Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2024 Supreme(Chh) 332

IN THE HIGH COURT OF CHHATTISGARH, BILASPUR
Arvind Kumar Verma, J.
Suresh Kumar Mahapatra S/o Late Goverdhan Mahapatra - Appellant
Versus
Dinesh Agrawal S/o Late Kishan Lal Agrawal – Respondent
ACQA No. 248, 258, 263, 145, 139, 138, 137, 135, 134, 131, 130, 129, 128, 127, 126, 125, 124, 123, 122, 120, 119, 118, 117, 116, 115, 114, 113, 112, 111, 110, 109, 107, 106, 105, 104, 103, 102, 101, 100, 99, 98, 97, 96, 94, 93 of 2019
Decided On : 15-03-2024

Advocates:
Advocate Appeared:
For the Appellant :Mr. Virendra Verma, Advocate.
For the Respondent:Mr. D.K. Gwalre, Advocate.

IMPORTANT POINT
The main legal point established in the judgment is the importance of proving the service of notice and the presumption of dishonour of a cheque based on the official mark and seal on the bank slip or memo. Additionally, the judgment emphasizes the need to establish the capacity to advance the amount mentioned in the complaint.

Headnote:
Section 138 - Negotiable Instrument Act - 138 - 139 - 146 - The court acquitted the respondent for the offence under Section 138 of the Negotiable Instrument Act, 1881. The appellant failed to produce the service of notice to the respondent, and the trial Court held that the cheque was issued by the respondent in advance as a security, hence, Section 138 of the N.I. Act does not apply. The trial Court also held that the return of dishonored cheques has not been proved, and the service of notice as required under the proviso Clause- (B) of Section 138 of the N.I. Act was not proved. The court rejected the application under Section 391 of the Criminal Procedure Code, stating that it was an attempt to fill up the lacunas in the prosecution case, which is not permissible. The court also emphasized the importance of the official mark and seal on the bank slip or memo for the presumption of dishonour of a cheque. The court found that the appellant failed to establish the capacity to advance the total amount of Rs. 92 Lakhs, as his monthly income is only Rs. 6 Lakhs. The court concluded that the trial court rightly acquitted the respondent, and the appeals were dismissed.
Fact of the Case:
The appellant, a financer, filed a complaint under Section 138 of the NI Act against the respondent, who had issued multiple cheques as security for loans. The trial Court acquitted the respondent, stating that the cheques were issued in advance as security and the return of dishonored cheques and service of notice were not proved.
Finding of the Court:
The court found that the appellant failed to produce the service of notice to the respondent and rejected the application under Section 391 of the Cr.P.C. The court emphasized the importance of the official mark and seal on the bank slip or memo for the presumption of dishonour of a cheque. The court also found that the appellant failed to establish the capacity to advance the total amount of Rs. 92 Lakhs, as his monthly income is only Rs. 6 Lakhs. The court concluded that the trial court rightly acquitted the respondent, and the appeals were dismissed.
Ratio Decidendi: The court held that the appellant's failure to produce the service of notice and the rejection of the application under Section 391 of the Cr.P.C. were crucial in the decision. The court also emphasized the importance of the official mark and seal on the bank slip or memo for the presumption of dishonour of a cheque. Additionally, the court found that the appellant failed to establish the capacity to advance the total amount of Rs. 92 Lakhs, as his monthly income is only Rs. 6 Lakhs.
Final Decision: The court concluded that the trial court rightly acquitted the respondent, and the appeals were dismissed.

Judgement Key Points

Questions or Aspects Raised by the Legal Query

Whether, prior to the amendment of Section 138 of the Negotiable Instruments Act in 2003, the court could acquit an accused based on the cheque return memo not bearing the mandatory details required under Section 146 of the NI Act.

