Vinod Tyagi vs State Of U.P. And Another
2015 Latest Caselaw 26 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

								A.F.R.
 
							Court No. - 43				       Appl. u/s 482 No. - 9003/2015.
 

 
Applicant :- 			Vinod Tyagi
 
Opposite Party :- 			State of U.P. and another
 
Counsel for Applicant :- 	Anil Kumar Pandey, Arvind Srivastava
 
Counsel for Opposite Party :-  Govt. Advocate
 

 
Hon'ble Pankaj Naqvi,J.

Heard Sri Anil Kumar Pandey and Sri Arvind Srivastava, learned counsel for applicant and learned A.G.A.

This application under Section 482 Cr.P.C. has been filed for quashing the proceedings of Complaint Case No.3865/2014, under Section 138 of the Negotiable Instruments Act, pending in the court of Addl. Chief Judicial Magistrate-VII, Agra and the order of summoning dated 18.12.2014.

1. O.P. No.2 filed a complaint under Section 138 of the Negotiable Instruments Act (for short "the Act") against the applicant alleging that a cheque dated 24.8.2014, issued by the applicant, for Rs.47,88,545/-, was dishonoured on 10.9.2014 as per bank memo received by O.P No.2 on 12.9.2014. The cheque was again presented to the drawee bank for payment on 29.10.2014, but was again dishonoured on 1.11.201 as per bank memo received by O.P. No.2 on 2.11.2014. O.P. No.2 sent a registered legal notice on 20.11.2014 to the applicant calling upon him to tender the amount in question within 15 days of the date of receipt of notice, which remained unreplied, hence a complaint under Section 138 of the Act was lodged on 18.12.2014. The complaint, the affidavit, the original cheque, bank memos, notice dated 20.11.2014, its receipt, etc. prima facie disclosed commission of an offence under Section 138 of the Act, consequently, the applicant stood summoned under order dated 18.12.2014.

2. It is submitted on behalf of the applicant that in the absence of any averment as regards service of notice under Proviso (b) & (c) to Section 138 of the Act, complaint as framed and filed did not disclose any cause of action, thus the same is liable to be quashed. He placed reliance on a Judgment of the Apex Court in the case of M.D. Thomas v. P.S. Jaleel and another, 2009 (14) SCC 398.

3. Learned A.G.A. would submit that the complaint as framed and filed along with appended documents, disclosed sufficient cause of action. He further on the strength of the judgment of the Apex Court in the case of Ajeet Seeds Ltd. v. K. Gopala Krishnaiah, 2014 (12) SCC 685, contends that once a registered notice is sent under Proviso (b) to Section 138 of the Act to the drawer of the cheque, presumption of due service of the notice would stand attracted both under sub-section 114 of the Evidence Act and under Section 27 of the General Clauses Act and it is not the requirement of law to state in the complaint that notice is deemed to have been served with the addressee or he is deemed to have the knowledge of notice unless and until contrary is proved by the addressee at the stage of evidence.

4. Chapter XVII of the Act originally containing Sections 138 to 142 was inserted in the Act by the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 with the object of promoting and inculcating faith in the efficacy of banking system and its operations and giving credibility to negotiable instruments in business transaction. The introduction of the said Chapter was intended to create an atmosphere of faith and reliance on banking system by discouraging people from not honouring their commitments by way of payment through cheques. Section 138 of the Act was enacted to punish those unscrupulous persons who purported to discharge their liability by issuing cheques without really intending to do so.

5. The Proviso appended to Section 138 of the Act lays down three conditions which are to be complied with before a complaint under Section 138 of the Act could be filed. Proviso (a) is not relevant for the present purpose and accordingly Proviso (b) & (c) are quoted hereunder:

138. Dishonour of cheque for insufficiency, etc., of funds in the account.-

Provided that nothing contained in this section shall apply unless--

(a) ..........

(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 thirty 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.

6. A perusal of Clauses (b) & (c) to the proviso would indicate that before a complaint could be filed, the payee or the holder in due course of the cheque, as the case may be, is to make a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid and the drawer of such cheque fails to make payment of the said amount to the payee or as the case may be, to the holder in due course within 15 days of the receipt of notice.

