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. o;o + THE 1:1: iH C Uh-lT OF-T (, , .. -! .-,·;··-o n ,. 1 '- --r, CJ , ..... -- .--/ --1 n. . Z h'ih r c n t- ·-r,'' o ·- 70] - Vt.:.;:. t_.,: (._,fJ • _ tJ __ .1 jr..Jdqn;e·t?t aronounced Ofl: 21st Septen7be0, 20.1·1 f]-U I H» II) ""/2 0 l1 ] SHREE E,D,j TRAV!::LS G( TOUI LTD. &( 0 Til rcJug h: . ..... Petitioners i\1r.SunH upta, Sr.Advocate with Mr . .Ja'cin Zaveri, MLGaurav · f.\rga rvva I and M r.Ta nrnaya Ag a IVV,Lli l r vocates vers ciS DESTil\ll\ ON F THE \1\/0ELD [ c:; ij B c '\ f\jiTn !\! F I'X'") D p 1\ f F"rE Reo- ·r· .• , ''1"1 p j- \ ....J \ \....) 1 U • 1) -- I . j I " j \1 J-\ n • o o ' ,.) !i,.} L" I L '-' f Tllr-ough: !\,1,r.f.\.nil·idya Malhotra,. J> •. dvocate CRL WIIJ 1'"" 111] 1':'/"qll .. l., --... __ , u SHRE':· DAI T 0 6'/Ei C r TQUPr' LTD - I a::: I,\. ) I\! '\ _..J Gi ' . I I ' Ex. ORS. "T' ,-I ' l r-t, \n ·' I I •. \. '·':) I 1 • ... , Pebtioners Mr.S 1 Gupta, Sr.!\d\!Ocate with Zaveri, Aga 111\fc:JJl and M I'.Ta n maya Aga nNaL i\dvocates versus DESTIN ON OF THE \i\/OP. f c, 1 i P, '1\1-1..:. PP 1\16 -IE P o', P 'l'L· _ •••• Thrcugn: Mr. Malhotra, Advocate i\lii (' L .ll"fl. -· • 1 _, _·.Llud Jc. SHREE TP,A\IELS & TOU lTD. ORS. , ... TllrCtJgh: iVIrSu.nii upta, SrJ\fJvocat:e V\'tth r ja:=in z.a\·erL Mr.Gau:-a\r /J, o a rvv a a n d 1·. T a n rna v a - . ocates - ' Crl. rv1. C.l\lc .1CJSrJj'2CJll cc n !-1ec r·n,:) 1 of 2.1. ! versus DEST!NA.TIOl\1 OF THE \/\JORLD (SUBCONTINEi\lT) PRIVATE !LTD. . .... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C SHREE i::Z.AJ TRAVELS 6( TOU LTD. & ORS. Thmugh: .. ... Petitioners Mr.Sunil Gupta, with Zaveri, Mr.Gaurav /-\garvval and Mr.Tanrnaya ,L\ga rwa I, Advocates versus DESTINIAT!OI\1 OF THE V\/ORLDI(SUBCONTiNE:INT) PRIVATE LTD. .. ... Respondent Thr-ough: Malhotra, l\dvocate CRLM.C. 1173/2011 SHREE Ri\] TRAVELS & LTD. & ORS. .. ... Pehtioners Mr.Sunil Gupta, Sr.Advocate with Mr.Jabn Zaveri,, Mr.Gaurav Agarwal and Mr.Tanmaya AganNaL Advocates Through: versus DESTINATION OF THE VVORLD (SUBCONTINEf\lT) PRIVATE LTD. .. ... Respondent Throuqh: Mr.Anindya Malhotra .. t-\dvocate CRLM.C. 1114/2011 SHREE RAJ TR.AVELS & TOURS LTD. & ORS. . .... Petitioners Through: Mr.Sunil Gupta, Sr.Advocate with Mr-_Jatin Zaveh, Mr.Gaurav ,6,garwal and Mr.Tanmaya Agarwal, Advocates Cri.M.C.I\Jo.l056/2011 8,, connected matt.c::rs Page Z ofH - '!, - '\ ! ver·sus DESTINATION OF THE PRIVATE LTD. .,.,. Respondent Through: Mr.P\nindya MlaHlotra, Advocate CRLM.C SHREE RAj TRAVELS & TOURS LTD. 6c ORS .. . .... Petitioners Mr.Suniil Gupta, Sr.Advocate with Mr.jatin Zaveri, Mlr.Graurav Agarvva1l M/(.Tannlaya Aganrvall .. jj,dvocates ·rhrougil: DESTiNATION OF THE \NORLD (SUBCONTiNENT) LTD. .. ... Pzespondent