Statutes Discussed

• Section 146

ORDER :

1. This petition is filed under Section 378 (8) of the Code of Criminal procedure being aggrieved by the impugned judgment and order dated 29.05.2018 passed by the Court of learned Judicial Magistrate First Class, Raipur C.G. in Criminal Case Nos. 811/2016, 790/2016, 1414/2016, 840/2016, 796/2016, 807/2016, 1432/2016,1415/2016, 1417/2016, 1418/2016, 785/2016, 800/2016, 787/2016, 799/2016, 1416/2016, 810/2016, 792/2016, 791/2016, 798/2016, 806/2016, 797/2016, 1413/2016, 839/2016, 778/2016, 1020/2016, 781/2016, 782/2016, 809/2016, 795/2016, 1412/2016, 1019/2016, 794/2016, 808/2016, 780/2016,1017/2016, 1021/2016, 1022/2016, 793/2016, 801/2016, 786/2016, 1018/2016, 838/2016, 784/2016, 783/2016, 779/2016 whereby the trial Court has acquitted the Respondent for the offence under Section 138 of the Negotiable Instrument Act, 1881 and since common question of fact and law is involved in all the appeals which have been heard together and are being disposed of by this common judgment.

2. Brief facts of the case are that as per the complaint, the appellant is doing a business as a financer and the respondent is doing a business in the name of Dinesh Enterprises and he is the proprietor thereof. The respondent took loan of Rs.1,00,000 in the complaint case No.811/2016, Rs.9,50,000 in the complaint case No.790/2016, Rs. 1,00,000 in the complaint case No.1414/2016, Rs.1,00,000 in the complaint case No.840/2016, Rs.6,00,000 in the complaint case No.796/2016, Rs.2,00,000 in the complaint case No.807/2016, Rs.4,00,000 in the complaint case No.1432/2016, Rs.3,00,000 in the complaint case No.1415/2016, Rs.2,00,000 in the complaint case No.1417/2016, Rs.1,00,000 in the complaint case No.1418/2016, Rs.1,00,000 in the complaint case No.785/2016, Rs.1,00,000 in the complaint case No.800/2016, Rs.1,00,000 in the complaint case No.787/2016, Rs.1,00,000 in the complaint case No.799/2016, Rs.1,00,000 in the complaint case No.1416/2016, Rs.1,00,000 in the complaint case No.810/2016, Rs.2,40,000 in the complaint case No.792/2016, Rs.1,50,000 in the complaint case No.791/2016, Rs.6,00,000 in the complaint case No.798/2016, Rs.50,000 in the complaint case No.806/2016, Rs.2,00,000 in the complaint case No.797/2016, Rs.2,00,000 in the complaint case No.1413/2016, Rs.50,000 in the complaint case No.839/2016, Rs.1,90,000 in the complaint case No.778/2016, Rs.1,00,000 in the complaint case No.1020/2016, Rs.3,00,000 in the complaint case No.781/2016, Rs.2,00,000 in the complaint case No.782/2016, Rs.1,00,000 in the complaint case No.809/2016, Rs.1,00,000 in the complaint case No.795/2016, Rs.1,00,000 in the complaint case No.1412/2016, Rs.90,000 in the complaint case No.1019/2016, Rs.1,00,000 in the complaint case No.794/2016, Rs.1,00,000 in the complaint case No.808/2016, Rs.2,00,000 in the complaint case No.780/2016, Rs.1,00,000 in the complaint case No.1017/2016, Rs.1,00,000 in the complaint case No.1021/2016, Rs.1,00,000 in the complaint case No.1022/2016, Rs.5,00,000 in the complaint case No.793/2016, Rs.1,00,000 in the complaint case No.801/2016, Rs.6,00,000 in the complaint case No.786/2016, Rs.1,00,000 in the complaint case No.1018/2016, Rs.1,00,000 in the complaint case No.838/2016, Rs.1,80,000 in the complaint case No.784/2016, Rs.1,00,000 in the complaint case No.783/2016, Rs.5,00,000 in the complaint case No.779/2016 for his business purpose and handed over the cheques of the same amount in favour of the appellant. The cheques were presented in the bank for encashment which was returned by the bank with a remark “dishonored due to insufficient funds”. Thereafter, the appellant served a notice by the registered post to the respondent but despite the notice, the amount was refunded. The appellant filed complaint under Section 138 of the NI Act against the respondent. After trial the trial Court held that the cheque was issued by the respondent in advance as a security, hence, Section 138 of the N.I. Act does not apply.

3. The trial Court also held