IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CRIMINAL APPLICATION No. 1790 of 2009 For Approval and Signature:
HONOURABLE MR.JUSTICE M.R. SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2 To be referred to the Reporter or not ? YES 3 Whether their Lordships wish to see the fair copy of the judgment ? NO 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? NO 5 Whether it is to be circulated to the civil judge ? NO ========================================================= SOMESH SARJIVAN JAIN - Applicant(s) Versus STATE OF GUJARAT & 1 - Respondent(s) =========================================================
Appearance :
MR TUSHAR L SHETH for Applicant(s) : 1, MR LB DABHI ADDL.PUBLIC PROSECUTOR for Respondent(s) : 1, MR PURVISH J MALKAN for Respondent(s) : 2, MR MAYUR H MALKAN for Respondent(s) : 2, MRS DHARITA P MALKAN for Respondent(s) : 2, =========================================================
CORAM : HONOURABLE MR.JUSTICE M.R. SHAH
ORAL JUDGMENT Date : 24/01/2012 1.00. Present petition under Article 226 of the Constitution of India has been preferred by the petitioner herein – original accused to quash and set aside the impugned judgement and order dtd.11/1/2008 passed by the learned Additional Sessions Judge and Presiding Officer, Fast Track Court No.5, Junagadh in Criminal Revision Application No.85 of 2007, by which the learned revisional court has allowed the said Revision Application preferred by the respondent No.2 herein – original complainant and has quashed and set aside the order passed by the learned Judicial Magistrate (First Class), Junagadh below application Ex.51 in Criminal Case No.3789 of 2005 and thereby directing the petitioner to be joined as accused in the said complaint for the offence under section 138 of Negotiable Instruments Act, in exercise of the powers under section 319 of the Code of Criminal Procedure.
2.00. Facts leading to the present petition in nutshell are as under :-
2.01. That the respondent No.2 herein – original complainant has filed the complaint being Criminal Case No.3789 of 2005 against one Umesh Sarjivan Jain in the court of learned Judicial Magistrate (First Class), Junagadh for the offence punishable under section 138 of the Negotiable Instruments Act for dishonour of the cheque No.55987 dtd.6/10/2005 for an amount of Rs.1 Lac, drawn by Jain Electronics, a Proprietorship Firm, alleged to have been signed by the petitioner herein – Somesh Jain. That in the said complaint initially the learned Magistrate directed to issue Summons against the said Umesh Jain for the offence punishable under section 138 of the Negotiable Instruments Act. That thereafter trial proceeded further and plea of the accused was recorded, who pleaded not guilty and thereafter evidence of the original complainant was recorded and even thereafter evidence of both the sides were recorded and thereafter the evidence of the original complainant was closed.
That during the cross-examination of the accused Umesh Jain, it was submitted by him that the dishonoured cheque has not been signed by him and that he is not the proprietor of the Jain Electronics and the said cheque is signed by petitioner herein – Somesh Jain. That thereafter the original complainant submitted application Ex.51 before the learned trial court under section 319 of the Code of Criminal Procedure and requested to join petitioner herein as accused by submitting that it has come on record from the deposition of original accused - Umesh Jain that petitioner is the proprietor of Jain Electronics who has issued the cheque and the said cheque is signed by the petitioner and not original accused - Umesh Jain. That the said application came to be dismissed by the learned Magistrate by holding that as the petitioner who was sought to be joined as accused, was not served with notice under section 138(B) and (C) of the Negotiable Instruments Act, he cannot be arraigned as accused in exercise of the powers under section 319 of the the Code of Criminal Procedure. Being aggrieved by and dissatisfied with the order passed by the Judicial Magistrate (First Class), Junagadh below application Ex.51 in Criminal Case No. 3789 of 2005 in dismissing the said application submitted by the original complainant to arraign the petitioner as accused, respondent No.2 – original complainant preferred Revision Application No. 85 of 2007 before the learned Sessions Court, Junagadh and the learned Additional Sessions Judge and Presiding Officer, FTC No.5, Junagadh by the impugned judgement and order dtd.11/1/2008 allowed the said Revision Application and has quashed and set aside the order passed by the learned Judicial Magistrate (First Class), Junagadh below Ex.51 in Criminal Case No. 3789 of 2005 and has allowed the application Ex.5 submitted by the original complainant by directing to arraign the petitioner as accused in exercise of the powers under section 319 of the the Code of Criminal Procedure. Being aggrieved by and dissatisfied with the judgement and order passed by the learned revisional court in Revision Application No. 85 of 2007, petitioner herein, who is ordered to be arraigned as accused subsequently in exercise of the powers under section 319 of the the Code of Criminal Procedure, has preferred the present petition under Article 226/227 of the Constitution of India read with section 482 of the Code of Criminal Procedure.
