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2011(1) Bankmann 500 (J&K)
JAMMU AND KASHMIR HIGH COURT
Muzaffar Hussain Attar, J.
Priyanka Overseas Pvt. Ltd. —Petitioner
versus
J&K Bank Ltd. & Ors. —Respondents
Appeal No. 69 of 2009
Decided on 16.6.2009
Counsel for the Parties:
For the Petitioner:Mr. M.A. Quayoom, Advocate.
For the Respondent:Mr. Roshan Khayal, Advocate.
IMPORTANT POINT
A person who borrows money cannot be permitted to wriggle out of his liability to discharge debt on pure technical pleas.
Headnote:(i) Negotiable Instruments Act, 1881—Section 138—Criminal Procedure Code, 1973—Sections 177 and 182—Dishonour of cheque—Territorial jurisdiction of court—Mere sending of notice under Section 138 from a place may not give jurisdiction to Court of that place to entertain and try complaint—Presently, cheque was presented at Srinagar, memo stating that cheque could not be encashed was also received at Srinagar, notice was also issued at Srinagar, service whereof has been admitted by petitioners—Offence can be enquired into and tried by Court having jurisdiction over in all such local areas where, any of the acts is performed—Offence under Section 138 having been held to be concatenation of number of acts some of which have taken place at Srinagar Court at Srinagar has jurisdiction in. terms of statute to hear and try complaint. (Paras 18 to 23)
(ii) Negotiable Instruments Act, 1881—Section 138—Dishonour of cheque—A person who borrows money and thereafter in discharge of debtor liability issues a cheque, and subsequently by any mode frustrates payment thereof cannot be permitted to wriggle out of his liability to discharge debt and commitment to repay the same on pure technical pleas. (Para 27)
Muzaffar Hussain Attar, J.—Undeterred by their failure to scuttle the criminal proceedings initiated for alleged commission of offence under Section 138 of the Negotiable Instruments Act. 1881 (for short Act of 1881) pending on the files of Ld.CJM Srinagar the petitioners have now again ventured to seek dismissal of the complaint on the basis or the judgment of the Hon’ble Supreme Court in case titled M/s. Harnam Electronics (P) Ltd v. M/s National Panasonic India Ltd.1 which according to petitioners provide that mere sending of notice under S.138 of the Act of 1881 from a place may not give jurisdiction to the Court of that place to entertain and try the complaint.
2. It is apposite in order to keep the record straight, to make mention of the earlier petition filed under Section 561, Cr.P.C. No. 90/07 and 95/07 by the present petitioners for quashment of proceedings on the grounds which have been taken again in the present petition. One of the grounds taken in the earlier petitions by, present petitioners was lack of jurisdiction of the Ld. CJM, Srinagar to entertain and try the complaint against the petitioners. This Court vide its judgment dated 1st Feb. 2008 negatived all the contentions raised by the petitioners which include the ground of jurisdiction. Para 5 of the said judgment is reproduced as under:
“That brings’ me to the question as to whether or not the Chief Judicial Magistrate, Srinagar had jurisdiction to entertain the complaint and take cognizance against petitioner/company and its directors. While there is no doubt that the cheque was drawn on “Bharat Overseas Bank” but that per se would not shift jurisdiction to New Delhi for the simple reason that as a matter of fact, it would have been presented for encashment at respondent/bank’s Air Cargo branch at Srinagar who further transmit it to concerned bank through their Regional Collection Centre, New Delhi, but the refusal having been conveyed to respondent/bank at Srinagar, the local Court would not cease to have the jurisdiction. No other ground has been urged at bar except that the respondent/ bank has also exercised its option of having the mortgaged properties at Delhi attached under “Realization of Securities Act” which, however, does not appear to have any bearing on this matter pertaining as it is strictly to the criminal aspect under N.I.Act.”
3. The said judgment was allowed in petition under Section 561A No. 90/07 and the petition was also dismissed by this Court vide its order dated 07.07.2008. The Xerox copy of the earlier petitions and copies of judgments produced by Mr. Roshan Khayal, at motion/hearing stage are taken on record. The respondent No.2 who, figures as accused No.5 has challenged proceedings initiated against him before this Court reportedly on the ground that when the petitioners obtained financial assistance/loan from respondent No.1 he was not in any manner whatsoever, involved in the affairs of the petitioners’ company. This Court has stayed the proceedings against respondent No.2. Likewise, it is stated that on similar grounds the Hon’ble Supreme Court stayed proceedings against the respondent No.3 who figures as accused No.6 in the complaint. The proceedings are thus being conducted against the petitioners, in the complaint, pending on the files of the Ld. CJM, Srinagar.
4. The record reveals that petitioners have obtained financial assistance from respondent No.1 way back in the year 2001 which was enhanced initially to 25 crores of limit as post shipment limit and 25 crores as forward exchange etc. The financial assistance was obtained at different times. In the complaint filed by respondent No.1, it is further alleged that in liquidation of the part of the debt the petitioner No.2 executed a post dated cheque No.329836 dated 19.01.2007 for an amount of Rs.5 crores under cover letter No.POPL 2006 dated 26.12.2006 to meet part liability of loan, letter of credit, (overdraft-current, account No.3126). It is further alleged in
