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

PRADEEP NANDRAJOG, J. For orders, see Cri.M.C.No.l056/2011. SEPTEMBER 21, 2011 mm (PRADEEP NANDRAJOG) JUDGE Certify that the digital and physical file have been compared and the digital data is as per the physical file and no page is missing. 'Yo + (; THE iHi H Oi-=- DU ... /),,T rec:·pr)/(J(l/)[7 Z&17 Senterr;iJer 7011 __ •' - jucfq;ner7t pronounced on: 21st Septen?/:Jer 20.1' 1 C.K{LJ1.C J_Q56/2011 SHREE RAJ TRAVELS G( TOUrtS lTD. 5( OP5 .., ... Petitioners Through: i\1r.Sunii Gupta, Sr.A.dvocate. with Zaveri, Mr.Gaurav Agarwal and Mr.Tanrnaya Agarvv:al, 11:\dvocates DESTINATION OF: THE \1\/0RLD (SUBCONTiNENT) PP.lVA.TE UfD. . .... Respondert Through: Malhotra, Advocate :[HLM.C. SHREE RAJ TRAVELS & TOURS LTD. & ORS. . .... Petitioners Tjl o .I \ .. L.o . r/ii·.sunl 1 upta, Sr.!\dvocate with M 1· .jati n ZaverL r.<:;aurcw Agarvvai and Mr.Tanmaya J\ga rwal/-\dvocates versus DESTIN ON OF THE \NOF\LD PP,I\//\TE L ..... Hespc;ndent Througt:: Malhotra, Advocate 1rnl il\lil C lJI-·,r·L/''01' 1. ,_n .11"!. SHREE R/\j TRJ\\/ELS & TOURS LTD. . .... PetitiC>ners 61 ORS. Through: Gupta, Sr.Advocat:e vvith r.jati n Za'>.rerL M r.Caa urav f.\g 31 rvvall and M r.Ta n maya J\garvval, A,dvocates c:onnect::.·J \=·age :i of / Ve(SL!S DEST!NAT!Ol\1 OF THE \NORLD (SUBCONTINENT) PRIVATE LTD. ,,., Respondent Through: Advocate CP,LJllLC. SHREE F\AJ TRAVELS 6( TOUf\S LTD. 6( ORS. .. ... Petitioners Mr.SunH Gupta, Sr.P1dvocate with Zaveri, Mr.Gaurav and Mr.Tanrnaya Thr-ough: - - A.dvocates versus DESTINATION OF THE PRIVATE LTD. . .... Respondent Through: Mr.Aninr::!ya Malhotra, CRLM.C. 111)/2011. SHREE RAJ TRAVELS & LTD. & ORS. .. ... Petitioners Through: Gupta, Sr.Advocate with Mr,Jatin Zaveri,, Mr.Gaurav Agarwal and Mr.Tannnaya AgarwaL Advocates versus DESTII\LA,TION OF THE \NORLD (SUBCONTiNEf\lT) PRiVATE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C llJl:J/2011 SHREE I::ZP,j TRAVELS & TOURS LTD. & ORS. .. ... Petitioners Through: Mr.Sunil Gupta, Sr.Advocate with Mr,Jatin Zaveri, f'l,garwal and Mr.Tanmaya Aqarwalr 11:\dvocates Cr!.M.C.I\Io.1056/20:Ll 81 connec:terllTicittc:>rs Page 1 of 2.1 -· !, i 9; versus DESTINATION OF THE V\fOR.LD (SUBCOI\JTH\IENT) PRIVATE LTD. . .... Respondent Through: Mr.P\nindya MlaH1otra, Advocate CRLM.C. SHREE RAJ TRAVELS & TOURS LTD. E)( ORS" ..... Petitioners Mr.SunH Gupta, Sr.Advocate with Mr.jabn Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya AgarvvaL t3,dvocates ·rhrough: versus DESTII\IAT!ON OF THE \NORLD (SUBCONTiNENT) LTD. . .... Respondent Thr-ougll: Mr.Anindya Malhotra, Advocate CRLM.C SHREE RAJ TRAVELS & TOUHS & ORS. . .... Petitioners Through: Mr.Surnill Gupta, SI-.Advocate with Mt-.jatin Zaveri, !Mr.Gaurav Agarwal and Mr.Tanmaya Aga rwa I, Advocates versus DESTII\LLATiON OF THE \1\/0RLD LTD" ..... Respondent Through: Mr.Anindya Malhotra, CRLM.C. SHREE TRAVELS & TOUR.:S LTD. 61 ORS. . .... Petitioners Mr.Sunil Gupta, Sr.Ad\Jocate with Mr.jlatirn Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Through. Cri.IVI.C.No.1056/2011 8t conne::::ted matters ! --·,-! Advocates versus DESTrNATION OF THE WORL[l (SUBCONTINENT) PRiVATE LTD. . .... Respondent Through: Mr.Aninolya Advocate CRLM.C. 11"19/2011 SHREE RAJ TRAVELS 5( TOUR.S LTD. & ORS. . .... Petitioners Mr.Sunll Gupta, Sr.Advocate with M 1-.Jati n Zaveri, M r.(;a urav . Agarwal and Mr.Tanmaya Agarwal, Advocates Through: versus OF THE V\/OF< (SUBCONTINENT) PRIVATE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C JJUU./2011 SHREE RAj TRAVELS & LTD. & ORS. . .... Petitioners Through: Mr.Sunil Gupta, Sr.Advocate with Mr :jatin Zaveri, Mr.Gaurav Agarwal and Mr.Tanrnaya Agarwal, Advocates versus DESTiNATION OF THE WORLD (SUBCONTINENT) PRiVJlTE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C. 11BJ12011 SHHEE RAJ TP,A\IELS f)( TOUF\5 LTD. 0( ORS. .. ... Petitioners Through: Mr.Sunil Gupta, Sr.Advocate with Mr.J[atin Za\/eri, Mr.(iaurav Cri.M.C.I\Io.1056/2.011 & connected matters i ---,! /\garw;3JI and Mr.Tanmava · ' J Agarwa:!, versus OF THE \NOR, (SUBC:ONTINEI\lT)PRIVATE LTD. .. ... Respondent Through: Mr.A.nindya Malhotra, ,t,dvocate · CRLM.C. 11B6l?Oll SHREE P,16J TP\1-\\/ELS &, TOUP.5 LTD. 5c ORS. .. ... Petitioners Gupta, Sr.Adivocate with Mrjatin Zaveri, Mr.Gaurav Agarwal and Mr.Tanrnaya AgarwaL J\dvocates Through: versus DESTINATION OF THE \NORl.D (SUBCONTINENT) PRIVATE LTD. .. ... Respondent Through: Mr./J111indya Malhotra, Advocate CRLM.C 11El7/701JL SHREE RAJ & TOURS LTD. 5c ORS. . .... Petitioners Through: Mr.SunH Gupta, Sr.f\,,dvocate with Zaveri, Mr.Gaurav and Mr.Tanrnaya J-\g a rwa i, versus DESTIN.A.TION OF THE \NORLD (SUBC:ONTH\!ENT)PRIVATE LTD. . .... Respondent Through: Mr.Anijndya Malhotra, .Advocate CRLM.C 1188/2011 C:: l··11 R\. tc E P 0. : Tr.:t A\ I c l ·c: ,\, TO i 1 c:; : .._r u 11L- .. ........ I,JI! .. -· -· & OR (' 0'otihonel--s ' \J' . . . . . II ,_ k -::. Through: Mr.Surnil Gupta, Sr.Advocate Cri.M.C.No.1056/2011

