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

1. V\/hether the Reoorters of local papers rT1av be alh:;:,'JEG to see the judgment?

3. Whether tile judgment should !oe reported in the Digest? PRADEEP NAINDH.AJOG, j[1]. l. Br~efly stated the facts leadir:g to filing of the abovE: captioned petitions a1-e that r-espondent i.e. 'Destination ot Wor!d (Subcontinen Pv~. Ltd.' a connpany registered under the Companies Act filed 15 compla1ints under Section 138 of the 1\! egotia bl e Instr~; lllents Act, 1881 (llerei nafter 1-eferred to c:s the 'f\ll i~ct'); 3 cheques bei 1< g the subject matter of each complaint Petitioner !\~o.l i.e. 'Shree Raj Travels & Tours i_td.' a company r-egistered under tile Companies Act was impleaded as accused No.1 ancl petitioners 2 to 7 wer-e impleaded as; co-accL!sed on the alle,g1ation that as D~rectors they were inc:harge of the day to day affairs of the company and hence vvere vicariously liable for the defaults of the company. The con!piai:lt vvas filed. in the Court of /~dditional Chief J\r1ett-opoljtan a~!istr-ate (he~·einafter referred to as the Cri.M.C.l\lo.1056/2!J11 8'. ·::on'WC::ced matte!·s Page 6 of Z[7] f 'ACMM') Nevv Delhi, inter-alia, aJe ng that the respondent cornpar1y and the a=:cused f\!o.l company had entered intc 2 agreements in tenlls vvhereof the accused I'Jo.l compa,ly had issued 45 cheques drawn on State Bank of ~ndia. Mumbai Branch, in favour of the respondent company, which cheques when prese 1r encashment by the respondent cornpar~:y with its Banker lOCi Bank ~~ew Delhi, were dishonoured and upon the cheques being returned the respondent company iss.ued n ces contemplated unde( proviso (b) to Section 138 Nl P1ct from Delhi to the accused No.1 company which failed to make payment in respect of the sum for which the cheques \1\iere drawn within 15 da} s of the receipt of the said n ces. VVith respect to the jurisdiction of the Courts at Dellni il·~ vvas pleaded that for the reason the respondent company had presented the cheques in question for collection with its banker ~OC! !Bank situate::! in Delhi, the Court had the necessary jurisd~ction.

2. ~t may be noted at the outset at after the cornp!aints wer-e filed, tile respondent co1T1p·any fHeol a suit bearinJ No.SS0/2010 in which petitioner No.1 was imp~eaded as th::: defendant before the High Couwt of Bombay praying for a decree to be passeci in the prinCiipa~ sum for wh~ch the 45 cheques forming the subject-Tnatter of the aforesaid ·complaints were issued. ~n tile plaint, jurisdiction of the Courts at ~/lumbai was pleaded on tl1e averment that the agreement pursuant whereto the cheques were issued vva'3 executed at Mumbai as also that the cheques in question were drawn and issued at Mumb0d. Cri.IVI.C.No.1056/2011 g, con'lecteci cnatters Page 7 of 'i!."l }

3. Taking cognizance· of 't!-1e complaints, the learned ACI\!JM SUITimoneci e petitioners to face trial for an offence punishable under Section 138 of the N.L Act.

4. Upon service of the sunnmons, the petitioners filed application(s) undei- Section 177 C:r.P.C. inter-aHa stating that the courts at Delhi have no jurisdiction to take cognizance of the complaints· and prayed that the complaints be returned to the respondent to be filed in the court of competent jur-isdiction. Together with the said application(s), petitioners 2 to 7 filed appHcation(s) seeking exemption for personal appeal"ance before the Court. Dismissing the application(s)::;eeking exemption fror~n personal appearance and keeping pending, for consideration, application(s) filed under Section 177 Cr.P.C. vide o1rder elated 25.05.2010 e !earned ACMM issued bailable warrants agai~-lst petitioners 2 to 7.

5. Aggrieved by the order dated 25.05.2010, petitioners 2 to 7 filed petition(s) under Section 482 Cr.P.c:. before thi.~ Court, which petitions were dismissed vide order dated 23.09.2010. l~ggrieved tl1ereto, petitioners filed petition; seeking Special Leave to Appeal before the Supreme Court which wer-e disposed of vide on::ler dated 14.1.2011 with a direction to the leamed /l,CMM that applications filed unde;- Section 177 Cr.P.C. would be disr,Josed of vvithin 2 weeks.

6. Vide or~der dated 14.02.2011 the learned ACM~;; disrn issed the appl ication(s) under Section 177 Cr. P.C. filec by the petitioners on the ground that In view of the dicturn of law laid down by the Supre111e Court in the decision Cri.M.C.No 1056/2011 & COil~':Ccted mattr~r-c (L/ reported as (2004). 7 SCC 338 llidalat Prasad v Roop La/ Jindal once the agistrate has taken cognizance of a complaint he has no power return the same to th::: complainant with a direction t!lat the same ge filed in 3 court of competent jurisdiction.

