JUDGMENT
Rajesh Bindal, J.
1. This order will dispose of a bunch of five quashing petitions bearing Nos. 34728-M, 37559-M, 37562-M, 37565-M and 37568-M of 2000 filed by the petitioners which arise out of five different complaints filed by the respondent No. 2 in case of different cheques issued by petitioner No. 1-firm to the respondent No. 2-complainant. The facts are being noticed from Criminal Misc. No. 37562-M of 2000.
2. The prayer in the petition is for quashing of complaint filed by respondent No. 2-complainant under Section 138 of the Negotiable Instruments Act, 1881(hereinafter referred to as ‘the Act’) on account of non-clearance of the cheque issued by petitioner No. 1-firm.
3. Briefly, the facts as stated in the complaint are that a cheque bearing No. 5800242 dated April 17, 1999 drawn on Dena Bank, Rampura, Surat for an amount of Rs. 1,32,481/- was issued by the petitioner No. 1 to the complainant. The cheque was presented by the complainant through its banker to the Bank of the petitioner and the same was returned unpaid vide memo dated April 20, 1999 with the objection exceeds arrangement. No notice for dishounour of the cheque was issued by respondent No. 2-complainant. However, the cheque was presented again by complainant and the same was returned uncleared vide memo dated September 17, 1999 with the objection sign jointly. On account of non-clearance of the cheque, the respondent No. 2-complainant got notice issued to the petitioners under Section 138 of the Act on October 1, 1999. The notice issued by respondent No. 2-complainant remained unreplied. A complaint was filed in the Court of Judicial Magistrate, First Class on November 18, 1999 within the period of limitation. After preliminary evidence, the petitioners were summoned to face trial vide order dated May 25, 2000. It is at this stage that the petitioners approached this Court for quashing of the complaint filed by respondent No. 2-complainant and also the summoning order dated May 25, 2000.
4. In the above factual matrix, relief for quashing of the complaint is sought by the petitioners on the ground that the Court at Hoshiarpur did not have the jurisdiction to entertain the dispute as the cheque was issued at Surat and was dishonoured at Surat. Secondly, no offence under Section 138 of the Act is made out for the simple reason that the cheque was returned unpaid for the reason sign jointly. In fact the cheque was to be signed by two persons whereas, it was signed by only one, therefore, no complaint under Section 138 of the Act was maintainable. Thirdly, the contention is that the cheque having been dishonoured vide memo dated April 17, 1999 initially, the cause of action arose to respondent No. 2-complainant at that time to file complaint and not when the cheque was not cleared on second presentation. Reliance has been placed upon judgments of Hon’ble the Supreme Court in 2002(7) S.C.C. 581, Vinod Tanna and Anr. v. Zaheer Siddiqui and Ors. and Sadanandan Bhadran v. Madhavan Sunil Kumar .
5. On the other hand, learned Counsel for respondent No. 2-complainant, submitted that the filing of present petition before this Court is an abuse of process of law. No ground for quashing of the complaint is made out as all the contentions raised by the learned Counsel for the petitioners praying for quashing of the complaint are totally meritless. In fact the cheque on both the occasions had been returned primarily on account of the fact that there was no balance in the account of the petitioners. The Court at Hoshiarpur has the jurisdiction to try the complaint as part of the cause of action had arisen within its jurisdiction. Respondent No. 2-complainant having not issued any notice at the time when the cheque was returned uncleared first time, certainly had the right to present the same again during the period of its validity and issue a notice before filing of complaint as the cause of action to file complaint arises not merely on return of the cheque uncleared but if the amount is not paid in spite of issue of notice. In this regard, the submission is that on the first occasion, when the cheque was received back uncleared, respondent No. 2 did not issue any notice and file a complaint for the reason that the petitioners requested to wait for some time and present the cheque again as one of the partners had been shot dead.
