Shree Raj Travels & Tours Ltd. v. Destination of the World (Subcontinent) Private Ltd.

VERSUS

DESTINAT~ON OF THE \NORUD (SUBCONT~NEI\lT)PRIVATE LTD...... Respondent Through: Mr.A.nindya Malhotra, J\dvocate CRLM.C. JL1B6/~011 C:HREE. D/\' TR/\\/Ci' r -·~OUR'- 1 TO.._j' \: 1 \r-·tj..J\J-\ \t C LJ c_,~ ~. '""'\._) II_ I " 5c ORS...... Petitioners Through: M;-.SunH Gupta, Sr.Advocate with Mr.jatin Zaveri, Mr.Gaurav.Agarwal and Mr.Tanmaya Agarwa~, f-l,dvocates versus DESTINATION OF THE \NORLD (SUBCONT~NENT) PRIVATE LTD...... Respondent Thl-ough: !VIr.f-l~tl)ndya Malhotra, Advocate CRLM.C 11tl7/2011 SHREE RAJ TRAVELS & TOURS LTD. 5c ORS...... Petitioners ~'l1ro• 19 h · !1 •...... _.. 11. Mr.SunH Gupta, Sr.t\dvocate with Mr.Jatin Zavf-::ri, Mr.Gaurav Agarwal and Mr.Tanrnaya A,garwal, Jl~dvocates versus DESTlr~AT!ON OF T!-~E \/VORLD (SUBCONT~NEf\lT)PRIVATE LTD...,.. Respondent Through: rv1r.Anlndya Malhotra,.Advocate (:RLM.C 1188/2011 ~ I I R~ E n /\ l -"I'D A' -L l c F T'C ~ ~ R.-- ' ·-o::~ n d::::-\flj ~ r\ \/ L. __..J 0( •. I v h.:~~~ -· ~ ~. & ORS. ·..... Petitioners Through: Mr.Suni Gupta, Sr.Advocate Cri.M.C.No.10.56/2011 [!.,_connected rna'.:te1·s F'age 5 of Z[1]

1. ( with Mr.Jatin Zaveri, Mr..Gaurav Agarvval and Mr.Ta nrnaya Agarvval, Advocates versus DESTir·JATION OF THE \/VOHLD (SUBCONTINENT) PRIVATE L-·,·n...... Respondent Thr-ough: Mr.t\nindya Malhotra, Advocate CORAM: HON"BLE MR. jUSTIICE PHJl~[JD::/P NAir\~DRP\J)OG I \1\/hether- the Repol"ters of kica~ papers rnav be allowed to see the judgment?

2. To be referr-ed to R,eporter or not?

3. Whether the judgment should be reported in the Digest?. PRADEEP NAINDRAIOG,;.

1. Briefly stated the facts leading) to filing of the above captioned pf~htions are that respondent i.e. 'Destination of World (Subcontinent) Pvt. Ltd.' a cornpany registered under the Companies,l\ct filed 15 comp!a1ints under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter l~eferred to as the 'NI ~.;ct'); 3 cheques beii'Q the subject matter of each complaint Petitioner No.1 Le. 'Silree Raj Travels 5! Tours Ltd.' a company registered under the Companies Act was impleaded as accused No.1 and petitioners 2 to 7 were impleaded as co-accused on the alleg1ation that as Directors they were inc:har·ge of the day to dla:/ affairs of the company and hence were vicariously liable For the defaults of the company. The cornplaint vvas filed in e Court of Additional Cllief Metropolltan Maoist'·ate (hereinafter (eferred to as the Cr!.M.CI\Io.1056/20111} connecced matters r 'ACMM') New Delhi, inter-a.lia, CJ\ie ng that the respondE:nt corrrpany c1111o! the accused No.I company had entered into.[2] agreements in ten11s whereof the accused No.1 compa ry had issued 45 cheques drawn on State Bank of ~ncia. Mumba! Branch, in favour of the respondent company, which cheques when presented for encashment by the respondent company with its Banker !OCl Bank Niew Delhi, were dishonoured and upon the cheques being retul-ned tLe respondent company issued notices conteiTiplate:d under proviso (b) to Section 138 Nl fl1ct from Delhi to the accused No.1 company which failed to make payment in respect of the sum for which the cheques vvere drawn within 15 days of the receipt of the said notices. V\!ith respect to the jurisdiction of the Courts at Delhi iit '1Nas pleaded that for the r-eason the respondent company h.ad presented the chequEs in question fot- collection with its banker iOO !Bank situated in Delhi, the Court had the 1iecessary jurisdiction.