ThroL!gh: Mr.Anindya Malhotra, .Advocate CRLM.C 11761{2011 SHREE RAJ TR.A\/ELS & TOURS LTD. Gc ORS. . .... Petitioners Through: Mr.Surdil Gupta, Sr.Advocate vvith Mt-.j]abn Zaveri, Mlr.Gaurav Agarwal and M r.Ta nrnaya Aga rwa i, Advocates versus OF THE VVORLD (SUBCONTINENT)PRIVATE LTD.. . .... Hespondent Through: Mr.Aninclya Malhotra, Advocate CRLM.C. SHREE R.Aj TRl\VE.LS & TOUR5 LTD. 6( ORS. . .. ., Peb'doners T!1roug!l Mr.Sunil Gupta, Sr.Advocate with M ,-_j!ati n ZaverL M r.Ga urav ,6,garwa:l and Mr-.Tanmaya Cr·J.IVI.C.i\lo.1056/2.011 1St connecTed matters Page 3l Gf '1.7 -·;!, versus DESTiNATION OF THE WORLD (SUBCONTlNEI\lT) PPJVi1,TE LTD, .,. .. Respondent Through: Mr.f\nillolya i\dvocate CRLM.C 1179/.2011 SHREE RP-J TRf-\,\/ELS f)( TOUR.S LTD, f)( ORS. ..,_. Pehtioners Mr.Sunil Gupta, Sr.P\dvocate with Zaveri, Mr.c;aurav , Agarwal and Mr.Tanmaya Agarwal, Advocates versus OF THE VVOPlLD (SUBCONTINENT) PRiVATE LTD. ., .... Respondent Through: Ma!hotra, Advocate I::UU-12011 SHP\EE RAJ TP,t"VELS & TOtJRS LTD. & ORS. .. ... Petitioners Thmugh: Mr.Sunil. Gupta, Sr.Advocate with Mr:jatln Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Agarwal, Advocates versus DESTINATION OF THE WORLD (SUBCONTINENT) ..... Respondent Through: Mr.Anindya Advocate CRLM.C 118:3/2011 SHHEE RAJ TP,AVELS 6< LTD . 6( OR.S. ..... Petitioners Mr.Sunil Gupta, Sr.Ad\iocate vvith Mf'.jlatin Zaveri, Mr.Caurav Through: CrUVI.CI\Jo.1056/2011 & connected mattPt·s P3ge Lt. of ZJ' i l'-\garw;Jil a::d Mr.Tanmaya i\olvocates versus F THE \1\!0RUD D LTD. .. ... Respondent Through: Malhotra, ,t\dvocate CRLM.C. 11B60011 SHREE .. R 11 " ,- r: L···o : _.J\/-:\ \: c L...::..\ u t\ .._) I II • 6c ORS. .. ... Petitioners Through: M;-.Sunil Gupta, Sr.Ao1vocate with Mrjatin Zaveri, Mr.Gaurav Aganivail and M r.Tanmaya AgarwaL 1-\dvocates versus DESTINATION OF THE \NORl.D (SUBCONTiNENT) PRIVJ.\TE LTD. . .... Respondent Through: Mr.An ndya Malhotra, Advocate CRLM.C. 1187/2011 Sh1REE P,AJ TRJ1NELS & TOURS LTD .. 6c ORS. . .... Petitioners ! ,r roua.1: . Gupta, Sr.Advocate with M(.j]atin Zaveri, Mr.Gaurav and Mr.Tanrnaya J1,qa rwa i, . versu::; DESTINATION OF THE \1\/0RLO (SUBCONTINEf\iT)PRIVATE LTD. .. ... Hespondent Through: Mr.Anino!ya Malhotra, .Advocate CRLM.C 1188/2011 n '\ \ 1'D fl Cl c [" T'(l' I ·-o .. , \ t /-\ 1 II (\ J--Jl L. L-._) ()!_ ) .J'' f.._,. : -· ll .__., . ·' & ORS. .. ... Petitioners Through: Mr.Suni Gupta, Sr.Advocate Cri.M.C.No.1056/2011 eSt connected matte1·s Page 5i of Z1 -·-,!, with Mr-.Jatin Zaveri, Mr.Gaurav' Agarwal and Mr.Tanmaya AganNal, Advocates versus DESTINJ-\TION OF THE \/VOIRLD (SUBCONTINEf\IT) PRIV/-\TE D. .. ... R',espondent Throu-gh: Mr.Anindya Advocate CORAIM: HONaBlE MR. jUST/ICE PHAD[EIP NAINDRJI\jOG

