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2009(1) Crimes 189 (J&K)
JAMMU AND KASHMIR HIGH COURT
Sunil Hali, J.
Vinod Kumar Gupta —Petitioner
versus
Jai Paul —Respondent
Criminal Revision No. 6 of 2007
Decided on 10.11.2008
Counsel for the Parties:
For the Petitioner:Mr. B.M. Bhardwaj, Advocate.
For the Respondent:Mr. Raghu Mehta, Advocate.
IMPORTANT POINT
Cheque presented for payment returned unpaid for being ‘reported stolen’, the intention of the drawer is clear that he wanted either to stop payment or dishonour the cheque.
Headnote:Negotiable Instruments Act, 1881—Section 138—Dishonour of cheque—Endorsement made in bank memo was that payment had been stopped which had been scratched and new endorsement that “cheque was stolen” was made —Petition to quash complaint—Whether offence was attracted in given bank memo endorsement? Yes.
Held: The argument of learned counsel for the petitioner is that on subsequent presentation of the cheques on 3.12.2003, the endorsement shows that the payment had been stopped which consequently was scratched and it was written that the cheques had been stolen. This according to the petitioner does not constitute an offence under Section 138 of Negotiable Instruments Act. Undoubtedly, there are two expressions used under Section 138 of Negotiable Instruments Act, one is on account of insufficiency of funds to honour the cheque and the second is when it exceeds the payment arranged to be paid from that account. Stopping of cheques or having been stolen is not covered. The argument is catchy at the outset but on a deep scrutiny, it would reveal that it was an act of the drawer by intimating to its banker to stop the payment which resulted in non-cashment of cheques. The intention became clear when the encashment of the cheques were stopped after having been issued in discharge of the liability or debt. Stopping of cheques or closing of account by the drawer itself means that the drawer had no intention of allowing these cheques to get encashed at that time, the same were issued in favour of the drawee.
However, under one eventuality it would not be a penal offence if the drawer had informed in advance that the account had been closed or payment had been stopped. It could be stopped but not in such a manner. If the drawer after issuing the cheques would have intimated its banker to stop payment or close the account, it would be deemed that there was no money in the account and the same is squarely covered by Section 138 of the Negotiable Instruments Act. (Paras 6 & 7)
The conjoint reading of the aforesaid discussion reveals that the intention of the accused alone would determine the nature of offence committed by him, more particularly, in cases under Section 138 of the Negotiable Instruments Act. (Para 11)
Result: Petition dismissed.
Sunil Hali, J. —A complaint was filed by the respondent-complainant against the petitioner-accused under Section 138 of the Negotiable Instruments Act. It was alleged in the complaint that two cheques bearing No.791017 dated 7.11.2003 for an amount of Rs. 2,00,000 and bearing No.791015 dated 11.11.2003 for an amount of Rs. 3,00,000 were issued by the petitioner in favour of the respondent. The said cheques were presented by the complainant respondent through his banker i.e. Punjab National Bank, Gangyal, Jammu for encashment on 10.11.2003 and 13.11.2003 respectively but the same were returned unpaid due to the reason that “cheques amount exceeds arrangement” in the account of the accused-petitioner.
2. That both the cheques, above referred, were again presented by the respondent-complainant through his banker for encashment on 3.12.2003. However, the said cheques were again dishonoured and returned by the banker of the accused unpaid. A joint memo came to be issued by the State Bank of India on 3.12.2003 which reveals that the payment was stopped by the petitioner and the said endorsement has been erased and it was written that the cheques “reported stolen”.
3. After the complaint was filed, the process was issued against the petitioner-accused. He filed application before the trial court for dropping of the proceedings and the said application was dismissed on 6.6.2005, against which a criminal revision petition was preferred before the Learned District Judge, Jammu, who also vide its order dated 6.1.2007 dismissed the same. It is how this petition under Section 561A Cr.P.C. is before this court.
4. I have heard learned counsel for the parties and perused the record.
5. There is no dispute that the cheques, details of which is given above, were presented before the banker of the accused and were returned unpaid on account of “cheques amount exceeds arrangement”. Again on presentation of the cheques to the same bank on 3.12.2003 endorsement was made that the payment has been stopped which has been scratched and new endorsement that cheques have been stolen, has been made. In essence, the cheques presented by the respondent-complainant issued by the petitioner-accused have not been encashed on account of the endorsement mentioned hereinabove, Section 138 of the Negotiable Instruments Act deals with the dishonour of cheques for insufficiency of funds in the account maintained by the drawer. For facility of reference Section 138 of Negotiable Instruments Act is reproduced as under:
138. Dishonour of cheque for insufficiency, etc. of funds in the account—Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by any agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment a term which may be extended to two years or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless:
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount
