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Judgment
78 paragraphs · 1,663 wordsM. Jeyapaul, J.—Aggrieved by the order of acquittal recorded by the learned 14th Metropolitan Magistrate, Egmore, Chennai in C.C. No.
5032 of 1997, the present Criminal Appeal is preferred by the complainant.
The appellant herein filed the complaint before the trial court u/s 138 of Negotiable Instruments Act alleging that in discharge of the dues payable
by the first accused, the first accused issued a cheque bearing No. 991231 dated 29.1.1997 for a sum of Rs. 25 Lakhs. The said cheque was
deposited by the complainant for collection on 28.5.1997. As the same was returned dishonoured with an endorsement ""insufficient funds"" on
28.5.1997, the complainant issued a statutory notice dated 29.5.1997 alleging that there was no payment made within 15 days from the date of
receipt of notice. The complainant invoking the provisions u/s 138 of Negotiable Instruments Act launched prosecution as against all the accused.
On the side of the complainant, the Assistant Manager of the complainant was examined as P.W.1. The Branch Manager of the complainant
bank was examined as P.W.2 and the Bank Manager of the accused bank was examined as P.W.3. As many as 13 documents were marked on
the side of the complainant. On the side of the accused, the employee working under the first accused was examined as D.W.1 and D.W.2 and 10
documents were marked on the side of the accused.
The trial court having found that the complainant chose to issue earlier notice dated 9.4.1997 under Ex.D.2 and failed to prosecute the accused
within 30 days from the expiry of 16 days from the date of receipt of notice by the accused, chose to acquit the accused.
The learned Counsel appearing for the complainant would submit that there was no earlier notice as contended by the accused. The alleged
earlier notice issued by the complainant to the accused was not established. It is his further contention that the cheque number and the specific
amount covered under the subject cheque were not specifically referred to in the alleged notice Ex.D.2 issued by the complainant to the accused. It
is his further submission that even if such an earlier notice was issued by the complainant to the accused, there is only one prosecution and there is
no successive prosecution. Therefore, he would submit that the trial court has misdirected itself to come to a wrong decision that the complainant is
not entitled to prosecute the accused.
The learned Counsel appearing for the accused would submit that the issuance of earlier notice dated 9.4.1997 under Ex.D.2 was established
by producing the notice issued by the complainant and the extract of the Cheque Return Register maintained by the accused Bank. It is his further
submission that the postal cover in which Ex.D.2 was sent to the first accused bank was also produced to buttress the genuineness of Ex.D.2
issued by the complainant and received by the first accused. Therefore, he would submit that the present prosecution initiated by the complainant
beyond the period of limitation as prescribed u/s 142 of Negotiable Instruments Act is not at all maintainable. Therefore, the trial court has rightly
approached the legal issue and rendered the finding that the complainant cannot lawfully prosecute the accused, based on the second notice
Ex.P.4, it is further submitted.
As regards the subsisting liability and the issuance of the subject cheque Ex.P.2 for a sum of Rs. 25 Lakhs, no serious dispute has arisen.
It is contended by the complainant that no earlier statutory notice was issued under Ex.D.2. The copy of the statutory notice Ex.D.2, the postal
cover in which the statutory notice was received and the extract of the Cheque Return Register maintained by the South Indian Bank,
Nungambakkam Branch, Chennai would go to establish that the complainant had in fact issued a statutory notice as on 9.4.1997 calling upon the
accused to make payment of the amount due under the cheque.
Of course the said notice does not specifically refer to the cheque number but the date and amount of the cheque have been specifically referred
to in the said notice. If we correlate those particulars with the information available in the extract of Cheque Return Register maintained by the
South Indian Bank, Nungambakkam Branch, we can very easily come to the decision that the earlier notice Ex.D.2 dated 9.4.1997 refers only the
subject cheque dated 29.1.1997 issued by the accused to the complainant for a sum of Rs. 25 Lakhs.
The complainant, who has failed to refer to the above cheque in the statutory notice cannot be permitted to take advantage of his own wrong
to defend that such a notice cannot be construed as statutory notice.