¶1\1\/hether the Reporters of papers rnav be allowed to see the judgment?

¶2To be refen-ed to Reporter-or not'?

¶3Wilether the judgment should loe reported in the Digest? PRADEEP

¶1Briefly stated the facts leading) to filing of tile above captioned petitions are that r-espondent Le. 'Destination of World (Subcontinent) Ltd.' a connpany registered under tile Companies Act filed 15 Lmder Section 138 of tile Negotiable Act, 1881 (hereinafter referred to as the 'NI 1G.ct'); 3 cheques beii''9 the subject matter of each complaint. Petitioner No.1 Le. 'Shree Raj Travels 6c Tours Ltd.' a company registered under the Companies Act was impleaded as accused 1\lo.l and petitioners 2 to 7 were impleaded as co-accused on :the a!leg1ation that as Directors tlney were inchar-ge of the day to affairs of the company and llence were vicariously liable for the defaults of the company. The cornpiaint was filed in e Court of Additional Chief Metropolitan (her·:=inafter referred to as the Cri.M.C.I\Io.l056/2011 /SI. connP.cced matters Page 6 of Z'7 --;!, - 'ACMM') New Delhi, inter-alia, .::,"'erring that tlhe company and the accused No.1 connpany had entered intc 2 agreements in tenTJs whereof e accused No.1 compa,.ly had issued 45 cheques drawn on State Bank of !ndia . Mumbai Branch, in favour of tl1e respondent company, which cheques wher presentee] r encashrnent by the respondent compo1ny with its Banker Bank Niew Delhi, were dishonoured and upon the cheques being returned the respondent compa y iss.ued notices conternplated under proviso (b) to Section 138 Nl Jl,ct from Delhi to the accused No.1 company which failed to make payment in respect of the sum for vvhich the cheques vvere drawn within l5 day·s of the receipt of the said n ces. VVith respect to the jurisdiction of the Courts at Delhi \Nas pleaded that for the reason the respondent company had presented the chequEs in question for collection with its banker Bank situated in Delhi, the Court had the nece::::sary jurisdiction.

¶2may be noted at the outset at after the complaints were filed, the respondent company filed a suit bearin No.SS0/2010 in whicr1 petitioner 1\Jo.l was as defendant before the High Court of Bombay praying for 3 decree to be passed in the principal! sum for which tile 45 cheques forming subject·rnatter of the aforesaid ·complaints were issued. tile plaint, jurisdiction of thf:: at 1\!'lumbai was pleaded on e averment that the agreement pursuant whereto the cheques were issued executed at Mun1bai as also that the cheques question were drawn and issued at MumbaL g, ccn,necteo n:3tte,-s Fag2 7 of 2.1 i r

¶3Taking cognizance of the complaints, ACIVJM summoned tne petitioners to face trial for ah offen:::e punishable under Section 138 of the N.L Act.

