N. Venkata Sivaram Prasad Vs. Rajeswari Constructions - Court Judgment

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criminal - dishonour of cheque - sections 2, 190, 200 and 203 of criminal procedure code, 1973 and sections 138, 139 and 142 of negotiable instruments act - notice issued to respondent for dishonour of cheque issued by him - respondent entitled to get opportunity to repay within fifteen days of date of notice - respondent can be treated guilty if he fails repay within such period - complaint initiated against respondent for dishonour of cheque before expiry of such period pre-mature - respondent cannot be treated guilty on date of filing complaint - proceedings pursuant to such premature complaint non-est in law. - - (b) such complaint is made within one month of the date on which the cause of action arises under section (c) of the proviso to section 138; (c) no court inferior to that of a metropolitan magistrate or a judicial magistrate of the first class shall try any offence punishable under section 138.'4. section 138 was brought on statute book with effect from 1-4-1989. in order to constitute the offence under section 138, the following ingredients are necessary :(a) the cheque must have been issued in favour of the payee, (b) that the cheque should have been returned by the bank unpaid, because the amount of money standing to the credit of the account is insufficient or it exceeds the amount arranged, (c) that the cheque should have been presented within a period of six months from the date on which it is drawn, (d) that the payee should have given a notice of dishonour to the drawer within 15 days of the receipt of the information by him from the bank reg under section 142, the magistrate is empowered to take the cognizance of any offence punishable under section 138 only on a complaint in writing made by the payee provided that such complaint is made within one month from the date on which the cause of action arises under clause (c) of proviso to section 139. 5. as already stated, the said proviso relates to failure of the drawer to make the payment to the payee the amount of money covered by the cheque which was dishonoured by the bank within 15 days from the receipt of the notice. 13. the magistrate under section 142 is entitled to take cognizance of the offence punishable under section 138, provided that there is a complaint in writing by the payee and if such a complaint is made within one month from the date on which the cause of action arises under clause (c) of proviso to section 138. a reading of section 142 would clearly denote that the cognizance of any offence punishable under section 138 can be taken by the magistrate provided that on the date of the complaint the offence punishable under section 138 has been made out. proviso (c) clearly stipulates that the section does not apply unless the drawer of the cheques fails to make the payment to the payee within 15 days of the receipt of the said notice. hence, the reading of proviso (c) to section 138 clearly denotes that it would not be an offence if the drawer pays the amount within a period of 15 days as a specified therein. even by the date of service of summons, there was no further complaint in writing to the effect that even after the expiry of 15 days period as mentioned in proviso (c), the drawer failed to pay the amount.g. bikshapathy, j. 1. the matter has been referred to the division bench at the instance of our learned brother k. s. srivastav, j. the case arose under section 138 read with section 142 of the negotiable instruments act, 1881. the issue that is referred is as follows : 'whether the court can proceed with the case if it comes to its knowledge that the offence is committed during the pendency of the premature complaint.' 2. a few facts are necessary for proper appreciation of the case. the appellant is the complainant and the accused is the respondent in c.c. no. 108/91 on the file of ii additional munsif magistrate, chirala. the respondent issued a cheque for rs. 18,000/dated 30-4-1991 in favour of the appellant. the said cheque was dishonoured by the bank on 7-5-1991 and the same came to the knowledge of the appellant on 13-5-1991. the appellant, thereafter issued notice on 25-5-1991 through registered notice requiring the respondent to arrange payment. the said notice was returned to the appellant by the postal authorities stating that the respondent refused to accept the notice on 27-5-1991. the appellant filed criminal complaint before the ii additional munsif magistrate, chirala on 3-6-1991. from the docket sheet of the court below, it is seen that the learned magistrate examined the complainant on 4-6-1991 and adjourned the case for hearing on 27-6-1991. thereafter the complaint was taken on file in c.c. no. 108/91 on 5-7-1991 and summons were issued on 27-8-1993, the accused was acquitted. against the said order the present appeal has been preferred by the appellant. the learned magistrate held that the cause of action for filing the complaint under section 142 of the act arose only on 12-6-1991 and since the complaint was filed during the pre-offence period, the accused cannot be found guilty of the offence under section 138 of the act. 3. before dwelving into the legal aspects, it is necessary to extract section 138 and section 142 of the act. section 138 : 'dishonour of cheque for insufficiency, etc. of funds in the account. - where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this act, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of the cheque, or with both : provided that nothing contained in this section shall apply unless - (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (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 fifteen days of the receipt of the 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 payments 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. section 142 : cognizance of offences :- notwithstanding anything contained in the code of criminal procedure, 1973 (2 of 1974); - (a) no court shall take cognizance of any offence punishable under section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque; (b) such complaint is made within one month of the date on which the cause of action arises under section (c) of the proviso to section 138; (c) no court inferior to that of a metropolitan magistrate or a judicial magistrate of the first class shall try any offence punishable under section 138.' 