2006(2) Crimes 282 (SC)
SUPREME COURT OF INDIA
(From Karnataka High Court)
B.P. Singh and Raveendran, JJ.
D. Vinod Shivappa—Appellant
versus
Nanda Belliappa—Respondent
Criminal Appeal No. 1255 of 2004
With
Criminal Appeal Nos. 1256-1261/2004
Decided on 25-5-2006

Headnote:(i) Negotiable Instruments Act, 1881—Section 138(b)—Dishonour of Cheque—Demand notice to appellant-accused was returned with endorsement “addressee always absent during delivery time. Hence returned to sender”—In other cases notices were returned with endorsement “party not in station. Arrival not known”—Petition to quash proceedings and complaint—High Court dismissed petition—Appeal—Complainant stated that notice may be deemed to have been served—Whether appellant in the circumstances could pray for quashing of proceedings? No—Question where postal endorsement showed that notice could not be served on account of non-availability of addressee, whether cause of action could arise for prosecution on basis of deemed service—Question could be answered by reference to facts of each case and no rule of universal application could be laid down—In interpreting a statute court must adopt that construction which suppressed mischief and advanced the remedy—Proviso to Section 138(b) was meant to protect honest drawers—If complainant was able to prove that drawer of cheque knew about the notice and deliberately evaded service and got false endorsement made only to defeat process of law, Court shall presume service of notice—These were all questions of facts and it would be premature to move High Court for quashing of proceedings.

       Held : The question is whether in a case of this nature, where the postal endorsement shows that the notice could not be served on account of the non availability of the addressee, a cause of action may still arise for prosecution of the drawer of the cheque on the basis of deemed service of notice under clause (c) of proviso to Section 138 of the Act. In our view this question has to be answered by reference to the facts of each case and no rule of universal application can be laid down that in all cases where notice is not served on account of non-availability of the addressee, the court must presume service of notice.(Para 11)

       To repeat, the proviso is meant to protect honest drawers whose cheques may have been dishonoured for the fault of others, or who may have genuinely wanted to fulfil their promise but on account of inadvertence or negligence failed to make necessary arrangements for the payment of the cheque. The proviso is not meant to protect unscrupulous drawers who never intended to honour the cheques issued by them, it being a part of their modus operandi to cheat unsuspecting persons.(Para 13)

       We cannot also lose sight of the fact that the drawer may by dubious means manage to get an incorrect endorsement made on the envelope that the parties has been found locked or that the addressee was not available at the time when postman went for delivery of the letter. It may be that the address is correct and even the addressee is available but a wrong endorsement is manipulated by the addressee. In such a case, if the facts are proved, it may amount to refusal of the notice. If the complainant is able to prove that the drawer of the cheque knew about the notice and deliberately evaded service and got a false endorsement made only to defeat the process of law, the Court shall presume service of notice. This, however, is a matter of evidence and proof. Thus even in a case where the notice is returned with the endorsement that the premises has always been found locked or the addressee was not available at the time of postal delivery, it will be open to the complainant to prove at the trial by evidence that the endorsement is not correct and that the addressee, namely the drawer of the cheque, with knowledge of the notice had deliberately avoided to receive notice. Therefore, it would be premature at the stage of issuance of process, to move the High Court for quashing of the proceeding under Section 482 of the Code of Criminal Procedure. The question as to whether the service of notice has been fraudulently refused by unscrupulous means is a question of fact to be decided on the basis of evidence. In such a case the High Court ought not to exercise its jurisdiction under Section 482 of the Code of Criminal Procedure.(Para 15)

       It is no doubt true that the receipt of the notice has to be proved, but as held by this Court consistently, refusal of notice amounts to service of notice. Similarly in a case where notice is not claimed even though sent by registered post, with the aid of Section 27 of the General Clauses Act, the drawer of the cheque may be called upon to rebut the presumption which arises in favour of service of notice.(Para 21)

       (ii) Interpretation of Statute—Rule of Purposive Construction—Court must adopt that construction which suppressed the mischief and advanced the remedy.(Para 12)

       Result : Appeal dismissed.