¶4Upon service of the sunnmons, the petitioners filed application(s) under Section 177 C:r.P.C. inter-ana stating that the courts at Delhi have no jurisdiction to take cognizance of complaints:· and prayed that He complaints be retur:1ed to the to be filed in tre court of competent jurisdiction. Together with the sa:d application(s), petitioners 2 to 7 filed appHcation(s) seeking exemption for personal appear·ance before Cour:. I Dismissing applicatlon(s) seeking exemption from personal appeal-ance and keeping pending, fer consideration, appiication(s) filed under Section 177 Cr.P.C. vide order elated 25.05.2010 the learned ACMM !ssue.J bailable warrants against petitioners 2 to

¶5Aggrieved by ti:e order dated 25.05.2010, petitioners 2 to 7 filed petition(s) under Section 482 Cr.P .. C:. befot-e this Cou!-t, which petitions were disrnissed vide order dated

23.09.2010. /\ggrieved thereto, petitioners fiied petition:; seeking Special Leave to Appeal before the Supreme Court vvhich were disposed of vide ol-cler: dated 14.L2011 with C:! direction to the learned that applications filed unde·- Section 177 Cr.P.C. would be disposed of within 2 weeks.

¶6Vide or-der dated

14.02.2011 learned dismissed the application(s) under· Section 177 Cr.P.C. fi!ec. by the petitioner-s on trle ground at view of the dicturr of iaw laid olovvn by· the Supre111e Cour-t in the decision Cri.M.CNo.1056/2011 & C01lnected matte1·: Page 8 of 2! ; \' reported as (2004) 7 SCC 338 /ida/at Prasad 11 Roop La! linda! once the agistrate has taken cognizance of complaint he has no power to 1retu1T1 the same to th;::: cornplainant with a direction that e same be filed in a court of competent jutrisdiction.

¶7Aggrieved by tile order dated 14.02.2011 passed by the !earned AC!VIM;' the i1ave filed the above-captioned petition(s) under Section 4B2 Cr.P.C. requiring this Court to hold that courts at Delhij have no jurisdiction to take cognizance of the complain1ts question and directions to the learned returrn the same for filinq befo1re the Court of Competent Jurrisdiction.

¶8It is the case of the petitioners that the cheques m question were drawn at Murnbai. The drawee bank is a:= Mumbai, notice issued by the !respondent to the petitione:- company was received at Mumbai and thus merely the respondent posted the notice from and deposited cheque with its bank at Delhi ·would not confe:- jurisdiction on Courts in DeihL

¶9The is:;ue llas to t1e debated Nit!l refe1rence to Section 138 of the Nl Jkt and the applicable of the Code of Criminal Procedure i.e. Sections 177, 178 and 179 of the Code of Criminal Procedure.

¶10In the decision 1-eported as 1999

(7) SCC 510 I(Bl7askaran Vs. Slwi7i;_araj_7_ tlc;_l{J_j(Ivan Balan Supreme Court. has opined, after considering Sections 17f: to Section 179 of the Code of Criminal Procedure, that an Cri.M.C.I\Jo.1056/2011 & connected matters Page 9 of '!, offence n1ay 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! jurisdiction, qua an offence, law ;-ecognizes more than 1 court havingi territorial jurisdiction and the issue of territoria: jul-isdiction would have to be decided with reference tc whether a part of an offence ·1Nas committed within the territorial jurisdiction of a court. The issue is no longer res integr-a and ! just ne to note the decision of the Supreme Court in. KBhaskaratts case (supra) and higrhlight that the aforesaid is to be culled out fror:n paras 11 and 1:2 of the said decision.

