IN THE HIGH COURT OF JAMMU & KASHMIR AND LADAKH AT SRINAGAR
Sanjeev Kumar, J.
M/s. D Meadows Ladakh - Petitioner
Versus
Mohammad Ali - Respondent
CRM(M) 278/2021 and Crl (M) 1008/2021
Decided On : 22-11-2021
Negotiable Instruments Act, 1881-Section 138-Code of Criminal Procedure, 1973-Section 482-Dishonour of cheque-Quashing petition-It is not a case of converting civil dispute into a criminal case to harass petitioner as alleged-If dispute has contours of dispute of civil nature and does not constitute a criminal offence, Court may be justified to quash complaint or criminal proceedings as the case may be, in exercise of inherent power under Section 482 Cr.P.C.-Criminal proceedings ought not to be permitted to degenerate into weapon of harassment-Complaint filed by respondent does not lack ingredients of offence under Section 138 N.I. Act-Petitioner by way of notice was called upon to pay amount of cheque and on his failure to make payment within stipulated period, complaint was filed within period of limitation-Probable defence of accused in a complaint under Section 138 of N.I. Act, that cheque issued by him which was later dishonoured was not for any legally enforceable debt or liability, can be raised by accused only at stage of leading evidence and cannot be considered by Magistrate at threshold at the time of taking cognizance-Petitioner has not made out a case for quashment of complaint and consequent proceedings in exercise of inherent powers conferred on this Court by Section 482 Cr.P.C.-Petition dismissed. (Paras 7, 8, 10, 12, 18, 19 and 20)
Result-Petition dismissed.
JUDGMENT :
Sanjeev Kumar, J.
The petitioner, an accused in the complaint filed under Section 138 of Negotiable Instruments Act, 1981 [‘N.I. Act’] by the respondent, is before this Court seeking exercise of inherent power vested in this Court by Section 482 Cr.P.C to quash the complaint and the consequent proceedings in case titled “Mohammad Ali vs. M/S D Meadows, Ladakh pending trial before the Court of learned Chief Judicial Magistrate, Kargil, Ladakh (for short ‘the trial Court’).
2. The aforesaid complaint as well as the proceedings taken therein are challenged primarily on the ground that the cheque, alleged to have been dishonored, was not issued by the petitioner in favour of the respondent for any legally enforceable debt and that the complaint has been filed just to wreck vengeance and cause harassment to the petitioner and his family members. It is averred that the dispute between the petitioner and the respondent, if any, is purely a dispute of civil nature and, therefore, the respondent can not be permitted to set the criminal law in motion to settle the civil dispute by creating fear of prosecution. Reference is also made to a civil suit for permanent prohibitory injunction filed by the petitioner against the respondent which is subjudice in the Court of Sub-Judge, Kargil, Ladakh. It is lastly contended that the complaint filed by the respondent purportedly under Section 138 read with 142 of N.I. Act is only a tool of harassment and, therefore, allowing such complaint to proceed would be gross abuse of process of law.
3. The petition is resisted by the respondent who has entered appearance and contested the petition through his counsel Mr. M.A. Qayoom, Advocate. The star point raised by Mr. Qayoom to resist this petition is that when the cheque issued by the petitioner to the respondent is not denied, there is presumption under Section 139 of N.I. Act that the same has been issued for discharging legally enforceable debt. He submits that the pleas raised by the petitioner in this petition may, at best, amount to defence of the petitioner, to be led by him during the trial. He argues that the trial Court, at the time of taking cognizance, was only to ensure that the ingredients of Section 138 of N.I. Act were pleaded and demonstrated and once, it was so found, the Magistrate had no option, but to take the cognizance. He further submits that the petitioner has not come to this Court with clean hands, in that, the petitioner in his statement recorded before the trial Court under Section 251 Cr.P.C, has not set up the defence which he has pleaded in this petition, rather he has completely denied the contents of the complaint being false and misleading allegations. On these short submissions, learned counsel for the respondent seeks dismissal of this petition.
4. Having heard learned counsel for the parties and perused the record, it is necessary to set out, though briefly, the relevant facts as may be necessary for disposal of this petition.
The case projected by the respondent in the complaint filed by him before the trial Court is that he agreed to sell a piece of land measuring 80 ft. x 200 ft. to the petitioner for consideration of Rs.40.00 lakhs and an agreement to sell dated 17.01.2018 was executed at Kargil, Ladakh. It is pleaded that an amount of Rs.20.00 lakhs was paid by the respondent and in lieu thereof, the possession of the land aforesaid was handed over to him. It was also agreed between the parties that a proper sale deed shall be executed and duly registered before the Sub-Registrar, Kargil in due course of time and the remaining consideration amount would be paid by the petitioner after registration of the sale deed. On 18.12.2018, the respondent executed a proper sale deed with respect to the land aforementioned in favour of daughter of the petitioner, namely Kouser Zabeen and got it duly registered before the Sub-Registrar, Kargil, Ladakh. The petitioner issued a post dated cheque for an amount of Rs
Point of Law : Inherent jurisdiction under Section 482 Cr.P.C. though wide, has to be exercised sparingly, carefully and with caution and only when such exercise is justified by the tests specificall....
Even a blank cheque leaf, voluntarily signed and handed over by accused, which is towards some payment, would attract presumption under Section 139 of Negotiable Instruments Act.
Section 138 NI Act proceedings cannot be quashed at a pre-trial stage when statutory requirements are met, as the question of legally enforceable debt must be examined only at trial under the Section....
Point of Law : Hon’ble Supreme Court observed that, Section 139 of N.I. Act, includes a presumption that there exists a legally enforceable debt or liability, which is a rebuttal one.
A cheque issued as security does not negate potential liability under S.138 of the Negotiable Instrument Act if essential legal conditions are met.
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