2002(2) ALL MR (JOURNAL) 41
DELHI HIGH COURT
S.K. AGARWAL, J.
Raj Chawla Vs. P. N. Kapoor
Crl. M (M) No. 4166 of 2000
14th August, 2001
Petitioner Counsel: Mr. A. K. SINGHLA with Mr. PANKAJ GUPTA
Respondent Counsel: Mr. SANJAY KATYAL with Mr. RAMESH KATYAL
Negotiable Instruments Act (1881) Ss.138, 139 - Dishonour of cheque - Once the cheque is issued presumption under S.139 follows in favour of the holder - Merely because drawer of the cheque issued notice to drawee or to bank for stopping payment, it would not save from an action under S.138.
1998(2) ALL MR 433 (S.C.) Rel.on. (Para 5)
Modi Cement Ltd. Vs. K. K. Nandi, 1998(2) ALL MR 433 (S.C.) =AIR 1998 SC 1057 [Para 3]
Electronics Trade and Technology Development Corporation Ltd., Secunderabad, 1997 ALL MR (Cri) 1027 (S.C.) =1996 AIR SCW 840 [Para 3]
JUDGMENT:- This petition under Section 482 Cr.P.C. is directed against the order dated 4th January, 2000 passed by Ms. Barkha Gupta, M.M. Patiala House, New Delhi summoning the petitioner holding that, prima facie, a case under Section 138 of Negotiable Instrument Act is made out against him.
2. Learned counsel for the petitioner argued that in the complaint there is no averment to the effect that the cheque in question was dishonoured due to insufficiency of funds or to show that petitioner's account did not have the necessary funds to honour the cheque in question. Therefore, no cognizance could be taken on such complaint. Learned counsel for respondent No.1 argued to the contrary.
3. Law, in this regard is well settled, merely because payment of the cheque was stopped it would not disentitle the beneficiary from initiating proceedings under Section 138 of Negotiable Instruments Act. The Supreme Court in Modi Cement Ltd. v. K. K. Nandi, AIR 1998 SC 1057 : (1998(2) ALL MR 433 (S.C.)) had held :
"16. We see great force in the above submission because once the cheque is issued by the drawer a presumption under Section 139 must follow and merely because the drawer issues a notice to the drawee or to the Bank for stoppage of the payment in will not preclude an action under Section 138 of the Act by the drawee or the holder of a cheque in due course. The object of Chapter XVII, which is titled as "OF PENALTIES IN CASE OF DISHONOUR OF CERTAIN CHEQUES FOR INSUFFICIENCY OF FUNDS IN THE ACCOUNTS" and contains sections 138 to 142, is to promote the efficacy of banking operations and to ensure credibility in transacting business through cheques. It is for this reason we are of the considered view that the observations of this Court in Electronics Trade and Technology Development Corporation Ltd., Secunderabad, 1996 AIR SCW 840 : (1997 ALL MR (Cri) 1027 (S.C.)) (supra) in paragraph 6 to the effect "Suppose after the cheque is issued to the payee or to the holder in due course and before it is presented for encashment, notice is issued to him not to present the same for encashment and yet the payee or holder in due course presents the cheque to the bank for payment and when it is returned on instructions. Section 138 does not get attracted," does not fit it with the object and purpose for which the above chapter has been brought on the Statute Book."
4. In this case, cheque in question was dishonoured initially because of insufficiency of funds. In support of the complaint CW-2 Ashok Kumar, official from the Bank was examined, who categorically stated that the cheque in question was dishonoured due to insufficiency of funds. However, subsequently on the instructions of the petitioner, cheque was dishonoured due to stop payment. Relevant portion of the statement of CW-2 reads as under :-
"I have also brought copy of cheque return register. The same is also signed by our Branch Manager at point 'A'. As per the said record Bank had given remark regarding dishonour cheque F-1 at point 'B'. As per our Bank language meaning of said remark 'B' is insufficient funds. The copy of said cheque return register is Ex.CW 2/B."
5. In view of the above, as per settled law, once the cheque is issued by the drawer, presumption under Section 139 of the Act follows in favour of the holder. Merely because the drawer of the cheque issued notice to the drawee or to the bank for stopping payment, it would not save from an action under Section 138 of the Negotiable Instruments Act.
6. At the stage of summoning, the Magistrate is mainly concerned with the allegations made in the complaint or the evidence led in support of the same. He is required to be prima facie satisfied whether there is sufficient grounds for proceeding against the accused. The Magistrate is not required to go into the detailed discussion about the merits or demerits of the case. Defence of the accused cannot be taken into consideration at this stage.