¶81connectecl rnatte1-s Page 5i of 7.7 t I with Mr.Jatin Mr.Gaurav Agarvval and Mr.Tanmaya i-\garvva1, Advocates versus DESTIN/\TION OF THE \/VORLD (SUBCOf\lTlNENT) PR!V/J1TE D. . .... R.espondent Through: Mr.ij,ninolya Malhotra, Advocate CORAIM: HONDBLE MR. JUSTICE PHA[\l[EP NAINDRP'JOG L VVhether the Repol-ters of papers may be alknved to see the judgm.ent?

¶2To be ,-efe!Teo1 to R.eportel-or non

¶3Whetller tile judgment slloul·d be reported in the Digest? · PRADEEP NAINDR.AIOG, j,

¶1Briefly stated the facts leading1 to filing of the above captioned petitions are that respondent i.e. 'Destination of World (Subcontinent) Pv1=. Ltd.' a cornpany registered under the Companies Act filed 15 comp1la1ints under Section 138 of tile Negotiable instruments ,4ct, 1881 (hereinafter referred to as the 'Nl 1L\ct'); 3 cheques bei119 the subject matter of each complaint. Petitioner No.1 i..e. 'Shree Raj Travels & 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 alleQJation that as Di!rectors they were inc:har-ge of the day to dlav affairs of the company and llence were vicariously liable For the defaults of the company. The cornplaint vvas filed the Court of Additional Chief Metropolijtan (hereinafter referred to as the [S,_ connF>cted matters Page tS of 27 'ACMM') New Delhi, inter-,_alia, ,;:r,rerring that the respondent COiilpany and the accused No.1 connpany had entered intc 2 agreements in terms vvhereof H1e accused No.1 compa:1y had issued 45 cheques drawn on State Bank of . Mumbai Branch, in favour of the respondent company, which cheques when presented for encashment by the respondent company with its Banker Bank New Delhi, were dishonoured and upon the cheques being returned the respondent company is::: .. ued notices contemplated under proviso (b) to Section 138 Nl f-l1ct 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. VVith respect to the jurisdiction of the Courts at Delhi i;t 1Nas pleaded that for the reason the respondent company had presented the cheques in question collection with banker Bank situated in Delhi, the Court had tile necessary jurisdiction.