7. Aggrieved by the order dated 14.02.2011 passed b:1 the !earned ACMM, the petitioners have filed the abovecaptioned petition(s'l under Section 482 Cr.P.C. requirin[9] this Court to hold that courts at Delhi have no jurisdiction to take cognizance of the complain1ts in question and seek directions to the learned ACMl~ 1~etu1T[1] the s;.ime for filin~1 befoi-e the Court of Competent jurisdiction.

8. It is the case of the petitioners that the cheques !FI question were dravvn at Murnb.ai. e drawee bank is a~ Mumbai, notice iSS ivied by the respondent to the petitione · company was received at Mumbai and thus merely becausE~ the respondent posted the notio::> from De~hi and depositecl the cheque with its bank at Delhi would not confeljurisdiction on Courts in Delhi.

9. Tile is:;ue llas to be debated Nitll refel-ence to Sectior: 138 of the Nl Act and the applicable provisions of the Code of Criminal l:~rocedure i.e. Sections 177, 178 ancl 179 of the Code of Criminal Procedure.

10. In the decis Oil l~eported as 1999 (7) SCC 510 KB/Jaskaran \Is.. 5ha·nkaran \./,~ldhvan Balan S Anr, the. --------------· -·- Supreme Court has opined, afte1- considering Sections 17f to Section 179 of tile Code of Ci-imina~ Procedure, that ar Crl.rvi.C.I\Io.1056/2011 P,t co lllE'rJ.::d matters Pagr~ 9 of 2:,, { offence may be cc;;-ipleted in ~~! rent localities al!d thus can be trreai in an CJurt hc;,ving jurisdiction over said localities. To p it pithily, iin 1~e!ation to territorial jurisdiction, qua ar: offence, law recognizes more than 1 court having[1] terr~toriai Jurisdiction Cind the issue of territor\a. jur-isdiction would have to be decided vvith reference tc whether a part of a~~~: offence ·1Nas committed within tilE territor-ial iurisdlction of a court. e issue is no lono~,.::r res J..._, integra and [ just i1r2t'::1 to note the decision of the Supr·eme Court in. K.Bhaskaranis case (supra) and i1ighlight that tile aforesaid is to be culled out frorn paras 11 and 1:2 of the said dectsion.

11. The next logical question would be, vvhat are the c~·ntoul~,~ of C:=>c'-•o~--. '~c; 0.f the Nl ~ nPrtainl·nq to ~r·h:::; -r~. be u r,.._) _, t: L,,,.L _ c _, L 1 v c:,,. ~ _ c ·" '~- ~ L:. perforrlled in relation to ar[1] offence contemplated by the 'd c ·t' ~) sa[1]...Jec 10n! It harr::;ilv be re~empinasized that it are acts of Co ·, 'r11ll11. SC:. i'u" 'r'l rJ',... ·.i 1-j.~! '1 c: c;,' 1) "1···, '1Ni-.l;I (;-·1 r·n ':''• i·:ul-e 0 iFfE•""l rnc:; \lill··ti·l 0,- """,._),. t 1..__,,., ___.._..._. l • ••••....., ~- L. a,., ij •I......... r::._},. v, ~ 1 vv·ithout the renuisite iTH..?ns rea. dero,2ncHno -1 ·' "._, upon I,Nhethet" th.e offence i~; an absc1ute offence or not.

12. Let me thus note Section L3El, r~n i\.ct which reads as unde1-:~ \/\!here any cheque drawn by a pe1~son on en account: n1aintained by hilT wi a banker for payment of any amount of r'noney to another person from c~t of that account for U1e dischar9e, in vvhole or in pai-t, of any debt or other liability, is returned by the bank unpaid.. either becatJse Df the arnou of rnoney standing to tile credit of that account is insufficient to llonour the cllec\ue <Jr that it EYCeeols the amount arranged to !:)e paid f1~om i1=hat account by cHi, Cd.i\11 C.No.1056/2Clll & umnected matters agreernent;~nac\e with tila:::bank,, such person shall be deerr1ed to have c.:Jmmitted an offence and shall out prejudice to any other provisions of this Act, be punished wiith imprisonment for a term 't~lhkh may extend to two year, or with fine which ITlay extend to tvvice the amount of e cheque, or with both: Provided that nothing contained in this section shall app~y unless- (a) The cheque 11 las been pi'esented to the bank within a per-iocl of six months ft~onn the date on which it is drawn or within e period of its va!idity, whiche\ier is earliel-, (b) The payee or- the holder- Induce course of tf-le cheque, as the case may be., ~l'iakes a demand for the payment of the said amount of money by g ivinq <:~1 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 olravver of such cheque ils to make the payrnent of the said amount· of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice, · Explanation: Fo1- the put-pose CJf th~s !!debt or other iiabilit)/' means a enforceable debt or other liab~ility, section, legally _ [&

