CRLP/8476/2009 of Manchala Ramanaiah Vs M/s. Gold Fields on 29 December 2011

ORDER:

This Criminal Petition is filed by the Petitioner/Accused (Forshort, ‘The Accused’) under Section 482 of Cr.P.C. seeking to quashproceedings in Calender Case No.194 of 2009, pending on the file ofthe Court of Special Judicial Magistrate of First Class (Mobile Court),Nellore, registered for offences punishable under Section 138 Readwith Section 142 of the Negotiable Instruments Act, 1881 (For short,‘The Act’).

2. Whereas the petitioner is the accused, the first respondent isthe complainant in the Calender Case. For the sake of convenience, Irefer the parties as arrayed in the Calender Case.

3. The case of the complainant in brief is as follows : The accusedapproached the complainant to arrange money to purchase a newtractor. In that regard, the accused indebted some amount to thecomplainant. Towards the discharge of the debt amount, he got issueda cheque bearing No.0051313, dated 11-12-2006 for a sum ofRs.58,502/- drawn on Pinakini Grameena Bank, Vinjamur Branch,Nellore District. The complainant presented the cheque for collectionat Nellore in Karnataka Bank Limited, Nellore, which was returned byhis banker with an endorsement dated 14-03-2007 “Insufficient Funds”in the corresponding account of the accused. Immediately, the complainant got issued legal notice dated 22-03-2007 to the accusedto repay the amount. The accused on receiving the said notice,approached the complainant and requested him to present it again, inthe meanwhile he would arrange the funds. Later, the complainantpresented the said cheque for collection, but the same was returned byhis banker with an endorsement ‘Insufficient funds” in the account ofthe accused on 04-06-2007. Subsequently, the complainant gotissued a legal notice dated 15-06-2007 to the accused but the accusedhaving received the same failed to discharge the debt amount. Hence,the accused is liable to be punished for the alleged offence.

4. It is the contention of learned counsel for the accused thatoriginally with reference to the debt being claimed by the complainant,a cheque drawn on Pinakini Grameena Bank, Vinjamur Branch said tobe issued by the accused in the case was presented prior to 14-03-2007 before Karnataka Bank Limited at Nellore for encashment and on14-03-2007 the banker issued a memo to the effect that there was nocorresponding account of the accused in Pinakini Grameena Bank,Vinjamur Branch, and thereafter the complainant issued legal noticeon 22-03-2007 to comply with the requirement of paying the chequeamount which was served upon the accused on 23-03-2007 and onthe reply of the accused again it was presented before Karnataka BankLimited on 04-06-2007 for encashment and that Bank issued a memoto the effect that there was no account in the other bank and thereafterthe complainant issued another notice on 15-06-2007 for which theaccused sent reply by way of registered post with acknowledgementdue and in fact as per law and precedents the cause of action aroseon the date of service of first notice and within three months thecomplaint should have been filed but the complaint was filed much later on the basis of the reply given by the accused 03-07-2007 andtherefore the case is barred by limitation. In support of his contentionhe has relied upon a decision of this Court reported in P. JanardhanaRao V. Sri VenkateswaraTransport, Chittoor, Rep. by its Partnersand others[[1]],wherein it was held as follows at para No.9 of pointNo.2:

5. The point for consideration is whether there are grounds toquash the Calender Case as requested by the Accused?

6. In the decision cited supra, it is observed and held :

“9. In Sadanandan Bhadran’s case {1998 (2)ALT (Crl.) 289}, the Apex Court made it clear that a chequecan be presented any number of times during the period of itsvalidity by payee and the payee may, without taking pre-emptory action in exercise of his right under Clause (b) ofSection 138 of the Act, go on presenting the cheque so as toenable him to exercise such right at any point of time duringthe validity of the cheque. But, once he gives a notice underClause (b) of Section 138 of the Act, he forfeits such right forin case of failure of the drawer to pay the money within thestipulated time he would be liable for the offence and thecause of action for filing the complaint will arise. TheSupreme Court made it clear that the combined reading ofSections 138 and 142 of the Act leaves no room for doubt thatcause of action within the meaning of Section 142 of the Actarises and can arise only once. Following the said decision,the Apex Court once again held in M/s. Prem Chand VijayKumar’s case {2005 (2) ALT (Crl.) 286} that if the dishonourof the cheque has once snowballed into a cause of action, it isnot permissible for the payee to create another cause ofaction with the same cheque and it was not in dispute in thatcase that there was issuance and receipt of lawyer’s noticeson both the occasions and that the complaint was barred afterreceipt of the first lawyer’s notice. I n Maruthi CollegeEngineering and Technology’s case {2006 (3) ALT (Crl.) 96

(A.P.} our High Court also followed Sadanandan Bhadran’scase and made it clear that once the payee gives a noticeunder Clause (b) of Section 138 of the Act, he forfeits his rightto go on presenting the cheque so as to enable him toexercise such right under Section 138 of the Act and thelearned Single Judge quashed the criminal proceedings underSection 138 of the Act on that ground. No authority contraryto the principle laid down in the above said bindingprecedents, has been brought to my notice and if so, theapplication of the principle to the admitted facts of this case,where there was presentation twice and lawyer’s notice twice,makes the complaint incompetent under Section 138 of theAct read with Section 142 thereof. The acquittal of both theaccused by the trial Court on that ground does not appear tobe susceptible to any interference”.

7. It is clear form this decision that by virtue of Section 138 of theN.I. Act, the demand should be made within 15 days from the date ofservice notice and one month after the service of notice the complaintshould have been filed subject to the compliance of the requirements.

8. Even though the complainant was served with notice in thispetition, he has not chosen to appear before this Court.

9. By virtue of sections 138 of the N.I. Act and by virtue of thedecision cited supra, the cause of action to file the complaint wouldarise only from the date of service of the first notice and subsequentproceedings does not give rise to further cause of action to do so. Therefore, the Calender Case is barred by limitation as it was filedbeyond the prescribed period of limitation.

Hence, the Criminal Petition is allowed quashing the entireproceedings in Calender Case No.194 of 2009, pending on the file ofthe Court of Special Judicial Magistrate of First Class (Mobile Court), Nellore.

__________________________

G. KRISHNA MOHAN REDDY, J

Dated:29-12-2011.Dsh.

THE HON’BLE SRI JUSTICE G. KRISHNA MOHAN REDDY

236

CRIMINAL PETITION No.8476 OF 2009

December, 29, 2011

DSH

[1]2007 (1) ALT (Crl.) 186 (A.P.)