Neutral Citation No. - 2024:AHC:102434 A.F.R Reserved on: 13.05.2024 Delivered on: 05.06.2024 Court No. - 92 Case :- APPLICATION U/S 482 No. - 9536 of 2024 Applicant :- Smt. Archana Singh Gautam Opposite Party :- State of U.P. and Another Counsel for Applicant :- Diwakar Tiwari, Gyanendra Singh Counsel for Opposite Party :- Ashish Pandey, G.A.,Vivek Kumar Singh Hon”ble Arun Kumar Singh Deshwal,J.

1. Heard learned counsel for the applicant, learned counsel for the opposite party no. 2 and Sri Brijesh Kumar Dwivedi, learned AGA for the State.

2. The present application has been filed for quashing the entire criminal proceeding, including the impugned summoning order dated 15.02.2024 passed by the learned Special Judicial Magistrate-II, Banda in Complaint Case No. 712 of 2023 (Brajesh Kumar Singh Vs. Smt. Archana Singh Gautam and others), under Section 138 N.I. Act, 1881, P.S. Kotwali Nagar, District Banda, pending in the Court of learned Special Judicial Magistrate-II, Banda.

3. The counsel for the applicant contends that the Bank returned the cheque in question because the cheque was invalid as the cheque in question was issued from the account maintained in Allahabad Bank on 02.06.2023, though the Allahabad Bank had already merged into the Indian Bank on 01.04.2020, and the cheque of the Allahabad Bank was valid till 30.09.2021; therefore, on the date of issuance as well as presentation of the cheque, it was invalid. Therefore, bouncing, of such the invalid cheque will not attract the liability u/s 138 N.I. Act.

4. Per contra, learned counsel for the opposite party no. 2 has relied upon the judgment of Hon’ble Apex Court in the case of NEPC Micon Ltd. V. Magma Leasing Ltd ( 1999) 4 SCC 253 in the judgment the Apex Court observed in paragraph no. 7 that the expression “insufficient to honour the cheque is a genus of which the expression” that account being” is species and paragraph no. 9 of the above judgment the Hon'ble Apex Court has observed that “the interpretation which sought for, were given, then it would only encourage dishonest persons” should be avoided. On relying on the above judgment, the counsel for the opposite party no. 2 has submitted that the invalid cheque issued by a person is also covered u/s 138 N.I. Act. He also relied upon the judgment of Delhi High Court in the case of Sri Premanand Prusty Vs. Smt. Sita Devi passed in CRL.M.C. No. 1566 of 2023, in that case the Delhi High Court had observed that once the signature on the cheque is not disputed then the cheque if returned on the ground of its validity then the prima facie the offence u/s 138 N.I. Act will be attracted.

5. Learned AGA has also adopted the argument of counsel for the opposite party no. 2 and submitted that if the applicant was aware that the cheque in question has been declared invalid as the Allahabad Bank has already been merged into Indian Bank then just to cheat the opposite party no. 2, he had issued this cheque;

therefore, the offence u/s 138 N.I. Act, will be attracted.

6. After hearing the rival submission of the counsel for the parties and perused the record, it is clear that the Allahabad Bank had merged into the Indian Bank on 01.04.2020. Thereafter, a wide circular was made by the Indian Bank in newspapers mentioning the fact that all the cheques issued by Allahabad Bank can be exchanged with the cheques of Indian Bank by 30.09.2021, and the cheque from Allahabad Bank will be honoured by 30.09.2021.

Therefore, the cheque issued by the Allahabad Bank was valid till 30.09.2021, and all the cheques of Allahabad Bank which were presented before the Indian Bank till 30.09.2021, were honoured by the Indian Bank, and after 30.09.2021, cheques issued from the account maintained by the erstwhile Allahabad Bank were declared invalid for honouring. Section 138 N.I. Act prescribes the condition for initiation of proceeding on bouncing the cheque in the proviso (a) of Section 138 N.I. Act. As per the proviso (a) of Section 138 N.I. Act, cheque mus