13. In Bhaskaran's case (supra) (':?:Supreme CotH-t hc-,d an occasion to deal with the issue of territorial jUI"isdiction in relation to Section 138 of the Nl ancl of necessity, the discussion requin::d the SuprelT11e Court to ~dentiify the various acts of commission and crrdssionr which::::onstituted the offence punishable under Section 138 of the N! t\ct and suffice would it be to llighligllt tl1at in para 1.[4] of the · Cr!.!VIC.No.l056/2011 & connrccted mac~e:·s Page 11 of27 [ decision, th1?. Supreme Court hirgh~ighted that there are 5 acts which are the components of e offence punishable under Section 138 of the 1\11 Act and I re-produce the same from para V[1]: oF tile decision of e:.'3upreme Court. They read as under:-

(i) drawinq of the cheque,

(ii) presentation of the cheque to the bank,

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

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

(v) failure of the dravvr~r to make payment witl1in 15 days of the receipt of the notice.

14. After holding at 5 acts vvou~d constitute the components of an offence under Section 138 of the ~\H Act, in paras 15 and 16 the Sup1~erne urt observed as undet-:-

16. Thus it is clear, if the five differ-ent acts were done in five different localities 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 tl1e.Act. ~n other vvords, the com::-,iainant can choose any one of Cri.M C.i\lo.1055/20E & connecied rnatters ! ~ i those courts having jurisdiction over any one of the local areas within the territorial Hrnits of which any one of those five acts was done. As the amplitude stands so widened and so expansive it 1s an idle ·exercise to raise jurisdictional question regarding the offence under Section 138 of the,; l-\ct." (En1phasis Supplied)

15. On the issue of service of notice required to be given by the complainant to tile acetJ:~;ed, the Suprem1e Court observed as under:-

18. On the pai-t of the pay:'~e he has to make a demand by "91 ivi ng a nohcel'' in writing. ~f thlat was the only r-equirement to complete the offence on the failure of t11e di'awer to pay the cheque amount within 15 days from the elate of such "1g ivi ng", the trava iIs of e prosecution would have been very much lessened. But the legislature says that failurrc:: on the part of the drawer to pay t!1e amount should be within 15 days "of the receipt" of the said notice. ~t is, therefol-e, clea1- that "ghiing notice" in the context is not the same as receipt of notice. Giving is a process of vvhich receipt is the accomplishment. it is for tile payee to perform the former pmcess by sencliinQ e notice to the drawer at the co:Tect address CrUVl.C.No.l056/2011 6t connected matters Page 1J of 2.[1]

20. If a strict interpretat~or1' is given that the drawer should have actually received the notice for the period of 15 days to start running no matter that the payee se the notice on the correct add(ess, a trickster clileque drawer wou!d get the pren1ium to avoid rec:ei\f!ing the nobce by different strategies and he could escape frorn e legal consequences of Section 138 of the,r~ct. it rnust be borne ln mind that the court should not adopt an inte retatlon vvhich helps a dishonest evader and clips an honest payee as that would defeat the \lery ieg islative r:-r[1] E~asr.J re.:21.....The context envisag'.~d in Section 138 of the Act invites a liberal ·i E~ r-etabon for the person who has the statutor-y obligation to give notice because he is presumed to be the loser in the transaction and it is for his inter-est the very pmvisiOI:"I is rnade by the leG1islature. The words in ciause (b) of the proviso to Section 138 of the 1~.ct shovv that the payee has the statutcry obngation to urnake a dernancl" by giving notice. The thrust in the clause is on the need to "make a demand". It is only the mode fo1- making such dernan(i which the legislature has prescribed.;D\ payee can send tile notice for~ doing his part ifor giving the notic::'. Once it is despatched hi~ part is over and the (:ext depends on vvhatthe sendee does.