4. section 138 was brought on statute book with effect from 1-4-1989. in order to constitute the offence under section 138, the following ingredients are necessary : (a) the cheque must have been issued in favour of the payee, (b) that the cheque should have been returned by the bank unpaid, because the amount of money standing to the credit of the account is insufficient or it exceeds the amount arranged, (c) that the cheque should have been presented within a period of six months from the date on which it is drawn, (d) that the payee should have given a notice of dishonour to the drawer within 15 days of the receipt of the information by him from the bank regarding the return of the cheque and that the drawer should have failed to make the payment within 15 days of the receipt of the notice. under section 142, the magistrate is empowered to take the cognizance of any offence punishable under section 138 only on a complaint in writing made by the payee provided that such complaint is made within one month from the date on which the cause of action arises under clause (c) of proviso to section 139. 5. as already stated, the said proviso relates to failure of the drawer to make the payment to the payee the amount of money covered by the cheque which was dishonoured by the bank within 15 days from the receipt of the notice. 6. the learned counsel for the appellant sri adinarayana rao submits that the complaint even though filed before the expiry of 15 days after the service of the notice, could still be regarded as a valid complaint if by the date of taking cognizance and issuing summons, 15 days' time as required by the proviso (c) to section 138 has expired. on the other hand, the learned counsel for the respondent submits that the offence under section 138 can be said to be complete only if the drawer fails to pay the amount within 15 days of the receipt of the notice as contemplated in proviso (c) to section 138. until such time, that an offence is complete, it would not be open for the complaint to file a complaint as it is pre-mature. further, the magistrate has no jurisdiction to entertain such a complaint when the offence itself is not made out. 7. the point that arises for consideration as to whether the magistrate can take cognizance of the complaint given in the instant case and proceed with the trial of the complaint after the expiry of 15 days as prescribed under section 138(c) of the act. 8. our learned brother krishna sharan srivastav, j. referred to the decision of y. bhaskar rao, j., reported in m/s. mahalakshmi enterprises v. sri vishnu trading company, (1991) 1 andh lt 22 and also the decision of our learned brother b. subhashan reddy, j reported in p. prakas chand v. v. v. rama rao & company & state, (1994) 1 andh lt (cri) 510. construing the said two cases, the learned judge has come to the conclusion that the decisions of the two learned judges are diametrically opposite. we have perused the judgments of the learned single judges and we find that the opinion formed by our learned brother krishna sharan srivastav j, appears to be not correct. in m/s. mahalakshmi enterprises case (cited supra), the question that fell for consideration was as to when the limitation starts under section 142(c) of the act for filing a complaint for the offence committed under section 138 of the act. in that case, the complaint was filed by the drawer within 15 days of the receipt of the notice by the payee. but, however, the maintainability of such a complaint or taking cognizance thereof was not the subject-matter before the learned single judge. the learned single judge held that since the complaint was filed even before the starting of the limitation, the said complaint must be treated as within time. only, the aspect of the limitation was considered by the learned judge. 9. in prakash chand case (1994 (1) andh lt (cri) 510) (cited supra), the complaint was filed by the drawer against the payee before the expiry of 15 days from the date of receipt of the notice. the learned judge held that the penal provision has to be construed strictly. since 15 days time allowed under section 138(c) had not expired, the complaint before the magistrate by the drawer was pre-mature and accordingly the criminal proceedings were quashed. the learned judge further held even if the cognizance was taken of such a complaint which was filed within 15 days of the receipt of the notice, that cannot be a relevant consideration for construing the penal provision. 10. thus, both the cases travel in a different direction and the attack was on different grounds. while the former case decided the limitation for filing a complaint before the magistrate under clause (b) of section 142, the latter case related to the maintainability of the complaint, when such a complaint was made by the payee within a period of 15 days from the date of receipt of the notice by the drawer under section 138(b). 11. another judgment of the learned single judge of this court was also brought to our notice by the learned public prosecutor. it is reported in s. b. v. satyanarayana rao v. a. venkateswar rao, (1995) 2 aplj 488, decided by r. m. bapat, j. the learned judge held that the starting point for limitation has to be counted from the date on which the accused can receive the notice. 12. section 138 was engrafted in order to avoid various kinds of avoidances practised by the drawers of the cheques as against the payees. to ensure that the cheques are honoured, the dishonour of the chques have been made as an offence under section 138. it is made clear that the offence under section 138 can be said to constitute only when the cheque is returned by the bank unpaid under two situations i.e., the amounts standing to the credit of that account is insufficient to honour the cheques or that it exceeds the amount arranged to the paid from that account by arrangement made with that bank. 13. the magistrate under section 142 is entitled to take cognizance of the offence punishable under section 138, provided that there is a complaint in writing by the payee and if such a complaint is made within one month from the date on which the cause of action arises under clause (c) of proviso to section 138. a reading of section 142 would clearly denote that the cognizance of any offence punishable under section 138 can be taken by the magistrate provided that on the date of the complaint the offence punishable under section 138 has been made out. 14. the word 'complaint' is