1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPLICATION NO. 2336 OF 2001
WITH
CRIMINAL APPLICATION NO. 2339 OF 2001
1. Karishma Consultant,
2. Ms.Varsha Devang Desai,
both having their place of
residence and business at
C-305, Karachi Citizen
Co-op, Housing Society Ltd.
New Juhu Link Road, behind
JVPD Bus Depot,
Mumbai 400 057 .... Applicants.
(Org.Accused Nos.1&2)
V/s.
1. Om Prakash Agarwal,
residing at 21 Sunita,
Cuffe Parade,
Mumbai 400 005 (Orig.Complainant)
2. State of Maharashtra .... Respondents
WITH
CRIMINAL APPLICATION NO. 2339 OF 2001
1. Karishma Consultant,
2. Ms.Varsha Devang Desai,
both having their place of
residence and business at
C-305, Karachi Citizen
Co-op, Housing Society Ltd.
New Juhu Link Road, behind
JVPD Bus Depot,
Mumbai 400 057 .... Applicants.
(Org.Accused Nos.1&2)
V/s.
1. S.V.Sampat,
residing at 2A Shrikrupa,
5th Carter Road, Ground
Floor, Borivali (East),
Mumbai 400 067 (Orig.Complainant)
2. State of Maharashtra .... Respondents
::: Downloaded on - 09/06/2013 15:06:10 :::
2
.....
Mr.N.K.Thakore i/by Mr.Prakash Naik for the
applicants.
Shri S.V.Marwadi, Advocate for respondent no.1.
Mrs.Usha V. Kejriwal, APP for State.
.....
WITH
CRIMINAL APPLICATION NO. 2337 OF 2001
1. Karishma Consultant,
2. Ms.Varsha Devang Desai,
both having their place of
residence and business at
C-305, Karachi Citizen
Co-op, Housing Society Ltd.
New Juhu Link Road, behind
JVPD Bus Depot,
Mumbai 400 057 .... Applicants.
(Org.Accused Nos.1&2)
V/s.
1. Smt.Kalpana Agarwal,
Wife of Om Prakash Agarwal,
residing at 21 Sunita,
Cuffe Parade,
Mumbai 400 005 (Orig.Complainant)
2. State of Maharashtra .... Respondents
....
Mr.N.K.Thakore i/by Mr.Prakash Naik for the
applicants.
Mrs.A.A.Mane, APP for State.
....
WITH
CRIMINAL APPLICATION NO. 2338 OF 2001
1. Karishma Consultant,
2. Ms.Varsha Devang Desai,
both having their place of
residence and business at
C-305, Karachi Citizen
Co-op, Housing Society Ltd.
New Juhu Link Road, behind
JVPD Bus Depot,
::: Downloaded on - 09/06/2013 15:06:10 :::
3
Mumbai 400 057 .... Applicants.
(Org.Accused Nos.1&2)
V/s.
1. Rashmi Agarwal,
C/o. Om Prakash Agarwal
through Shiv Prakash Pandey,
certified attorney,
residing at 21 Sunita,
Cuffe Parade,
Mumbai 400 005 (Orig.Complainant)
2. State of Maharashtra .... Respondents
....
Mr.N.K.Thakore i/by Mr.Prakash Naik for the
applicants.
Mr.A.S.Shitole, APP for State.
ig ....
WITH
CRIMINAL APPLICATION NO. 2340 OF 2001
1. Karishma Consultant,
2. Ms.Varsha Devang Desai,
both having their place of
residence and business at
C-305, Karachi Citizen
Co-op, Housing Society Ltd.
New Juhu Link Road, behind
JVPD Bus Depot,
Mumbai 400 057 .... Applicants.
(Org.Accused Nos.1&2)
V/s.
1. Ravindra Agarwal,
C/o. Om Prakash Agarwal
through Prakash Pandey,
certified attorney,
residing at 21 Sunita,
Cuffe Parade,
Mumbai 400 005 (Orig.Complainant)
2. State of Maharashtra .... Respondents
....