6. As regards the objections raised by the bank for non clearance of the cheque second time, the submission is that even that objection is also sufficient to bring the non-clearance of the cheque within the mischief of the offence committed under Section 138 of the Act for the simple reason that in the preliminary evidence it has been brought on record that on both the occasions, when the cheque was presented for payment, the account of the petitioners did not have sufficient balance for the clearance of cheques. The judgments relied upon by the counsel for petitioners have been distinguished. As regards the judgments in Vinod Tanna’s case (supra) relied upon by the learned Counsel for the petitioner, the submission is that the same does not lay down any proposition of law as such as it is a judgment on its own facts which were not disputed. Further, it is submitted that the return of the cheque second time with the objection that ‘sign jointly’ is nothing else but the connivance of the petitioners with the bank officials. In the partner, ship deeds placed on record by the petitioners, there is no such condition that the bank account of the petitioner No. 1-firm shall be operated jointly by two or more partners.
7. Learned Counsel for the respondent No. 2-complainant has further relied upon K. Bhaskaran v. Sankaran Vaidhyan Balan and Anr. , M.M. Malik and Ors. v. Prem Kumar Goyal and Anr. 1991 Criminal Law Journal 2594, Ess Bee Food Specialities and Ors. v. Kapoor Brothers 1992 Criminal Law Journal 739, Kashmir Singh v. State of Punjab and Anr. 1991(1) R.C.R. (Crl.) 324, Gura Singh v. State of Rajasthan 2001(1) R.C.R. (Crl.) 122 (S.C), Prem Cashew Industries v. Zen Pareo 2001(1) R.C.R. (Crl.) 134 (Delhi), Rakesh Nemkumar Porwal v. Narayan Dhondu Joglekar and Anr. 1993 Criminal Law Journal 680 (Bombay). Further reliance is on judgments of Goaplast (P) Ltd. v. Chico Ursula D’Souza and Anr. and NEPC Micon Limited and Ors. v. Magma Leasing Limited , where Heydon principle of mischief rule was applied even in the proceedings under Section 138 of the Act.
Heard learned Counsel for the parties and perused the paper book.
8. In NEPC Micon Ltd and Ors. case (supra), Hon’ble the Supreme Court refer ring to Heydon’s rule opined as under:
10. This Court in the case of Kanwar Singh v. Delhi Admn. while construing Section 418(i) of the Delhi Municipal Corporation Act, 1959 observed:
It is the duty of the Court in construing a statute to give effect to the intention of the legislature. If, therefore, giving a literal meaning to a work used by the draftsman, particularly in a penal statute, would defeat the object of the legislature, which is to suppress a mischief, the court can depart from the dictionary meaning or even the popular meaning of the word and instead give it a meaning which will ‘advance the remedy and suppress the mischief’.
11. Further, while interpreting the statutory provision rule dealing with penalty under the Drugs and Cosmetics Act, 1940 and the rules in the case of Swantraj v. State of Maharashtra this Court held that every legislation is a social document and judicial construction seeks to decipher the statutory mission, language permitting, taking the one from the rule in Heydon’s case of suppressing the evil and advancing the remedy. The Court held that what must tilt the balance is the purpose of the statute, its potential frustration and judicial avoidance of the mischief by a construction whereby the means of licensing meet the ends of ensuring pure and potent remedies for the people. The Court observed that this liberty with language is sanctified by great Judges and textbooks. Maxwell instructs us in these words:
There is no doubt that the office of the Judge is, to make such construction as will suppress the mischief, and advance the remedy, and to suppress all evasions for the continuance of the mischief. To carry out effectively the object of a statute, it must be so construed as to defeat all attempts to do, or avoid doing, in an indirect or circuitous manner that which it has prohibited or enjoined: quando aliquid prohibetur, prohibetur et omne pe quod devenitur ad Mud.
This manner of construction has two aspects. One is that the courts, mindful of the mischief rule, will not be astute to narrow the language of a statute so as to allow persons within its purview to escape its net. The other is that the statute may be applied to the substance rather than the mere form of transactions, thus defeating any shifts and contrivances which parties may have devised in the hope of thereby falling outside the Act. When the courts find an attempt at concealment, they will, in the words of Wilmot, C.J. ‘brush away the cobweb varnish, and show the transactions in their true light’.
12. This benignant rule originated four hundred years ago in Heydon’s case (1584)3 Co.Rep. 7a : 76 E.R. 6371 which resolved-
That for the sure and true interpretation of all statutes in general (be they penal or beneficial, restrictive or enlarging of the common law), four things are to be discerned and considered:
1st. What was the common law before the making of the Act:
2nd. What was the mischief and defect for which the common law did not provide.
