Delhi High Court
Vijay Singh vs M/S. Hindustan Antibiotics Ltd. & ... on 30 January, 2013
Author: G.P. Mittal
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 30th January, 2013
+ CRL. M.C. 1151/2012
VIJAY SINGH ..... Petitioner
Through: Mr. Rajiv Bajaj, Adv.
versus
M/S. HINDUSTAN ANTIBIOTICS LTD. & ANR...... Respondents
Through: Ms. Rajdipa Behura, APP for the State.
+ CRL. M.C. 1705/2012
VIJAY SINGH ..... Petitioner
Through: Mr. Rajiv Bajaj, Adv.
versus
M/S. HINDUSTAN ANTIBIOTICS LTD. & ANR...... Respondents
Through: Ms. Rajdipa Behura, APP for the State.
+ CRL. M.C. 1706/2012
VIJAY SINGH ..... Petitioner
Through: Mr. Rajiv Bajaj, Adv.
versus
M/S. HINDUSTAN ANTIBIOTICS LTD. & ANR...... Respondents
Through: Ms. Rajdipa Behura, APP
for the State.
+ CRL. M.C. 1707/2012
VIJAY SINGH ..... Petitioner
Through: Mr. Rajiv Bajaj, Adv.
versus
Crl.MC 1151/2012 Etc Page 1 of 5
M/S. HINDUSTAN ANTIBIOTICS LTD. & ANR...... Respondents
Through: Ms. Rajdipa Behura, APP for the State.
CORAM:
HON'BLE MR. JUSTICE G.P.MITTAL
JUDGMENT
G. P. MITTAL, J. (ORAL)
1. By virtue of these Petitions under Section 482 of the Code of Criminal
Procedure (Cr.P.C.), the Petitioner seeks quashing of the cognizance
taken by the learned Metropolitan Magistrate ('MM') in four criminal
complaints arising out of the dishonour of the four cheques which are
tabulated hereunder:-
Sl.No. Cheque Date Amount Drawn on
No.
1. 050842 15.01.2001 2,00,000/- Bank of Punjab Ltd. Roshan
Ara Road, New Delhi.
2. 050843 01.02.2001 2,00,000/- -do-
3. 050844 15.02.2001 2,00,000/- -do-
4. 050846 28.02.2001 1,47,481/- -do-
2. It is admitted case of the parties that after the four cheques were
dishonoured on account of 'stop of payments/insufficient funds' a legal
notice under Section 138 of the Negotiable Instruments Act, 1881 (the
Act) was served upon the Petitioner. The Respondent No.1 did not take
any action in pursuance of the first notice. All the four cheques were
presented for collection to the Bank of Punjab. The cheques were again
dishonoured as intimated to the Respondent No.1 by memo dated
30.03.2001.
3. The short question for determination in these Petitions is, whether a fresh
cause of action can arise on subsequent dishonour of the cheques and non
compliance of the legal notice under Section 138 of the Act. In these
cases, subsequent notices were sent by registered post to the Petitioner on
14.04.2001 and the same are deemed to be served on 17.04.2001. The
cause of action for filing of the complaint arose after 15 days of the
service, that is, on 02.05.2001. The instant complaints were filed on 29th
May, 2001.
4. The law laid down in Sadanandan Bhadran v. Madhavan Sunil Kumar
(1998) 6 SCC 514 that the failure of the holder of the cheque/payee to file
a complaint within one month resulted in forfeiture of the Complainant's
right to prosecute the drawer which forfeiture cannot be circumvented by
him by presenting the cheque afresh and inviting the dishonour to be
followed by a fresh notice was revisited by a three Judge Bench of the
Supreme Court in MSR Leathers v. S. Palaniappan & Anr. Criminal
Appeal No.261-264 of 2002, decided on 26.09.2012.
5. It is, however, urged by the learned counsel for the Petitioner that the
cheques can be presented on second or subsequent occasion only if an
assurance of payment is made by the drawer of the cheque. I am unable
to agree to the submissions raised on behalf of the Petitioner.
6. In MSR Leathers the Supreme Court analyzed the provisions of Sections
138 and 142 of the Act. It was held that there was nothing in Section 138
or Section 142 of the Act to curtail the right of the payee on failure of the
holder of the cheque to institute prosecution against the drawer when the
cause of action to do so had first arisen. The Supreme Court held the
payee or the holder of the cheque can defer prosecution till the cheque
which is presented again gets dishonoured for the second or successive
time. Paras 21 and 31 of the report are extracted hereunder:-
"21. There is, in our view, nothing either in Section 138 or Section
142 to curtail the said right of the payee, leave alone a forfeiture of
the said right for no better reason than the failure of the holder of
the cheque to institute prosecution against the drawer when the
cause of action to do so had first arisen. Simply because the
prosecution for an offence under Section 138 must on the language
of Section 142 be instituted within one month from the date of the
failure of the drawer to make the payment does not in our view
militate against the accrual of multiple causes of action to the
holder of the cheque upon failure of the drawer to make the
payment of the cheque amount. In the absence of any juristic
principle on which such failure to prosecute on the basis of the
first default in payment should result in forfeiture, we find it
difficult to hold that the payee would lose his right to institute such
proceedings on a subsequent default that satisfies all the three
requirements of Section 138.
x x x x x x x x x x
31. Applying the above rule of interpretation and the provisions of
Section 138, we have no hesitation in holding that a prosecution
based on a second or successive default in payment of the cheque
amount should not be impermissible simply because no
prosecution based on the first default which was followed by a
statutory notice and a failure to pay had not been launched. If the
entire purpose underlying Section 138 of the Negotiable
Instruments Act is to compel the drawers to honour their
commitments made in the course of their business or other affairs,
there is no reason why a person who has issued a cheque which is
dishonoured and who fails to make payment despite statutory
notice served upon him should be immune to prosecution simply
because the holder of the cheque has not rushed to the court with a
complaint based on such default or simply because the drawer has
made the holder defer prosecution promising to make
arrangements for funds or for any other similar reason. There is in
our opinion no real or qualitative difference between a case where
default is committed and prosecution immediately launched and
another where the prosecution is deferred till the cheque presented
again gets dishonoured for the second or successive time."
7. Thus, the Supreme Court clearly laid down that there would be second or
successive cause/causes of action so long as the cheque is re-presented
and is dishonoured within a period of its validity, that is, subject to the
outer limit of six months of when it is drawn.
8. The fact that the drawer of a cheque assures the payee of payment of the
cheque amount on a future date may be one of the causes for deferring the
prosecution under Section 138 of the Act. In Para 21 in MSR Leathers
the Supreme Court was quite categorical that the failure to prosecute the
drawer of the cheque on the basis of first default in payment would not
result in any forfeiture of the payee's right to institute the proceedings
under Section 138 on a subsequent default if it satisfies all the three
requirements under Section 138.
9. In view of the latest pronouncement in MSR Leathers, the Respondent
No.1 was well within its right to launch prosecution on the basis of the
dishonour of the cheques on 30.03.2001 which was followed by issuance
of the notices within 15 days of the dishonour of the cheques.
10. The Petitions are devoid of any merit; the same are accordingly
dismissed.
11. Pending Applications also stand disposed of.
(G.P. MITTAL)
JUDGE
JANUARY 30, 2013
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