7. The Apex Court in the case C.C. Alavi Haji v. Palapetty Muhammed and another, 2007 (6) SCC 555, held as under:-

10. It is, thus, trite to say that where the payee dispatches the notice by registered post with correct address of the drawer of the cheque, the principle incorporated in Section 27 of the G.C. Act would be attracted; the requirement of Clause (b) of proviso to Section 138 of the Act stands complied with and cause of action to file a complaint arises on the expiry of the period prescribed in Clause (c) of the said proviso for payment by the drawer of the cheque. Nevertheless, it would be without prejudice to the right of the drawer to show that he had no knowledge that the notice was brought to his address.

11. However, that the referring Bench was of the view that this Court in Vinod Shivappas case (supra) did not take note of Section 114 of Evidence Act in its proper perspective. It felts that the presumption under Section 114 of the Evidence Act being a rebuttable presumption, the complaint should contain necessary averments to raise the presumption of service of notice; that it was not sufficient for a complainant to state that a notice was sent by registered post and that the notice was returned with the endorsement out of station; and that there should be a further averment that the addressee-drawer had deliberately avoided receiving the notice or that the addressee had knowledge of the notice, for raising a presumption under Section 114 of Evidence Act.

12. Therefore, the moot question requiring consideration is in regard to the implication of Section 114 of the Indian Evidence Act, 1872 insofar as the service of notice under the said proviso is concerned. Section 114 of the Indian Evidence Act, 1872 reads as follows:

Section 114- Court may presume existence of certain facts -The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events human conduct and public and private business, in their relation to the facts of the particular case.

Illustrations

The Court may presume -

(f) That the common course of business has been followed in particular cases.

....

13. According to Section 114 of the Act, read with illustration (f) thereunder, when it appears to the Court that the common course of business renders it probable that a thing would happen, the Court may draw presumption that the thing would have happened, unless there are circumstances in a particular case to show that the common course of business was not followed. Thus, Section 114 enables the Court to presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business in their relation to the facts of the particular case. Consequently, the court can presume that the common course of business has been followed in particular cases. When applied to communications sent by post, Section 114 enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. But the presumption that is raised under Section 27 of the G.C. Act is a far stronger presumption. Further, while Section 114 of Evidence Act refers to a general presumption, Section 114 refers to a specific presumption. For the sake of ready reference, Section 27 of G.C. Act is extracted below:

27. Meaning of service by post -

Where any Central Act or Regulation made after the commencement of this Act authorizes or requires any document to be served by post, whether the expression served by post, whether the expression serve or either of the expressions give or send or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.

14. Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement refused or not available in the house or house locked or shop closed or addressee not in station, due service has to be presumed. (Vide Jagdish Singh v. Natthu Singh: AIR 1992 SC 1604; State of M.P. v. Hiralal and Ors.: (1996) 7 SCC 523 and V. Raja Kumari v. P. Subbarama Naidu and Anr.: (2004) 8 SCC 774. It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved.

15. Insofar as the question of disclosure of necessary particulars with regard to the issue of notice in terms of proviso (b) of Section 138 of the Act, in order to enable the Court to draw presumption or inference either under Section 27 of the G.C. Act or Section 114 of the Evidence Act, is concerned, there is no material difference between the two provisions. In our opinion therefore, when the notice is sent by registered post by correctly addressing the drawer of the cheque, the mandatory requirement of issue of notice in terms of Clause (b) of proviso to Section 138 of the Act stands complied with. It is needless to emphasis that the complaint must contain basic facts regarding the mode and manner of the issuance of notice to the drawer of the cheque. It is well settled that at the time of taking cognizance of the complaint under Section 138 of the Act, the Court is required to be prima facie satisfied that a case under the said Section is made out and the aforenoted mandatory statutory procedural requirements have been complied with. It is then for the drawer to rebut the presumption about the service of notice and show that he had no knowledge that the notice was brought to his address or that the address mentioned on the cover was incorrect or that the letter was never tendered or that the report of the postman was incorrect. In our opinion, this interpretation of the provision would effectuate the object and purpose for which proviso to Section 138 was enacted, namely, to avoid unnecessary hardship to an honest drawer of a cheque and to provide him an opportunity to make amends.