¶11The next logical question \Nould be, what are the contours of Section 138 of the Nl t pertaining to acts to be performed in relation to an offence contemplated by the said Section'? it hardly be re-ernphaslzed that it are acts of commission or ornission which constitute offences, with or without the requisite rnens rea, depending upon whether. the offence an absolute offence or not.

¶12Let me thus note Section 13El, Nll A.ct which reads as under:-\Nhere any cheque drawn by a person on 2n account: maintained by him with a banker. for payment of any amount of to another person from out of that account for discharge, in whole or in part of any debt or other liabiiity, is returned by the bank unpaid, either because of tile amount of money standing to tile credit of that account is insuffic:fent to l1onour the cheque or that it exceeds the amount arranged to be paid fmm account by an , Cri.1Vi.C.No.l056/2011 8t connected m<Hters Page 10 of n --.!, agreernent rnade ·with tllat bank, such person shall be deerned to have committed an offence and shall without prejudi!C:e to any other provisions of· this Act, loe punished imprisonment for a term vvllkh may extend to two year, or with fine which may extend to tvvice the amount of the cheque, or with both: Provided that nothing contained in ti1is section shall unless-

(a) The cheque ilas been pi-esented to the bank within a period of six months from the date on which :t is drawn within the pedod of its validity, whichever is earlier,

(b) The payee 01-the induce course of the clleque,, as the case may be., makes a demand for the payn1ent of the said amount of money by _giving 2]1 notice, in writing, to the drawer, of the cheque, within thirty days of the receipt of information by him from thejbank return of the cheques as unpaid, and

(c) The dravver of such cheque ils to make the payment of the said amount·: of money to the payee or, as the case may be, to the hol,der in due course of the cheque, within fifteen days of the receipt of the said notice, · Explanation: For the purpose of section. ' 1delot or other liabiiity" means a legaHy . enforceable debt or other rc

¶13In Bl7askararis case (supra) e Supreme Court had an occasion to clea! witll the issue of territoriai in relation to Section 13B of the 1\li /\ct, 2,nd of necessity, the discussion required the Supreme Court to various acts of commission and omission· wilich constituted the offence punishable under Section 38 of the N! Act and suffice vvould be to highligilt tl1at in para 1L1l of the Cri.IVIC.No.1056/2011 8t connected mati:e:-s Page 11 of27 --;!, [ decision, th(:.> Supre1T1e Court that there are 5 acts which are the cornponents of e offence punishable Under Section 138 of the Nl Act and re-produce the same from para 1·4 of the decision of the rsupreme Court. They read as under:-

(i) drawinq of the cheque,

(ii) presentation of the cheque to e bank,

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

(iv) givinq notice in vvr-iting to the olrawer of the cheque demanding payment of tile cheque amount,

(v) failure of the drawer to make witl1in 15 days of the receipt of tile notire.

¶14After holding that acts constitute components of an offence under Section 138 of the N! t\ct, in 15 and 16 the observed as under:- /{15. it is not necessary that aH 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 But a concatenation of all the above five is a sine qua non fot· the con1pletion of the offence under Section 138 of tile Code. .In tilis context a reference to SectioG 178( d) of e Code is useful. It is extracted below: . 16. Thus it is clear, if the five different acts were done in five different localities any one of the courts exercising jurisdiction in one of the five iocal can become the place of for offence under Section 138 of the A.ct. In other.· words, the complainant caP choose any one of Cri.M.C.No.l055/20E & connected matters --;!, ! 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 a rn pi itude stands so widened and so expansive it is an idle ·exercise to raise jurisdictional question regarding offence under Section of the f-\ct." (Ernphasis Supplied) [ <j['

