Point of Law: Penal Consequences - There is a statutory presumption under Section 139 of the N.I. Act in favour of the holder of the Cheque. A prosecution under Section 138 of the N.I. Act is ultimately to bring the offender to suffer penal consequences.

JUDGMENT :

1. Rule. Mr. Harshit S.Tolia, learned advocate for the respondent no.1 and Ms. Monali Bhatt, learned APP, for the respondent no.2, waive service of notice of Rule on behalf of respective parties. With the consent of the parties, the matter is heard finally today.

2. This petition has been filed under Article 226 of the Constitution of India as well as Section 482 of the Code of Criminal Procedure for quashing and setting aside the complaint being Criminal Case No.2288 of 2014 pending before the learned 6th Additional Chief Judicial Magistrate, Bhavnagar under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the ‘N.I. Act’ for short) and the consequential proceedings, if any, initiated in pursuance thereof.

3. It is stated in the petition that a Memorandum of Understanding (MoU) was signed between the respondent no.1 and 23 clients of the respondent no.1, which included the present petitioners and even by Arvindbhai Pragjibhai Jogani with regard to the land belonging to respondent no.1. It is stated that the said land was acquired by the Government and vested to the Agricultural Department and thereafter to Bhavnagar University. It is contended that from the very beginning the said MoU had no legal force or legal binding, as the persons signing it as the owners of the land, were not at all competent to sign the MoU. It is stated by the petitioners that they had no active role in execution of MoU except the fact that their names were included in the MoU as parties.

3.1 It is stated that a Cheque bearing No.131875, dated 22.12.2013 of Rs.5,50,000/- signed by Mr. Arvindbhai Pragjibhai Jogani, drawn on HDFC Bank, Hazira Branch, Surat, was given to the complainant, who is respondent no.1 in the present petition, while the present two petitioner have no connection and nowhere are related to that transaction of Arvindbhai Pragjibhai Jogani with that of respondent no.1.

3.2 The subject cheque got dishonoured on 05.03.2014 on the ground of insufficiency of fund. Statutory legal notice was issued on 20.03.2014 to the present petitioners and Mr. Arvindbhai Pragjibhai Jogani, alleging that the cheque was issued as a part of MoU. It is stated by the present petitioners that legal notice does not allege issuance of cheque as in compliance of MoU and further in the notice respondent no.1 has admitted the fact of cheque being signed by Mr. Arvindbhai Pragjibhai Jogani.

3.3 It is contended in the petition that the petitioners neither signed the cheque nor have issued the same to the respondent no.1 - complainant of Criminal Case No.2288 of 2014. The entire grievance of the complainant is against Mr. Arvindbhai Pragjibhai Jogani, who had signed the cheque, which came to be dishonoured and after the legal notice, criminal complaint filed under Section 138 of the N.I. Act.

4. Heard Mr. Kuldeep D.Vaidya, learned advocate for the petitioners, Mr. Harshit S.Tolia, learned advocate for respondent no.2 and Ms. Monali Bhatt, learned APP for the respondent no.1 - State.

5. Mr. Kuldeep D.Vaidya, learned advocate for the petitioners submitted that the learned Additional Chief Judicial Magistrate, Bhavnagar has mechanically passed the order of taking cognizance under Section 204 of the Cr.P.C. against all the arraigned accused and summons were ordered to be issued. Mr. Vaidya, submitted that cheque was signed by Mr. Arvindbhai Pragjibhai Jogani in whose name the Bank Account was running. He submitted that the present petitioners were not the joint bank account holders, thus no liability can be attached towards the cheque issued by Mr. Arvindbhai Pragjibhai Jogani. Advocate Mr. Vaidya, referring to the order passed in Special Criminal Application (Quashing) No.1638 of 2015 dated 19.04.2017, submitted that petitioner no.1 – Bharatbhai Chhaganbhai Patel had also challenged the process issued in Criminal Case No.2287 of 2014, which was pending in the Court of 2nd Additional Chief Judicial Magistrate, Bhavnagar under Section 138