IMPORTANT POINT
Strict compliance with the notice of demand under Proviso (b) to Section 138 of the NI Act is essential, and any demand in excess of the cheque amount without specifying the reason for the excess demand renders the notice defective and the complaint not maintainable.

JUDGMENT

1. This petition has been filed under Article 227 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973 (in short, `Cr.P.C.') seeking quashing of Criminal Complaint bearing No. 523804/2016, titled as Kaveri Plastics v. Nafto Gaz India Private Limited & Ors., registered under Sections 138/141/142 of the Negotiable Instruments Act, 1881 (in short, `NI Act'), pending before the Court of the learned Metropolitan Magistrate, NI Act-04, Central District, Tis Hazari Courts, Delhi (hereinafter referred to as `Metropolitan Magistrate').

Factual Matrix

2. The above complaint case has been filed by the respondent against the petitioner, arraying the petitioner herein as the accused no.3. In the said complaint, it has been alleged that the accused no.1, that is, Nafto Gaz India Pvt. Ltd., entered into a Memorandum of Understanding with the respondent herein, that is the complainant, on 30.04.2012, pertaining to the sale of land bearing Khasra No.75, Khewat No.61, Khata no.112 and Khatoni No.61/14, Village-Humayun Pur situated at Abadi of Arjun Nagar, New Delhi, and also agreed to take on lease the said property till the final sale deed is executed. It also issued certain cheques towards the liability of the payment of the rent for the leased property.

3. It is stated that Cheque bearing no.876229 dated 12.05.2012 drawn on the Indian Overseas Bank, R.K.Puram, Delhi amounting to Rs.1 crore (Rupees one crore) issued by the accused no.1 was returned dishonoured with the remark `funds insufficient'. It is alleged that on the dishonour of the said cheque, the respondent herein sent a legal demand notice on 08.06.2012, on which the accused nos.4 and 5 gave a false and frivolous reply. It is alleged that the accused no.3/petitioner herein avoided service of the demand notice.

4. The accused in the complaint, including the petitioner herein, were summoned by an order dated 04.09.2012 passed by the learned Metropolitan Magistrate.

5. Though not relevant to the present case, the petitioner states that he has also filed a complaint against the respondent and his family members, basis which an FIR has been registered against them.

6. At the stage of framing of notice, the petitioner along with the co-accused, filed an application seeking discharge, contending that the notice of demand dated 08.06.2012 called upon the accused to pay double the amount of the cheque issued, and therefore, was not in terms of Proviso (b) of Section 138 of the NI Act, and for this reason, the complaint was not maintainable. The said application, however, was dismissed by the learned Metropolitan Magistrate by an order dated 06.10.2021, holding that the same is not maintainable. The petitioner thereafter has filed the present petition.

Submissions by the learned counsel for the petitioner

7. The learned counsel for the petitioner submits that the cheque in question was for an amount of Rs.1 crore, however, by the demand notice dated 08.06.2012, the respondent had demanded from the petitioner pay a sum Rs.2 crores. Placing reliance on the judgments of the Supreme Court in Suman Sethi v. Ajay K. Churiwal and Another, (2000) 2 SCC 380 and in Rahul Builders v. Arihant Fertilizers & Chemicals and Another, (2008) 2 SCC 321, he submits that the complaint is not maintainable as the demand in excess of the cheque amount has been made by the respondent in the Demand Notice.

8. He further submits that the plea of the respondent that there was a typographical error in the legal notice dated 08.06.2012, is not only false but also cannot be accepted to make the complaint maintainable inasmuch as the benefit of this mistake, if any, has to accrue in favour of the accused. As long as the demand is not made for the amount of the cheque, even if it was by way of a clerical mistake, the complaint would not be maintainable. In support, he places reliance on the judgments of Andhra Pradesh High Court in M/s. Yankay Drugs and Pharmaceuticals Ltd. Hyderabad v.