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PUNJAB AND HARYANA HIGH COURT
Jitendra Chauhan, J.
Shalini Enterprise & Anr. —Petitioners
versus
Indiabulls Financial Services Ltd. —Respondent
Crl.Misc. No. 35842 of 2011
Decided on 5.9.2012
Counsel for the Parties:
For the Petitioners:Mr. Akashdeep Singh, Advocate.
For the Respondent:Mrs. Kiran Bala Jain, Advocate.
IMPORTANT POINT
Security cheque can also be legally and validly utilized towards discharging of liability of Drawer.
Headnote:(i) Negotiable Instruments Act, 1881—Section 138—Criminal Procedure Code, 1973—Sections 177, 178 and 482—Dishonour of cheque—Summoning order—Territorial jurisdiction of court—Jurisdiction of Court to try cases arising under Section 138 of Negotiable Instruments Act will vest in any of places where any of component acts i.e., acts constituting offence are committed—If acts that constitute offence are committed in different areas over which different courts have appropriate jurisdiction, there is no reason to restrict jurisdiction of such courts to only one court—Offence u/s 138 of Negotiable Instruments Act would fall in procedural purview of Section 178 (d) of Cr. P.C in case acts constituting offence are committed in courts of different territorial jurisdiction—Complaint is maintainable within territorial jurisdiction of Gurgaon as complainant company has its corporate office at Gurgaon and collecting bank with regard to cheque in question is situated at Gurgaon—Criminal courts at Gurgaon have territorial jurisdiction to try and decide complaint—Petition dismissed. (Paras 7, 10, 11 and 12)
(ii) Negotiable Instruments Act, 1881—Section 138—Dishonour of cheque—Liability of drawer—Security cheque is an integral part of commercial process entered into between Petitioner and Respondent/Complainant—Security cheque is not only a deterrent for drawer against dishonoring his financial commitment but can also be legally and validly utilized towards discharging of liability of Drawer—It cannot be argued that a security cheque is not handed over or issued in pursuance of any undischarged liability—To hold so would defeat whole purpose of a security cheque—Security cheque is an acknowledgment of liability on part of drawer that cheque holder may use security cheque as an alternate mode of discharging his/its liability. (Para 11)
Jitendra Chauhan, J.—This petition under section 482 Cr.P.C has been filed for quashing of complaint No. 5091 dated 11.10.2010/15.12.2010 titled as Indiabulls Financial Services Ltd. v. Shalini Enterprise & Anr. under section 138/142 of the Negotiable Instruments Act, (hereinafter referred to as the ‘Act’) pending in the court of Judicial Magistrate Ist Class, Gurgaon, (Annexure P-4); summoning order dated 11.10.2010 (Annexure P-5) and all the subsequent proceedings arising therefrom.
2. The brief facts of the case, as set out in the complaint are that the petitioners availed loan of Rs. 20 lacs from the respondent-Company, engaged in the business of disbursement of various kinds of loans and promised to make regular EMI for the return of loan. The respondent-company is having its Corporate office at Indiabulls House, 448-451, Udyog Vihar, Phase-V, Gurgaon. In discharge of aforesaid loan liability, the petitioner issued cheque No. 854718 dated 27.7.2010 for a sum of Rs. 20 lacs drawn on Canara Bank, Sealdah, Kolkata in favour of the respondent-company. The petitioner assured that the cheque would be honoured on presentation. The respondent-company presented the cheque with its Banker ING Vysya Bank Ltd. Gurgaon for encashment. The said cheque was dishonoured and returned vide memo dated 10.8.2010 with the remarks “Insufficient Funds”. The respondent-company issued legal demand notice to the petitioner. Despite the notice, the petitioners did not pay the cheque amount to the respondent-company, even after the statutory period of 15 days. Thus, a complaint (Annexure P4) under section138 of the Act was filed against the petitioners in the court ofJudicial Magistrate Ist Class, Gurgaon. The Judicial Magistrate, Ist Crl.Misc. No. 35842 of 2011 3 Class, Gurgaon vide order dated 11.10.2010 (Annexure P5) summoned Shalini Enterprise and Shalini Mehra (petitioners herein) to face trial under section 138 of the Act. Subsequentlythe present petition was filed for quashing the complaint (Annexure P4) and summoning order (Annexure P5).
3. In the background of the factual matrix detailed herein before, the short issue that arises for consideration is whether the Court at Gurgaon is competent to try the Complaint u/s 138 of the Act.
4. It is not in dispute that the cheque was presented for encashment at Gurgaon. The plea of the petitioner is that the entire business transaction including the taking of the loan and deposit of security cheques took place in Kolkata and hence, the respondent can not create jurisdiction of the Gurgaon Court simply because depositing the cheque (for encashment) at a place, other than the place of its issuance. In support of his plea, the Ld. Counsel for the Petitioner principally relies on M/s Harman Electronics (P) Ltd. And another v. M/s National Panasonic India Limited.1 His additional plea is that the cheque which was presented for encashment was actually a security cheque and hence no liability would arise by dishonour of such a cheque.
5. The Learned Counsel for the Respondent on the other hand contends that as per the decision of the Hon’ble Apex Court in K. Bhaskaran v. Sankaran Vaidhya Balan2, a complaint u/s 138 Negotiable Instruments Act can be filed at any of the five places where the acts, which constitute the offence, are committed/ done. These five acts are :
* drawing of the cheque
* presentation of the cheque to the bank
* returning of the cheque unpaid by the drawee bank
* giving notice in writing to drawer of the cheque amount demanding payment of the cheque amount
* failure of the drawee to make payment within 15 days of the receipt of the notice.
6. Learned counsel for the respondent further contends that in the present case, two of the above mentioned acts were done at Gurgaon i.e. Presentation of the cheque and issuance of notice to the drawer. Accordingly, the exercise of jurisdiction by the Court at Gurgaon is in accordance with the mandate of the Hon’ble Supreme Court’s judgment in K
