Anil Haribhai Desai vs Kanubhai Muljibhai Shah and 1

Honourable Mr. Justice Bankim. N. Mehta

The appellant original complainant has preferred this appeal u/s 378 of the Criminal Procedure Code, 1973 and challenged the judgment and order of acquittal passed by learned Additional Senior Civil Judge & JMFC, Vadodara in Criminal case no. 6895/99 on 25/2/2009.

According to appellant, there was friendship between him and respondent no. 1. As Respondent no. 1 was in need of finance, Rs. 1,00,000/- was given to him as loan. Respondent no. 1 gave cheque no. 2295155 dated 1/10/1999 for Rs. 25,000/- drawn on Central Bank of India towards the outstanding amount. On tender of the said cheque in the Bank, it was returned unpaid with endorsement of "insufficient funds" and was informed about the return of the cheque on 25/10/1999. Therefore, notice dated 29/10/1999 was served to respondent no. 1. However, respondent no. 1 did not pay the unpaid amount of the cheque. Therefore, complaint u/s 138 of the Negotiable Instrument Act (for short "Act") was filed before learned Judicial Magistrate First Class, Vadodara and it was registered as Criminal case no. 6895/99. Learned Trial Judge issued summons to respondent no. 1. On service of summons, respondent no. 1 appeared before the Court and denied having committed the offence and claimed to be tried. Therefore, complainant adduced evidence to prove his case. On completion of recording of evidence, further statement of respondent no. 1 was recorded u/s 313 of the Criminal Procedure Code. Respondent no. 1 in his further statement stated that he has not taken any amount as loan from the complainant but he has purchased "Press" and cheques were given towards security, that the amount of cheque was re-paid but cheque was not returned and false case is filed against him. The Trial Court, after hearing learned advocates for the parties, dismissed the complaint by impugned judgment. Being aggrieved by the said decision, complainant has preferred this appeal.

I have heard learned advocate Mr. Sharma for the appellant and learned advocate Mr. Chirag Patel for respondent no. 1 and learned APP Ms. CM Shah for respondent no. 2 at length and in great detail. I have also perused the impugned judgment and record and proceedings of the Trial Court. Learned advocate Mr. Sharma for the appellant submitted that the cheque in question returned with endorsement of "Insufficient Fund" and the Bank informed him by Bank memo dated 4/10/1999 on 25/10/1999. Therefore, immediately on 29/10/1999, notice was served to the respondent no. 1 informing him about return of the cheque unpaid. Therefore, the notice was served as required under the provision of the Act. He also submitted that the documentary evidence in the form of Bank memo exh 24 and Bank register exh 37 indicate that information with regard to dishonour of cheque was received by the complainant on 25/10/1999. Therefore, the Trial Court committed error in recording finding that legal notice as required under Law has not been served to respondent no. 1. Therefore, the impugned judgment is required to be set aside.

Learned advocate Mr. Patel submitted that the documentary evidence indicates that the intimation with regard to dishonour of cheque was dated 4/10/1999 and the complainant has raised a plea that it was received by him on 25/10/1999. However, no convincing evidence is produced on record to prove the date of receipt of Bank memo. He also submitted that the notice in question was issued on 29/10/1999. Therefore, it was not within fifteen days of receipt of Bank memo as required at the relevant point of time. Therefore, the Trial Court was justified in acquitting respondent no. 1 and hence no interference is wanted in the impugned judgment.

Learned APP Ms. CM Shah has adopted the submissions made by learned advocate Mr. Patel.

It appears from the rival submissions that the Trial Court acquitted the respondent no. 1 on the ground that notice as required u/s 138 of the Act was not served to respondent no. 1. There is no dispute that cheque was issued by respondent no. 1 and had returned unpaid by the Bank on account of "insufficient funds". Only question, which is required to be determined by this Court is, whether notice as required u/s 138 of the Act was served to respondent no. 1 or not?.

u/s 138 of the Act where any cheque drawn by a person on an account maintained by him with 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, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or there it exceeds the amount arranged to be paid from that account, such person shall be deemed to have been committed an offence. It also provides that such person shall not be liable for punishment unless 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. It further provides that the Payee or Holder in due course of the cheque, as the case may be, makes a demand for payment of the said amount of money by giving notice, in writing, to the drawer of the cheque, within fifteen days (as provided at the relevant time) of the receipt of information by him from the Bank regarding return of the cheque as unpaid and drawer of such cheque fails to make payment of such amount of money within fifteen days of the receipt of such notice. In view of this, it is clear that when a cheque is bounced on account of insufficient funds or on account of other reason mentioned u/s 138 of the Act, the Payee or Holder in due course is required to make demand for the amount of unpaid cheque by giving notice in writing to the drawer of cheque within fifteen days of the receipt of information by him from the Bank. After amendment, "fifteen days" were substituted by "thirty days" with effect from 6/2/2003. Therefore, Payee or Holder in due course was required to make demand within fifteen days of receipt of the information from the Bank regarding the return of the cheque as unpaid. In the instance case, according to appellant, he received the information from Bank regarding return the cheque as unpaid on 25/10/1999. Therefore, notice was issued to the drawer of the cheque i.e. respondent no. 1 on 29/10/1999 and hence, there was due compliance of provision of Law.

The complainant has produced the Bank memo at exh 24. It is not in dispute that it is dated 4/10/1999. It is also not in dispute that it is returned with endorsement that the cheque has been returned on account of insufficient funds. Therefore, now the question is whether the complainant has received the memo on 25/10/1999 as claimed by him. In order to support this contention, the complainant has relied upon the endorsement made on the memo exh 24 by him. On perusal of the document, it appears that the complainant has made an endorsement that he received the memo on 25/10/1999. The Bank memo was the original one and it was in the custody of the complainant. Mere endorsement would not conclusively prove that it was received on the day when the endorsement was made. The complainant has not adduced any cogent evidence to support his case that he received the Bank memo not on the date mentioned on the memo but on 25/10/1999. In absence of any cogent and convincing evidence, it would be difficult to believe that the complainant received the Bank memo on 25/10/1999. On the contrary, as the Bank memo is dated 4/10/1999, the presumption can be drawn that it was received by the complainant not on 25/10/1999 as claimed by him. Therefore, in my view, it can not be accepted that it was received on 25/10/1999 as claimed by the complainant.

Learned advocate Mr. Sharma also tried to canvass that the xerox copy of Bank register exh 37 indicates that he received the Bank memo on 25/10/1999. On perusal of exh 37, it appears that it is a register maintained by the Bank to show details of account holder, cheque details, reasons for return of cheques etc. It indicates that the complainant was an account holder in the Bank and cheque no. 295155 dated 1/10/1999 was returned. Ex. 37 does not bear signature of the complainant indicating that he has received the Bank memo on 25/10/1999. It bears signature of the Manager with date of 25/10/1999. This does not support the complainant''s case that he received the Bank memo on 25/10/1999. Therefore, it can not be said that the Bank memo was received by the complainant on 25/10/1999.

In view of the above, it clearly emerges from the evidence produced before the Trial Court that the cheque in question was returned and Bank gave information to the complainant regarding the return of cheque as unpaid by its communication dated 4/10/1999. The notice of demand and for payment of cheque amount was issued on 29/10/1999. Therefore, there was noncompliance of requirement of section 138 of the Act. Hence, the Trial Court was justified in acquitting the accused. Learned advocate Mr. Sharma has not been able to point out any infirmity in the impugned judgment. Therefore, no interference is wanted in the impugned judgment.

In the result, the appeal fails and stands dismissed.