The inability to honor a cheque under Section 138 of the NI Act is not actionable if there is no legally enforceable debt or liability attributed to the issuing party.

JUDGMENT

1. This is a petition filed under Section 482 Cr.P.C, wherein the petitioner has approached this Court with a prayer to set aside and quash the Complaint Case No. 114 (S) of 2021 under Section 138 of the Negotiable Instruments Act (NI Act), 1881 and which case is pending before the Court of the learned Judicial Magistrate First Class at Shillong.

2. Heard Mr. L. Shongwan, learned counsel for the petitioner who has submitted that the case of the petitioner is that on 15.10.2019, the petitioner and the respondent No. 1 on one side and the proforma respondent on the other side, have jointly entered into an Agreement for Sale of a plot of land situated at Bishop Cotton Road, Shillong measuring about 18,262.69 sq.ft, which land belongs to the proforma respondent, with the petitioner and the respondent No. 1 being the proposed buyers. The agreed consideration for the said plot of land is Rs. 2,60,00,000/- (Rupees two crores sixty lakhs).

3. Prior to the date fixed for execution of the final Sale Deed, in the month of May, 2019, the respondent No. 1 apparently backed out of the deal citing inability to fulfil her part of the monetary commitment. The petitioner then agreed to carry on with the proposed sale transaction by going single and pursuant to this, a Settlement Agreement dated 13.08.2020 was drawn up between the petitioner and the respondent No. 1.

4. According to the terms of the said Settlement Agreement, the petitioner has agreed to refund a sum of Rs. 1,50,00,000/- (Rupees one crore fifty lakhs) to the respondent No. 1 which sum of money was said to have been paid to the proforma respondent by the respondent No. 1 as advance payment in respect of the property. The said amount was to be disbursed in the following manner:

i. Rs. 35,00,000/- (Rupees thirty-five lakhs) as the first instalment to be paid in the last week of September, 2020;

ii. Rs. 37,50,000/- (Rupees thirty-seven lakhs and fifty thousand) as the second instalment to be paid in the month of March, 2021;

iii. Rs. 37,50,000/- (Rupees thirty-seven lakhs and fifty thousand) as the third instalment to be paid in the month of September, 2021 and;

iv. Rs. 40,00,000/- (Rupees forty lakhs) only as the fourth and last instalment to be paid in the month of March, 2022.

5. The petitioner then paid the first of the instalments by remitting the amount of Rs. 5,00,000/-(Rupees five lakhs) by cash and Rs. 30,00,000/-(Rupees thirty lakhs) by cheque, about five of them for varying amounts. Apart from this, the petitioner has also handed over five blank cheques to the respondent No. 1.

6. The learned counsel has also submitted that sometime in the month of March, 2021, the petitioner received reliable information which created doubt about the claim of the respondent No. 1 as regard the payment of advance amount of Rs. 1,00,00,000/- (Rupees one crore) to the proforma respondent and accordingly, to allay this doubt, the petitioner called for a joint meeting of the three of them on 16.03.2021, the said meeting being held at the office of the petitioner at Lummawrie, Laitumkhrah, Shillong.

7. It was at this meeting that the proforma respondent clarified that she was not paid the Rs. 1,00,00,000/- (Rupees one crore) by the respondent No. 1. To this effect, the proforma respondent has re-confirmed her claim that she has not received the said sum of one crore from the respondent No. 1, by way of a letter dated 06.04.2021 issued upon the petitioner herein and which letter was also attested by