22. It is well sealed that a notice refused to be accepted by the addressee can be presumed to l1ave been served on him (vide l-larcharan Singh v Sh!vrani[2] anC: jagdis/7 Singh v. l\!atthu Singh[3]),

23. Her-e ·che 1otice is rn~2ol as undai 1T~1ed and 110it as n::fu.sed. \'\fill th any signif~cant difference between the tvvo so far as tlile pt-esumption of service is r:o11cerned?::n this Crl.IV!.C.I\Io.1056/20111St connected matters connection a reference to Src;=tion 27 of the General Clauses i\ct will be usefuL The section reads thus:

24. No doubt Section 138 the /l,,ct does. not require that the notice should be given only by " t" Nl t[1] ' • I. ' l ' ' I • pos. ~ one ne!ess r 1e prmc~;p e !ilcorporateo m Section 27 (quoted above) can profitably be imported· In a case where the sender has despatched the notice by post vvith e correct address written on it. Then it can be deemed to have been ser\ted on the sendee unless he p(oves that it vvas not really served and that he was not r·espo:;sible for such rnon-service. J\ny other inter-pretation can leacl to a very tenuous position as the drawer of the cheque vvho is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice. '

25. Thus, vvhen a notice is returned by the sendee as unclaimed such date V\rouid be the cornmenclnrg date in reckoning the period of 15 days conternpiatecl in clause (c) to the proviso of Section[1] 138 of the Act. Of col_u-se such reckoning would be without prejudice 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 cas·~ the accused d~d not even attempt to discllarge the lourden to rebut the afol-esa~d presumption." (Etnphasis Supplied)

16. Tile expressions: /pres-entation of the cheque to the Bank/ a.nd 'if t~he tive difl::ere··Jt acts were done in tlve different localities any one of N;;e courts exercising jurisdiction In one cf the five !oca/ areas can becotne the a/ace of trial tor the m~fence under Section 138 ol tlre /(jet' to'

I. b,e· -fo I !nd.11'-l n ':'1 reo, c: l d. "'\;l 01 1 1=, r-.:;:,,~ n e-r-·ti\{a 'I\ I I. "l l?/7;:yr.:://,.::, (":::1 1-7' c:.._, •.._ \_.. ~..) Ci' f),._) ~L. 0 ~......,_, ·,__.._, \!''".•• • v 1.;:._ y ~.!.='-~:::.'.:.!.."':.::::L:._:-:::.~l-. '-• case (supra) hav:~ bee:n understood many to mean IJ..lat Cr!Ni.CI\lo.1056/201l 8, conrf':::ted rn<:·t~ers Page ·.~5 of 27 the Court within ioc2l limits of vvhic:h e payee Bank' i.e. the Bank vvhen:> the complainant deposited the cheque i:; situated has the jurisdiction to try the complaint unde- Section 138 of the Nl Act and tli:e understanding appears to be fortified by the observations of the Supreme Court in paras 15 and 16 ti-Jat if the 5 acts contemplated as the ingredient of an offence under Secbon 138 of the f\H Act were done in 5 diff':':'rent local es,, any one of the court exercising jurisdictio;: In any one of e 5 iocal areas 'Woulo have jurisdiction.

17. But, it is apparent that the observations in para 15 and 16 are an obiter as it is not:=l places where the 5 acts constituting an offence under Section 138 of the N~ Act can possibly be pe1~fo1Tned The aict:; can be performed, as would be ·explained hereinafter, onlly at 4 piaces and I vvould immediately state that act No.2 and act No.3 reiate to only one place i.e. the place where the clrav"'ee bank is located.

18. The second and the third c! of the 5 listed by the Supreme Court, as constituting r::: offence under Section 138 of the f\!1 A.ct al-e: (a) presentation of the cheque to the bank; and (b) returning the cheque unpaid by the drawee bank.

19. The thir-d act is tile rehwn tile cheque unpaid by the di-awee bank and tllus there Is no scope for any arrgument as to which bank is co11templated vvith reference to the said act. The second act pertains to the act of presentation of cheque to the banli<. i llighiight tnat ~~twin words used are 'the bank. Cri.M.C. No.1056/2011 8t conne:::ted m2tters Page Hi ofn ~

20. ~n e decisiorn reported as 2001 (3) SCC 609 Shri lshar Allov Steels Ltd. Vs. /avaswals Neco Ltd, a 3 Judge Bench of the Supreme Court, il,aving as a member of the Bench the author of the judgrne in B!?askaran's case (supra), dealt with and decided as \Arhat would be meant by 'the bank' as mentioned in Section 138 of e Nl Act. V\/as it the drawee bank or e Dayee bank? The Supreme Court answered the question in the following words:- "2. (a) V\/hat s rneant by, e bank" as mentioned in clause (a) of the proviso to Section 138 of the Negotiable !Instruments t\ct 18817 (b) Does such bank mean the bank of the drawer of the cheque or tile payee of the cheque?