Mr.N.K.Thakore i/by Mr.Prakash Naik for the
applicants.
Mrs.A.A.Mane, APP for State.
::: Downloaded on - 09/06/2013 15:06:10 :::
4
....
CORAM : V.R.KIN GAONKAR, J.
DATE : 22ND SEPTEMBER, 2009.
ORAL JUDGMENT :
1 The group of above noted applications filed
by original accused persons for quashing of
criminal complaint case u/s.482 of Criminal
Procedure Code is being decided together in
as much as identical questions of law and
facts are involved therein :
2 The applicants are the proprietary business
concern and proprietor, respectively who
had certain transactions with the
respondent no.1 (Complainant). Devang Desai
was husband of the applicant no.2 and was
duly authorized to issue cheques for and on
behalf of the applicants. There is no
dispute about the fact that he issued five
cheques in question towards discharge of
financial liability which the applicants
were supposed to discharge. There is also
::: Downloaded on – 09/06/2013 15:06:10 :::
5
no dispute about the fact that the said
five cheques were dishonoured by the UCO
Bank when they were presented for
encashment. The UCO Bank returned the
cheques to the respondent no.1
(Complainant) with intimation that the
cheques could not be honoured due to
insufficiency of the funds in the account
of the applicants. There is also no
dispute about the fact that the cheques
were issued on Bank account of the
applicants.
3 The respondent no.1 had issued demand
notice in the context of the five criminal
cases. That notice was replied by the
applicants. The tenor of the reply was
that the signatory of the cheques i.e.
Devang Desai had died on 1st May 1996 before
the presentation of the cheques in the Bank
and as such, the cheques were no more valid
instruments. It was also stated in the
::: Downloaded on – 09/06/2013 15:06:10 :::
6
reply notice that the intimation was duly
given to the Bank about the death of
Devang Desai, yet the Bank had wrongly
endorsed that the cheques could not be
honoured due to insufficiency of the funds
in the account.
4 The applicants seek quashing of the
criminal ig complaint cases mainly on the
ground that the cheques were no more valid
one and, therefore, the dishonor of such
cheques could not have incurred any
criminal liability against them. They
filed applications before the Metropolitan
Magistrate, for discharge, which were
rejected. The learned Metropolitan
Magistrate held that the contention raised
by the applicants could not be considered
at the pre-emptory stage.
5 Heard the learned counsel.
6 Mr.Prakash Naik, learned counsel for the
applicant submits that the respondent no.1
::: Downloaded on – 09/06/2013 15:06:10 :::
7
was duly intimated about the death of
Devang Desai, the authorized signatory of
the cheques and therefore, the complaint
cases should not have been initiated at
all. He would submit that the intimation
was given to the Bank but incorrect
endorsement was made by the Bank and
therefore ig mere dishonor of the cheques
cannot be a ground to proceed with the
criminal cases. He contended that the
cheques became invalid in the eye of law
before the date of the presentation
thereof. He invited my attention to the
explanation given below Section 138 of the
Negotiable Instrument Act as well as 141 of
the Negotiable Instrument Act. He seeks to
rely on certain observations in JT 2001
(10) SC 345 in Vinod Tanna & Anr. v. Zaheer
Siddiqui & Ors. As against this,
Mr.S.V.Marwadi, learned counsel for
respondent no.1, submits that the complaint
::: Downloaded on – 09/06/2013 15:06:10 :::
8
cases need not be quashed when the disputed
question of facts are involved. He would
point out that there is no record to
indicate that the Bank was informed by the
applicants about the death of said Devang
Desai before presentation of the cheques in
question. He contended that the cheques
were issued by the authorized person for
and on behalf of the applicants and
therefore, the applicants are the drawers
of the cheques. He seeks to rely on
certain observations in 2000 ALL.MR.
(Cri)1476 in Car Mart Pvt. Ltd V/s. Apollow
Finvest India Ltd. & Ors.
7 Clinching question is whether the cheques
in question lost validity due to the death
of the authorized signatory and therefore,
the applicants, who are the drawers of the
cheques in the eye of law, can prima facie
escape the criminal liability.
