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RAJASTHAN HIGH COURT
Sandeep Mehta, J.
Bhagwati Kumar Gupta —Petitioner
versus
State of Rajasthan and Anr. —Respondents
S.B. Criminal Misc. Petition No. 2742/2012
Decided on 21.12.2012
Counsel for the Parties:
For the Petitioner:Mr. Hemant Jain, Advocate.
For the Respondent:Mr. A.R. Nikub, Public, Prosecutor, Advocate.
IMPORTANT POINT
Onus on the holder of the cheque before launching a prosecution under Section 138 of the Act is only to the, extent of sending the notice to the correct address of the drawer. Thereafter, the necessary consequences as enshrined in section 27 of the General Clauses Act would follow, as per which has to be presumed that the notice has been served on the addressee.
Headnote:Negotiable Instruments Act, 1881—Section 138—Petition for quashing complaint and order taking cognizance of offence on plea and ground that mandatory notice for demand of money was not served upon petitioner personally—Concept and requirement of giving notice to drawer of cheque prior to initiation of prosecution— Onus on holder of cheque is only to extent of sending notice to correct address of drawer—Section 27 of General Clauses Act then provided that notice would be presumed to have been served upon addressee—No reason or ground to quash proceedings.
Held: In view of the aforesaid authoritative pronouncement of the Hon’ble Apex Court in the larger bench reference, there is hardly any room for any doubt that the onus on the holder of the cheque before launching a prosecution under Section 138 of the Act is only to the, extent of sending the notice to the correct address of the drawer. Thereafter, the necessary consequences as enshrined in section 27 of the General Clauses Act would follow, as per which has to be presumed that the notice has been served on the addressee. It is not disputed by the learned counsel for the petitioner that the notice, which was sent by the complainant was at the correct address of the accused.
Who at the correct address receives the notice cannot be in the control of the complainant. It would be too harsh and virtually an absurd proposition to require from the holder of the cheque to manage the affairs in such a fashion that the same is served on the addressee himself. It is only in order to avoid such situation that the legislature enacted Section 27 of the General Clauses Act providing for presumption of service, even in cases, wherein the notice is not accepted by the addressee or cannot be served for various other reasons. As interpreted by the Hon’ble Apex Court in C.C. Alva Haji’s case, even a refusal to accept the notice, has been considered to be a sufficient service upon addressee. If the contention of the learned counsel for the petitioner is accepted then the same would lead to situation of absolute absurdity. Such an interpretation would be totally against the spirit of Section 138 of the N.I. Act. The unscrupulous accused would then easily manipulate the affairs and have the acknowledgement of the notice signed by anybody apart from himself/herself and then try to take a shield of non-service of the notice for raising a defence that the notice was not served and thus proceedings are vitiated. This in the opinion of this Court cannot be correct interpretation of the legal requirements of the Section 138 of the N.I. Act. The Hon’ble Apex Court whilst considering the case of M.D.Thomas (supra) was not made aware of the earlier Larger Bench decision rendered in the case of C.C. Alva Haji. Applying the law of precedents, the decision rendered by the Larger Bench of the Hon’ble Apex Court in the case of C.C.Alva Haji has to be considered to be holding field and to be laying down the correct position of law.
In the case at hand also, the complainant in his complaint has specifically averred that the mandatory notice of demand was sent by a registered post to the accused and the notice has been received by Komal Gupta the family member of the accused at his correct address on 27.7.2010.
Therefore, there is no force in the contention of the learned counsel for the petitioner that the notice in this case has not been served as per Section 138 of the N.I. Act and that the proceedings should be quashed on this ground. (Paras 7 to 10)
Sandeep Mehta, J.—The instant misc. Petition has been filed on behalf of the accused petitioner Bhagwati Kumar challenging the orders dated 19.2.2011 and 9.4.2012 passed by the learned Special Judicial Magistrate (N.I. Act Cases) Srigangangar in complaint case No. 195/2011 taking cognizance and reading over the accusation to him for the offence under Section 138 of the N.I. Act and the order dated 19.10.2012 passed by the learned Addl. Sessions Judge, No. 2, Sriganganagar in revision, whereby, the aforesaid orders have been affirmed.
2. Learned counsel Mr. Hemant Jain submits that the orders impugned passed by the learned courts below as well as all the proceedings of the complaint are illegal and amount to an abuse of process of the Court. He submits that the learned Special Judicial Magistrate (N.I. Act Cases), Sriganganagar is not seized of the territorial jurisdiction to try the case. He further submits that the legal notice for demand of money, which was allegedly sent by the complainant to the petitioner was not served on the petitioner. It was received by one Kamal Kumar and therefore, the proceedings of the complaint are absolutely illegal and amount to an abuse of the process of the Court.
3. Learned counsel placed reliance on the decision of this Court in tile case of M.D. Thomas v. P.S. Jaleel and Anr.1 in support of his argument and submitted that the instant misc. petition deserves to be pending in the court of learned Special Judicial Magistrate (N.I. Act Cases), Srigangangar deserve to be quashed.
4. Heard and considered the arguments of the learned counsel for’ the petitioner and the learned Public Prosecutor and perused the orders impugned passed by the courts below and the documents filed alongwith the documents.
5 The basic thrust of’ the arguments of the learned counsel for the petitioner is based on the contention that the mandatory notice for the demand of money was not served upon the petitioner personally and therefore, it cannot be considered to have been served to him and as such, the proceedings of complaint are vitiated. He has relied on decision of Hon’ble the Apex Court in the case of M.D.Thomas v. P.S. Jaleel referred to supra, wherein the notice of demand was served upon the wife of the accused and the Hon’ble Apex Court held that the mandatory requirement of giving notice of demand in terms of Clause (b) of the proviso to Section 138 of the Act was not complied with.
6. In the opinion of this Court, the aspect which this Court has to consider is as to whether in light of the earlier view expressed by the Hon’ble Apex Court in its decision rendered in the case of C.C. Alavi Haji v. Palapetty Muhammed & Anr.2 the contention of the learned counsel for the petitioner, which is based on the subsequent Supreme Court Judgment rendered in the case of M.D.Thomas (supra) can be accepted. The Hon’ble Apex Court in the case of C.C. Alvi Haji, was answering a reference on the aspect as to what is the concept and requirement of giving notice to the drawer of the cheque prior to the initiation of the prosecution under Section 138 of the N.I. Act. The Hon’ble Apex Court answered the reference made to it in this regard and a Three Judges Bench of Hon’ble Apex Court after considering the various facets of law including the provisions of Section 27 of the General Clauses Act, 1987 observed and concluded as below:
“Chapter XVII of the Act originally containing Sections 138 to 142 was inserted in the Act by the Banking, Public Financial institutions and Negotiable Instruments Laws (Amendment) Act, 1988 with the object of promoting and inculcating faith in the efficacy of banking system and its operations and giving credibility to negotiable instruments in business transaction. The introduction of the said Chapter was intended to create an atmosphere of faith and reliance on banking system by discouraging people from not honouring their commitments by way of payment through cheques. Section 138 of the Act w
