High Court of Judicature at Madras
THE HONOURABLE MRS. JUSTICE ARUNA JAGADEESAN
Palani
Versus
B. Shanthilal
Crl.OP.Nos.10470 of 2005 & Cr.MP.No.3771 of 2005
Decided On : 07-09-2009
Negotiable Instruments Act - Quashing of Proceedings - Section 138 - Summary of Acts and Sections: Section 138 of the Negotiable Instruments Act - The court discussed the legal provisions of Section 138 of the Negotiable Instruments Act, which creates a legal fiction for the commission of an offence when a cheque is dishonoured due to various reasons. The court emphasized that while exercising jurisdiction under Section 138, it can only consider the allegations made in the complaint and the sworn statement of the complainant and his witnesses.
Fact of the Case:
The petitioner borrowed a loan and issued a cheque which was returned with an 'account closed' endorsement. The respondent filed a complaint under Section 138 of the Negotiable Instruments Act. The petitioner argued that the respondent had a pending case against him and misused blank cheques. The respondent contended that the court cannot probe into the truthfulness of the allegations at this stage.
Finding of the Court:
The court held that the continuance of the proceedings would not be an abuse of process of court and dismissed the petition, emphasizing that the trial court should go into the details of the allegations made against the respondent.
Issues: The issues revolved around the genuineness of the cheque, misuse of blank cheques, and whether the continuance of the proceedings would amount to an abuse of process of court.
Ratio Decidendi: The court emphasized that while exercising jurisdiction under Section 138 of the Negotiable Instruments Act, it can only consider the allegations made in the complaint and the sworn statement of the complainant and his witnesses. It also highlighted that the truthfulness or otherwise of the allegations made in the complaint is a matter for proof.
Final Decision: The Criminal Original Petition was dismissed, and the connected MP was closed.
This Criminal Original Petition is filed by the petitioner/accused to quash the proceedings in CC.No.12687/2004 on the file of the learned Metropolitan Magistrate VIII, George Town, Chennai.
2. The brief facts, which are essential for the disposal of this Criminal Original Petition, are as follows:-
The petitioner/accused has borrowed a loan of Rs.5 lakhs and executed a promissory note in favour of the respondent/complainant on 4. 2003 and on repeated request made by the respondent for repayment of the loan amount with interest, the petitioner had issued a cheque bearing NO.583197 dated 10. 2004 for a sum of Rs.6,80,000/-drawn on State Bank of India, Elephant Gate Branch, Chennai on 10. 2004. When the said cheque was presented for encashment, the same was returned on 10. 2004 with an endorsement “account closed”. The respondent issued a statutory notice dated 10. 2004 to the petitioner and the petitioner/accused received the said notice on 110. 2004, but neither paid the cheque amount within the stipulated period nor sent any reply. Hence, the complaint has been filed by the respondent under Section 138 of the Negotiable Instruments Act.
3. According to the petitioner, he has preferred a complaint against the respondent herein, who is arrayed as the accused for the offences under Sections 420, 384 of IPC and Section 4 of the TNPCEI Ordinance 2003 in Cr.No.625/2004 before the Inspector of Police, Central Crime Branch, Egmore, which is pending investigation and for the same cheque amount, the respondent has filed the present complaint under Section 138 of the Negotiable Instruments Act. He would submit that the police had registered a case on 211. 2004, the respondent was arrested on 30.11.2004 and on his confession, certain documents were seized in the presence of the witnesses.
4. The learned counsel for the petitioner pressed into service the certified copy of judgement made in OS.No.6262/2005 dated 7. 2005, dismissing the suit filed by the respondent against the petitioner and the learned Judge has found that the cheque allegedly issued by the petitioner is not a genuine one and blank cheques had been misused by him. The learned counsel would further contend that the said aspect goes to the root of the case including the cognizance taken by the learned Magistrate and the continuance of the proceedings on the basis of the impugned complaint by the learned Magistrate would certainly amount to abuse of process of court.
5. Per contra, Mr.N.S.Sivakumar, the learned counsel for the respondent would contend that this court in exercising its jurisdiction under Section 482 of Code of Criminal Procedure cannot probe into the truthfulness or otherwise of the allegations made in the complaint and proceed to analyse the materials which are produced in support of the allegations and more particularly, this court cannot look into the materials produced by the accused at this stage.
6. The learned counsel for the petitioner would rely upon the decision of the Honourable Supreme Court rendered in the case of State of Orissa Vs. Debendra Nath Padhi [2005-1-SCC-568], wherein the Honourable Supreme Court, while dealing with the trial courts power to consider any material filed by the accused under Section 227 of Code of Criminal Procedure, has held that at the stage of framing of charge, the defence of the accused cannot be put forth and permitting the accused to adduce his defence at that stage is against the criminal jurisprudence. The learned counsel placed reliance on the observations made by the Honourable Supreme Court in the said decision that under Section 482 of Code of Criminal Procedure, the High Court has got wide powers and to prevent abuse of process of court or otherwise to secure the ends of justice, material of unimpeachable character of sterling quality could be considered under exceptional circumstances. The Honourable Supreme Court has held thus:-
“29. Regarding the argument of the accused having to face the trial
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