G. Ravikumar vs S. Ravindranath and Another

This is an application filed under S. 482, Cr.P.C. to quash the proceedings in C.C. No. 369/84 on the file of the X Metropolitan Magistrate, Secunderabad initiated against the petitioner herein by the 1st respondent.

The facts in brief, are as follows :

The petitioner herein issued a cheque bearing No. 432518, dated 9-2-1994 in favour of the 1st respondent for Rs. 95,000/- on State Bank of India, Mudford Branch, Secunderabad. The 1st respondent through his, banker, Canara Bank, M.G. Road Branch, Secunderabad presented the cheque for encashment on 9-2-1994 and the same was returned with the endorsement "Funds insufficient" and the same was intimated by the banker on 10-2-94. The 1st respondent once again presented the cheque for encashment on 12-3-1994, but the same was returned once again with endorsement "Funds insufficient" and the same was received by the bank of the 1st respondent on 15-3-94. Thereupon, the notice, dated 22-3-1994 was issued to the petitioner calling upon him to pay Rs. 95,000/- covered by the said cheque within 15 days of the receipt of the said notice, but the said notice was returned by the postal authorities with an endorsement "party continuously absent for 7 days. Hence returned to sender on 5-4-94. "The 1st respondent once again sent the said notice on 18-4-1994 to the petitioner, but the same was returned. Once again, the 1st respondent sent another notice, dated 25-4-94 telegraphically and also under Certificate of posting to the petitioner intimating about the dishonour of the cheque and calling upon him to pay the amount of the cheque within 15 days of the receipt of the notice. The petitioner while acknowledging the receipt of the said notice, dated : 25-4-1994, issued a reply notice, dated 4-5-94 through his advocate. As the petitioner failed to pay the amount due under the cheque in spite of the said notice, the 1st respondent filed the complaint against the petitioner on 31-5-94 for the offence under S. 138 of the Negotiable Instruments Act (hereinafter called as the Act). The learned Magistrate took the case on file as C.C. No. 369/94. The petitioner has come up with this application to quash the said proceedings initiated against him.

Heard the learned counsel on both sides.

The only contention raised by the learned counsel for the petitioner at length is that the proceedings in C.C. No. 369/94 initiated against the petitioner is barred by limitation and as such, it is not maintainable and its continuance amounts to abuse of process of the Court. The learned counsel for the petitioner elaborates his contention stating that the notice, dated 22-3-94 to the petitioner calling upon him to pay the cheque amount of Rs. 95,000/- within 15 days from the date of receipt of the notice, was returned to the 1st respondent-complainant on 5-4-94, therefore the cause of action for filing the complaint under S. 138 of the Act arose after expiry of 15 days commencing from 5-4-1994 i.e., on 20-4-1994 and the complaint should be filed within 30 days from the date of commencement of the cause of action i.e., within 30 days from 20-4-1994 and that the complaint in this case has been filed on 31-5-1994 i.e., after lapse of 12 days after expiry of limitation period and therefore, the proceedings are not maintainable against the petitioner as they are barred by limitation. The learned counsel for the 1st respondent, on the other hand, contends that the cause of action arose after expiry of 15 days after the receipt of the notice dated 25-4-1994 by the petitioner and after the reply notice, dated 4-5-94 issued through his counsel i.e., on 19-5-1994 and the complaint has been filed within one month from 19-5-1994 and as such, the complaint is not barred by time and this petition is liable to be dismissed. It is further contended by the learned counsel for the 1st respondent that the notice, dated 22-3-1994 was issued within the statutory period of 15 days from the date of dishonour of the cheque i.e., 5-4-94. When the said notice was not received by the petitioner, the 1st respondent, by way of abundant caution and with a bona fide intention to give one more opportunity to the drawer of the cheque to pay the amount, issued the subsequent two notices dated 18-4-94 and 25-4-94 and the notice dated 25-4-1994 alone was received by the petitioner, but failed to pay the amount due under the cheque and thus the complaint is not barred by time.

