?IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 27/09/2002
CORAM
THE HONOURABLE MR. JUSTICE A. PACKIARAJ
Criminal Original Petition No. 15093 of 2000
P.Sumathi : Petitioner
-Vs-
M.P.Ashok : Respondent
PRAYER: Petition filed to call for the records in CC.No.6 of 2000,
pending on the file of the learned Judicial Magistrate No.II, Erode
and quash the complaint.
!For petitioner : Mr.R.Ramesh for
M/s M.S.Palaniswamy
^For respondent : Mr.T.S.Sivagnanam
:O R D E R
This petition has been filed to quash the private complaint filed
against the petitioner for offence under Section 138 Negotiable
Instruments Act.
2.The brief facts that are necessary for the purpose of disposing
of this petition may be stated as follows:
The accused, who is the sole proprietrix of Velmathi Textiles, had
purchased yarns on credit from Sri Balaji Modern Yarns, Erode and for the said liability, towards the sale purchase, had issu
cheques to Sri Balaji Modern Yarns. Sri Balaji Modern Yarns having
received the cheques had made an endorsement in favour of the complainant.
The total sum of the three cheques amounts to Rs.3,24,400/- and the
fourth cheque relates to Rs.1,22,400/-. The complainant presented the
three cheques totalling to Rs.3,24,400/- on 13.10.2000 and the same
were dishonoured for want of funds. Hence after observing all the
formalities, the present complaint has been filed.
3.The present petition for quashing has been filed mainly on the
ground that there is absolutely no debt or liability for the accused
towards the complainant and hence provisions under Section 138
Negotiable Instruments Act would not be attracted. However, it has to be seen that 138 Negotiable Instruments Act does not au
against the drawee but also holder in due course. But the same has
been countered by the learned counsel for the petitioner stating that in the present case the complainant cannot be termed to
due course since the cheque was not endorsed directly by the drawer
to the complainant, but as a matter of fact, it has been endorsed in
favour of a third person, who in turn had endorsed it to a fourth
person and the fourth person had in turn, endorsed it to the complainant
and as such, he cannot be deemed as a holder in due course, but may
at best be stated to be a holder.
4.I need not go into this issue as such, as to whether the
original drawee has endorsed in favour of the second person, who endorsed it in favour of a third person, who in turn had end
complainant. This matter has to be decided only by the trial court. The
learned counsel would no doubt argue that a bare look on the cheque
itself would reveal the same. It is pertinent to note that the original
cheque is not before the court, but only a xerox copy is there. However, this court cannot come to any particular conclusion
to when and under what circumstances the endorsement has been come to
be made. As against this endorsement it s the specific case of the
complainant that the purchase has been made from Sri Balaji Modern
Yarns and the cheque has been drawn in favour of Sri Balaji Modern Yarns
and as such, when they are disputed facts and this court sitting
under 482 Cr.P.C cannot go into the question of disputed facts and the
matter has to be necessarily decided only in the trial court.
5.In support of his contention, the learned counsel would rely on
the decision of Sukanraj Khimraja and another Vs. N.Rjagopalan and
others (1989 1 LW 401) wherein their Lordships have held as follows:-
“In the instant case, the plaintiff as a brother of M was fully
aware that the cheque has been dishonoured and the endorsement in his
favour was only after it was returned by the Bank. Therefore, Ex.A-1
has lost its negotiability. Hence, he cannot be a holder in due course”.
6.In so far as the decision of the Division Bench of this court is
concerned, no doubt, there is an observation that the cheque has lost its negotiability and hence the subsequent endorser can
litigation where the claimant sought redress on the basis of the endorsement after the cheque has been dishonoured, without b
negotiability. The learned Judges in the decision cited supra have not stopped with a mere observation as quoted supra, but h
with a subsequent sentence which reads as follows :-
“This essential characteristic having not been comprehended and
more so, when the cheque had never been thereafter presented to the Bank for encashment, the suit as laid, would not have bee
It is in this context that the learned Judges have held that the
plaintiff in that case was not a holder in due course. But in the
present case, admittedly, the cheque has not lost its negotiability. The
cheque is valid for six months and it could be presented in the bank
any number of times before the expiry of six months period. And as a
matter of fact, even according to the petitioner, the cheque has been deposited in the bank after the endorsement has already
of insufficiency of
funds. In other words, the cheque in the present case has not lost its negotiability whereas in the case decided by the Divis
cheque has not been deposited in the Bank and therefore, their
Lordships have held that it has lost its negotiability. In such
circumstances, I do not feel that the decision may apply to the facts of this
case. Hence I do not see any merit in the points raised by the learned
counsel for the petitioner. Secondly, it will not be out of place for me to state that in the present case, PW-1 has been exa
continued and at that stage, this petition has come to be filed. In
such circumstances, I don’t feel it proper to exercise the power of
this court vested under 482 Cr.P.C and entertain this petition.
7.In support of this I would rely upon the decision reported in
Amar Chand Agarwala Vs. Shanthi Bose (AIR 1973 SC 799) wherein it has
been observed as follows:
” Where the accused moved the High Court at the time when the trial was almost coming to a close and what remained to
examination of two prosecution and one court witnesses and the High
court quashed the charge and entire proceedings on the grounds that the
complainant suppressed material facts and that the evidence on record did not establish the alleged offence. The order was li
set aside. The proper course at that stage to be adopted by the high
court was to allow the proceedings to go on and to come to its logical
conclusion, one way or the other and decline to interfere with those
proceedings. The questions whether there was suppression and whether
the evidence established the alleged offence were matters to be
considered by the trial court after an appraisal of the entire evidence.”
8.For the above said reasons, I see no merits in this petition and
the same is therefore, dismissed. Consequently, Crl.M.P.No.5198 of 200
1 is also dismissed.
INDEX: Yes Web: Yes 27.09.2002 tar A.PACKIARAJ, J. To 1.The Judicial Magistrate No.II, Erode 2.-do- Through the Chief Judicial Magistrate, Erode