2. it may be noted at tr1e outset at afte1- the complaints were filed/ tile respondent company filed a suit bearin.J No.550/2010 in which petitioner r~Jo.l was impleaded as th[2] defendant befor·e the High Court of Bombay pray~ng for a decree to be passed in the principa1l sum for whkh the 45 cheques forming the subject-·matter of the aforesaid ·complaints were issued. in the plaint jurisdiction of the Cout-ts at Murnbai was pleaded on the averment that the agreement pw-suant vvheJ-eto the cheques were issued was executed at f\/~umbai as also that the cheques in question were drawn and issued at MumbaL Cr·!.JI/l.C.f\io.1056/2:J11 &, CC'i'lec!:eci ITF'lt'ers Page 1 of Z'

3. Taking cognizance of the complaints, tile learned AC~!lM surnrnonecl the petitioners to face trial for an offence punishable under Section 138 of e N.l. Act.

4. Upon service of the summons, the petitioners filed application(s) under Section 1T[7] C:r.P.C. inter-ana stating that the cou1rts at Delhi have no jurisdiction to take cognizance of the complaints· and prayed that tre complaints be returned to the respondent to be filed in the court of competent jur-isdiction. Together with the sa(d application(s), petitioners 2 to 7 filed appHcation(s) seeking exemption for personal appearance before the Coun.. Dismissing the application(s) seeking exemption frorn personal appear-ance and keeping pending, fer consideration, application(s) filed under Section 177 Cr.P.C. vide order dated 25.05.2010 the learned ACMM issued bailable warrants against petitioners 2 to 7.

5. Aggrieved by the order olatE~d 25.05.2010,. petitioners 2 to 7 filed petition(s) under Section 482 Cr.P.C.:. before this Court which petitions were dismissed vide order dated 23.09.2010.;~ggrieved thereto, petitioners filed petitions seeking Special leave to Appea~ before the Supreme Court which were disposed of vide order dated 14.1.2011 with a direction to the learned ~\CMM at applications filed unde: Section 177 Cr.P.C. would be disposed of within 2 weeks.

6. Vide or-der dated 14.02.2011 the learned ACMM dismissed the application(s) under Section 177 Cr.P.C. filed by the petitioners on the ground at in view of the,jjcturr: of law laid down by the Suprerne Court in the decision Crl.fVl.C.No.1056/20:11 & connected mattero Page B ofn reported as (2004) 7 SCC 338 /i!dalat Prasad 1/ Roop Lq7/ linda! once the Magistrate has taken cognizance of a complaint he has no power to return the same to the complainant with a direction that tile same be filed in a court of competent jurisdiction.

7. Aggrieved by the order dated 14.02.2011 passed b:; the !earned! AC!VIM,. the petitionE~rs have filed the abovecaptioned petition(s) under· Section 4B[2] Cr.P.C. t-equiring this Court to hold that courts at !Jelh~ have no jurisdiction to take cognizance of the complaints in question and seek directions to the learned ACMM to return the same for filing befo1-e the Court of Competent jul-isdiction.

8. It is the case of the petitioners that the cheques in question were drawn at MurnbaL The drawee bank is at Mumbai, notice issued by the respondent to the petit:ione~­ company was 1-eceived at Mumbai and thus merely becausy the respondent posted the notice from DeHli ~nd deposited the cheque with its bank at Delhi would not confe( jurisdiction on Courts in Delhi.

9. The issue l1as to t1e debated ·Nitll,-eference to Sectio~: 138 of the Nl )),ct and the applicable provisions of the CodE;~ of Criminal l:::~rocedure i.e. Sectiorns 177, 178 and 179 of the Code of Cri1T1inal Procedure,

10. ~n the decision reported as 1999 (7) sec 510 I(BI7askaral[7] Vs, Sha·nl:-_ar?j_?_ Va_jdhvan Balan S AnL, thE: Supr-eme Court. has opi.ned, afte,- considering 5ections 178 to Section 179 of the Code of Crirninal Procedure, that an Cri,M,C.I\Jo.1056/2011 & conneci:;:,d matters Page 9 ofn offence may be completed in different localities and thus can be tried in any Court ha ng jurisdiction over said localities, To put it pithily, iin relation to territoria:J jurisdiction, qua an offence, law;-ecognizes more than 1 court llavingi territorial jurisdiction and the issue of territorial jurisdiction would have to be decided with reference to whether a part of an offence INas committed within the territorial jur-isdiction of a court. e issue is no longP.r r·es integra and I just need to note the decision of the:Supreme Court in. KBhaskarads case (supra) and hiQJhlight that the aforesaid is to be cuiled out fron[1] paras 11 and l:Z of the' said decision.

11. The next Iogica I question \Mould be, what are the. contours of Section 138 of the Nl.1~\ct pertaining to acts to be perforrned in r-elation to an offence contemplated by the said Section!) it hardly be re-emphasized that It are acts of commission or omission which constitute offences, 'Nith or without the requisite n1ens rea, depending upon Vlfhether •.I the offence is an absolute offence or not.

