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2011(1) Bankmann 549 (A.P.)
ANDHRA PRADESH HIGH COURT
B. Chandra Kumar, J.
J. Vidya Sagar —Petitioner
versus
State of A.P. and Anr. —Respondents
Criminal P. No. 5259 of 2007
Decided on 28.4.2010
Counsel for the Parties:
For the Petitioner:Mr. P. Shiv Kumar, Advocate.
For the Respondent: P.P.
IMPORTANT POINT
Police investigation is not contemplated under provisions of N.I. Act.
Headnote:(i) Negotiable Instruments Act, 1881—Sections 138 and 142—Dishonour of cheque—No police investigation is contemplated under provision of the Act—It is payee, who has to make complaint in writing, and upon such complaint, Court is empowered to take cognizance. (Paras 8 and 9)
(ii) Negotiable Instruments Act, 1881—Section 138 read with Section 420 of IPC—Criminal Procedure Code, 1973—Section 482—Dishonour of cheque—Quashing application—Offence under Section 138 is made out even if cheque is returned on the ground of closure of account—A cheque can be presented any number of times during the time of its validity— Though documents filed by petitioner cannot be looked into at this stage, since there is no allegation that petitioner had fraudulent intention on the date of issuing cheque and closed account by the date of issuing cheque, ingredients of Section 420 of IPC have not been made out—Proceedings against petitioner liable to be quashed. (Paras 8, 19 and 20 )
B. Chandra Kumar, J.—This Criminal Petition has been filed to quash the proceedings in C.C.No.437 of 2005 on the file of the Additional Judicial First Class Magistrate, East & North, R.R. District, transferred to X Metropolitan Magistrate, Malkajgiri, RR District.
2. The brief facts of the case are as follows:
The second respondent herein filed a complaint alleging that he is one of the partners in M/s. Sai Chakra Financers and M/s. Yogeshwara Financers and that the partners were not in a position to uphold the trust of the managing partners and therefore, the firm was dissolved, accounts were settled and a memorandum of understanding was reached between the parties on 5.6.2001. Due amounts to be paid by the Firm and to be received by the Firm were distributed among the partners. In pursuance of the said memorandum of understanding, the second respondent approached the petitioner for the payment of the due amount to be paid to him and the petitioner issued a cheque bearing No. 081308, dated 13.5.2002 for Rs. 3,85,000 of Central Bank, Himayatnagar branch. When the said cheque was presented in the bank of the second respondent i.e., ICICI Bank, Vasavinagar branch, the second respondent received an intimation that the account was closed. The second respondent lodged a complaint against the petitioner alleging that the petitioner issued a false cheque and closed the account without any intimation with an intention to cheat him and to avoid the payment. Basing on the said complaint, a case was registered in Crime No.251 of 2002 on 5.6.2002 for the offences punishable under Sections 420 of IPC and 138 of the Negotiable Instruments Act, 1881 (for short ‘the Act’).
3. The stand of the petitioner is that he had approached M/s. Sai Chakra Financers and M/s. Yogeshwara Financers and availed the loan and executed the promissory note and issued a blank cheque and subsequently, he had paid the entire loan amount with interest within the stipulated time and when he requested to return the promissory note and blank cheque, the second respondent represented that the promissory note and the blank cheque were misplaced and assured that they will be returned to him as and when found.
4. The learned counsel for the petitioner submits that the police are not authorized to investigate into a case filed for the offence under Sections 138 of the Act. He further submitted that even if the allegations made in the complaint are taken at their face value and accepted in their entirety, they did not prima facie constitute any offence or make out a case against the petitioner.
5. No representation for the second respondent, though notice was served.
6. In the light of the facts and circumstances, the only points that arise for consideration are:
1. Whether the police are empowered to file charge-sheet for the offence punishable under Section 138 of the Act? and
2. Whether the ingredients of Section 420 of IPC have been made out from the contents of the charge sheet?
7. Section 138 of the Act is as follows:
“Section 138. Dishonour of cheque for insufficiency, etc., of funds in the accounts—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 an 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 for 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 with