For proper appreciation of the rival contentions of the counsel, it is necessary to look into the Ss. 138 and 142 of the Act. Section 138 reads as follows :

"138. Dishonour of cheque for insufficiency, etc. of funds in the account. - Where any 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, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from the account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of the cheque, or with both :

Provided that nothing contained in this section shall apply unless -

(a) the 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;

(b) the payee or the holder in due course of the cheque, as the case may be, 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 fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and

(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee, or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

Explanation :- For the purposes of this Section, "debt or other liability" means a legally enforceable debt or other liability. Section 142 of the Act reads as under :

"Cognizance of offence. Notwithstanding anything contained in the Code of Criminal Procedure, 1973, (2 of 1974), -

(a) no Court shall take cognizance of any offence punishable under S. 138 except upon a complaint, in writing, made by the payee, or, as the case may be, the holder in due course of the cheque;

(b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to S. 138;

(c) no Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the First Class shall try any offence punishable under S. 138."

It is clear from the above provisions that to constitute an offence under S. 138 of the Act :

(a) the cheque in question should have been presented to the bank within a period of six months of the date of its drawal and within the period of its validity whichever is earlier. (b) the payee or holder in due course of such cheque should have made 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 from the date of receipt of information from the bank regarding the return of the cheque unpaid. (c) The drawer of such cheque should have failed to make the payment of the said amount to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice, (d) the complaint is made within one month from the date on which the cause of action arises under clause (c) of proviso to S. 138 of the Act.

It is not disputed that the cheque in question had been issued by the petitioner in discharge of his liability to the 1st respondent. It is also not disputed that the said cheque was presented to the bank for encashment within the period of six months from the date of its drawal or within the period of its validity. It is also not disputed that the cheque in question was returned on 15-3-1994 with the endorsement of the bank "insufficiency of funds". It is also not disputed that on 22-3-1994 the 1st respondent, who is the payee under the cheque, issued the notice to the petitioner under registered post acknowledgment due demanding payment within 15 days, and the said notice was returned with the postal endorsement "party continuously absent for 7 days. Hence returned to the sender on 5-4-1994". Thus, in compliance of proviso (b) of S. 138, the notice dated 22-3-1994 had been issued by the payee to the drawer within 15 days from the date of information of the dishonour of the cheque i.e. 15-3-1994 for insufficiency of funds. The learned counsel for the petitioner also is not disputing the said compliance of proviso (b) of S. 138 of the Act. But, his contention is that the cause of action for filing the complaint under S. 138 Act arose on 20-4-1994 i.e. as soon as the expiry of 15 days commencing from 5-4-1994 that is the date on which the period of 15 days granted to the drawer to make the payment of the amount due under the dishonoured cheque, and the period of limitation for initiating proceedings under S. 138 of the Act is only 30 days from the date of commencement of cause of action i.e., 20-4-1994 and thus, the statutory period of limitation expires by 19-4-1994.

Thus according to the counsel for the petitioner, the cause of action for the payee arose after the expiry of 15 days from the date of return of the notice dated 22-3-1994, though the said notice was not served on the drawer and that the subsequent notices, dated 18-4-1994 and 25-4-1994 will not save the limitation. To be specific his contention is that whether the demand notice issued to the drawer of the cheque in compliance of proviso (b) of S. 138 of the Act, is received by him or not, the cause of action arises after expiry of 15 days from the date of return of the said notice. I am unable to accept this contention. Clauses (b) and (c) of proviso to S. 138 of the Act are independent of each other. Clause (b) of the proviso enjoins the payee or the holder in due course of the cheque as the case may be, should make a demand for the payment of the amount by giving a notice in writing to the drawer of the cheque within fifteen days of the receipt of the information by him from the bank regarding the dishonour of the cheque. Issuance of the demand notice within fifteen days from the date of information regarding the dishonour of the cheque is sufficient compliance of clause (b) of the proviso. In the instant case, as earlier stated, it is not disputed that in the instant case, the 1st respondent payee has complied with the proviso (b). Clause (c) of the proviso, gives an opportunity to the drawer of the cheque to make the payment of the amount to the payee within 15 days from the date of receipt of the demand notice. If he fails to make good the payment within the said period of 15 days, then the cause of action arises for the payee to file the complaint. Under clause (b) of S. 142 of the Act, the period of limitation for filing such a complaint is 30 days from the date on which the cause of action arose under clause (c) of proviso to S. 138 of the Act. It is significant to note that under clause (c) of the proviso the cause of action arises only after the expiry of 15 days of the receipt of the demand notice by the drawer and not after the expiry of 15 days from the days of returned unserved notice issued to the drawer.