3.00. Mr.Tushar Sheth, learned advocate appearing on behalf of the petitioner has vehemently submitted that the learned revisional court has materially erred in allowing the revision application and quashing and setting aside the order passed by the learned Magistrate passed below application Ex.51 in Criminal Case No. 3789 of 2005. It is further submitted that as such the said order passed by the learned Magistrate below application Ex.51 in rejecting the said application was absolutely just and proper and in consonance with the provisions of the Negotiable Instruments Act, more particularly section 138 of the Negotiable Instruments Act which was not required to be interfered with by the revisional court. It is further submitted by Mr.Sheth learned advocate appearing on behalf of the petitioner that the learned revisional court has not properly appreciated that no statutory notice as required under section 138 of the Negotiable Instruments Act was issued and served upon the petitioner and therefore, in absence of any statutory notice as required under section 138 of the Negotiable Instruments Act, the complaint against the petitioner for the offence under section 138 of the Negotiable Instruments Act was not maintainable and therefore, the petitioner could not have been arraigned as accused in exercise of the powers under section 319 of the the Code of Criminal Procedure, in complaint which otherwise was not maintainable in absence of any statutory notice as required under section 138 of the Negotiable Instruments Act.
3.01. Mr.Sheth, learned advocate appearing on behalf of the petitioner has further submitted that while exercising the powers under section 319 of the the Code of Criminal Procedure, petitioner cannot be arraigned as accused in a complaint which otherwise was not maintainable in absence of any statutory notice as required under section 138 of the Negotiable Instruments Act. It is submitted that in the present case, admittedly statutory notice has been served upon the original accused Umesh Jain and even the said criminal complaint was not even against Jain Electronics, a Proprietorship Firm, who has drawn the cheque. It is further submitted that even the statutory notice was served upon the original accused Umesh Jain and therefore, when in absence of any statutory notice upon the petitioner as required under section 138 of the Negotiable Instruments Act, if the complaint was not maintainable, petitioner cannot be arraigned as accused while exercising powers under section 319 of the Code of Criminal Procedure in a complaint / Criminal Case which otherwise was not maintainable. Therefore, it is requested to quash and set aside the impugned judgement and order passed by the learned revisional court in Revision Application No. 85 of 2007 and to restore the order passed by the learned Judicial Magistrate (First Class), Junagadh below application Ex.51 in Criminal Case No. 3789 of 2005.
4.00. Present petition is opposed by Mr.Malkan, learned advocate appearing on behalf of the original complainant - respondent No.2 herein. It is submitted that the impugned judgement and order passed by the learned revisonal court is just and proper which is not required to be interfered with by this Court in exercise of the powers under Article 226/227 of the Constitution of India. It is submitted that at the relevant time when the statutory notice was served upon the original accused Umesh Jain, who is brother of the petitioner, he did not disclose that he is not signatory to the cheque and that the said cheque is signed by the petitioner. It is submitted that only from the deposition of the original accused – Umesh Jain it came to the knowledge of the complainant that in fact dishonoured cheque has been signed by the petitioner and therefore, when the dishonoured cheque has been signed by the petitioner, he is rightly arraigned as accused for the offence punishable under section 138 of the Negotiable Instruments Act while exercising powers under section 319 of the Code of Criminal Procedure.
4.01. Mr.Malkan, learned advocate appearing on behalf of the original complainant has heavily relied upon the decision of the Division Bench in the case of Satish Chand Singhal Vs. State of Gujarat and Others, reported in 2006(3) GLR 2209 by submitting that a similar contention was raised that since statutory notice was not served upon the person who was sought to be arraigned as accused while exercising powers under section 319 of the Code of Criminal Procedure, he could not have been arraigned as accused, the Division Bench has held that despite non-service of the statutory notice as required under section 138 of the Negotiable Instruments Act such person can be arraigned as accused in exercise of the powers under section 319 of the Code of Criminal Procedure.
4.02. Mr.Malkan, learned advocate appearing on behalf of the original complainant has also relied upon the decision of the Hon'ble Supreme Court in the case of Raghubans Dubey Versus State of Bihar, reported in AIR 1967 S.C. 1167 by submitting that as observed by the Hon'ble Supreme Court, once cognizance has been taken by the Magistrate, he takes cognizance of an offence and not the offenders and therefore, once he takes cognizance of an offence, it is the duty of the Magistrate to find who offenders really are and once he comes to the conclusion that apart from the persons sent by the police some other persons are also involved, it is his duty to proceed further with against those persons. Therefore, it is submitted that in the present case once the Magistrate has taken cognizance he has taken cognizance of the offence under section 138 of the Negotiable Instruments Act and therefore, when it was brought to the notice of the learned Magistrate and it has come on record that dishonoured cheque has been signed by the petitioner, he was required to be arraigned as accused. Therefore, it is submitted that as such no illegality has been committed by the revisional court in quashing and setting aside the order passed by the learned Magistrate directing the petitioner to be joined as accused in exercise of the powers under section 319 of the the Code of Criminal Procedure.