(c) To which bank the cheque is to be presented for the rQ11rposes of attractinq the penal provisions of Section 138 of the Act?, are the questions to be determined by this Court in this appeal. 7 ~-r- has ~-''r ','1("' nntr·c c~- 1 '"~a-:- t~o l"''d- ~<e ar[1] - ~ 1L,......;....... ! 1•• _. I ~· 1.. ! l A _ _., I I ~ a, offence.under Section 138 of the Act, it is mandato-ry tr1e cheque i's pr·esented to "the bank" within a period of six months from the date on whi_cr11 it is drawn or within the period of its validity, whiclnever is earlier.. ~t Is the cheque drawn which has to be presented to "the bank" w~thin the period specified therein. When a postdated cheque is written or drawn, !t is only a bill of exchangJe. The post-dated cheque become a · cheque under the Act on the date which is written on tl1e said cheque ancl the six months' Cri.M.C.I\Io.1056/2011 8t connected m.'itters Page 17 of:n period has to be r-eckoned, for the purposes of Section 138 of the ~~ct, frorn the sard date.

8. Section 138 provides th '1Nhere any cheque drawn by a person on an account maintained by him with a "banke;J' for payment of any amount of money to another pe:-son from out of that account for the discharge, in whole 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 creoL of that account is insufficient to honour the clleque or that it exceeds the a'r1lount arrarnged to be paid frorn that account an agreemr2nt made w~th that bank, such person shall be deemed to have commiitted an offenc,e punishable with im pt-isonrnent as prescribed! erei n subject to the conditions mentioned in clauses (a), (b) and

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

9. The use of t~,e \Nords "a ba1nkl/ and "the bank" in the section is an indicator of the intenbon of the leqis!ature. The former is an indirect (s/c indefinite) artic!e and the latter ls prefixed by a dirrect (sic definite) artide. ~f the !egis~ature intended to have the sarn,e rneanin~gs for "a bank" and "the bank", then:·. vvas no cause or occasion for mentioning! it distinctly and differently by using two oliffere articles. It is worth noticing that the \JVO "banker" in Section 3 of the Act is prefixed by the indefinite article "a" and the word "bank" where tl[1]:e cfleque is intended to lJe presented under Section 13B is pr-efixecl by the definite a cile i'the" The same section permits a person to is':,ue a cheque on an account ITlalintained by hirn vvitln "a bank" and Cri.M.CNo.1056/2011 &:::onnec'ced matters Page 13 ofn makes him liable for crinr:~~nal prosecution if it is returned by the bank" unpa~d. The payment of the cheque is contemplated by "the bank'' meaning ereoy where e p~t=:>rson issuingJ the cheque has an account. "The" is the word used before nouns, vvith a spec ng or partkularising effect as ooposed to th~:: Indefinite or generaiising force 9f "a" or '''an". ~t determines \/\that particula1- thing is meant; that is, what particular thing we are to assume to be meant '''The" i.s always mentioned to denote a particular thing 01- a person. ''The'' would, thel-efore, refer implicitly to a specified banlk: and not any bank. [(The bank" referred to jn clause (a) to the proviso to Section 138 of the lkt vvou!d mean the drawee bank on which the cheque is drawn and not all banks where the cheque is presented for collection including the bank of e payee, ir: whose favour tJ~,e cheque is isst.-r:ed.

10. it, howe'Jet-, does not rnean that the cheque is always to be presented e dra\fller's bank on whiich the cheque is issued. The payee of tile cl1eque has tile option to pn::sent the cheque in any bank including the collrE~c:ting bank where he has his accou.nt but to attract the criminal liabilitv of ti~1e drawe1- of the cheque such collecting bar',k is obliged to _JO~sent the cheque_ in tile drawee or pavee hank on which the cheque is drawn within the period of six month~ from the date on vvhicll it is shown to have been issued,......The ~-~on-presentaUon of the cheque to the drawee ba k within tl1e period specified 1n the section vvou!d absolve t person issuing the cheque of his cr-iminal iiabilit)r under Section 138 of the Act wile shall otherwise may be ~iab~e to pay the cheque amount to the payee in a civil action initiated under the ~avv. A combiried,-eadinq of Sections 3, 72 and 138 of the J~ct would leave no doubt in our mind that the lavv ·----· mandates the ch~1!e _ _to _}o1~_.Qresented;qt th~ bank on whicl~1 t is draiNn if the drawer is to be held criminaliv liable. Sucl[1] _Qresentation is Crl.M.C.No.l056/2011 8t con1w~teo miltte.rs PagelS orll· nece~sarii\l to be madP within six months at the bank on which the che(U,!~~~ ~::; drawn whethec presented pel-'~:onal!v or throuqh another bankl namely, the collecting_b.;:~nk of the payee." (E;nphasis Supplied)

21. T!lough the decision in ls.hc~'F Al//oJ/s case (supra) has been rendered in the context limitation for presentaticn of a cheque, the said decis~on ftlrings out in no uncertain terms that Section 138 of tile N~ t1ct contemplates that a cheque is required to be presentrpd for encashment to the drawee Bank and. that the payee Bank, merely acts as an agent of the payee/COillp!ainant for the purposes of presenting t!le clleque in questirJn r encashme to tile drawee Bank.

