Jatinder Poddar vs Prem Nath Sharma

H.S. Brar, J.

This is a petition under section 482 of the Code of Criminal Procedure, for quashing the complaint, dated February 24, 1993, annexed as Annexure P.1 with the petition filed by the respondent No.1 Prem Nath Sharma, in the Court of learned Judicial Magistrate First Class, Amritsar, and for setting aside of entire subsequent proceedings in the trial Court including the summoning order, dated April 2, 1993 and notice, dated December 6, 1993, Annexures P.2 and P.3 respectively attached with the petition, being an abuse of the process of the Court.

Briefly stated, the facts are that Jatinder Poddar petitioner issued a Cheque (No. 0197663, dated January 10, 1993) in favour of the complainant (respondent No.1 Prem Nath Sharma in this petition) for Rs.75,395.25 drawn on Union Bank of India, Chowk Phawara, Amritsar and the cheque was for consideration. Complainant Prem Nath Sharma presented the said Cheque drawn on the Union Bank of India, Chowk Phawara, Amritsar issued by the accused petitioner, through the Jammu and Kashmir Bank Ltd., Shastri Market, Amritsar, who after presentation of the same sent a Memo of dishonour to the complainant, dated January 12, 1993, issued by the Union Bank of India, Chowk Phawara, Amritsar, which showed that the accused had closed the Account either on January 11, 1993 or on January 12, 1993. The Memo of dishonour issued by the Union Bank of India, Amritsar revealed that the payment was not made as the account was closed.

ComplainantPrem Nath Sharma sent a notice to the accusedpetitioner through his lawyer in accordance with the Negotiable Instruments Act, calling upon him that since the cheque issued by him stood dishonoured on presentation through the Jammu and Kashmir Bank Ltd., Shastri Market, Amritsar, he should arrange to make the payment of the aforesaid Cheque within fifteen days of the receipt of the notice. The accused petitioner was informed through the said notice that he had committed an offence under Negotiable Instruments Act and he was liable to be imprisoned for a term which may extend to one year or fine which may extend to twice for the amount of the Cheque or both, as provided under the law. The aforesaid Cheque was presented within six months from the date on which it was drawn.

After completing all the formalities of sending notice etc. to the accused under the Act, the accusedpetitioner did not make any payment and ultimately a complaint under section 138 read with sections 141 and 142 of the Negotiable Instruments Act and under section 420 of the Indian Penal Code, was filed against the accusedpetitioner.

The learned Judicial Magistrate First Class, Amritsar, after going into the statements of the witnesses and other relevant evidence, found a prima facie case under section 138 of the Negotiable Instruments Act and summoned the accusedpetitioner Jatinder Poddar and started further proceedings.

Accusedpetitioner Jatinder Poddar filed this petition, as stated above, for quashing the complaint as well as the summoning order and further proceedings. This has come up for hearing before me today.

The main contention of the learned counsel for the petitioner for quashing the complaint and the consequent proceedings before the Magistrate is that no case under section 138 of the Negotiable Instruments Act or any other provision of the Indian Penal Code, is made out against the accused petitioner, as the Cheque was dishonoured on account of the closure of the Account of the accusedpetitioner when the Cheque was presented. The quashment of the complaint as also consequent proceedings thereto, thus, sought is on the ground that there was no Account of the petitioner with the Bank when the Cheque was presented. To take support for this argument, the learned counsel for the petitioner has cited S.Prasanna v. R. Vijayalakshmi, 1992 ISJ (Banking) 436. (a judgment of the Madras High Court).

On the other hand, the learned counsel for the respondents states that the Cheque was issued to the complainant by the accusedpetitioner on January 10, 1993 and the Account was closed by the accusedpetitioner on January 11,1993. According to the learned counsel for the respondents, a clearcut case is made out under section 138 of the Negotiable Instruments Act as well as under section 420, Indian Penal Code, against the petitioner. To substantiate his contention, he has also cited a Single Bench judgment of the Court in Uggar Sain and others v. The State of Punjab and others, 1993(3) RCR 444 and Japahari v. Priya, 1993 ISJ (Banking) 557 (Kerala High Court), as also a Division Bench judgment of the Bombay High Court in Rakesh Nemjumar Porwal v. Narayan Dhondu Joglekar and another, 1993 ISJ (Banking) 251.

On a closer scrutiny, it is crystal clear that the learned Judge of this Court in Uggar Sain''s case (supra) has taken a view that the borrower was not expected to issue a postdated cheque in lieu of the loan received by him in advance knowing that he himself had no money in the Bank. The same view has been taken by the learned Single Bench of the Kerala High Court in Japahari''s case (supra). While commenting on the judgment of the Madras High Court in S. Prasanna''s case (supra), the learned Judge of the Kerala High Court in Japahari''s case held as under :

" Learned counsel invited my attention to two decisions, one by a single Judge of Karnataka High Court (in Hunasikathimath v. State of Karnataka, 1991 (1) Crimes 226 : 1991 ISJ (Banking)101 and another by a single Judge of Madras High Court in Prasanna v. Vijayalakshmi, 1992 ISJ (Banking) 436, in which the view taken is that the endorsement "account closed" would not fall within the ambit of section 138 of the Act. Learned single Judge of the Madras High Court has followed the decision of the Karnataka High Court in Hunasikathimath''s case. The view of both the learned Judges is that closure of account is not a ground envisaged in section 138 of the Act. With great respect of learned Judges, I am of the view that the drawer of the cheque who closes his account with the bank before the cheque reaches the bank for presentation, is actually causing insufficiency of money "standing to the credit of the account". Hence I am unable to persuade myself to toe the line with the reasoning adumbrated in the above two decisions."

The Division Bench of the Bombay High Court in Rakesh Nemkumar Porwal''s case (supra), has also in their elaborated judgment, not endorsed the view taken by the Madras High Court in S.Prasanna''s case (supra). I also respectfully agree with the Single Bench Judgment of this Court in Ujjar Sain''s case (supra) and Division Bench judgment of the Bombay High Court in Rakesh Nemkumar Porwal''s case (supra) and respectfully disagree with the view taken by the Madras High Court in S. Prasanna''s case (supra).

In this view of the matter, I do not find any substance in this petition under section 482 of the Code of Criminal Procedure and it is dismissed as such.