¶15On the issue of service of notice required to be given by the complainant to the acnJ:sed, tile Supreme Court observed as under:- "17. The more important point be deddled in this case is whetller the cause of action has arisen at all as notice sent by complainant to the \Nas returned as (/unciaimed". The conditions pertaining to the notice to be given to the drawer, have been formulated and incorpot"ated in clauses (b) to (c) of tile pmviso to Section 138 of e Act. The said clauses are extracted below::

¶18On the pa1rt of the payee he has to make a demand by (/g1iving a nobce''' in writing. that was only 1-equirement to complete offence on tile failure of tile dl-awer to pay tile cheque amount within 15 days from the date of such "1giving", the travaUs of the would have been very much lessened. But the legislatUI-e says that failure on the part of the dr-awer 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 nobc:e. Giving is a process of vvlhich receipt is the accomplishment. it is for tl1e payee to perform the former process by sencHns::1 the notice to drawer at the co1Tect address. Crl.rV1.C.No.1056/2011 6; connected matter::; Page B of '1.1

¶20If a strict interpretation is given that the drawer should have actuaHy received the nobce for the period of 15 days to start running n.o matter that the payee sent the notice on the correct: address, a trickster cheque drawer would get the premium to avoid rec:eiv1ing the notice by differe1.1t stt-ategies and he could escape ·from the legal consequences of Section 138 of the ,Act. It must be borne in rnind that the court should not adopt an interpr-etation which helps a dishonest evader and clips an honest payee as that would defeat the very legislative measure.

¶21.... The context envisagecl in Section 138 of the Act invites a liberal inteqJretation for the person vvho has the statutory obligation 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 !e9is!ature. The words in clause (b) of the proviso to Section 138 of the i\ct show tllat payee has the statutory obligation to Hmake a demancl" IJy 91iving notice. The thrust In the clause is on the need to "make a dernand". is only the mode for making such demand which the legislature has prescribed .. 4 payee can send the notice fo1r doing part for giving the notice. Once it is despatched his part is over and the next depends on vvhat the sendee 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 I-larcharal1 Singh v. 517/vrani2 and jagdish Sin:;}h v. l\latthu Singh3). 23'. Ht:=:.·n:·: rhe is returned as undaimecl and not as refused. V\lill there be any difference betvveen tvvo so far as the p1resumption of service is concerned? this Cri.JV!.C.I\Io.1056/2011 8t corltle,:ted matters Page H of 27 .-! -.!, connection a to Scc:tio.n 27 of the General Clauses i\ct will be useful. The section reads thus:

¶24No doubt Section 138 of the A,ct does not require that the notice should be given only by "post". Nonetheless the principle incorpor.ated in Section 27 (quoted above) can profitably be imported in a case where sender has despatched the notice by post vvith the correct address written on it. Then it can be deemed to have been serv·ed on the sendee unless he proves that it was not really served and that he was not for such IliOn-service. J\ny other intenJretation can lead to a vel-y tenuous ' - position as the di-avver of the cheque vvho is liable to pay the amount would· 1-esort to the strategy of subterfuge by successfully avoidjng the notice.

¶25Thus, vvhen a notice is returned by the sendee as : .. such date would be the commencin,g date in reckoning the period of 15 days contemplatec! in clause (c) to the proviso of Section 138 of Act. Of course such reckoning would be without prejudice to e right of the drawer of the cheque to show that he had no knowledge that the notice vvas brought to his address. In the oresent case e accused not even attempt to discllarge the burden to rebut pn::sumption." (Ernpl1asis Supp!ieo) (D