22. Thus, the 21ld act to whlch tine Supreme Court r-eferred to in Bhaskarar/s CC152 as one of e:], '\/Vhicr[1] consbtutes til~ offence under Section 138 p!-esentation of the cheque of e '- !\II Act 1/\fas th[2] drawee bank and need!ess to state the 3~d act which constitutes an jngn?dlent of the offence Is tile retum of the cl~1eque unpaid by the drawee bank and thus it becorrteS Cfly'Stal clear that the 2rj and 3rd act constituting the offeilce vvoulol relate to only one olace i.e. the o!ace:Nnere the dravvee bank is locatecl. I '

23. These are r11y humble reasor1s to hold that the observations in paras 15 and 16 have to be read as an orbiter and thus tile 5 acts conten--~.plated as constituting the offence are cap;:;:1ble of being performed not in 5 but only in 4 places and since rj,eposit of th·c:: clneque with the payee bc;;nk is not an act contemplated as an in·gredient of the offence, the pla:ce vvhere the payerc:~ bank Is located \N.Ould bE: C:l.M.C.No.1056/2011 g_ connected mat'.:ers Page:Wof n irrelevant for pel us(:::::; of detennlrdng jurisdiction of the crirTlinal court.

24. It is settled law that a decision is an authority for the point it decides and not what can be logically deduced therefr-om and the ~-atio of a decision has to be 9athered with reference to the facts of a ca:~::e and ~just highHght only one decision of the Supreme Court being the declsior[1] repor-ted as Dhodha House v S,K__LijalnqL(2006) 9 SCC 41. -,[5]

26. The re\evant !~jortion of. Section 6, Section 7 and Section 64 of N~ 1-\ct c=J'';d Section 72 of the 1\H ?~ct reads as ·under:-- Section 6. Cheque: - A "cheque" is a bH! of exchange dra·JVn on a specified banker and not expressed to be payable otherwise than on demand and it ':ncludes the electronic image of a truncated cheque and a cheque in the electronic for·m. )( )( )( Section 7. The nlaker of c·l bill of exchange or Cheque is cailed the "ciravver"; the pe1r-s:on thereby di1-ect2d to pay is called tl1e "Drawee". )( )( )( Section 64. Presentrnent r payment. (l)]Prornissory notes, bills of exchange and cheques· must be presented for payment to the maker, acceptor or drawee tllereof respectively, !:::Jy or on beh.::?.lf of the holder as hereinafter provided. !n c!efault of such presentrnent the Cd.!VLC.i"Jo.1056/2011 & con,·l~:cteci rr:J~ters Pag.::.:a of n other parties thereto are nut Hable thereon to such holder........ )( )( )( Section 72. Subject e prov1s1ons of section 84 a ci-reque must in OTde1~ to charge the drawer, be presented at t!he bank upon which it is drawn before the relati~o~n lbetv1reen the olra\Ner and his banker has been adteredl to the prejudice of the drawer. 27.,o._ co-joint reading of Sections 6, 7, 64 and 72 as a~so cf Section 138 of the Nl;~ct bi~ings out that in order to attract penal provisions of Section 13B of the N~ Act a cheque i::; required to loe prese1-1ted for encashnnent to the drawee Bank and that the payee Bank acts mere~y as an agent of the payee/complainant for the purposes of presenting the cheque in question to the dravvee Bank. The nrecessary corollary thereof is that no pa of cause of action for thf~ offence punishable under Section 138 of the N~ l-\Ct arises ir[1] the Court within the local limits wh~ch the coHectiing Bank of the compla~nant i.e. payee Bank is situated and thus sait: Court has no jurisdiction to try a con'lplaint under Sectior 138 of the Nl t.\ct filed by the complainant.

28. This takes me to the considel-abon of second questior involved in the pn::s~c::nt case i.e. vvl1ether the court w~thir the local liimits of which the place fron[1] where thE complainant had se a notice c:o rnpiated under provisc (b) appended to Section 138 of e 1\H Act is situated has the jurisdiction to try a cornplaint filed under Section 138 of tile NlAct. '1'! IVl C 1.\lo 1056/')01 1 c con..-,c·-"o::J ·-~-rt--rc.._.. • • • • L- __ J... )I._, I;,.. \.. l._ L I; 1.::... ~ ~' ?;115e:a of 27

29. I have already noted the observations ~Ylade by the Supreme Court in Bhaskaran's case (supra) in the foregoing paras and would highlight tho::;rt in paras 17 to 23 th[2] Supreme Court has reflected upon the limitation within which the notice has to be g n to the accused. The Supreme Court was considerinsr e expression 'giving a notice' in proviso (b) to Section 1313 of the Ni J\ct, with refer-ence to the 15 cJays' time conternplated then by vvhich the requisite notice had to be served, which time is ncnv 3C days.