defined in cr.p.c. to mean any allegation made orally or in writing to a magistrate, with a view to his taking action under this code, that some person, whether known or unknown, has committed an offence, but does not include a police report. the word 'offence' has been defined in section 2(n), cr.p.c. it says that the offence means any act or omission made punishable by any law for the time being in force and includes any act in respect of which a complaint may be made under section 20 of the cattle trespass act, 1971. under section 190 of the cr.p.c., a magistrate of first class may take cognizance of any offence among other events, upon receiving a complaint of facts which constitute such offence. under section 200 of the code, magistrate taking cognizance of an offence on complaint shall examine the complainant on oath and also the witnesses present, if any. the object of examination of the complainant under section 200 is to ascertain and satisfy whether there was a prima facie case against the person accused of an offence in the complaint (see : nirmal jith singh hoom v. state of west bengal, : [1973]2scr66 . 15. under section 138, until and unless the criteria laid down therein are complied with, it would not constitute an offence. proviso (c) clearly stipulates that the section does not apply unless the drawer of the cheques fails to make the payment to the payee within 15 days of the receipt of the said notice. thus, the payee has been given liberty to make the payment within 15 days of the receipt of the notice even though the cheque was returned by the bank unpaid. hence, the reading of proviso (c) to section 138 clearly denotes that it would not be an offence if the drawer pays the amount within a period of 15 days as a specified therein. in such circumstances, there could not have been any complaint alleging the violation of section 138. the pre-offence period granted to the payee should be construed strictly, otherwise the very purpose of section 138(c) of the negotiable instruments act would be frustrated. the complainant should be able to point out to the offence under section 138 when the complaint was filed. when the complaint is filed even before the offence is completed, it cannot be said that the offence is made out and, therefore, such complaint is invalid in the eye of law. as already noticed, under section 142 of the act, no court shall take cognizance of any offence punishable under section 138, except upon a complaint in writing made by the payee. therefore, the necessary ingredient enabling the magistrate to take cognizance of the offence is that there should be a complaint in writing by the payee and the said complaint should disclose an offence under section 138. in the complaint made by the respondent before the magistrate, no offence could have been disclosed as the time prescribed under section 138, proviso (c) was not exhaused by the time the complaint was presented to the magistrate. even by the date of service of summons, there was no further complaint in writing to the effect that even after the expiry of 15 days period as mentioned in proviso (c), the drawer failed to pay the amount. 16. the matter may also be viewed from the provisions of section 190, cr.p.c., where the magistrate is empowered to take cognizance of any offence upon receiving a complaint of facts which constitute such an offence. we have already referred to the defination of the 'complaint' in cr.p.c. therefore, for taking cognizance of the offence, there should have been a complaint containing the facts which constitute an offence. unless the offence is ex facie disclosed in the complaint, the magistrate cannot have any competence to take cognizance of the offence and proceed further. in the present case, on the facts stated in the complaint, there could not be any offence. as the complaint on the basis of which the magistrate proceeded to take cognizance is not a complaint at all in the eye of law, the question of proceeding with the case on the basis of such complaint does not arise. in the instant case. the magistrate had no means of knowing whether the offence was completed subsequent to the date of the complaint because, as already stated, there was no further written complaint as required by section 142(a). the subsequent events on completion of the offence can only come to the knowledge of the court by way of complaint in writing. apart from the original complaint which does not disclose any offence, there is no further complaint. as rightly pointed out by the learned additional public prosecutor, when the special law specifies not only the ingredients of the offence but also the procedure, the requirements have to be strictly complied with. hence, we are of the opinion that the court cannot proceed with the case even after the lapse of time as prescribed by section 138(c) of negotiate instruments act. 17. we are constrained to observe that if the magistrate had applied his mind to the question whether the offence under section 138 is made out as per the allegation in the complaint and rejected the complaint at the threshold itself, the delay and unnecessary controversy would have been avoided. the complainant would have known where he stands and he would have preferred a fresh complaint on the expiry of 15 days. inasmuch as the condition precedent for taking cognizance is the prima facie disclosure of offence based on the allegations in the complaint itself and as the offence was not made out on the date of taking the complaint on file and examining the complainant, the magistrate instead of taking cognizance of the offence and proceeding further, should have straightway returned the complaint. at the most, he should have, after examining the complainant, dismissed the complaint under section 203, cr.p.c. 18. we are, therefore, of the view that the question referred to the division bench does not really arise because the factum of completion of the offence had not come to the notice of the magistrate by way of a complaint in writing before proceeding with the trial. in any case, the magistrate should not have acted upon the premature complaint which is not a complaint at all in the eye of law. we do not, therefore, find any merit in the appeal though we have expressed our disapproval of the procedure followed in taking cognizance of the offence, proceeding with the case and ultimately acquitting the accused. 19. the criminal appeal is dismissed. 20. appeal dismissed.