¶2may be noted at the outset at afte·r the complaints were filed, the respondent company filed a suit bearing No.SS0/2010 in which petitioner No.1 was as the defendant before the High Court of Bombay prayiing for a decree to be passed in the sum for which the 45 cheques forming subject--matter of the aforesaid complaints were issued. the plaint, jurisdiction of the Courts at IV!umbai was pleaded on the averment that the agreement pursuant whereto the cheques were issued was executed at IViumbai as also that the cheques in question were drawn and issued at Mumbai. 8, connected matte1·s Page 1 of ZJ

¶3Taking cognizance of the complaints, the learned ACMM sumrnonecl the petitioners to face trial for an offence punishable under Section 138 of the 1\LL Act.

¶4Upon service of the summons, the peUtioners filed application(s) under Section 177 C:r.P.C. inter-aiia stating that the courts at Delhi have no jurisdicbon to take cognizance of the complaints and prayed that tt-:e complaints be 1-eturned to the respondent to be filed in the court of competent jurisdiction. Together with the sa(d application(s), petitionel-s 2 to 7 filed appiication(s) seeking exemption for personal appearance before Dismissing application(s) ::;eeking exernption from personal . appearance and keeping pending, for consideration,· application(s) filed under Section 177 CrY.C. vide order elated 25.05.2010 the learned ACMM issued bailable warrants against petitioners 2 to 7.

¶5Aggrieved by the order dated 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. thereto, pehtioners filed petitions seeking Special Leave to before the Supreme Court which were disposed of vide ot-cler dated 14.1.2011 with a direction to the learned /1,CMM tl1at applications filed unde:- Section 177 Cr.P,C. would be disposed of within 2 weeks.

¶6Vide order dated

14.02.2011 learned ACMI\f! dismissed tr1e application(s) under· Section 177 Cr.P.C. filec' by the petitioners on the ground that in view of the dictum of law iaid down by the Supreme Cour-t in the decision Cri.M.C.No 1056/2011 & connected matte1·c: Page ti of 2i . reported as (2004) 7 SCC 338 / 1!da!at Prasad 11 Roop La/ linda! once the r .. iagistrate has taken cognizance of a complaint he has no power to return the same to the complainant with a direction tf1at the same be filed in ::1 court of competent jurisdiction.

¶7Aggrieved by the order dated 14.02.2011 passed b'r the !earned ACIVIM, the petitionE:rs have filed t!1e above-captioned petition(s) under Section 4B2 Cr.P.C. requirinn this Court to hold that courts at have no jurisdiction to take cognizance of the complairrts in question and seek directions to the learned ACMM to return the same for filing before the Court of Competent

¶8It is t!1e case of the petitioners that the cheques in question were dravvn at Murnbai. The drawee bank is Mumbai, notice issued by the to the petitione,.· company was received at Murnbai and tlltUS merely the respondent posted the notice From and deposited cheque with its bank at Delhi would not confe( jurisdiction on Courts in Delhi.

¶9The issue l1as to !Je debated :Nitll reference to Section 138 of the P,ct and the applicable provisions of the of Criminal Procedure i.e. Sections 177, 178 ancl 179 of Code of Criminal Procedure.

¶10decision reported as 1999

(7) sec 510 KBhaskaran lis. Sha·nl;an::7J..? __ lla_lQjf7Van Balan Supreme Court has opined, after Sections 178 to Section 179 of the Code of Procedure, that ar: Cri.M.C.l\Jo.1056/2011 & cotlnect:::d matters ?age 9 of2? -·-.! offence may be completed in different localities and thu::; can be trieci in any Court· hcn,r1ng over .said localities. To put it pithily, iin relation to territorial jurisdiction, qua an offence, Ia\!\/ :·ecognizes more than 1 court having1 territorial jurisdiction rind the issue of territorial ju1·isdiction would have to be decided with reference to whether a part of an offence 'INas committed within the territorial jur-isdiction of a court. The issue is no longer· res' integra and r just neeci to note the decision of the Supreme Court in. KBhaskararls case (supra) and highlight that the;· aforesaid is to be culled out from paras 11 and 1:Z of the said decision.

¶11The next logical question '\Mould be, \Nhat are the contours of Section 138 of the 1\11 i\ct pertaining to acts to be performed in relation to an offence contemplated IJy the' said Section'? It hardly be re-ernphasized that it are acts of COITlmission or ornission which constitute offences, \Nith or. without the requisite nlens rea, depending upon 1Nllether, the offence is an absolute offence or not.

¶12Let me thus note Section 13Ei, A.ct which reads as: under:-\!\/here any cheque drawn a person on 2 n account: maintained by !:1im with a banker for payment of any amount of r'noney to another person from out of that account for discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the anwunt of rnoney standing . to the credit of that account is insufficient to honour the cheque or that it c:xceeds the amount arranged to be paid fmrn that account by an , Cri.IVLC.No.1056/2011 1St connected matters .-' agreernent made with that bank,, such person shall be deemed to have an offence and shall without to any other provisions of this Act, be punished imprisonment for a term whkh may extend to two year, or with fine which rnay extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless-

(a) The cheque has pl-esented to the bank within a period of six months from the date on which it is drawn or within the period of its va!idityl' whichever is earlier,

(b) The payee or the holder-Induce course of the cheque,, as the case may be,, makes a demand for the payment of the said amount of money by giving c!l notice, in writing, to the drawer, of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheques as unpaid, and

