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HIGH COURT FOR STATE OF TELANGANA
G.RADHA RANI, J
Dr. Pydi Krishna Rao – Appellant
Versus
Dr. Budithe Vishweshwara Rao – Respondent
CRLRC/2477/2018
NEGOTIABLE INSTRUMENTS ACT - SECTION 138 - DISCHARGE OF ACCUSED - PAYMENT OF CHEQUE AMOUNT WITH INTEREST AND COSTS - SUMMARY TRIAL - INTERPRETATION
Fact of the Case:
The complainant filed a private complaint under Section 138 of the Negotiable Instruments Act (NI Act) against the accused for issuing a cheque without sufficient funds. The accused appeared before the court on the first hearing date and filed a memo along with two Demand Drafts, one for the cheque amount and another for costs, requesting to settle the case. The trial court, relying on the judgment of the Hon'ble Apex Court in M/S. Meters and Instruments Private Limited and another v. Kanchan Mehta, allowed the memo and discharged the accused on condition of depositing the cheque amount with interest and costs.
Finding of the Court:
The court held that the trial court was correct in discharging the accused on payment of the cheque amount with interest and costs on the first hearing date, as per the guidelines laid down by the Hon'ble Apex Court in M/S. Meters and Instruments Private Limited and another v. Kanchan Mehta. The court observed that the offence under Section 138 of the NI Act is primarily a civil wrong and the procedure to try the case is summary in nature. The court further noted that the accused had appeared before the trial court on the first hearing date itself and had come forward to deposit the cheque amount and costs, and that the trial court had also directed the accused to pay some more amount towards costs and simple interest @6% per annum. The court found that the complainant was sufficiently compensated and that there was no illegality or impropriety in the trial court's order discharging the accused.
Issues: Whether the trial court was correct in discharging the accused on payment of the cheque amount with interest and costs on the first hearing date.
Ratio Decidendi: The court relied on the judgment of the Hon'ble Apex Court in M/S. Meters and Instruments Private Limited and another v. Kanchan Mehta, which held that where the cheque amount with interest and cost as assessed by the Court is paid by a specified date, the Court is entitled to close the proceedings in exercise of its powers under Section 143 of the NI Act read with Section 258 Cr.P.C. The court also noted that the normal rule for trial of cases under Chapter XVII of the NI Act is to follow the summary procedure and that summons trial procedure can be followed where sentence exceeding one year may be necessary.
Final Decision: The court dismissed the Criminal Revision Cases filed by the complainant and confirmed the orders of the court below in discharging the accused.
COMMON ORDER:
Crl.R.C.No.2137 of 2018 is filed by the complainant aggrieved by the order dated 23.07.2018 in Crl.M.P.No.1831 of 2018 in C.C.No.11 of 2018 on the file of the III Special Magistrate, Hyderabad in dismissing the petition filed by him to punish the accused under Section 138 of the Negotiable Instruments Act (for short “NI” Act) and to direct the accused to pay twice the cheque amount.
2. Crl.R.C.No.2477 of 2018 is filed by the complainant aggrieved by the order dated 10.08.2018 in C.C.No.11 of 2018 on the file of the III Special Magistrate, Hyderabad in discharging the accused for the offence under Section 138 of the Negotiable Instruments Act, accepting the Demand Drafts filed by him towards interest and costs.
3. The case of the complainant was that he filed a private complaint under Section 138 of the NI Act. He was the owner of the land admeasuring 27 cents in Old Survey No.354, New Survey No.261/1 which was equivalent to 1306 Sq.yards situated at Balaga Village and Rural Panchayat, Srikakulam Mandal and District. The accused approached him through a mediator Dumpala Ramarao @ Lakshmana Rao Master, to purchase the land of the complainant for a valid consideration as per the existing market rate @Rs.1,35,00,000/-, for which the complainant accepted and executed a registered sale deed bearing document No.6352 of 2017 dated 16.10.2017 at Joint Sub-Registrar Office, Srikakulam.
4. On the date of execution of sale deed, the accused and the mediator Ramarao, promised to pay the balance sale consideration of Rs.76,66,000/- after deducting card value of Rs.58,34,000/- within ten(10) days. The existing market rate in the Sub-Registrar Office according to the card of Sub-Registrar was Rs.58,34,000/-, as such in the sale deed the sale consideration was shown as Rs.58,34,000/- and for the said consideration, the accused had given cheque bearing No.186136 for Rs.48,34,000/- and another cheque (the subject matter of the complaint under Section 138 of the NI Act) bearing No.186137 for Rs.10,00,000/-. The complainant was acquainted with the mediator Ramarao since more than one decade and believing the version of the accused and on their request, executed the registered sale deed. Thereafter, the complainant deposited the 1st cheque for Rs.48,34,000/- and the same was cleared. Later, the complainant deposited the 2nd cheque bearing No.186137 in his current account in Vijaya Bank, Habsiguda Branch, Hyderabad for clearance. The said cheque was returned on 21.10.2017 with an endorsement that it was dishonoured due to “Insufficient Funds” in the account of the accused.
5. The complainant issued a legal notice dated 27.10.2017 under Section 138 of the NI Act. The accused received the same on 30.10.2017 and gave a reply to the legal notice on 06.11.2017. Through reply legal notice, the accused requested to deposit the cheque once again, but did not send any proof in support of his contention that there was sufficient balance kept in his account, as such, the complainant filed the private complaint for issuing the subject cheque without keeping sufficient amount in his account.
6. On receipt of summons, the accused appeared before the court and filed a memo vide SR.No.3344 of 2018 on 05.06.2018 along with two (02) Demand Drafts, one for Rs.10,00,000/- towards cheque amount and another for Rs.5,000/- towards costs for the settlement of the case on the first date of hearing. The contention of the learned counsel for the accused was that the dishonour memo was issued by the bank due to technical issue though there were sufficient funds in his account by the date of issuance of the memo by the concerned bank and relied upon the judgment of the Hon’ble Apex Court in the case of M/S. Meters and Instruments Private Limited and another v.
Kanchan Mehta1.
7. The learned counsel for the complainant contended before the trial court to punish the accused as per Section 138 of the NI Act and to award compensation twice the cheque amount apart from infl
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