8 Admittedly, the cheques were drawn on
::: Downloaded on – 09/06/2013 15:06:10 :::
9
account of the applicants and there is no
dispute about the fact that the applicants
were liable to pay the amount shown under
the cheques in question. The deceased
(Devang Desai) was only authorized
signatory of the cheques in question. The
plain reading of Section 138 of the
Negotiable Instrument Act would show that
the criminal liability would arise when
cheuqe is dishonoured though presented to
the Bank within the period of six months
from the date it was drawn or within the
period of its validity, whatever is
earlier. According to Mr.Naik, the
expression Period of its validity does
imply that it was the period which could be
upto the date of death of said Devang
Desai. The cheques in question could not
regarded as invalid instruments as on date
of death of the signatory qua the payee
bank unless the death was duly intimated to
::: Downloaded on – 09/06/2013 15:06:10 :::
10
the bank. Take for example, that A has
issued a cheque and died period to
presentation thereof in the Bank. No
intimation about the death is given to the
Bank and the amount is available in the
account, the Bank is then legally bound to
honour the cheuqe as and when it is
presented.ig The cheque cannot be
dishonoured unless it is communicated to
the Bank that the signatory of the cheque
was no more alive. Obviously, unless there
is tangible evidence to infer that the Bank
was duly intimated about death of said
Devang Desai, prior to presentation of the
cheques in question, it cannot be said that
the instruments became invalid.
9 In Vinod Tanna & Anr. v. Zaheer Siddiqui &
Ors in JT 2001 (10) SC 345 (Supra), the
Apex Court held that when the dishonor of
the cheque was on the ground that the
drawer s signature was incomplete, it would
::: Downloaded on – 09/06/2013 15:06:10 :::
11
not give rise to the criminal liability
u/s. 138 of the Negotiable Instrument Act.
For, the dishonor of the cheque would fall
outside the ambit of Section 138 of the
Negotiable Instrument Act. In such a case,
the cheque cannot be said to have been
returned unpaid by the Bank because of
insufficiency of the funds standing to the
credit of the account holder or it exceeds
the amount alleged to be paid. In the
present case, the Bank refused to honour
the cheques in question, because there was
no appropriate amount at the credit of the
applicants to satisfy the demanded amount
shown under the cheques in question. Had
the cheques been dishonoured on account of
death of the authorized signatory, then
probably the impact would have been
something different.
10 Though the applicant no.2 is not a
signatory of the cheques in question, yet
::: Downloaded on – 09/06/2013 15:06:10 :::
12
she and the applicant no.2 are the account
holders and the chqeus were issued on their
accounts. In somewhat similar fact
situation, this Court in Car Mart Pvt. Ltd
V/s. Apollow Finvest India Ltd. & Ors.2000
in ALL.MR.(Cri)1476 held that the drawer
of the cheque cannot escape the liability
on the ground
ig that the signatory of the
cheque died prior to the date mentioned in
the cheuqe. It is pertinent to note that
herein the question whether the signatory
of the cheques, died prior to the dates of
the presentation of the cheques, is a
disputed question of fact. The question
whether the applicants gave due intimation
about the death of the authorized signatory
of the cheques to the Bank is also disputed
question of fact. There is nothing on
record to say that such prior intimation
was given to the Bank soon after death of
the said signatory of the cheques, namely,
::: Downloaded on – 09/06/2013 15:06:10 :::
13
Devang Desai and request was made to treat
the cheques in question as a invalid
instruments. Considering these aspects of
the matter, it is difficult to countenance
the contentions raised by Mr.Naik. The
applicants being drawers of the cheques in
question, are prima facie liable to face
the criminal prosecution.
ig The applications
are, therefore, without much merit.
11 In the result, the applications are
dismissed.
12 The Trial Court shall expedite the trials
of the criminal complaints.
(V.R.KIN GAONKAR, J.)
::: Downloaded on – 09/06/2013 15:06:10 :::