JUDGMENT
K.T. Thomas, J.
1. In view of the conflicting views on interpretation of Section 138 of the Negotiable Instruments Act, 1881 (for short “the Act”), Thulasidas J. has referred this case to a Division Bench. Balakrishnan J. has held in Mahadevan Sunil Kumar v. Bhadran [1991] 1 KLJ 335 ; [1992] 74 Comp Cas 805, 807 that :
“… it is clear that cause of action for filing the complaint may arise on several occasions and the payee or holder in due course is entitled to present the cheque at any time within a period of six months from the date on which it was drawn and for filing the complaint, he should have served notice of such dishonour to the drawer ; the payee or holder in due course can make a second presentation of the cheque and, if other conditions are fulfilled, he can launch a complaint on the basis of the second dishonour of the cheque as the cheque would remain valid for a period of six months.”
2. Padmanabhan J., without noticing the decision in Mahadevan Sunil Kumar’s case [1992] 74 Comp Cas 805, took a contrary view in his order dated February 18, 1991 (Crl. R. P. No. 480 of 1990) (see p. 853 infra).
3. The facts of this case are the following: The respondent herein filed a complaint before a Judicial Magistrate of the First Class alleging that the petitioner has committed the offence under Section 138 of the Act (respondent will be referred to as the complainant hereinafter). He stated in the complaint that a cheque drawn on Vijaya Bank for Rs. 10,000 was issued by the petitioner on November 4, 1989, in favour of the complainant ; and, on November 6, 1989, the cheque was returned dishonoured by the drawee-bank on the ground “refer to drawer”. Notice issued by the complainant was received by the petitioner on November 23, 1989. But no payment was made pursuant to the said notice. The complainant again presented the said cheque on January 15, 1990, before the drawee-bank and it was again dishonoured. A fresh notice was issued to the petitioner which he received on February 13, 1990. As no payment was made by the petitioner thereafter too, a complaint was filed on March 12, 1990. The learned Magistrate took the complaint on file and issued process to the petitioner. This criminal miscellaneous case has been filed by the petitioner to quash the complaint.
4. The only ground urged by the petitioner is that the respondent cannot have a second cause of action on the same cheque when once he had failed to institute a complaint on the strength of the first cause of action.
5. Section 138 of the Act creates a new offence based on a cheque returned unpaid and subject to certain conditions. The said section and its ancillary provisions have been included in Chapter XVII of the Act. The said Chapter was introduced in the Act on April 1, 1989. The offender, as per Section 138, is the drawer of the cheque. One of the conditions to constitute the offence is that the cheque should have been presented to the bank within six months of its issue. Another condition is that the payee should have made a demand for payment by registered notice after
the cheque is returned unpaid. The third condition is that the drawer should have failed to pay the amount within 15 days of the receipt of notice. Unless the cheque is returned unpaid due to insufficiency of money standing to the credit of the drawer or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank, Section 138 of the Act is not attracted. Section 139 of the Act casts a presumption that the holder of a cheque has received the same towards discharge of a liability. Section 140 of the Act precludes the drawer from pleading that he had no reason to believe that the cheque would be dishonoured. A complaint can be filed only by a payee, or a holder in due course, of the cheque. Section 142 imposes a further restriction that no complaint can be filed after one month of the date on which the cause of action arose.
6. From the scheme of the provisions in Chapter XVII of the Act, two features loom large. The first is that more than one cause of action on the same cheque is not contemplated or envisaged. The second is that, institution of prosecution cannot be made after one month of the cause of action. If more than one cause of action on the same cheque can be created, the consequence would be that the same drawer of the cheque can be prosecuted and even convicted again and again on the strength of the same cheque. The Legislature cannot be imputed with the intention to subject a drawer of cheque to repeated prosecutions and convictions on the strength of one cheque.
7. Drawing a cheque is a sine qua non for an offence under Section 138 of the Act. This Division Bench has held in Prithviraj v. Mathew Koshy [1991] 1 KLT 595 ; [1991] 71 Comp Cas 131, that when the main body of Section 138 is read along with its proviso, it is clear that the offence is committed when the drawer of the cheque fails to make payment within fifteen days of the receipt of the notice. The question considered by the Division Bench in the aforesaid case was whether any offence can be committed with respect to a cheque issued before the introduction of Section 138 of the Act. The Division Bench observed in that context thus (at page 135 of 71 Comp Cas) ;
“Dishonour of cheque by itself does not give rise to a cause of action, because payment can be made on receipt of notice of demand contemplated in Clause (b) of Section 138 and in that event, there is no offence, nor any attempt to commit the offence, nor even a preparation to commit the offence. Failure to pay the amount within fifteen days of receipt of notice alone is the cause of action and nothing else.”
8. Though the date of drawing the cheque is not the criterion to decide the date of cause of action as held in Paramjith Singh v. N.C. Job [1989]
2 KLT 740 ; [1990] 67 Comp Cas 570 (Ker), and affirmed by the Division Bench in Prithviraj’s case [1991J 71 Comp Cas 131 (Ker), drawing of cheque is the genesis of the facts without which there can be no offence.
9. It is contended that since the view adopted by the learned single judge in Mahadevan Sunil Kumar’s case [1991] 1 KLJ 335 ; [1992] 74 Comp Cas 805, is also possible, the complainant cannot be denied the right to proceed against the petitioner for the offence under Section 138 of the Act. Even if such a view is possible, it is one of the settled principles of interpretation of statutes that, when two interpretations are possible of a penal provision, only that which is less onerous to the accused should be preferred (vide Maxwell on the Interpretation of Statutes, 12th edition, at page 239) :
“The principle applied in construing a penal Act is that if, in construing the relevant provisions, there appears any reasonable doubt or ambiguity, it will be resolved in favour of the person who would be liable to the penalty.”
10. The learned author quoted Lord Esher M. R., from the decision in Tuck and Sons v. Priester [1887] 19 QB 629, 638 (CA), thus :
“If there are two reasonable constructions, we must give the more lenient one. That is the settled rule for the construction of a penal section.”
11. The Supreme Court has adopted the same principle for interpretation of penal statutes (vide M.V. Joshi v. M.U. Shimpi, AIR 1961 SC 1494). Departure from this principle is permitted if the object and scheme of the statute would be defeated otherwise (vide Chief Inspector of Mines v. Karam Chand Thapar, AIR 1961 SC 838 ; [1961-62] 20 FJR 282 and Maharaja Booh Depot v. State of Gujarat [1979] SCC (Crl.) 275).
12. That apart, according to us, the words in the relevant provisions of the Act are not so ambiguous as to afford scope for an interpretation which leads to the disastrous consequences cited above. We have already indicated the possibility of such consequences ensuing if more causes of action than one are permitted to arise in respect of the same cheque. Hence, the principle adopted in Mahadevan Sunil Kumar’s case [1992] 74 Comp Cas 805, cannot be regarded as correct. We are in agreement with the view expressed by Padmanabhan J. (see on next page).
13. For the aforesaid reasons, we quash the proceedings by which the learned Magistrate issued process against the petitioner on the complaint.
14. Criminal miscellaneous case is disposed of accordingly.