(c) The drawer of such cheque fails to make the payment of tile 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: For the purpose of this section, "debt or other liabiHty" means a lega!iy . enforceable debt Of" other l b'

¶13In Bhaskaran's case (supra) the Supreme Court had an occasion to deal with the issue of jurisdiction in relation to Section 138 of the Ni and of necessity, the discussion required the Supreme Court to iden,bfy various acts of commission and ornfssion which constituted the offence punishable under Section 138 of the J.\ct and suffice would It be to highiigllt tilat in para 14 of the Cri.IVJ.C.No.1056/2.011 8z connected mattet·s Page 11 of21 t deci'sion, the Supreme Court hi9hiighted that there are 5 acts which are the components of the offence punishable under Section 138 of the Nl Act and i re-produce the same from para 14 of the decision of the Supreme (Court They read as under:-

(i) drawinq of the cheque,

(ii) presentation ofthe cheque to the bailk,

(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 amount,

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

¶14After holding that acts wouid constitute components of an offence under 138 of the Act, in paras 15 and 16 the Supreme Court observed as under:- l/15. It is not necessary that a II the above five acts should have been perpetrated at the same locality. it is possible that each of those five acts could be done at five locaHties. But a concatenation of all the above five is a sine qua non for the compietion of the offence under Section 138 of tile Code. .In this context a reference to Section 178( d) of the Coole is usefuL . it is extracted below:

¶16Tl1u:; it is clear, if the five 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 the Act. In other . words, the cornplainant can choose any one of Cri.M.C.No.1056/201l & connected matters Page l2 of 27 ·-.!, / ! ·-.! those courts having jurisdiction over any one of the local within the territorial limits of which any one of those five acts was done. As amplitude stands so widened and so expansive it is an idle ·exercise to raise jurisdictional question t-ega1 ding offence under Section of Act." (En7phasls Supplied) l

¶15On the issue of service of notice required to be given by the complainant to the tile Supreme Court observed as under:- "17. The more important point to be deddled in this case is whether the cause of action bas ar·isen at all as nobce sent by complainant to the accusec! \Nas returned as '/unclaimed". The conditions pertaining to the notice to be given to the dravver, have been formulated and incorporated in clauses (b) to {c) of the proviso to Section 138 of the Act. The said clauses are extracted below:

¶18On the part of the payee he has to make a demand by "gliving a notice in writing. that was only requirement to complete offence on the failure of tile drawer to pay the cheque amount within 15 days from the date of such of the prosecution would have been very much lessened. But the legislature says that failure on the part of the drawer to pay the amount should be within 15 days {{of the receipt" of the said notice. is, therefore, clear that "giving notice" in the context is not the same as receipt of notice. Giving is a process of \1\ihicll receipt is the accomplishment. It is for tile payee to perform the former process by send1inr] e notice to the dravver-at tile correct address Cr!.fV1.CNo.1056/201l S:( connectsd matte:s Page 13 of 2.7 ---,-!

¶20If a strict interpretabon is given that the drawer should have received the notice for the period of 15 days to start running n.o. matter that the payee sent the notice on the correct address, a trickster cJ1eque drawer would get thE: premium to avoid n:x:ehdng the nobce by different strategies and he could escape from the legal consequences of Section 138 of the ,Act. it must be borne iri mind that e court not adopt an interpretation which helps a dishonest evader and clips an honest payee as that wouid defeat the very legislative rmeasure.

¶21.... The context envisaged in Section 138 of the Act invites a liberal inter·pretation for the person who has the statutory obligation to give notice because he is presurned to be the loser in the transaction and it is for his interest the very pmvision is made by the ie9islature. The words in cia use (b) of the proviso to Section 138 of the Act sllow that the· payee has the statutory to "make a deiT1ancl" by rgiving notice. The thrust 1n the clause is on the need to "make a demand". is only the mode for making such demand which the legislature has prescribed .. 4 payee can send the notice for doing his part for giving the notice Once it is despatched his part is over and the next deoends on what the sendee I . does.

¶22It is well settled that a notice refused to be accepted by the addressee can be presumed to have been served on him (vide h'archaran Singh v. 517/vranP and jagdish Sing/7 \<'. 1\!atthu Singh3).

¶231che notice is returnred as undai11H::d and not as refL:secL V\fili any sigrdficant difference betvveen tvvo so far as presur11ption of service is concerned? !n this Cr!.IV!.C.No.1056/201115t connec!:ecl matters Page :14 of 21 -- 'j, connection a refel-ence to Section 27 of the General Clauses i'\ct will be usefuL The section reads thus:

¶24No doubt Section 138 of the Act does not require that the notice should be given only by "post". Nonetheless the pd.nclple incorporated in Section 27 (quoted above) can profitably be imported in a case where sender has despatched the notice by rpost 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 r·esponsible for such non-service. other inter-pretation can leacl to a very tenuous position as the di-avver of the cheque vvho is liable to pay the amount wouk:l ·resort to the strategy of subter-fuge by successfuHy avoiding the notice.