It is further contended that the said statutory notice was not issued specifically for claiming a sum of Rs. 25 Lakhs in the subject cheque dated
29.1.1997. The said notice also refers to another cheque for Rs. 4,79,452/- issued by the 2nd accused in his individual capacity. Though the
complainant has referred to two cheques in the statutory notice Ex.D.2 and has come out with the prosecution u/s 138 in connection with the
subject cheque for Rs. 25 Lakhs, the Court finds that the statutory notice issued for the comprehensive amount of Rs. 29,79,452, which is the
accrued amount for two cheques, one for Rs. 25 Lakhs and another for Rs. 4,79,452 does not become invalid.
The complainant is bound to initiate criminal action u/s 138 of Negotiable Instruments Act within 30 days from the date of receipt of notice
Ex.D.2. The subsequent notice Ex.P.4 has been issued only on 29.5.1997 and the same was acknowledged by the accused under Ex.P.5 on
31.5.1997. The present complaint has been launched on 11.7.1997 well beyond the expiry of 30 days from the date of receipt of the first statutory
notice dated 9.4.1997.
The Supreme Court in Sadanandan Bhadran Vs. Madhavan Sunil Kumar, has held that an offence u/s 138 of Negotiable Instruments Act is
presumed to be committed by the drawer of the cheque immediately on failure to make payment within 15 days of receipt of the registered notice
in accordance with Clause (b) to proviso u/s 138 of Negotiable Instruments Act. The cause of action for filing the complaint u/s 138 of Negotiable
Instruments Act arises only once. The concept of successive cause of action cannot be read into Sections 138 and 142 of N.I. Act. It has been
categorically held that the drawer of the cheque gets absolved of the offence, if no prosecution was launched on his failure to make payment within
15 days of receipt of notice served in accordance with Clause (b) to proviso to Section 138 of Negotiable Instruments Act. Once notice under
Clause (b) of Section 138 is issued, the payee forfeits such rights, if he does not initiate prosecution on failure of drawer to pay money within the
stipulated time after receipt of registered notice.
The said decision was reiterated in the subsequent judgment in Prem Chand Vijay Kumar Vs. Yashpal Singh and Another, . It has been held
therein that the payee is at liberty to present the cheque repeatedly within its validity period, but once notice was issued and the payment was not
forthcoming within15 days from the date of receipt of such notice, the payee is bound to avail the very cause of action arising thereupon and lodge
the complaint. So, the dishonour of the cheque of each presentation gives rise to a fresh right to present it again during the period of its validity, but
it does not give a fresh cause of action.
The learned Counsel appearing for the complainant would refer to the decision of the Supreme court in R.S. Traders v. Rita Khanna 1998
(93) Company Cases 665. That was a case where the cheque, which was dishonoured was time and again represented for payment, but based on
the only statutory notice issued after the last dishonour was intimated to the complainant, prosecution u/s 138 of Negotiable Instruments Act was
launched. In the above facts and circumstances of the case, the Supreme Court observed that there was delay in prosecution in that case and that
successive invocation of the prosecution u/s 138 is barred. It has also been observed that there have been no successive prosecutions or
convictions on the strength of one dishonoured cheque in that case.
The aforesaid ratio laid down by the Supreme Court does not run counter to the decision already rendered by the Supreme Court in
Sadanandan Bhadran Vs. Madhavan Sunil Kumar, and reiterated in the subsequent judgment in Prem Chand Vijay Kumar Vs. Yashpal Singh and
Another, .
The complainant being the payee can present the cheque any number of times within six months from the date of issuance of cheque. But, once
he issued the statutory notice calling upon the drawer of the cheque to make payment, he cannot escape from the on-set of period of limitation
prescribed u/s 138 read with Section 142 of Negotiable Instruments Act.
On facts, it is found that the complainant has come out with the present complaint after the expiry of 30 days from the date of receipt of the
earlier statutory notice Ex.D2.dated 9.4.1997. The trial court has rightly returned the finding that such a complaint lodged by the complainant
based on the subsequent notice is not at all maintainable in law as it is barred by limitation.
In the elaborate judgment, the trial court has adverted to the entire gamut of facts in this case and the question of law arising in the matter and
has returned the verdict that the complaint is not maintainable and therefore the accused is entitled to acquittal. The order of acquittal in the above
facts and circumstances of the case does not warrant reversal.
In view of the above, confirming the judgment of the acquittal recorded by the trial court, the appeal stands dismissed.