By making above submissions and relying upon above decisions, it is requested to dismiss the present petition.
5.00. Mr.L.B. Dabhi, learned Additional Public Prosecutor appearing on behalf of the State has requested to pass appropriate order in the facts and circumstances of the case.
6.00. Heard the learned advocates appearing on behalf of the respective parties at length.
7.00. Short question which is posed for consideration of this Court is, whether a person against whom a complaint for the offence under section 138 of the Negotiable Instruments Act is otherwise not maintainable in absence of issuance of and service of statutory notice upon him as required under section 138 of the Negotiable Instruments Act, can he be arraigned as an accused subsequently in exercise of the powers under section 319 of the Code of Criminal Procedure ?
7.01. It is required to be noted that in the represent case, dishonoured cheque for which the impugned complaint for the offence under section 138 of the Negotiable Instruments Act has been filed, has been issued by one Jain Electronics, a Proprietorship Firm. It appears that the said cheque was given to complainant by original accused Umesh Jain. It is also required to be noted that even statutory notice as required under section 138 of the Negotiable Instruments Act has been issued by the original complainant upon original accused Umesh Jain and even said notice was served upon the said Umesh Jain. Therefore, admittedly no statutory notice as required under section 138 of the Negotiable Instruments Act has been issued and served upon the petitioner herein, who is sought to be arraigned as accused for the offence under section 138 of the Negotiable Instruments Act.
7.02. Considering the provisions of section 138 of the Negotiable Instruments Act only in a case where a cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge in whole or in part of any debt or other liability is returned by the bank unpaid and said cheque has been presented to the bank within six months from the date on which it is drawn or within the period of its validity, whichever is earlier and that the payee or the holder in due course of the cheque, as the case may be, makes demand for the payment of the said amount of money by giving a notice in writing to the drawer of the cheque within 30 days of the receipt of the information by him from the bank regarding return of the said cheque as unpaid, and drawer of such cheque fails to make payment of the said cheque of money to the payee or the as the case may be to the holder in due course of the cheque within 15 days of the receipt of said notice then and then only it can be said that such person has committed offence under section 138 of the Negotiable Instruments Act and complaint against him is maintainable if said complaint is made before the Magistrate within one month of the date on which the cause of action arises under Clause (C) of proviso to section 138 of the Negotiable Instruments Act. Therefore, it can be said that a person who is not issued and/or served with the notice as required under Clause(b) of Section 138 of the Negotiable Instruments Act, no complaint can be filed against him for the offence under section 138 of Negotiable Instruments Act.
As observed by the Hon'ble Supreme Court in the case of Jugesh Sehgal Vs. Shamsher Singh Gogi, reported in (2009) 14 SCC 683, for making out a case for the offence under section 138 of the Negotiable Instruments Act, the following ingredients are required to be fulfilled :-
“To constitute an offence under Section 138, Negotiable Instruments Act 1881, the following ingredients are required to be fulfilled;
(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account;
(ii) the cheque should have been issued for the discharge, in whole or in part, of any debt or other liability;
(iii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier;
(iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
(v) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(vi) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice.
Being cumulative, it is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under section 138 of the Negotiable Instruments Act.”
7.03. In the present case, as stated above, admittedly no notice has been issued and served upon the petitioner as required under section 138 of the Negotiable Instruments Act and therefore, cause of action for filing the complaint against the petitioner for the offence under section 138 of the Negotiable Instruments Act does not arise. Therefore, as such in absence of any statutory notice upon the petitioner even as proprietor of Jain Electronics, a Proprietorship Firm – drawer of the cheque, petitioner cannot be prosecuted for the offence under section 138 of the Negotiable Instruments Act and therefore, in absence of such notice as required under section 138 of the Negotiable Instruments Act and any eventuality as contemplated under Clause (C) of provision to section 138 of the Negotiable Instruments Act, no complaint can be filed against petitioner for the offence under section 138 of the Negotiable Instruments Act and even the learned Magistrate cannot take cognizance of the offence against the petitioner for the offence under section 138 of the Negotiable Instruments Act. Under the circumstances, petitioner cannot be arraigned as accused subsequently for the offence under section 138 of the Negotiable Instruments Act in exercise of the powers under section 319 of the Code of Criminal Procedure. By exercising powers under section 319 of the Code of Criminal Procedure arraigning the accused subsequently, complaint winch otherwise was not maintainable against the petitioner for the offence punishable under section 138 of the Negotiable Instruments Act, cannot be made maintainable. Under the circumstances, nobody can be arraigned as accused by the learned Magistrate in exercise of the powers under section 319 of the the Code of Criminal Procedure in a complaint for the offence under section 138 of the Negotiable Instruments Act which otherwise is not maintainable.