¶25Thus, vvhen a notice is returned by the sendee as unclaimed date wou!d be the commencing date in reckoning the period of 15 days co-ntemplated in clause (c) to the proviso of Section 138 of the Act. Of course such reckoning would be without prejudice tD 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 not even attempt to discharge tl·ie burden to rebut the afol-esaid presumption." (Etnphasis Supplied)

¶16The expr·essions: /pre.s-entaticm of the cheque to the Bank/ a.nd 'if the five difl:erer1t acts were done in five different localities any one of the courts exercising jurisdiction in one of the five local areas can becorrJe the o/ace of trial i'or the oir..Fence under Section 138 ol the Act' to . . be found in 14 and l6 n2spective!y in case (supra) have been understood loy many to mean that Cri.M.CI\Jo.1056/2011 1St conrected lllc'tLe•s ?age 15 of 27 ! J the Court within local limits of which the payee Bank· i.e. thr:= Bank vvhere complainant cleposited the cheque is situated has the jurisdiction to try the complaint under Section 138 of the 1\H Act, and the unolerstanding appears to be fortified by the observations of the Supreme Court in paras 15 and 16 that if the 5 acts as the ingredient of an offence under Section 138 of the 1\H i\ct were done in 5 different localities, any one of the court exercising jurisdiction in any one of the 5 iocal areas vvould have jurisdiction.

¶17But, it is appal-ent that the observatiqns 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 Act can possibly be performed The can be performed, as would be explained hereinafter, on1ly at 4 and would immediately state that act No.2 and act No.3 to only. one place i.e. the place wl1ere the drawee bank is

¶18Tlle second and the tl1ird act of the 5 listed by the: Supreme Court, as constituting th12 offence under Section 138 of the Nl A.ct are: (a) presentation of the chequre to the bank; and (b) returning the cheque unpaid by the drawee bank.

¶19The third act is the return of tile cheque unpaid by the drawee bank anol thus there is no scope for any arrgument as to which bank is contemplated with to the said act. The second act pertains to the act of presentation of. cheque to the bank. i highligr1t t11at the twin words used .are 'the bank. Cri.M.C.No.1056/2011 8t connected matters Page 16 of 17 · --·!, '!, \'l(' tl: p,1 I ,,J '':1 .. li fj 1/

¶20the decision reported as 2001 (3) SCC 609 Shri !shar Allov Steels Ltd Vs. lil.Xaswa!s 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 vvhat would be meant by 'the bank' as mentioned in S1ection 138 of the Act. \!\/as it the drawee bank or e payee bank? The Supreme Court answered the question in the following words:- "2 . ( a) \/\f hat is rn e a n t . by, ''the b a n k" as mentioned in clause (a) of the proviso to Section

1.38 of the Negotiabl.e !Instruments Act, 1881?

(b) Does such bank mean the bank of the drawer of the cheque or tile payee of the cheque?

(c) To which bank the cheoue is to be presented for fQ.!:Jrposes oif attractinc: penal provisions of 138 of the Act?, are the questions to be determined by this Court in this appeaL hac; ho nnti.CPr('.! ril-to an - • ......,J ,._. 1 •. ,_, 1 •• ' ,....,.. -- .__ " .._A - - .... offence .under Section 138 of the Act, it is mandatory at the cl1eque is presented to /{the bank" within a period of six months from the date on it is drawn or within the period of its validity, whichever is earlier. is the cheque drawn which has to be presented to /{the bank" within the period specified therein. When a post-dated cheque is written or drawn, it is only a bill of exchang1e. The post-dated cheque become a cheque under the Act on the date which is written on tile said cheque ancl the six months' Cri.i\II.C l\io.1.0S6/201J 8( connected nvrcters '!, period has to be reckoned, for the purposes of Section 138 of the Act, from lthe said date.

¶8Section 138 provides INhere any cheque drawn by a person on an account maintained by him with a "banker" for payment of any amount of money to another person 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 ·of that account is insufficient to honour tlli'e cheque or that it exceeds the amount to be paid from that account by an agreement made with that bank, such person shall be deemed to have commiitted an offence punishable \Nith imprisonment as prescribed tl1erein subject to tile conditions mentioned in clauses (a), (b) and

(c) of the PI'Oviso. Section 3 of the Act defines the "banker'' to include any person acting as a banker and any post office savings bank. :Sectron 72 of the Act provides that a cheque must in or-der to charge the drawel-,, be presented at the bank upon vvhich it is drawn before the relations between the d.r-awer and his banker has been altered to the prejudice of the oll-awer.

¶9The use of the words "a bank'' and "the bank" in the section is an indicator of the intenbon of the leqislature. The former is an indirect (sic indefinite) article and the latter is prefixed by a · direct (sic definite) artide. If the legislature intended to have the sarn·e meanings for "a bank" and "the bank", was no cause or occasion for mentioning] it distinctly and differently by using two different artides. 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" wher·e the cheque is intended to be presented under Section 138 is pi-efixecl by the definite articJe '''the". The same section permits a person to is::,ue a cheque on an . account maintained by hirn vvi'dl "a bank" and Cri.M.C.No.1056/2011 8t connected matters - :!, ! makes htm liable for crinndn,rJI prosecution if it is returned by "the bank" unpaid. The payment of cheque is contemplated by "the bank" meaning thereby where the person issuinQJ the cheque has an account. liThe" is the worol used before nouns, with a specifying or particularising effect as opposed to indefinite or genera!ising force of 1/a" or '''an". 'determines what particular thing is meant; that is, what particular thing we are to assume to be meant. UThe" is always mentioned to denote a particular thing 01-a person. HThe'' would, therefore, refer implicitly to a specified bank and not .any bank. liThe bank" refen-ed to in clause

(a) to the proviso to Section 138 of the Act would mean the drawee bank on whicll the cheque is drawn and not all banks where the cheque is presented for collection including the band< of the payee, in whose favour the cheque is issued.

¶10it, however, does not that the cheque is always to be presented to the drawer's bank on whiich tile cheque is issued. The payee of the ·cheque has the option to pn:sent the cheque in any bcllllk including the coHecting bank where he has his account but to attract criminal liability of the drawer of the cheque such collecting bank is obliged to _present the cheque in the drawee or pavee i?ank on which ithe cheque is drawn within the period of six months from the date on whicll it is sl1own to have been issued ........ The non-presentaUon of the cheque to the drawee bank within the period specified in the section would absolve the person issuing the cheque of his criminal liabHit)t under Section 138 of the Act, who shall othervvise may be to pay the cheque amount to the. payee in a civil action initiated under lavv. A combined of Sections 3 72 and 138 of the would leave no doubt in ouc mind that the mandates the cheqwe _ _to at the bank on which it is drawn if the drawer is to be held criminally liable. Such presentation is 2/ Crl.rlt.C.No.1056/2011 & connected matters Page of. 27 ! ! necessarily to be made within six months at the bank on which the drawn whether presented personally or through another bankj_ namely, collecting of the Q.Q_yee.''' (Emphasis Supplied)

¶21Thou9h the decision in ishar lJ,\1/oVs case (supra) has been rendered in the context of limitation for presentaticn of a cheque, the said decision brings out in no uncertain terms that Section 138 of tile 1\H f-\ct contemplates that a cheque is required to be pr-esented for encashment to the drawee Bank and that tt1e payee Bank, merely acts as an agent of the payee/complainant for the purposes of presenting the cheque in question fol-encashment to tile drawee Bank. "1 L. Thus, the 2nd act to whicll the Suprerne Court ,-eferred to in f317askararr's ca:::e as one of e vvhich constitutes the offence under Section of Act vvas the presentation of the cheque e drawee bank and needless to state the Tel act whict1 constitutes an ingredient of the offence is tile return of the cheque unpaid by the dl-awee bank and thus it becornes crvstal clear that the - . and 3rd act constituting the offence would relate to only one place i.e. the place 'INhere the drawee bank is located.

¶23These are my humble 1reasons to hold that the observations in paras 15 and 16 have to be read as an orbiter and thus the 5 ads as constituting the offence are capQble of being performed not in 5 but onl)/ in 4 places and since deposit of tilf:: cheque with the payee bank Is not an act conternplated. as an ingredient of the offence, the place where the payee bank located would be Crl.M.CNo.1056/2011

¶81connected rnat"cers Page 20 of 2? ·-.-!, ' irrelevant for purposes of jurisdiction of the criminal court.

¶24It is law that a decision is an authority point it decides and not what can be logically deduced and the ratio of a decision has to be ;gathered with reference to the facts of a and highHght only one decision of the Suprerne Court being the decislon reported as Dhodha Ho_use v SJ( /I;Jainqi (2006) 9 SCC 41,.

¶25The matter regarding jurisdiction can also be dedded vvith reference to Section 6, :3ec::tion 7, Sect1ion 64 a nci Section 72 of tr1e Nl /1,ct.

¶26The relevant of Section 6, Section 7 and Section 64 of l\!l a•·,d Section 72 of the N! Act reads as ·under:-· Section 6. Cheque: - A. "cheque" is a bH! of exchange drawn on a specified banker· and not expressed to be payable otherwise than on demand and it mcludes the electronic image of a truncated cheque and a cheque in the electronic form. )( )( )( Section 7. The maker of a bill of exchange or Cheque is called "drawer"; person thereby di1·ected to pay is called the "Dravvee". )( )( )( Section

¶64Presentment for payment.

(l)]ProiTiissory notes, biHs of exchange and cheques must be presented for payment to the maker, acceptor or drawee thereof respe(:tively, by or on behalf of the holder as provided. 111 defe:wlt of suc1·-11 presentment, 61 connecteci m0tters Pasc' .Zl of 21 --------·-' '-" ____ ___ -·;j, other parties thereto are nut iliable thereon to such holder ....... . )( )( )( Section 72. Subject hJ e provisions of section 84 a cheque n1ust in order to charge the drawer, be presented at tlhe bank upon which it is drawn before the relation between the drawer and his banker has been to the prejudice of the drawer.