12. Let me tl1us note Section 13El, Nl 1-\ct which reads as' under:- Where any cheque drawn loy a pel-son on 2n account: maintained by him v[1].dth a banker. for payment of any amount of r'noney to another person from out of that account for the dischar~Je, in whole or- in parr-t, of any debt or other liabiiity, is returned by the bank unpaid, either because of the arnount of money standing.to tile credit of that account is insufficient to l1onour the cheque or that it <C:>(ceeds the amount arranged to be paid from that account by an, Cri.IVI.C.No.1056/20ll 1St cnnnectecl matters agreement made with that loank, such person shall be deemed to have cor-r[1] n1ltted an offence and shall without prejudi(:e to any other provisions of this Act, be punished with imprisonment for a term INhich may extend to two year, or with fine which rnay extend to tvvice the amount of the cheque, or with both: Provided that nothing contained in this section shall appty unless- (a) The cheque has been presented to the bank within a per-iod of six months m the date on which it is drawn or within the period of its va!idity, whichever is earlier" (b) The payee or the holder Induce course of the cheque/, as the case may loe,, n~~akes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer, of the cheque) within thirty days of the receipt of information by him from the bank regard~ng the return of the cheques as unpaid, and

(c) The drawer of such cheque fadls to malG~ tr1e payment of t!1e said amount': of money to the payee or, as the case may be, to the ho!der in due course of the cheque, within fifteen days of the receipt of the said notice" · Explanation: For the purpose of this "debt or other iiabHity" means a enforceaiJle debt or· other liabillity" section.. legally.

13. In Bhaskaran's case (supra) e Supreme Court had an occasion to clea! with the issue of territorial jurisdiction in relation to Section 138 of the Nl /\ct, and of necessity, the discussion required the Supreme Court to iden,Ufy the various acts of commission and orniss~on· which constituted the offence punishable unjer Section 138.rjf the Nl J\ct and suffice would it be to ilig\lii(Jilt t1·1at in para 14 of the (1·!.1VLC.''Jo.1056/20:1 R: ccnnec~ecl matte:·s P:;,ge 11 of 27 decision, the Supreme Court highHghted that there are ~; acts which are· the components of the offence punishable under Section 138 of the 1\il Act and ~ re-produce the samE from para 14 oF the decision of the ~:3upreme Court. They read as under:-

(l) drawinq of the cheque,

(ii) presentation of the cheque to the bank,

(iii) returning the cheque unpaid by the drawee bank,

(iv) giving notice in writing to the drawer of the cheque demanding payment of the cheque arnount,

(v) failure of the drawer to make payment within 15 days of the receipt of the notice.

14. After holding tllat 5 acts wou~d constitute the components of an offence under Secbon 138 of the N! l\ct in paras 15 and 16 the Supreme Court observed as under:- "15. it is not necessary that aH the above five acts should have been perpetrated at the sarne locality. it is possible that each of those fiv~e acts could be done at five different ~ocaHties. But a concatenation of all the above five is a sine qua non fof· the completion of the offence under Section 132: of tile Code..In this context a reference to Section l78(a0 of the Code is useful. It is extracted below:

16. Tl1u:; it is clear, if the five different acts were done in five different locaiitiE:? 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.A.ct. in other vvords, the cornplc::inant can choose any one of Cri.M.C.No.1056/20E & connected matters Page 12'. of 27 (6 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 w~dened and so expansive it is an idle exercise to raise jurisdictional question regal ding the offence under Section 138 of the f-'lct." (En7phasis Supplied)

15. On the issue of service of notice required to be given by the complainant to the acctJ:c.;ed, tile Supreme Court observed as under:- "17. The more important point to be deddled in this case is whether the cause of action hq~]s ar·isen at aII as the notice sent by the complainant to tile accused was returned as Hunc!airned". The conditions pertaining to the notice to be given to the drawer, have been for-mulated and incorporated ~n clauses (b) to (c) of the proviso to Section 138 of the Act. The said cia uses are extracted below::

18. On the part of the payee he has to make a dernand by "giving a not~ce'· in writing. ~f that was the only requirement complete the offence on the failure of the di-awer to pay the cheque amount within 15 days from the date of such ~~~giving", the travai~s of the prosecution would have been very mucll lessened. But the legislature says that failure on.the part of the drawer to pay the amount should be within 15 days liof the receipt" of the said notice. ~t is, therefol-e,. clear that "giving notice" in the context is not the same as receipt of notice. Giving is a process of whicil receipt is 'the accomplishment. ~t is for the payee to perform the former process by sencl!ins;1 t~le notice to the drawet- at the correct address. Crl.fVLC.No.1056/2011 g, connected matters Page 13: of 'l[1]

20. If a strict interpretat~on~ is given that the drawer- should have actuaHy received the notice for the period of 15 days to start running no matter that the payee sent the notice on the correct address, a trickster cheque drawer would get the premium to avoid n:x:ehdng the notice by different stt-ategies and he could escape ·from the legal consequences of Section 138 of the,Act. ~t must be borne in nnind that e court shou~d not adopt an interpretation which helps a dishonest evader and clips an honest payee as that would defeat the very legislative measure. 21.....Tile context envisaged in Section 1.38 of the Act invites a Iibera! interp!-etation for the person who has the statuto1-y obligJation to give notice because he is presumed to be the loser in the transaction and it is for his interest the very provision is made by the les;1islature. The words in clause (b) of the proviso to Section 138 of the;~ct sl1ow that the payee has the statutory obligation to "make a demand" by giving notice. The thru:st In the clause is on the need to Hmake a demand". ~tis only the nnode for making such demand which the legisiatune has prescribed. A payee can send the notice for doing h~s part for giving the notice. Once it is despatched his part is over and the next depends on vvhatthe sendee does.

