Aruna Khurana and Others vs M/s Bareilly Financiers

V.S. Aggarwal, J.—M/s Bareilly Financiers (respondent No. 1) filed a complaint against the petitioners with respect to the offence punishable u/s 138 of the Negotiable Instruments Act (for short ''the Act''). It was contended that respondent No. 1 is the financier company and has its head office at Chandigarh. The petitioners-accused had approached the respondent-company for a loan of Rs. 30,000/-. It agreed to pay the loan on the oral agreement. The petitioners-accused had promised to return the same. It is further contended that towards the discharge of their liability through partner Aruna Khurana and Satish Khurana, a cheque of Rs.30,000/- was issued, drawn at Punjab & Sind Bank, Bareilly. It was in favour of the respondent-company. The cheque was presented to the banker at Chandigarh but was dis-honoured with the remarks "Insufficient balance''". On these broad facts, the required notice was issued and the complaint was filed.

The learned Chief Judicial Magistrate. Chandigarh on 19.11.93, held that there are sufficient grounds to proceed and summoned the petitioners as accused.

Petitioners by virtue of the present petition urge that the complaint and the subsequent proceedings should be quashed because no notice of demand contemplated had been served and in any case the petitioners cannot be prosecuted because they are simply the partners in a partnership firm. In the reply filed it is insisted that notice was issued and that the petitioners have to be prosecuted.

Section 138 of the Negotiable Instruments Act was added. In the said enactment w.e.f. 1. 4.1989 a new offence came into being for dishonoring of cheques for insufficiency of funds etc. It reads -

(Text of S. 138 omitted. - Editor)

A bare reading of the same certainly shows that the said provision would come into play provided that the cheque had been presented within a period of 6 months from the date on which it is drawn. In addition to that after it is dishonored, a demand notice has been sent for payment of the amount and the drawer must base failed to make the payment within 15 days of the receipt of the notice.

Learned counsel for the petitioners urged that registered notice is alleged to have been sent and it was received back unserved. Consequently, according to him there was non compliance of the provisions of Section 138 of the Act. However, the said contention at this stage cannot be appreciated. In paragraph 5 of the complaint, the respondent-company pleaded-

That the complainant feeling aggrieved served a legal notice upon the accused dated 26.10.93 which was sent to them by registered post as also through U.P.C. on 26.10.93, wherein the accused were asked to make the payment of the amount of Rs.30.000/- within 15 days of its receipt in favour of the complainant. But the said legal notice sent through registered A.D. were received back unserved, but the accused go the legal notice sent through U.P.C. and inspite of the service of the said legal notice through UPC. a copy of the postal Department and the unserved registered A.D. have been attached herewith for perusal of this Hon''ble Court, the accused did not made the payment of the amount of the cheque. A copy of the legal notice is herewith attached for the kind perusal of this Hon''ble Court.

The above said paragraph reveals that besides urging that notice was sent by registered post, it was said that it was sent under certificate of posting and the petitioners were served. It is for the respondent company to establish during the trial that notice was issued. At this stage, it cannot be held that no notice was served or that the proceedings should be quashed.

Confronted with that position it was urged that the petitioners as such who are partners of a firm cannot be prosecuted but it becomes unnecessary to go into this questionable this stage. In paragraph 2 and 3 of the complaint, the respondents contended :-

That the accused approached the complainant for a loan of Rs.30,000/-(Rs. Thirty Thousand only) and the accused agreed to pay the said loan amount alongwith interest, due on it, as early as possible. Accordingly, the complainant advanced the loan of Rs: 30,000/- to the accused on an oral agreement of loan, and the accused promised to return the same early.

That towards the discharge of their liabilities, the accused through its partners, namely Smt. Aruna Khurana and Sh. Satish Kumar issued an account-payee cheque bearing No.211396 dated 7.9.93 for Rs.30,000/- drawn on Punjab & Sind Batik, Bareilly, in favour of the complainant, on 7.9.93 and assured the complainant that as and when the said cheque will be presented by the complainant to his Bankers, the same will be encashed.

It is obvious from the above said assertions that the loan is alleged to have been taken by the petitioners and not by the firm. Once again it requires evidence and thereafter it can be considered as to whether when the firm is not a party, the petitioner can be prosecuted or not. At this stage, the contentions cannot be accepted.

For these reasons, the petition being without merit fails and is dismissed. Nothing said herein should be taken as an expression of opinion on the merits of the matter.