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Rajasthan High Court
Hon'ble N. N. Mathur, J.
S.B. Criminal Misc. Petition No. 708 of 2002
Decided on 26.8.2004
Dharmendra Kumbhat & Ors.
versus
State of Rajasthan & Ors.
The main legal point established in the judgment is that the liability of the husband for the wife's cheques under Sec. 138 of the Negotiable Instruments Act is contingent upon the husband being the drawer of the cheques or being part of an 'association of individuals' as defined in Sec. 141 of the Act.
Headnote:
Sec. 138 of the Negotiable Instruments Act - Liability of husband for wife's cheques - Husband's liability under Sec. 138 of the Act
Fact of the Case:
The petitioner and his wife were accused of an offence under Sec. 138 of the Negotiable Instruments Act for dishonoring cheques issued by the wife. The Judicial Magistrate took cognizance against both the petitioners, which was confirmed in revision by the Additional Sessions Judge.
Finding of the Court:
The court found that the husband, who was not the drawer of the cheques, cannot be prosecuted under Sec. 138 of the Act. The court held that the proceedings against the petitioner-husband were not sustainable and deserved to be quashed as it was an abuse of the process of the Court.
Issues: The crucial issue was whether the husband and the wife, the co-accused, can be treated as 'an association of individuals' as envisaged in the explanation appended to Sec. 141 of the Act.
Ratio Decidendi: The court emphasized that the question had to be examined in the context of the facts of each case, particularly the averments made in the complaint. It noted that while the drawer of the cheque can be prosecuted under Sec. 138, the expression 'other association of individuals' used in Sec. 141 of the Act is of significance.
Final Decision: The petition was allowed, and the orders passed by the Additional Sessions Judge and the Judicial Magistrate against the petitioner were quashed and set aside.
N.N. Mathur, J. : By way of instant petition under Sec. 482 CrPC, the petitioners have challenged the order of the Additional Sessions Judge (Fast Track), Jodhpur dated 26.6.2002 refusing to interfere with the order of the Judicial Magistrate No. 3, Jodhpur, dated 22.2.2001 taking cognizance against the petitioner along with his wife Smt. Sobha Kumbhat for offence under Sec. 138 of the Negotiable Instruments Act (hereinafter referred to as "the Act").
2. Briefly stated the facts of the case are that the second respondent Pramod Sharma filed a complaint on 22nd June, 1994 alleging inter alia that the petitioner herein is carrying on the business of chemicals in Chennai in the name of Kumbhat Group of Business. His firm namely K.G.B. India is having its branches at Jodhpur, Delhi and Madras. Both the accused per sons are the proprietor of the firm. In the year 1993, the complainant paid a sum of Rs. 3,000/- to Smt. Sobha Kumbhat for the printing of polythene bags. In the month of July, 1993, the complainant invested a sum of Rs. 5,000/- with K.G.B. India. It was agreed by the accused persons that they will pay 18% interest on the said amount. In total, a sum of Rs. 55,800 was invested. Some more details of the transaction has been given. Suffice it to say that the accused persons were liable to pay a sum of Rs. 59,018/- to the complainant.
3. It is further case of the complainant that Smt. Sobha Kumbhat issued four cheques of different amount i.e. Rs. 10,000/- dated 1.4.1994, Rs. 22,000/- dated 10.4.1994, Rs. 13,000/- dated 15.4.1994 and Rs. 14,018 dated 1.6.2004 under her signatures. All the four cheques were dishonoured by the Bank. After statutory notice, the instant complaint was filed. The learned Judicial Magistrate No. 3, Jodhpur has taken cognizance against both the petitioners namely Dharmendra and his wife Smt. Sobha Kumbhat for offence under Sec. 138 of the Negotiable Instrument Act by order dated 22.2.2001 which has been confirmed in revision by the impugned order dated 26.6.2002 passed by the Additional Sessions Judge (Fast Track), Jodhpur.
4. It is contended by the learned counsel that the cheques were not issued by the husband-petitioner as such he is not liable to be prosecuted for offence under Sec. 138 of the Act. On the other hand, it is submitted that the company as well as the person in charge of and responsible at the time of commission of offence are liable to be prosecuted under Sec. 138 of the Act in view of the provision of Sec. 141 of the Act. Thus, the crucial issue which arises for the consideration is whether the husband and the wife, the co-accused, can be treated as "an association of individuals" as envisaged in the explanation appended the Sec. 141 of the Act.
5. I am of the view that the question has to be examined in the context of the facts of each case particularly the averments made in the complaint. As provided under Sec. 138 of the Act, it is only the drawer of the cheque who can be prosecuted. However, the expression "other association of individuals" used in Sec. 141 of the Act is of significance. In the facts of the case, the petitioner-husband herein is obviously not a drawer of the cheques and the cheques have been issued by his wife Smt. Sobha Kumbhat. There is no allegation in the complaint to the effect that the husband has been doing the business along with his wife and the cheques were issued in discharge of her liability. Thus, in my opinion, the proceedings against the petitioner-husband is not sustainable and the same deserves to be quashed being abuse of process of the Court.
6. Consequently, the petition is allowed. The order dated 26.6.2002 passed by the Additional Sessions Judge (Fast Track), Jodhpur and the order dated 22.2.2001 passed by the Judicial Magistrate, No. 3, Jodhpur in Criminal Case No. 2164/1995 as against the petitioner Dharmendra stand quashed and set aside.