22. it is well settled that a notice refused! to be accepted by the addressee can be presumed to have been served on him (vide 1-larcharan Singh v. Sh!vrani[2] and jagdish Sing/7 v. fl!atthu 5/ngh:J.~). ~~ r!-~.....,.· • HE·:-e the notice is returned as unclaimed a,--,d,-1[- ·-,-- ro.;:,,,~p,-J '1'''111 tl·lPir··- ba "l-'f c"l,_,...,.;.f"ca,...d- ' i u,, u lc cl.::; ' •._I u ~ ~ '·''. 'vII.!.:: 't:' I,,__: d l),) '=:! H H u Q I h. difference betvveen the tvvo so far as the presumption of ser-vice is concerned? !n this Cri.IV!. C.l\1 o.1056/2011 1St connect~: d matters connection a refer~ence to Section 27 of the General Clauses i\ct will be usefuL The section reads thus:

24. No doubt Section 138 of the Act does not require that the notice should be given only by "post". Nonetheless the pdnc\ple incorpor~:rted in Section 27 (quoted above) can profitably be imported in a case where the sender has despatched the notice by post vvith the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not reaHy served and that he was not respo~lsible for such non-service. A[1],ny otfler interpretation can leacl to a very tenuous position as the dravver of the cheque who is liable to pay the arTIOUITt would· resort to the strategy of subterfuge by successfully avoiding the notice.

25. Thus, vvhen a notice is returned by the sendee as unc.!etimecJ such date wouid be e commencln[9] date in reckoning the period of 15 days contemplated in clause (c) to the proviso of Section 138 of the t..ct. Of course such reckoning would !be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice vvas brought to his address. In the present case the accused did not even attempt to discl1arge the burden to rebut the afo,~esaicl presumption." (En7phasis Supp/iecl)

16. The expr·essions: f_1resentation of tl7e cheque to the Bank' a.nd 'if the five d!fferer1t acts were done ln t7ve different !o:~-alities any one ol the courts exercising jurisdiction In one of the five local areas can beco/T?e the p/ace of trial lor the olrence un:ier Section 138 at" t!H[3].Act' to he fO'!Ild 1'r[1] 'J"'r~-s 11 ·::~~c' lF l~,-,~~·le(-·t;'JE=> 1 \·' ·1·1 DfJ:JI~~-~,,-·::1r7'r ·.....Je I.... \_. ~ G'.. eli _ _ (_.... (); ~ l.J """ -..J ·c ~.:--- ·-l... 1'... IJ ~. i!::~~..:_:z..t.:-...f:~!__~:~~.:-. _.., case (supra) have been understood many to mean that. Cri.IV!.C.I\Jo.1056/2011 &t conr~ecteri lTl<:<tte•s Page 15 Gf 'l.[7] / the Court within local limits of which e payee Bank'i.e. th::: Bank when? the complainant deposited the cheque i.s situated has the·· jurisdiction to try the complaint under Section 138_of the N~ Act, and the understanding~ appears to be fortified by the observations of the Supreme Court in paras 15 and 16 that if the 5 acts contempiated as the ingredient of an offence under Sect~on 138 of the f\H AcJ:: were done in 5 diffe!-ent localities.. any one of the court exercising jurisdictiOil in any one of the 5 ~ocal areas vvould have jurisdiction.

17. But, it is appal-ent that the observabons in para 15 and 16 are an obiter as it is not:5 places where the 5 acts constituting an offence under Section 138 of the N~ Ac:t can possibly be performed The acts can be performed, as would be explained hereinafter, onily at 4 r:;daces and; would immediately state that act No.2 and act No.3 relate to only one place i.e. the place where the draiMee bank is located.

18. The second and the tllird act, of tile 5 listed by the Supreme Court, as COilstituting t~l~~ offence under Section 138 of the f\!1 Act are: (a) presentation of the cheque ta the bank; and (b) returning the cheque unpaid by the dravvee'. bank.

19. The third act is the return of tile cheque unoaid bv the· l J dr-avvee bank and thus ther·e js no scope for any arQlJITlent as to which bank is contemplated vvith 1-eference to the said act. The second act pertains to the;::::ct of presentation of cheque to the bani<. i higl:ligr1t tnat t11r[2] twin vvords used are {the bank'. Cri.M.CNo.1056/2011 8t connected matters Page 16 ofn

20. ~n the decision reported as 2001 (3) SCC 609 Shri lshar Allov Steels L~aswals Neco Ltd., a 3 judge Bench of the Supreme Court, having as a member of the Bench the author of the judgment in Bhaskaran's case (supra), dealt with and decided as to what would be meant by 'the bani<:, as mentioned in Section 138 of the Ni Act. V\/as it the drawee bank or e payee bank? The Supreme Court answe the question in the following words:- "2. (a) \1\/hat is !TH~ant by, ''the bank" as mentioned in clause (a) of the proviso to Section 138 of the Negotiable !Instruments Act, 18817 (b) Does such bank mean the bank of the drawer of the cheque or the payee of the cheque?

(c) To which bank the cheque is to be presented for the rf[2]..!:!lrposes olf attracting the penal provisions of:Section 138 of the.Act?f are the questions to be determined by this Court in this appeal. 7 nt has nr.~ ''1-~ not"lc·.-.nl ·I-!- a:· to l~n- n(C> an _ n u ~c..., ~·--·:=. 1 _ t: 'L·~ \..._ ~ ~ c,._ '. d ~, e. · offence.under Section 138 of the Act, it is mandatory that the d1eque is presented to "the bank" within a period of six months from the date on which[1] it is drawn or within the period of its validity, whichever is earlier. ~t is the cheque drawn which has to be presen:ted to "the bank" within the period spedfied therein. When a postdated cheque is written or drawn, It is only a bill of exchangJe. The post-dated cheque become a · cheque under the Act on the date which is written on the said cheque ancl the six months' Cri.M.Cl\Jo.1056/201l 81 c::nmected nHtters,, ('.,•=-,!., periocl has to be reckoned, for the purposes of Section 138 of the Act, from the said date.

8. Section 138 provides that where any cheque drawn by a person on an account maintained by him with a "/:Janke/' for payment of anyamount of money to another person from out of that account for the discharge, in vvho!e or in part, of any debt or other liability,,is returned by "the bank'' unpaid, either because of the amount of money standing to the cred/= of that account is insufficient to honour tll1e cheque or that it, exceeds tile amount arTarnged to be paid from that account by an ag1reernent made with that bank, such person shall be deemed to have commiitted an offence punishable vvith imprisonrnent as prescribed therein subject to the conditions mentioned in clauses (a), (b) and

(c) of the proviso. Section 3 of the Act defines the "banker' to include any person acting as a bankel- and any post office savings bank. Sectfon 72 of the Act provides that a cheque rnust, in order to charge the drawer-, be presented at the bank upon which it is drawn belore the relations between the d.~-awer- and lhis banker has been altered to the prejudice of the drawer.

9. The use of the \rvords "a bank'' and "the bank" in the section is an indicator of the intent~on of the le~Jis!ature. The former is am indirect (sic indefinite) article and the ~atter is prefixed by a direct (sic definite) artide. ~f the leg1is~ature intended to have the same 1rneanings for "a bank" and "tile bank" r then~' was no cause or occasion for mentioningJ it distinctly and differently by using two different articles. It is worth noticing that the word "banker" in Section 3 of the Act is prefixed by the indefinite article "a" and the word "bank" wl1ere the cl1eque is intended to be presented under Section 138 is pi-efixecl by the definite artide '''the". The same' section permits a person to is~:ue.: a cheque on an account maintained by him wid[1] "a bank" and Cri.M.C.No.1056/2011 8t connected matters 2 '( makes him liable for crinndn prosecution if it is returned by "the bank" unpaid. The payment of the cheque is contemplated by "the bank" meaning thereby where the person issuingJ the cheque has an account. "The" is the worol used before nouns, with a speCiifying or par-ticufarising effect as opposed to the indefinite or generalising force of "a" 01- '·'an". it determines what particular thing is meant; tl1at is, what particular thing we are to assume to be meant. ''The" is always mentioned to denote a particular thing or a person. ~~Tile'' would, therefore, refer implicitly to a specified bank and not any bank. "The bank" referred to in clause (a) to the proviso to Section 138 of the Act would mean the drawee bank on which the cheque is drawn and not all banks where the cheque is presented for collection inciuding the bank of the payee, in whose favour the cheque is issued.

10. it, however, does not mean that the cheque is always to be presented to the drawer's bank on whkh tile cheque is issued. Tl1e payee of the cheque has the option to pn::sent the cheque in any bc1111k including the coif,ec:ting bank where he has his account but to attract the criminal liability of the drawer of the cheque such collecting bank is obliged to_JQresent the chegue in the drawee or pavee bank on which the cheque is drawn within the period of six months from the date on which it is sl1own to have b~en issued........The non-presentation of the cheque to the drawee bank within tl1e period specified in the section would absolve the person issuing the cheque of his criminal liabHity under Section 138 of the Act who shall othervvise may be liabie to pay the cheque amount to the payee in a civil action initiated under the iavv. A combined readinq of Sections 3 72 and 138 of the l~ct would leave no doubt in our mjnd that th1e !avv mandates the cheql!e __to _bl~_fQresented at the bank on which it is drawn if the d1~awer is to be held crinlinally liable. Such presentation is Cl·l.rv'i.C.No 1056/2011 &connected matters Page 19 of:n ne~e~;sari!y to be made within six months at_ the bank on wil~ch the. cheqlJJ~~ is drawn. whether presented personally or through another bank_" namelv, the collecting bc~nk of the QQ.vee." (Emphasis Supplied)· · 21. Thou9h the decision in isl7a·r /J\//oJ/s case (supra) has been rendered in the context of limitabon for presentation of a cheque, tll1e said decision tor~ngs out in no uncerta'n terms that Section 138 of the Nl, 1-Kt contemplates that a cheque is required to be present:,r::d for encashment to the drawee Bank and that the payee Bank, merely acts as an agent of the payee/complainant for the purposes of presenting the cheque in quesbon for encashment to til-2 drawee Bank.

22. Thus, t~le 2nd act to which the Supi~erne Court:--e.ferred to in Bhaskararr's case as oPe of e 5 vvhich constitutes the offence under Section 138 of e N~ A.ct vvas the presentation of the cheque to e drawee bank and needless to state the Td act wr1kh constjtutes an ingredient of the offence is the retum of e cheque unpaid by the d1~awee bank and thus it becomes crystal clear that the:zn~ and 3rd act constituting the offence would relate to only one place i.e. the place \Nhere the drawee bank is locatecl.

23. These are rny humble reasons to iloid !J·ic)t the observations in paras 15 and 16 l1ave to be read as an orbiter and tllus the 5 acts conten~~.platecl as constituting the offence are cap~1ble of being performed not in 5 but only in 4 places and since deposit of e cheque with the payee 'o---·l·l\> 1"c r10t·::s-n ac·t !Oil·tPr-np[1] atpnl ·;::,c;:=!"'1 in,,g· ra·Gli.PPt ef ~-llc:.. 0. " _::, Ul I ' _, ~. " l - - V• d ~',A I ' I ' " I c: I -; I,) " Lf 'offence, the pia.ce where the payee bank is ocateo would be trl.!'v[1].C.I\Io.1056/2.011 2, connected mar~ers Page;w cf:li' irrelevant for pi:....lrpose::; of deterrnin1ing jurisdiction of the criminal court.

24. It is settled law that a dec1s1on is an autirwrity for the point it decides and not what can be logically deduce'j therefr-om and the,-atio of a decision has to be ~gathered with reference to the facts of a ca":;e and ~just highHght only· one decision of the Supreme Court being the decision reported as Dhod!Ja !louse v 5)'(;~jainqL_(2006) 9 SCC 41.

25. The matte1- regarding jurisolk:tion can also be decided with reference to Section 6, ~3ec:tion 7, Section 64 and Section 72 of the Nl P,ct.

26. The relevant portion of. Section 6, Section 7 and Section 64 of 1\l~;~ct ~v-id Section 72 of the Ni ?~ct reads as ·under:-- Section 6. Cheque: - A. "cheque!! is a bi~! of exchange drawn on a spec ed !Danker· and not expressed to be payable otherwise than on demand and it tnciudes the elec!Tonic image of a truncated cheque and a cheque in the electronic form. )( )( )( Section 7. The maker of a biH of exchange or Cheque is ca II ed the "ci rawer"; the pet-:son thereby d11~ected to pay is ca~lecl the "Drawee". )( )( )( Section 64. Pr-esentment for payment. (l)]Pron-lissory notes, bill1s of exchange and cheques must be presented for payment to the maker, acceptor or drawee tile~-eof respe(:tivelyl by or on behalf of the holder as hereinafter provided. In default of sucJ11 pr,esentment the Crl.f\/i.CJ\:o 1056/2011 & COililecteci rnz1iters Pag<:: 2JL of:n other parties thereto are nut Hable thereon to such holder...,.... )( X )( Section 72. Subject e provisions of section B[4] a cheque must ir-·r order to charge the drawer, be presented at the bank upon which it is drawn before the relation between the drawer and his banker has been a~tered to the prejudice of the drawer.