30. Another decision of the Supr-eme Court, reported as (2009) 1 SC:C 720 /-Iannan Elec~tron.ics Pdvate Lim/ted v National Panasonic /ndia Private l i;_nited is worth noting on the subject.

31. in Hat7nan's case (supra) the question which had arisen before the Supr-eme Cow-l= was precisely the same,question which arises for consicllel-ation in the 1oresent petition i.e. whether e court withii"tt e ~ocai Hrnits of vvhich the place from wher-e the cornp!aliir1ant had sent a notice contemplated under- p:-oviso (b) Section 138 of the N~ Act is situated has tile ju:"isdiction to a complaint filed under Section 138 of the N~ J~ct. ~L\nsvver"i!llQl e aforesaid question 1n the negative, the Supreme Cou observed as under:- "12......The oniy question, therefore, which arises for consideration is that as to whether sending of notice from Delhi ittself 'Lrvou!d give rise to a cause of a on for takingJ co,gnizance under the Negotiable instr-uments C~l.fV[1].C.f~o.1055/201:L 1St::-onl',eC.LecJ matters i:Jage 23 cf 27 - Vf

13. It is one thing to say tilat sending of a notice is one of the inQJiredients for mainta.ining the complaint but it is another thing to say that dishonour of a cl1eque by itself constitutE:s an offence. For the purpose of proving its case that the accused had corn1Tliltted an offence under Section 138 of the 1\iegotiable ~nstruments Act, the ingredients tllereo: are required to be proved. \1\!h at would constitute an offence is stated in the main provision. The proviso appended thereto, however, imposes certain further conditions which are required to be fulfilled before cognizance of e offence can be taken. If the ingredients for constitution of tre offence Iaid down in provisos (a), (b) andl (c) appended to Section 13S of the f;JegJotiable lnstrLiments Act ar-e intend to be applied in favour of the accused, tlle1-e cannot be any doubt that receipt of a notice woulld u rnately 9ive rise to the cause of action for fHing a complaint.;!\s it is only on receipt of the notice that the accused at his own pe:-il may refuse to pay the amount Clauses (b) and (c) of the proviso to Section 138 therefore rnu.st be read tclQJether. issuance of notice would not by itself <gjve rise to a caus~ of action but communication of the notice would........For constitution of an offence under Section 138 of the Act, the noticr:: m.ust be received by the accused. ~It may be deemed to have been 1-eceived in certain situations. The vvord "cornrnuniCa~e:' inter ana rneans "to make known, infonT:, convey, etc".. 20...... /.\court derives a jrurisdict:lon only when the cause of action arose within its jurisdiction. The same cannot be conferred ioy any act of omission or comnlission ·on the part of the accused. A distinction must also be borne in mind [(},2tweer,, die ingreolit=:nt of an offence and commi..ssion of a part e offence. liJI[1] hl!e issuance of a notice by the ho.ld·er of a negotiable Ct"I.1Vl.CI\Io.1056/2011 & co:wected matters PagP 2'4 of 27 J instrUITlent is necessaryL5~~rv~ce tl1ereof is also imperative. Only on a serv~ce of such notice and failure on n1e par-t of e accused to pay the demanded aiT;ount withi1n a period of 15 days thereafter, the comr11dssion of an offence completes. 0_b0Jl9_ of n_oUce tl1_erefore, catlnot have ar·1\~ceqent over tile service. !t is only from that vievv of the matter that in Da!n?ia Ce;nent (B!;arat) Ltd v. Galaxy Traders S Agencies Ltd er-,lphasis ilas been laid on service of notice." (Ernphasis Suppiiea~) ~--- r' f" ' t. I I' 't' '.. r tl -jL, Ar a ·II"St o:usn reao1n01 or.lle c~eCISions or -_le:::>ca;rerne -~,. ~~---,ijfr'"t 1.'1 t::;;f-~d-c{--~)"":">n) ~1 r:(·,l Jt-far-,--r-•,.:J•;--.'·C: r--:,c;,:::,c ('C,'i'~·""d·--'< 1'}- rr•;::,\/ '--~ u I j,!;.:.___ ___:::!_.! '\~ C:...0::_!__. ~~I • J j I ~ I I ''-'' I I -!· \._, C'J._, c..) -....) ·U }-' l } ' t I;.A J strike to the reader that there is a confnct between the t\\fo decisions Inasmuch 2·5 rn Bhaskaran's case (~;upra) it W3S held tl1at the expression 'giving of notice' occurring in proviso (b) to Section 138 of the !\II Act means 'sending of notice' whereas in Hanna,rts ca::;e (supra) it V1tas heid that the said expression mr::'ans 'rece~CJ't ofnotice',