¶27A co-joint reading of Sections 6, 7, 64 and 72 as c.f Section 138 of the Nl 1-\ct brings out that in order to attract penal p!-ovisions of Section 13B of tll1e Act a cheque is required to be presented fo1-encasl1ment to the dravvee Bank and that the payee Bank acts nne,-eiy as an agent of the payee/complainant for the purposes of presenting cheque in question to the drawee Bank. The necessary corollary thel-eof is that no pa of cause of action. for the offence punishable under Section 138 of the Act arises in the Court within the limits of whr,ch the coHectiing Bank of the i.e. payee Bank is situated and thus saic; Court has no jurisdiction to try a connplaint under Sect.ior: 138 of tfle f\11 Act filed by the co1T11plainant.

¶28This takes me to the considel-abon of second questior involved in the case i.e. whether the court within local liimits of which from where complainant had sent a notice under provisc

(b) appendec! to 138 of the Nl Act is situated has the jurisdiction to try a complaint filed under Section 138 ofthe Nf .Act. Cl·i.IVl.C.i\lo.1056/2011 8t connected 22 of 27 -·-.!

¶29I have already noted the observations made by the Supreme Court in Bhaskaran's case (supra) in the foregoing paras and would highlight that in paras 17 to 23 tile Supreme Court has reflected upon the limitation withi 1l which the notice has to be given to the accused. Thr2 Supreme Court was considerin9 the expression 'giving cl notice' in proviso

(b) to Section 1313 of the Ni P1ct, with reference to the 15 days' time contemplated th1en by \Nhich the requisite notice had to be served, which time is now 30 days.

¶30Another decision of the Supreme Court, reported as

(2009) 1 SCC 720 Harman Electronics Pn'vate Limited National Panasonic Inola Private l i;_nited is worth noting on the subject.

¶31In Hannan's case (supra) the question which had arisen before the Supreme Court was precisely the .same:. .question which arises for conslcllel-ation in the present petition i.e. whether the court the ioca! limits of which . the place from where the l1ad sent a notice contemplated under proviso (b) to Section 138 of the Ni Act· is situated has the jurisdiction to try a complaint filed under · Section 138 of the Act. AnswedngJ the aforesaid question ' ln the negative, the Supreme Court observed as under:- "12 .... .,The only question, therefore, vvl1ich arises for consideration is that as to whether sending of notice from Delhi would give rise to a cause of action for takin9 cognizance under the NegotiaiJ!e lnstruments il\cL Crl.fVl.C.No.1056/2.0E <S( ::::onllected matters ! -· !,

¶13It one thing to say that sending of a notice is one of the ingJredients for 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 Secbon 138 of the Negotiable Act, ingredients thereof are required to be proved. What would constitute an offence is stated in main provision. The proviso appended thereto, however, imposes certain further conditions which, are required to be fulfilled before cognizance of the offence car1 be taken. If the ingredients for constitution of the offence I aid down in provisos

(a),. (b) and (c) appended to Section 13E: of the NegJoitiable Instruments f},ct ar-e intended to b,e applied in favour of the accused, the1-e cannot be any doubt that receipt of a notice woulld ultimately 9ive rise to the cause of action for filing a complaint. /\s lt is. only on receipt of the nobce 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 tc1gether. issuance of notice would not by itself ,gjive rise to a cause of action but coiTimunication of the notice wouid . ....... For constitution of an offence under Section 138 of the Act the notice rnust be receiveol by tile accused. it may be deemed to have been ,-eceived in certain s ations. ThE' vvord "communicate" inter alia means "to make known, inform, convey, etc".

¶20. .. ,. f-\ court derives a jurisdiction only when the cause of action arose its jurisdiction. The same cannot be conferred by any act of omission o1-commission on the part of the accused. 1rJ.. distinction must also be borne in mind loetween the ingredient of an offence and commission of a part of e offence. V\Lhile .issuance of a notice by the holder of a negotiable Ci"I.M.C.I\Io.1056/2011 & connected matters Page 24 of 'l1 . instrument is ti1ereof is also imperative. Only on a of such notice and failure on the part of t!1e accused to pay the demanded arnount within a period of 15 days thereafter, commission of an offence completes. Givinq of n_otice therefore, cannot have any_Qr:__ecedent over the service. is oniy from that view of the matter that in Da!n?ia Cement (Bharat) Ltd v_. Galaxy Tt73ders & Agencies Ltd empl1asis l1as been laid on ser·vice of notice." (Ernphasis Supplied)

¶32At a first blush re:adinQi of tlle cl·e:clsions of the ··t ·, Dj-r .• r- ., •d ·•_J ·n·-,•--o'<e· --· ' , .. , ·.y.. l,UU1 Ill !::.2_)d5i(c3_, Ei!7 (_Sdpi d; IL rnoy strike to the readerthat there is a conflict between the t\:vo decisions Inasmuch cs in BJ7ask(}ran's case (supra) it was held that tile expt·ession 'gi!/ing of notice' occurTing in proviso (b) to Section 138 of the Ni Act means 'sending of notice' whereas in Hannan.'s case (supra) it vvas l1eld that the said expression means - ..