8. In essence what the Apex Court held is that once a notice under Proviso (b) to Section 138 of the Act is despatched in writing by a registered post to the drawer of the cheque, then a presumption under Section 114 of the Evidence Act would come into play and the court may presume existence of certain facts regard being had to the common course of natural events, human conduct, public and private business in their relation to the facts of the particular case and by virtue of illustration (f) that common course of business has been followed in particular cases, which essentially in reference to a written communication, would enable the court to presume that in the common course of natural events, the notice would have been delivered to the addressee. Not only this, a presumption under Section 27 of the General Clauses Act, which presumes that service of notice has been effected when it is sent to the correct address by registered post also arises. Thus, once it is alleged that a registered notice was sent to the address of the drawer of the cheque, it shall be deemed to have been served with the addressee or is deemed to have the knowledge of the notice. Obviously both these presumptions under Section 114 of the Evidence Act and that of Section 27 of the General Clauses Act are rebuttable which the drawer is entitled to rebut at the stage of evidence by such cogent evidence as he may deem fit, but for the purpose of summoning, it would be a sufficient compliance of law, if only mode and manner of service of notice is indicated in the complaint.

9. Recently the Apex Court in the case of Ajeet Seeds Ltd. (supra), had an occasion to examine a similar issue wherein the High Court quashed the complaint at the stage of summoning on the premise that there are no recitals to demonstrate that the registered notice under Section 138 of the Act was served on any specific date, as the High Court had observed that there was no proof that either the notice was served or it was returned unserved and that there is no averment in the complaint about the same. The Apex Court while approving the law in the case of C.C. Alavi Haji (supra), held that a service of notice could be presumed both under Section 114 of the Evidence Act and Section 27 of the General Clauses Act and that it is not necessary to aver in the complaint that inspite of the notice returned unserved, it is deemed to have been served or that the addressee is deemed to have the knowledge of the notice unless and until contrary is proved by the addressee at the stage of evidence.

10. The Court has perused the judgment in the case of M.D. Thomas (supra) and finds that the same would have no application for the purpose of the present case. In the said case, the issue was as to whether a notice of demand under Section 138 of the Act could be treated as a valid service, if the same is served upon the wife of the drawer of the cheque and the Apex Court held in paragraph-7 of the cheque, the Apex Court held, it would not and accordingly a conviction on the basis of such service, i.e., on the wife of the drawer of the cheque, was set aside.

11. Reverting to the present case, the complainant in the complaint alleged that upon receipt of memo of the dishonour of the cheque on 2.11.2014, he sent a registered notice for demand of the amount under the cheque through his lawyer on 20.11.2014 to the applicant/drawer of the cheque. Applying the ratio propounded both in the case of C.C. Alavi Haji (supra) and as affirmed in Ajeet Seeds Ltd (supra), that a registered/AD notice dated 20.11.2014 was sent to the applicant/the drawer, which was duly addressed, presumption of due service would get attracted both under Section 114 of the Evidence Act and Section 27 of the General Clauses Act which prima facie discloses a cause of action to file a complaint under Section 138 of the Act. If what applicant contends, is accepted, i.e, the complaint must disclose an averment of service of registered notice in the complaint, it would become a convenient ploy for a trickster to avoid service on one pretext or the other, to the detriment of the payee, ultimately defeating the very purpose and object of the Amending Act.

12. No other plea is urged.

13. The application under Section 482 Cr.P.C. is dismissed.

However, observations made hereinabove would not prejudice the case of the applicant/accused while the trial court is adjudicating the issue on merits as observations are limited only to examine the correctness/validity of the summoning order dated 18.12.2014.

Order Date:- 20.4.2015

Chandra

(Pankaj Naqvi,J)