In the instant case, the demand notice dt. 2-3-94 issued to the drawer was returned unserved with an endorsement of the postal authorities "that the addressee was absent for 7 days." Therefore, it cannot be said that the drawer had received the said notice. It is in continuance of the said demand notice, the payee issued the subsequent notices, dated 18-4-94 and 25-4-1994. It is the latter notice, dated 25-4-94 that was received by the drawer and issued a reply notice, dated 4-5-1994. Thus, the demand notice dt. 25-4-94 issued on behalf of the 1st respondent-payee only on 4-5-1994 when he issued a reply notice. Therefore, under proviso (c) the cause of action arises for filing the complaint only after expiry of 15 days from 4-5-1994 and not before and the complaint has been filed on 31-5-1994 i.e., before the expiry of 30 days from the date of cause of action arose and as such, it cannot be said that the complaint is barred by time. The 1st respondent payee had issued the subsequent notices with a bona fide belief that after actual receipt of information about the dishonour of the cheque, the drawer will make the payment due under the cheque as the earlier notice was not received by him. The subsequent notices were issued in continuance of the earlier notice, dated 22-3-1994. Further, as earlier stated, as seen from clause (c) of proviso, the cause of action arises only after the expiry of 15 days after the receipt of the demand notice from the payee and not after return of the unserved notice. A fair reading of S. 138 of the Act together with its provisos will make it evident that the cause of action for initiating proceeding would arise only after expiry of 15 days of the receipt of the notice by the drawer and not from the date of return of the said notice without being served on the drawer of the cheque. The language of S. 138 of the Act is clear and explicit. The intention of the Legislature in introducing proviso (c) to S. 138 of the Act is that the drawer of the dishonoured cheque shall have an opportunity to pay the amount within 15 days from the date of demand notice issued by the payee. It cannot be construed that the cause of action arises after the unserved notice is returned. If that view is adopted that would mean to add another proviso to the provisions of S. 138 of the Act which is not the function of the Court or there would have been a specific mention to that effect in the existing proviso (c) to S. 138 of the Act. It is well known that the Court has got jurisdiction to interpret but not legislate. What we must look for is the intention of the Parliament of Legislature and we should take the intention of the Parliament or Legislature from the words which they have used. In Lalappa Lingappa and Others Vs. Laxmi Vishnu Textile Mills Ltd., , the Supreme Court held that when the language is clear and explicit, plain meaning must be followed and hardship and inconvenience are not meant for deviating from this rule. The function of the Judge is not to legislate but to declare the express intention of the Legislature even if that intention appears to be injudicious. The language in proviso (c) to S. 138 of the Act is clear and explicit and it means that the drawer of the dishonoured cheque is entitled to pay the amount within fifteen days from the date of receipt of the notice and the cause of action to file the complaint arises after the expiry of the fifteen days period from the date of receipt of that demand notice and not from the date of return of the unserved demand notice.

For the above said reasons the complaint filed by the 1st respondent cannot be said to be barred by time. Hence, I do not find any merits in this petition. The petition is dismissed.

Petition dismissed.