¶33A carr:ful reading of trle t11VO decisions shows that there is no conflict between the said dr::cisions inasmuch as they l'ave !Jeen rendered in different contexts. The decision in Bhaskaran's case (supra) was rendered in the context .Jf stal-ting point of Hmitation of 15 days prescribed in proviso (b) to Section 138 of the Ni Act and it was in tl1at context i.e. context of limitation that it was held by the Supreme Court that expressiion giving of notice-' occurnng in proviso (h) to SecUon1 138 of the IN! Act means 'sending o/ notice'. The decision Harn-;an's case (supra) vvas rendered in the context of cause of action for fWr1g a complaint Linder Section 1 '38 within juriscUc:tlon of a P .r:Jrt.ICL'ia•- f'OUI·r "'1--IC\ :1r·l r•J.-r!·ltPY_,_t :-t H' 1'c lo-v I ._.. - u . - l...l ......... -.. I. - -·' \. - u lJ \:1 CJ I ·I \J L )' .,_ L ... Cr!.rV\ C.No.1056/Z!l11 Bt connec-t:ed matters Page 25 of D ! -- C:upre•...,::_) fl"lrit·- ·c'·l·lP eYni-e-:::r,·oll ._/ l ! I t_ u l. ' . - ' c . . .. . ' I ··' :'::> . gl!//ng ol notice r occurrtng in proviso (b) to Section 138 of the Nl Act means I receipt of

¶34Now, same expr-ession can have different rneanings in different context as held by the Supreme Court In the decision reported as lV!ajik (}J..f]jwndar v Gourar.Qf.!_ Chandra Dey (2004) 12 SCC 8 wherein it was observed that a word occurri:·:g in a s.tatutory can have different meanings in different context within the sarne statute.

¶35Thus, the inevitable condusion would be that the :::Jth act contemplated as an ingreolient of the offence as llighlighted in Bf7askaran's case :I.e. 'giving notice writi.7g tothe drawer of cheque' den7anoi·f7g· pay;nent oftlJe cheq.;.;e an?ount for purposes of limitation would have a meaning ::JS explained in Bhaskaratts cas(:: and for purposes of jurisdiction vvould have a meanirng1 as explained in lshar AlfQJ(S case (supra),

¶36Before concluding l De fairiing not to lodge a caveat. With eiectronic banking and facility payable at par of · provided by bankers and .. :'::>1L· _ ._:d _v :n metropolitan cities, where cheques are cleared by not beirg presented to tl1e dravvee bank but at nodal branches of H··e concerned banks, tile subject matter of mc:y have to be decided keeping in ,vi',ew that the drawee bank llas created an agency where tine cheque in question ,s ,- arld r. 'N 1n. -·,,-,o ·tr''r•P _l .... - . l ...... _r:, . .) .. _ -....... _ .__, li ..... ._.t... (.11t ..,.._. t ;=JI<es tJirilf' :1'r'1. ;::;!T!rJ?,t-:,ht rolace v•r,··ler· .. ::;:, ...- ' ] [ ......:; ...._. _, , l,.l U L... , "-• t U ::J :..,A -.,. I J - ...._ ._. • I :£ .- -- \J I - Crl M.C.l\lo.lOSti/2011 8t connected mcnters Page 25 of j:J '!, - H rill I: li tt· rlj:l . "I I II. ,, ijj . , I r 0 l h Dj R • t !I I J the cheque woulcl be required to be tr-eated as presente,j to 'the bank' Le. the dl-awee bank. But, in such circumstances, propedy constituted !lave to be found in a complaint and lodging the caveat, I leave it at that for ,the debate to be properly argued in an appr-opriate case with e necessary relevant pleadinQJs.

¶37hold that on th1e pleadings in the complaint(s),: no part of cause of action can be said to have accrued to the corn pia in ant at Delhi:. that tile notice demanding paym2nt 'IVas posted rn Deihl and that the cheque vvas w the payee bank at Delhi ·vvould not constitute the acts contemplated as ingredients of c:m offence punishabie under Section 138 N! Act and thus i dispose of tile petitions theimpugned order(s) dated 14.2.2011 and din:ct: . ' learned to return complaint(s) to the respondents for filing in a Court having territoriai juhsdiction. 38 .. No costs. SIEPTIEMBER 21, 2011 mnn C!-I.M.C.No.1056/2011 & com;ected mCJtters ·- r--··.·· ' / <-,oo•._\'.0'-C'" {PHADIEIEP NANDRAJOG) JUDGE Page 2.7 cf 27 - '!, '

.) * IN THE HIGH COURT OF DELHI AT NEW DELHI % tudqment reserved on: lfJh September, 2011 /udqment pronounced on: 21st September, 2011 + CRL.M.C. 1188/2011 SHREE RAJ TRAVELS & TOURS LTD. & ORS. .. ... Petitioners Through: Mr.Sunil Gupta, Sr.Advocate with Mr.jatin Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Agarwal, Advocates versus DESTINATION OF THE WORLD (SUBCONTINENT) PRIVATE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, Advocate CORAM: HON.BLE MR. JUSTICE PRADEEP NANDRAJOG 1. Whether the Reporters of local papers may be allowed to see the judgment? 2. To be referred to Reporter or not? 3. Whether the judgment should be reported in the Digest?