3rd. What remedy Parliament hath resolved and appointed to cure the disease of the commonwealth.
And, 4th. The true reason of the remedy; and then the office of all the Judges is always to make such construction as shall suppress the mischief, and advance the remedy, and to suppress subtle inventions and evasions for continuance of the mischief, and pro private commando, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico.
Even with regard to the penal provision which is also a remedial one in the case of State of T.N v. M.K. Kandaswami the Court observed that in interpreting such a provision, a construction which would defeat its purpose and, in effect, obliterate it from the statute book should be eschewed; if more than one construction is possible that which preserves its workability and efficacy is to be preferred to the one which would render it otiose or sterile.
13. In the case of International Ore and Fertilizers (India) (P) Ltd. v. ESI Corporation (1949)2 All. E.R. 155 this Court referred to an oft-quoted passage from the decision in the case of Seaford Court Estates Ltd. v. Asher (1949)2 All. E.R. 155 wherein Lord Denning, L.J. Observed:
The English language is not an instrument of mathematical precision. Our literature would be much poorer if it were. This is where the draftsmen of Acts of Parliament have often been unfairly criticised. A judge, believing himself to be fettered by the supposed rule that he must look to the language and nothing else, laments that the draftsmen have not provided for this or that, or have been guilty of some or other ambiguity. It would certainly save the judges trouble if Acts of Parliament were drafted with divine prescience and perfect clarity. In the absence of it, when a defect appears a judge cannot simply fold his hands and blame the draftsman. He must set to work on the constructive task of finding the intention of Parliament, and he must do this not only from the language of the statute, but also from a consideration of the social conditions which gave rise to it and of the mischief which it was passed to remedy, and then he must supplement the written word so as to give force and life’ to the intention of the legislature….
A judge should ask himself the question how, if the makers of the Act had themselves come across this truck in the texture of it, they would have straightened it out? He must then do so as they would have done. A judge must not alter the material of which the Act is woven, but he can and should iron out the creases.
9. It was further held therein that even in a case where the reason of dishonour of cheque is ‘stop payment’ offence under Section 138 of the Act could still be made out as presumption under Section 139 of the Act is attracted in such cases also. In such cases, the Court has to presume that cheque was received by the holder for the discharge, in whole or in part, of any debt or liability. Of course this is rebuttable presumption. The onus is on the accused to show that stop payment instructions were issued not because of insufficiency or paucity of funds but on account of some other valid reason. Even on this ground complaint cannot be quashed.
The object of Section 138 of the Act is to inculcate faith in the efficacy of banking operations and credibility in transaction in business on negotiable instruments.
10. In MMTC Limited and Anr. v. Medchl Chemicals and Pharma (P) Ltd. and Anr. while discussing the issue regarding quashing of proceedings under Section 138 of the Act, Hon’ble Supreme Court opined that the power of quashing criminal proceedings should be exercised very stringently and with circumspection. The Court is not justified in embarking upon an enquiry as to the reliability, genuineness or otherwise of the allegations made in the complaint. The inherent powers, do not confer an arbitrary jurisdiction on the court to act according to its whim or caprice. At this stage, the Court could not have gone into merits and/or come to a conclusion that there was no existing debt or liability.
11. As on the issue of jurisdiction, in my opinion, the plea raised by learned Counsel for the petitioners deserves to be rejected keeping in view the law laid down by Hon’ble the Supreme Court in K. Bhaskaran’s case (supra). Paras 14 to 16 thereof can be referred to for the purpose, which are extracted below:
14. The offence under Section 138 of the Act can be completed only with the concatenation of a number of acts. Following are the acts which are components of the said offence: (1) Drawing of the cheque, (2) Presentation of the cheque to the bank, (3) Returning the cheque unpaid by the drawee bank, (4) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount (5) failure of the drawer to make payment within 15 days of the receipt of the notice.
15. It is not necessary that all the above five acts should have been perpetrated at the same locality. It is possible that each of those five acts could be done at 5 different localities.
But concatenation of all the above five is a sine qua non for the completion of the offence under Section 138 of the Code. In this context a reference to Section 178(d) of the Code is useful. It is extracted below:
Where the offence consists of several acts done in different local areas, it may be inquired into or tried by a court having jurisdiction over any of such local areas.
