AMULLYA KUMAR KHANDUA vs STATE OF ORISSA AND ANOTHER

S. K. SAHOO, J. Â Â Â Â Â Â Â Â

This is an application under section 482 of the Code of Criminal Procedure, 1973 filed by the petitioner Amullya Kumar Khandual challenging the

impugned order dated 03.11.2006 passed by the learned J.M.F.C. (P), Kujanga in I.C.C. Case No.123 of 2006/Trial No.1038 of 2006 in taking

cognizance of offence under section 138 of the Negotiable Instruments Act, 1881 (hereinafter in short “N.I. Actâ€) and issuance of process

against him. The opposite party no.2 Basanta Kumar Nayak filed a complaint petition in the Court of learned J.M.F.C. (P), Kujanga which was

registered as I.C.C. Case No.123 of 2006 against Rajashree Khandual as well as against the petitioner who is the wife of Rajashree Khandual for

taking cognizance of offence under section 138 of the N.I. Act. The complainant-opposite party no.2 has mentioned in the complaint petition that the

he was entitled to get nearly about Rs.7,50,000/- (rupees seven lakh fifty thousand only) from the accused persons Rajashree Khandual and the

petitioner for which Rajashree Khandual issued a cheque amounting to Rs.5,50,000/- (rupees five lakh fifty thousand only) bearing cheque no.328830

dated 10.04.2006 which was of United Bank of India, Erasama Branch in favour of the complainant and she signed the cheque in presence of the

petitioner.

When the complainant presented the cheque for encashment with his banker Punjab National Bank, Paradeep for collection on 31.08.2006, the cheque

returned from United Bank of India, Erasama Bank on 07.09.2006 with noting of insufficient fund and accordingly, Punjab National Bank, Paradeep

intimated the complainant on 13.09.2006 about the dishonour of cheque. The complainant issued pleader’s notice through registered post with

A.D. on 14.09.2006 to accused Rajashree Khandual requesting her to pay a sum of Rs.5,50,000/- to him within a period of fifteen days of the receipt

of notice. The notice was received by the petitioner on 17.09.2006. On 23.09.2006 the accused Rajashree Khandual gave a reply through her

advocate denying the claim of the complainant. Mr. Janmejaya Dash, learned counsel appearing for the petitioner while challenging the impugned

order contended that the cheque was issued to the complainant by accused Rajashree Khandual and when the cheque was bounced, pleader’s

notice was sent by the complainant to her and therefore, the complainant should not have been arrayed the petitioner as an accused in this case along

with Rajashree Khandual merely because the petitioner happens to be the husband of Rajashree Khandual. None appears on behalf of the

complainant-opposite party no.2. Mr. Arupananda Das, learned Addl. Govt. Advocate appearing for the State placed the complaint petition and the

initial statement of the complainant which are annexed to the petition as Annexures 1 & 2 respectively.

On perusal of the impugned order, it reveals that the learned Magistrate after perusing the complaint petition, initial statement of the complainant

recorded under section 200 of Cr.P.C. and other connected documents i.e. the bounced cheque, intimation of the bank regarding insufficiency of fund

in the account of drawer of the cheque and copy of the pleader’s notice has been pleased to hold that prima facie case under section 138 of the

N.I. Act is made out and accordingly, he took cognizance of such offence and issued process not only against accused Rajashree Khandual but also

against the petitioner. In the initial statement, the complainant has specifically stated that on 10.04.2006 accused Rajashree Khandual issued a cheque

bearing no.328830 of Rs.5,50,000/- which was of United Bank of India, Erasama Branch in his favour and on 30.08.2006 he presented the cheque for

collection in his account at Punjab National Bank, Paradeep Branch and on 07.09.2006 the banker of the drawer of cheque i.e. U.B.I., Erasama

returned the cheque on the ground of insufficiency of fund. He has further stated that after receiving the intimation on 13.09.2006 from Punjab

National Bank, Paradeep Branch, on 14.09.2006 he issued pleader’s notice by registered post with A.D. to accused Rajashree Khandual which

was received by her on 17.09.2006 and that the said accused intimated to the advocate of the complainant that she had no agreement with the

complainant. Section 138 of the N.I. Act incorporates strict liability. Being a penal provision, it has to be construed strictly.

Despite bonafide intentions, if a person has issued a cheque in favour of another person and it is returned unpaid by the bank, he is liable for

prosecution, provided the cheque was issued from out of the account maintained by the drawer with a banker for the discharge, in whole or in part, of

any debt or other liability. For making out a case under section 138 of the N.I. Act, the ingredients are (i) the payee of the cheque in case of

nonpayment of cheque is required to send notice within fifteen days in writing to the drawer of the cheque from the date of receipt of information

about the non-payment demanding the amount of cheque and (ii) the drawer fails to make payment of the amount within fifteen days from the date of

receipt of the notice. In the case in hand, not only from the averments made in the complaint petition but also from the initial statement, it is apparent

that it is accused Rajashree Khandual who issued the cheque bearing no.328830 of Rs.5,50,000/- to the complainant which was presented by the

complainant for encashment and it was dishonoured due to insufficiency of fund in the account of the accused Rajashree Khandual and after getting

intimation from the bank, the complainant issued registered post pleader’s notice to accused Rajashree Khandual.

In case of MSR Leathers -Vrs.- S. Palaniappan reported in (2012) 53 Orissa Criminal Reports (SC) 834, it is held that so long as the cheque is valid

and so long as it is dishonoured upon presentation to the bank, the holder's right to prosecute the drawer for the default committed by him remains

valid and exercisable.In case of Mrs. Aparna A. Shah -Vrs.- M/s Sheth Developers Pvt. Ltd. reported in (2013) 55 Orissa Criminal Reports (SC)

1104, it is held as follows:-

“23.We also hold that under Section 138 of the N.I. Act, in case of issuance of cheque from joint accounts, a joint account holder cannot be

prosecuted unless the cheque has been signed by each and every person who is a joint account holder. The said principle is an exception to Section

141 of the N.I. Act which would have no application in the case on hand. The proceedings filed under Section 138 cannot be used as an arm twisting

tactics to recover the amount allegedly due from the Appellant. It cannot be said that the complainant has no remedy against the Appellant but

certainly not under Section 138. The culpability attached to dishonour of a cheque can, in no case “except in case of Section 141 of the N.I. Actâ€

be extended to those on whose behalf the cheque is issued. This Court reiterates that it is only the drawer of the cheque who can be made an accused

in any proceeding under Section 138 of the Act.â€Â  Therefore, I am of the view that the complaint petition is maintainable only against the

accused Rajashree Khandual. Merely because the petitioner is the husband of the said accused and he along with his wife and the complainant were

doing a partnership business out of which the dissension arose, it was not proper on the part of the complainant to implead the petitioner as accused

no.2 in the said complaint petition. In view of the foregoing discussions, I am of the considered opinion that the learned Magistrate before issuing

process against the petitioner has not applied his judicial mind properly to the facts of the case and mechanically passed the impugned order. I am of

the further view that the continuance of proceeding against the petitioner would amount to abuse of process of Court and therefore, invoking power

under section 482 of Cr.P.C., I am inclined to accept the prayer made in this application and quash the impugned order dated 03.11.2006 passed by

the learned J.M.F.C. (P), Kujanga so far as the petitioner is concerned. Needless to say that the proceeding shall continue against the accused

Rajashree Khandual. Accordingly, the CRLMC application is allowed.