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2014 Supreme(Ori) 759
IN THE HIGH COURT OF ORISSA: CUTTACK
S.C. PARIJA, J.
CRLMP No.153 of 2014
(Date of Judgment : 09.04.2014)
In the matter of an application under Articles 226 and 227 of the Constitution of India.
M/s. Prakiti Enterprisers
and another ... Petitioners
Versus
M/s. Super Health Care ... Opp. Party
For Petitioner:M/s. Goutam Kumar Acharya
M/s. Subash Ch. Hota, S. K. Behera, R. Nayak and D. Naik
For Opp. Party:None
Headnote:1. CONSTITUTION OF INDIA, 1950 - Arts. 226 and 227 - N.I.Act - Sec. 138 - Whether High Court in exercise of its extraordinary writ jurisdiction under Art. 226 (2) of the Constitution can quash the criminal proceeding initiated by the opposite party (complainant) before a Competent Court at Chandigarh, having jurisdiction to entertain the complaint under Sec. 138, N.I.Act ? - Existence of jurisdiction is one thing and the exercise of it by the Court is quite another - Wider is the jurisdiction, the greater is the need for care and caution in exercise of it - High Court is not oblivious of its limitations to transgress into the jurisdiction of another High Court, merely because some part of the cause of action has taken place within the jurisdiction of High Court, to which the petitioners have approached at their own choice and convenience - In the instant case, as it is not disputed by the petitioners that Court at Chandigarh has the jurisdiction to entertain the complaint of the opposite party under Sec. 138 N.I.Act and further as the learned Magistrate on consideration of the materials on record has taken cognizance under Sec. 190 Cr.P.C. and issued process, it would neither be proper nor desirable for High Court to interfere in the said proceeding and quash the complaint on merit, in purported exercise of its extraordinary writ jurisdiction under Article 226 of the Constitution. (Paras - 19 to 23)
2. NEGOTIABLE INSTRUMENTS ACT, 1881 - Sec. 138 - Offence under the section would not be completed with the dishonour of the cheque - It attains completion only with the failure of the drawer of the cheque to pay the cheque amount within the expiry of 15 days mentioned in clause (c) of the proviso to Section 138 of the Act.
It is normally difficult to fix up a particular locality as the place of failure to pay the amount covered by the cheque. A place, for that purpose, would depend upon a variety of factors. It can either be at the place where the drawer resides or at the place where the payee resides or at the place where either of them carries on business. Hence, the difficulty to fix up any particular locality as the place of occurrence for the offence under Section 138 of the Act. (Para - 9)
3. WORDS AND PHRASES - 'Cause of action' - Expression 'cause of action' has a definite connotation, which means a bundle of facts which would be required to be proved.
In legal parlance the expression ‘cause of action’ is generally understood to mean a situation or state of facts that entitles a party to maintain an action in a Court; a group of operative facts giving rise to one or more bases for suing; a factual situation that entitles one person to obtain a remedy in Court from another person. (Para - 8)
JUDGMENT
S.C. PARIJA, J. : This writ petition has been filed under Articles 226 and 227 of the Constitution of India, praying for quashing of the Complaint Case No.31064 of 2013, pending in the Court of learned J.M.F.C., Chandigarh, under Section 138 of the Negotiable Instruments Act.
2.The case of the petitioners is that the petitioner No.1 is a proprietorship firm dealing in pharmaceutical products and in course of business, it was appointed as the super distributor of opposite party. On being appointed as the super distributor, the petitioner No.1 firm issued three cheques in favour of the opposite party as security, without bearing any dates and amount, drawn on State Bank of India, Tulashipur Branch, Cuttack (Orissa). While issuing the said three cheques, the petitioner No.1 firm had intimated the opposite party that the cheques have been issued towards security. It is the case of the petitioners that subsequently, as the opposite party did not extend any support to the petitioner No.1 firm, it was not able to market the pharmaceutical products which had been received from the opposite party. Inspite of complaint, as no effective steps were taken by the opposite party to support the distributorship of the petitioner No.1 firm, the stock of pharmaceutical products lying with the petitioner No.1 firm reached its expiry date, for which the same had to be destroyed, with the consent of the opposite party. It is alleged that as no support was extended by the opposite party, the petitioner No.1 firm stopped payment of all the three cheques issued as security, under intimation to opposite party, vide registered letter dated 29.9.2010. It is the further case of the petitioners that on receipt of such intimation regarding ‘stop payment’ of the three security cheques, opposite party informed the petitioners of not proceeding further or utilizing the security cheques and it was decided to wind up the business relationship between the petitioners and the opposite party.
3.It is alleged by the petitioners that surprisingly, on 07.5.2013, they received a legal notice under Section 138 of the Negotiable Instruments Act (‘N.I. Act’ for short), regarding dishonour of cheque No.534589, dated 17.4.2013, for Rs.1,00,000/- drawn on State Bank of India, Tulashipur Branch, Cuttack, (Orissa), due to payment stopped by the drawer. On receipt of the notice, petitioner No.1 firm gave a reply indicating that the fact regarding stop payment had been intimated to the opposite party since 2010 and requested the opposite party not to proceed further in the matter.
4.It is the case of the petitioners that inspite of receipt of reply to the legal notice issued under Section 138 of the N.I. Act, the opposite party has filed a criminal complaint vide Complaint Case No.31063 of 2013, before the learned J.M.F.C., Chandigarh, who has taken cognizance of the offence under Section 138 of the N.I. Act and issued summons to the petitioners.
5.The case of the opposite party (complainant), as detailed in the complaint is that the complainant is a proprietorship firm, duly registered with the Sales Tax authorities in Chandigarh and is carrying on business of selling pharmaceutical and FMCG products (Generics and OTC) on behalf of M/s. Shivek Labs Ltd. The petitioners have been purchasing different pharmaceutical/FMCG products (medicines) from the complainant firm from time to time. Whenever, the petitioners purchased pharmaceutical products from the complainant, a proper invoice was raised and a copy thereof was also dispatched to the petitioners, who chose to make part payment against the different invoices from time to time. In order to discharge the partial liability, the petitioners issued and delivered a cheque to the complainant firm bearing No.534589, dated 17.4.2013, amounting to Rs.1,00,000/-, drawn on State Bank of India, Tulashipur Branch, Cuttack (Orissa). On presentation of the said cheque with the banker of the complainant firm i.e. Punjab National Bank, Sec