¶16Tl1e. expressions:. /presentation of the cheque to the Bank/ a.nd 'il the ·.r/ve differet7i_L acts were done in llve dif[erent any one of tl?e courts exercising jurisdiction in one cf the five local areas can bec01ne the o/a·-a oF"'ria/ .J-hP urder 'c;ec',:on 1:Jo o,ctr..,c l!r{-' to • , C '-- L, , I I_ I _ Ln , . . _ _ I ) . __ _ U .1. .J 0 J I L : • ,_ c ·- . he· ff' 1!1ld l ,-1 l r=: 1-.:::oc::npr-·i-·l·v·\ 0 ·1>·' 'n :r?/l::!c-(,-':',f':::•r·7'c: ·"-·' · .... , \.... l--' c...··· u ._) -.- (_1. \ . ./ .1--- ...._. '-·-·- - j n , __ :;.::_. __ case (supra) ha\;e bec:n understcmdl loy mar·,y to mean that Cri.M.C.I\Jo.1056/201l 8t conre::ted rnatters --.!, the Court within lee=:! lirqits of e payee Bank i e. th:: Bank wl1ere corrqJiainant cleposited cheque i':; situated has the jurisdiction to lTy t!1e under Section 138 of the f\11 Act, and the understanding! appears to be fortified by the observations of the Supreme Court ir1 paras 15 and 16 that if tile 5 acts as the ingredient of an offence under Section 138 of the f\H Act wer-e done in 5 different localities,, any one of the court exer-cising jurlsdictiOil in any one e 5 areas vvoulc have jurisdiction.

¶17But, it is appai,ent that the oloservations in para 15 and 16 are an obiter as it is not 5 places where 5 acts constituting an offence under Section 138 of the A.ct can possibly be pe1rfom;ed The actc; can be performed, as vvould be explained hereinafter, onlly at 4 places and 1 would immediately state that act No.2 and act No.3 to only one place Le. the place where the dravvee bank is

¶18The second and the third act of the 5 listed by the Supl-erne Court, as constituting r:_: offence under Section 138 of the f\11 A.ct are. (a) presentation of the to the bank; and (b) returning the cheque unpaid by the c!ravvee bank.

¶19The third act is the return of tile cheque by the drawee bank and thus there is no scope for any argument as to which bank is contemplated vvith 1-eference to the said act. The second act pertains to H1e act of presentation of cheque to the bank. i highilg!-it tnat tl1r2 twin vvords used are 'the bank'. Cr!.M.CNo.1056/2011 K connected matters fJage 16 of 11 . !. -·--

¶20the decision reported as 2001 (3) SCC 609 Shri lshar Allov Steels Ltd Vs. /avaswals Neco l tel., a 3 judge Bench of the Supreme ha\ting as a member of the Bench the author of the judgrne in Bhaskaran's" case (supra), dealt with and decided as '1/\fhat would be meant by 'the bank' as mentioned in Section 138 of e Nl Was it the drawee bank or the C'ayee bank? Tile Supreme Court answe the question in the foHowing words:- "2,

(a) \/\/hat is rnea nt by, 'the bank" as mentioned in clause (a) of the proviso to Section

1.38 of the Negotiable !Instruments Act, 1881?

(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 purposes oif · attractinq penal provisions of Section 138 of the Act?, are the questions be determined by this Court in this appeal. has er _; noticec! tha:= to make an offence Section 138 of the .Act, it is mandatory that tine cheque 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 spedfied therein. When a post-dated c1-1eque is written or drawn, it is only a bili of exchangJe. e cheque become a · cheque under tile 1-\ct on the date which is written on tile sa c1 cheque and the six months' Cri.M.C.i\lo.1056/201J. 81 connected nvrttets Page 17 of :2.7 --;!, per-iocl has to be reckoned, for the purposes of Section 138 of the .Act, frorn ithf:' said date.

¶8Section 138 provides at '1/Vhere 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 vvhole or in part, of any debt or other liability, ,is returned by Hthe bank" unpaid, either because of the amount of money standing to the that account is insufficient to ilonour the cheque or that it exceeds the arnount to be paid from that account by an agreement made with that bank, such shall be deemed to have commiitted an offence punishable with imprisonment 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 banker and any post office savings bank. Sectron 72 of the Act provides that a cheque must, in order to charge the drawer,, be pr-esented at the bank upon wllicil .it is drawn befor-e the relations between the and his banker has been altered to the p!-ejudice of the dr-awer.