33. A can=~ful reading of the tvvo decisions shovvs that there is no conflict betvveen the said decisions inasmuch as they· l[1] ave been rendered in differe"lt contexts. The d12cision 1n Bhaska_ran's case (supra) was rendered in the context Jf starting point of Hn:itation per~od 15 days prescribed.in proviso (b) to Section 138 of the N~ Act and itt was in that context i.e. the co;ltext of limitation that it was held by the Supreme Court ti~1at the expn?ssiion giving of not!c:::·' occurnng in proviso (b) to Sectior,J 138 of the N~ Act means 'sending or notice', The decision ~n Hannan's case (suprt[1]) was render-eel in th~ context of cause of action for filing a complaint under Section 138 [\H;j1ct \N in jurisdiction of a '"'~riJ-ti.CI!!d=r-- co,ul-·i:;:-,r-,1-i i·-~ -~·b;:,t rf•r:·Jte,'<L.;.t \1,/-::Jt:- 1>-eld f"JV t-he f..! ~··. L.,._. _:....A. -.-· 1 1. L. f.......[1] ••• • _. J...... / • L a v v CJ --~ fr,_ 11 J' ~~ i 1... Cr!.IVl C.No.1CJ56/211l[1] St c:JrllieC~~ed mattc:rs ?age lS o[1]: n Suprerne Court that the e>qJre:ssion giving of not[1] ce r occurring in pi"OVlSO (l[1]) to Ser=:tion 138 of the Nl,1'\ct means 'receipt olnotice '.

34. Now, same expression can have different meanings in different context as held b)/ the Supreme Court in the decision reported as fl1ajik La! !11alwndar. v Gourargj!_ Chandra L_?f}_x (2004) 1.[2] SCC 8 wherein it was observed that a word occu:-:g 1n a.:tat ry provLsiron can have different meanings in d1fferent coiltext witfnlrn the sa r1e statute.

35. Thus/. the inevitable condusjon vvou!d be that the.+th act contemplated! as an ingredient of the offence 3S highlighted in Bhaskq_ran's case i[1].e. 'giving notice in writing to the drawer of cheque' den7anci;f7g pay;nent of the cheqJe an7ount for purposes of lim1tation would have a meaning as explained in Bhaskaran's case and for purooses of jurisdiction would rnave a rneaning[1] as explciinecl in lshar Allo;(s case (supra).

36. Before concluding I vvoutd De faHing not to lodge a caveat. With electronic bankin'(J and facility payable at p,]r of clearance p ded by bankers and especially ~n metropolitan cities, \Nhere cheques are c!earecl by not being presented to tile dravvee bank but at nodal branches of the cancel-ned banks, tile subject nnattel" of jurisdiction rnc;y have to be decidec keeping in evl that the drawee bank has createcl ar: a,gency w!1ere e cheque in question s tt"ansmitted r clear;':"1.nce and e s s whe:",:?. tine earance takes place would t 1 -;en ar9uatdy becorne tile place vvher[2] CrLM.C.No.1056/2011 8t cot-!il2Cteci matters !J. './I ~~ K\· WI! ~i;I f;ll !i; 't ' ~,. ' ·~) ', ~~1~ I (aid I! ~ o· ~ u\; ~~l I! kj' HI ~\; I ''I ~I l l,ii •. r_l·, b ~I~.I ~ ' it ·~I, ~: f~l ·l:;'i ',,I !1r r: lj.l f,i !•j. J the cheque woulcl be requir-ecl to be tr-eated as presente1j to 'the bank' Le. e dl-awee bank. ~~dt, in such circumstances, properly constituted p~eadings have to be found in a con1plaint and lodging t!1e caveat, ! leave it at that for the debate to be properly argueC: in an appropriate case witll the necessary relevant pleadinQJS.

37. ~ hold at on the plead~ngs in the complaint(s), no part of cause a.ctiori can be::;aid to have accrued to the complainant at elhi.:. that the notice demanding payment vvas posted rn C),en-:l and that the cheque vvas deposi~ed vvith the payee ba rid< at Deill i vvou !d not constitute the acts contemplated as Ingredients of an offence punishable under Section 138 N! and thus i dispose of the petitions quashing theimpu,;~ned order(s) dated 14.2.2011 and direct: e learned ~~CMM to return tile complaint(s) to ~he respondents for filing in a Court having territo(ial jurisdiction.

38. No costs. iC[EiiJJTIE"'iliiBEIIll ?1 ?n"" 1 J! II LII"U II'\ I.'-.,.-.. UJJL mm o-I.M.C.No.1056/2011 & connected mntte1·s -. "--.. ~·,- ~ -...,...,__ {PHADIEE!P NANDHJ.\jOG) jUDGE iJage 27 cf 21'