27. A co-joint reading of Sections 6, 7, 64 and 72 as also of Section 138 of the Ni;.J.ct bl"ings out that in order to attract penal provisions of Section 138 of e Ni Act a cheque is required to loe presented fo1- encashnnent to the drawee Bank and that the payee Bank acts mer-ely as an agent of the payee/comp!ainant for the purposes of presenting the cheque in question to the dravvee Bank. The n~ecessary corollary thereof is that no pa of cause of action for the offence punishable under Section 138 of the N~ Act arises in the Court within the local limits of w~1~ch the conectiing Bank of the compla~nant i.e. payee Bank is situated and thus saicl Court has no jurisdiction to try a con!""Jplaint under Sectior: 138 of the 1\11 Act filed by the com pia ant. ~

28. This takes me to the considExabon of second question involved !n the present case i.e. whether the court w!thir. the local liimits of which the p!ace from where the complainant flad sent a notice c:ontempiated under provisq (b) appended to Section 138 of the Ni /-\cit is situated has the jurisdiction to try a cornplaint filed under Section 138 ofthe N! Act. Cri.IVl.C.i\lo.1056/2011 tY.. connect::cd matter:; ?age 2'.[2] of 27

29. I have already noted the observations made by the Supreme Court in Bl7askaran's case (supra) in the foregoin'g paras and would highlight th,srt in paras 17 to 23 tile Supreme Court has reflected upon the limitation within which the notice has to be given to the accused. The Supreme Court was considerinG~ tl1e expression 'giving a notice' in proviso (b) to Section 1313 of the Ni J\ct, with reference to the 15 days' time cor1ternplated th1en loy which the requisite notice had to be serVi2d, which time is now 3C days.

30. Another decision of the Supr-eme Court, reported as (2009) 1 SC:C 720 Harman Electronics Private Limited v !Vatfonal Panasonic !na'fa Private Llinited is worth noting on the subject.

31. In Hannan's case (supra) tile question wl1ich had arisen before the Supr-eme Cou,_ was precisely the same.question which arises for considel-ation in the present. petition i.e. whether the court within~ the local limits of which.. the place fl-om where the comp!a1i11ant had sent a notice. conterrlplateol under proviso (b) to Section 138 of the N~ Act is situated has tile jurisdiction to try a complaint filed under Section 138 of the N! Act. Answehn~?J the aforesaid question in the negative, the Supreme Court observed as under:- "12......The only question, thei-efore, vvl1ich arises for considel-ation is that as to w['!ether sending of notice from Delhi ~tse!f ·would give rise to a cause of action for taking cognizance under the Negotiable lnstr-uments,AcL Cd.M.C.No.1056/201J. 8t connected matters Page 23 ofn

13. It is one thing to say tflat sending of a notice is one of the ingJredients for maintaining the complaint but it is another thing to say that dishonour of a cheque by itself constitutes an offence. For the purpose of proving its case that the accused had committed an offence under Section 138 of the Negotiable ~nstruments Act, the ingredients thereof are required to be proved. VI!hat would constitute an offence is stated in the main provision. The proviso appended thereto, however, imposes certain furthe1~ conditions 'which are required to be fulfilled before cognizance of the offence can be taken. if the ingredients for constitution of the offence laid down in provisos (a), (b) and (c} appended to Section 13S of the NegJotiable Instruments JJ1ct are intended to be applied in favour of the accused, thert:~ cannot be any doubt that receipt of a notice wouild ultimately 9ive rise to the cause of action for filing a complaint, As it is. only on r~eceipt of the notice that the accused at his own peril may refuse to pay the amount. Clauses (b) and (c) of the proviso to Section 138 therefore must be read tog1ether. ~ssuance of notice would not bv itself Qjve rise to a cause of action but communication of the notice would........For constitution of an offence under Secbon 138 of tile Act, tile notice 1rrwst be received by tile accused. it may be deemed to have been 1~eceived in certain si ations. Th,e vvord "communicate'' inte,~ alia means "to n1ake knovvn, i.nfonr:, convey, etc''. 20...... f-1 court derives a jur-isdiction only when the cause of action arose within its jurisdiction. The same cannot be conferred by any: act of omission 01~ commission on the part of the accused.,u.. distinction must a!so be borne in mind fb,c::tween the ir,gredlient of an offence and comrni.ssion of a part of;,:he offence. V\Q1il§2 issuance of a notice D'l the hold~_c_gf a neg_otrab!e Cri.M.C.!\Io.1056/2011 & connected matters.[7] j instrunr"lent is n~~~ssar:&____;;ervice tl1ereof is also imperative. Only on a serv~ce of such notice and failure on the part of tile accused to pay the demanded arnount within a perlodl of 15 days thereafter, the comrnission of an offence completes. ~ivinq of nobce tl1erefore~nnot have any__QI_eceqent overJ~he servic~. it is oniy from that view of tile matter that in Da!mia Cen7ent (f317arat) Ltd v, Galaxy Traders & Agencies Ltd emphasis l1as been laid on service of notice." (Ernphasis Suppl/ed)

32. At a first blush reading of tile decisions of tl1e Suprerne l ~ "I [j,-·t r' 'l. Cj_f.l-; ck'=i r:::;n:c rJd _;'.,f::J r·y;;~ f"' c; r -:; c r s (,. c i\ "~ ····;~' [·~· rr· ~ y,u ' I.f.:.__.a-'.:....:.!::__'...!::._..:._.,J '""/" •-;_;_!_.-._.c,~e-.-'d!--lluf "·,:::; strike to the reader that there ~s a confHct between the two decisions inasmuch as in Bhask;;;ran's case (supra) it was held tl1at the expression 'giving of notice' occurring in proviso (b) to Section 138 of the Nll Act means 'sending of notice' whereas in Hannan's case (supra) it \vas !1eid that the said expression mr:::ans 'rece1~ot olnotice'.

