according to the learned Advocate for the applicant, the case of the complainant that the cheque in question was issued towards part payment of interest is falsified by Clause 22 of the sale deed itself and as such the cheque in question is not towards any legal liability. The case of the applicant is that the said cheques were issued towards payment of sales tax, if any payable by the applicant even after the execution of the sale deed. He, therefore, contends that since prima facie the applicant has not been able to make out a case of legal liability as contended by him in the complaint, the proceedings are liable to be quashed. Reliance was placed by the learned Advocate for the applicant on (Pepsi Foods Ltd. and another v. Special Judicial Magistrate and others)1, reported in 1998(5) Bom.C.R. (S.C.)426; (G. Sagar Suri and another v. State of U.P. and others)2, reported in 2000(5) Bom.C.R. (S.C.)694; and (State of Haryana and others v. Bhajanlal and others)3, reported in 1992 Suppl. (1) S.C.C. 335.
4. Learned Advocate appearing on behalf of the non-applicant urged before me that under section 139 of the Negotiable Instruments Act, it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, or any debt or other liability. In this connection, reliance was placed on (Pankaj Mehra and another v. State of Maharashtra and others)4, reported in 2000(5) Bom.C.R. (S.C.)321; (Kusum Ingots and Alloys Ltd. v. Pennar Peterson Securities Ltd. and others)5, reported in 2000(5) Bom.C.R. (S.C.)428 and (Maruti Udyog Ltd. v. Narendra and others)6, reported in 1999(1) S.C.C. 113. It was further urged by the learned Advocate for the non-applicant that the sale deed was executed on 30th August, 1996 and the cheques in question have been issued on 1-9-1996 towards part payment of interest due on the entire consideration which had not been regularly and punctually paid and in these circumstances, the non-applicant is entitled to lead evidence under sections 91 and 92 in respect of the said sale deed. According to the learned Advocate for the non-applicant though the presumption under section 139 is rebuttable yet there is no material on record to rebut the said presumption and that it will be too premature to dismiss the complaint in question without giving opportunity to the non-applicant to lead evidence in this respect, since the applicant is denying his liability in respect of the said cheque though on the ground that the cheques were issued in relation to payment of sales tax, if any, due by the applicant even after the execution of the sale deed. He, therefore, contends that the appl