16. Thus it is clear, if the five different acts were done in five different localities any one of the courts exercising jurisdiction in one of the five local areas can become the place of trial for the offence under Section 138 of the Act. In other words, the complainant can choose any one of those courts having jurisdiction over any one of the local areas within the territorial limits of which any one of those five acts was done. As the amplitude stands so widened and so expansive it is an idle exercise to raise jurisdictional question regarding the offence under Section 138 of the Act.
12. In the present case, admittedly notice after dishonour of the cheque was issued by respondent No. 2 from Hoshiarpur and accordingly, the Court at Hoshiarpur has the territorial jurisdiction to entertain and try the lis between the parties.
13. As regards second issue raised by learned Counsel for the petitioners that com plaint in question is time barred as no notice was issued by the respondent No. 2 when the cheque was returned uncleared at the time of first presentation and the complaint was filed only when the cheque was returned uncleared at the time of second presentation. Even on this issue, keeping in view the settled position of law, the petitioners do not have any legs to stand. Hon’ble the Supreme Court in Prem Chand Vijdy Kumar v. Yashpal Singh and Anr. opined that Clause (a) of the Act does not put any embargo upon the payee to successively present a dishonoured cheque during the period of its validity. Such type of course is common in business transactions as some time once the cheque is returned on account of insufficient funds or similar such reasons, the same is presented again by the payee after some time on his own volition or at the request of the drawer in the expectation that it would be encashed. Primary interest of the payee is to get his money back and not to prosecute the drawer of the cheque. Recourse to the prosecution is taken not by choice but under compulsion. On each presentation of the cheque and its dishonour, a fresh right is created but the same is not a cause of action. But once a notice is given under Clause (b) of Section 138 the Act, the drawee of the cheque forfeits his right to present the cheque again as in case of failure of the drawer of the cheque to pay the money within the stipulated time, he would be liable for the offence and the cause of action for filing the complaint will arise. That cause of action on combined reading of Sections 138 and 142 of the Act arise only once when the notice has been issued. If notice is not issued no cause of action arises to file complaint. In case dishonour of a cheque once snowballed into a cause of action it is not permissible for a payee to create another cause of action with the same cheque with its presentation second time. In the present case admittedly no notice was issued by the respondent No. 2/complainant when the cheque was returned uncleared on first presentation but was issued only when the same was returned uncleared on second presentation and from that date the complaint is well within limitation. Accordingly, even this contention is also misconceived and is rejected.
14. Third ground raised by learned Counsel for the petitioners for quashing of the complaint is that the cheque was returned uncleared with the objection ‘sign jointly’, which according to him does not constitute an offence under Section 138 of the Act and accordingly, the complaint was not maintainable. However, even this argument is totally misconceived. Learned Counsel for respondent No. 2/complainant submitted that there is evidence on record to prove that even when the cheque was returned with the objection ‘sign jointly’ balance in the account of the petitioners was not sufficient to honour the cheque. Once that is so this comes within the mischief of Section 138 of the Act as there is a presumption under Section 139 of the Act that cheque had been issued in discharge of a debt or liability though the presumption is rebuttable but merely on the statement of the accused, the complaint cannot be quashed at this stage as this is a matter of trial during which any presumption could be rebutted. In addition to this, reference can be made to the fact that the same cheque when presented earlier was returned with the objection ‘exceed arrangements’. However, at the time of second presentation, the same was returned with the objection ‘sign jointly’. Nothing has been brought on record as to why the objection regarding signature was not raised at the time of first presentation. Further from the preliminary evidence produced by the respondent No. 2/com-plainant on record, it is clear that even when the cheque was presented for the second time and returned uncleared sufficient balance was not there in the account of the petitioner to honour the cheque. As the justification of objection and rebutting of presumption by the petitioners is concerned, in my opinion the same is matter of trial, which is to be finally adjudicated upon on appreciation of evidence to be led by the parties. Accordingly, even on this ground alone also the complaints cannot be quashed.
15. Keeping in view my above discussions and also the object for which the amendment was carried out in the Act, I do not find it to be a fit case where the complaint filed against the petitioners deserves to be quashed.
Accordingly, the petitions are dismissed. The parties through their counsels are directed to appear before the Court below on April 03,2008 for further proceedings.