7.04. At this stage, it is required to be noted that even the complaint filed by the respondent No.2 – original complainant is against one Umesh Jain in his individual capacity and even drawer of the cheque Jain Electronics, a Proprietorship Firm is not joined as accused. Therefore, the petitioner cannot be arraigned as accused in a complaint for the offence under section 138 of the Negotiable Instruments Act in exercise of the powers under section 319 of the the Code of Criminal Procedure.
7.05. Now, so far as reliance placed upon the decision of the Division Bench in the case of Satish Chand Singhal (supra) is concerned, at the outset it is required to be noted and it is reported that the against the said decision a Special Leave Petition is preferred before the Hon'ble Supreme Court and the judgement of the Division Bench has been stayed. Even otherwise, on facts the said decision will not be of any assistance to the complainant and the same would not be applicable to the facts of the present case. Before the Division Bench the dispute was with respect to the Director of a Company and drawer of the cheque was the Company which was arraigned as accused and even statutory notice was also served upon the Company – drawer of the cheque and subsequently during the trial it was found that the person who was to be arraigned as accused in exercise of the powers under section 319 of the Code of Criminal Procedure, was found to be in day-to-day management and affairs of the Company as a Director and therefore when he was sought to be arraigned as accused in exercise of the powers under section 319 of the Code of Criminal Procedure, it was contended by such director that in absence of any statutory notice upon him, he cannot be arraigned as accused. Considering section 141 of the Negotiable Instruments Act, the Division Bench confirmed the order passed by the learned Single Judge that notice upon the Company – drawer of the cheque can be said to be a deemed notice upon the Director of the Company, who was found to be in day-to-day management and affairs of the Company and therefore, the Division Bench negatived the contention of the said Director and has held that such a Director can be arraigned as accused in exercise of the powers under section 319 of the Code of Criminal Procedure, despite the fact that statutory notice has not been served upon such person prior to institution of the prosecution. It cannot be disputed that a legal fiction created by section 141 of the Negotiable Instruments Act would not be applicable to the Proprietorship Firm and the same would be applicable to the Company and/or Partnership Firm and the directors of the Company and/or Partners of the Firm. So far as the proprietor of a partnership firm who has drawn cheque is concerned, proprietor is required to be served a notice as required under section 138 of the Negotiable Instruments Act. Therefore, the decision of the Division Bench in the case of Satish Chand Singhal (supra) would not be applicable to the facts of the present case.
7.06. Even the decision of the Hon'ble Supreme Court in the case of Raghubans Dubey (supra) relied upon by the learned advocate appearing on behalf of the original complainant is concerned, the same would also not be applicable to the facts of the present case and would not be of any assistance to the complainant. In the case before the Hon'ble Supreme Court the dispute was with respect to the offences under Indian Penal Code where there is no statutory bar as provided under section 138 of the Negotiable Instruments Act. As stated hereinabove, unless all the ingredients as mentioned in section 138 of the Negotiable Instruments Act are satisfied, it cannot be said that such a person has committed offence under section 138 of the Negotiable Instruments Act and against such person complaint under section 138 of the Negotiable Instruments Act is maintainable. Under the circumstances, the decision of the Hon'ble Supreme Court in the case of Raghubans Dubey (supra) would not be helpful to the original complainant.
7.07. Under the circumstances, the learned revisional court has materially erred in allowing the said revision application and quashing and setting aside the order passed by the learned Magistrate and consequently allowing the application Ex.51 and directing the petitioner to be joined as accused for the offence under section 138 of the Negotiable Instruments Act in exercise of the powers under section 319 of the Code of Criminal Procedure. Under the circumstances, the impugned judgement and order passed by the learned Revisional Court deserves to be quashed and set aside and order passed by the learned Magistrate is required to be restored.
8.00. In view of the above and for the reasons stated above, present petition succeeds. The impugned judgement and order dtd.11/1/2008 passed by the learned Additional Sessions Judge and Presiding Officer, Fast Track Court No.5, Junagadh in Criminal Revision Application No.85 of 2007 is hereby quashed and set aside and the order passed by the learned Judicial Magistrate (First Class), Junagadh below application Ex.51 in Criminal Case No.3789 of 2005 is hereby restored and the application Ex.51 submitted by the original complainant in Criminal Case No.3789 of 2005 is hereby dismissed. Rule is made absolute to the aforesaid extent.
[M.R. SHAH, J.] rafik