33. A can=..:ful reading of tile two decisions shows that the'e i'::; no conflict t)etween the said dr:::cisions inasmuch as they !1 ave !)een rendered in different contexts. The decision in Bhaska_ran'.s case (supra) was rendered in the context,Jf starting point of Hmita.tion per~od 15, days prescribed in proviso (b) to Section l[3].S of the N~ Act and it was in that_ context i.e. tile context of limitation that it was held by the Supreme Court that the exp1-ess~on giving of notice::' occurring in proviso (b) to Section[1] 138 of the N! Act means 'sending or notice'. The decision ~n !-larn1an's case (supra) vvas rendered in the context of cause of action for filing a complaint under Section 138 N~ J}1ct w~thin jurisdiction of a '\rirhCLII~·r· (-'O"Ji-·'"";::: r·,c\;,-~ H";:,t c(J. r-Jt,p.-.-'- '·t u,,--,c hejr< l·)'/ t-!•e;.-; c~ <....l o __ ~ ~- d J j J 1 L ~, u[1] -·· 1_..,! _ ~· /\ L u "\:1 CJ __, t 'j t.t ~\ J '\- t • C:!.IVI C.No.1055/2!1J.[1] 1St conr.2c[7]:ed matters Page 25 of:U l Supreme Court that the expression g'/vlng of notice/ occurring in proviso (b) to se~=:tion 138 of the Nl,!\ct means 'receipt atnotice-:

34. Now, same expression can have different m1eanings in different context as held by e Supreme Court in the decision reported as Malik l a! 1ll/aju1ndar v Gouranqa_ C/Jandra Dey (2004) 12 SCC ·448 wherein it was observed that a word occurTi:·:g in a.st~rtutory provision can have different rneaninos in different context within the sarne -·· statute.

35. Thus, the inevitable concJusion would be that the ~~th act contemplated as an ingredient of the offence as highlighted in Bhaska_ran's case i[1].e. 'giving notice ti[7] writl7g to the drawer of cl;eque / den7anciil7g paytnent of tlJe cheque an7ount for purposes of limitation would have a meaning as explained in Bhaskaran's case and for purposes bf jurisdiction would have a meanlngJ as explained in /sl7?r Allo)(s case (supra).

36. Before concluding I \Atou~d De fai.ling not to lodge a caveat. Wit!: eiectronic: bankinq and facility payabie at par of clearance provided by bankers and especially n metropolitan cities, w!1ere cheques.are clearecl !Jy not being presented to the drav\lee bank but at nodai branches of the concerned banks, tile subject nnatter of jurisdiction may have to be decided keeping in vi~evv that the drawee ban\k has created an agency w!1ere the cheque in question;s t·---- f"rf~l·l+--'-ed·,- rlpa---,nl··e '"'lld -· r c; \Nhp•·p ·t/r-=- "'P':l'~-·nc-a _I d I.:;, ! L L ', L 1 _ c I c:;, ! ' u, t;.:::r,_ ! ~ ~- ·' ·~· 1!c t. 1·-- c~ 1 C1! 1, -. 'tal<es place would then arguably become the pLace wher,:e (I·] M.C.No.1056/2J11 1St cor-!nected matters r r!l~ ~(\;\ ~:.1:. ~I' ' 1.\1 i "!!.i ~ "'l;ji ~: ~I }$1! ~· the cheque wouici be required to be treated as presente'j to 'tile bank' Le, the drawee bank, B in such circumstances, propedy constituted pleadings have to be found in a complaint and lodging the caveat, i leave it at that for the debate to be properly argued in an appropriate case vrith the necessary relevant pleadingJs. 37, I hold that on the pleaonngs in the complaint(s), ·no part of cause of action can be said to llave accrued to the cornplainant Delhi.: that the notice demanding paym,,;::nt 'Nas posted rn Delhi and that tile cheque vvas deposired with the paye.e bank at Delhi vvould not constitute the acts contemplated as ingredients of an offence punishable under Section 138 ~JI Act and thus I dispose of the petitions quashing Uleimpugned order(s) dated 14.2.2011 and direct tl1e learned ACMM to return the complaint(s) to:=he respondents for filing in a Court having territo]-ial jurisdiction,

38. No costs.

SIEPTIEMBIER 21, 2(()11 mm Cri.IVI.C.No.1056/2011 & connected matters - re-...-:··........<:.-...:: (PHADIEIEP NA.NDRAJOG) jUDGIE Page 2.[7] cf27