¶9The use of the \Nords bankrr and "the bank" in the section is an indicator of the intention of tlle !e9is!ature. The former is an indirect (siC indefinite) article and the latter is prefixed by a direct (sic definite) artide. intended to have the sarnr:: meanings for "a bank" and "the bank", then:', v1ras no cause or occasion for mentioning] it distinctly and loy using two oliffere artides. it is worth noticing that the wonj "banker" in Section 3 of the Act is prefixed by the indefinite article "a" and the word "bank" wl1ere tile cheque is intended to be presented under Section 138 is pi-efixecl by the definite a cile !''the". The sarne section permits a person to a cheque on an account maintained by flirn with "a bank" and Cri.M.C.No.1056/2011 8t matters -.!, --".\ makes him liable for crinndnal prosecution if it is returned by "the bank" unpaid. The payment of cheque is contemplated by "the bank" meaning thereby where the person issuing the cheque has an account. /!The" is the word used before nouns, with a specifyrng or parbcularising effect as opposed to indefinite or gener;:dising force of "a" or '·'an". !t determines what particular thing is meant; that is, what particular thing we are to assume to be meant. '''The" is always mentioned to denote a particular thing 01-a person. "The" vvouid, therefore,. refer implicitly to a specified banlk: and not any bank. liThe 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 \/\/here the cheque is presented for collection including the band< of the payee, in wllose favour the cheque is issued.

¶10it, however/ does not rnean that the cheque is aiways to be presented U1e dl"awer's bank on whiicll the cheque is issueol. The payee of tile cheque has tl1e option to pn::sent the cheque in any bc:mk including the collecting bank where he has his account but to attract criminal liability of the drawer of the cheque such collecting bank is obliged to _JQresent the cl1eque in the drawee or pavee lJank on which t!-ee cheque is drawn witllin the period of six months from the date on whicll it is sl1own to have bePn issued ........ The non-presentatlon of the cheque to the drawee bank within 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 liable to pay the cheque amount to the payee in a civil action initiated under lavv. A combined readinq of Sections 31 72 and 138 of the !;ct would leave no doubt in our mind that tr11e lavv mandates the cjJ_equ_e _ _to _}]I;;__JQresented at the bank on wrlich it is dl-awn if the drawer i:s to be held crimina!lv liable. StKil presentation is UI.M.C.No 1056/2011 8t connecteci matters Page :IS: of Z7 necessarily to be made within six rnonth1s at the bank on vvllich the i::; drawn . whether presentee\ personally or through another bankL namely, of the (Emphasis Supplied)

¶21the decision in lshc1'r /L;l//oJ/s case (supra) h(:JS been rendered in the context of limitation for presentaticn of a clleque, the said decisi1on brin1;;:JS out in no uncertain terms t!lat Section, 138 of tile f:\ct contemplates that a cheque is requireo: to be p!-ese for encashment to the dr-awee Bank and at the payee Bank, merely acts as an agent of the payee/complainant for purposes of presenting the cheque in questi()n for encashment to tile .drawee Bank. /! L. L. Thus, the 2nd act to wh!cil the Court referre:i to in Bhaskarar/s GL::::e as one of t\"'1e 5 whicr1 constitutes offence under Section of [\U Act vvas p!-esentation of the cheque e d,-awee bank an j needless to state the act which constitutes an ingredient of the offence is tile return of e cheque unpaid by dl-awee bank and t!nus it becorn,es crsrstal ciear that U1e :zn:i and 3 1d act constituting the offerKe would relate to only place i.e. the place vvnere tile drawee bank is located.

¶23These are my l1umble reasons to hold that observations in parc:s 15 and 16 !lave to be read as an orbiter and thus the 5 acts conte::TI,Piated as constituting the offence are of being perfomned not in 5 but only in. 4 places and since deposit of the cheque with tl1e payee 0' .I·S rtot· '·Ont·orYlp!a'-IPC1 "C' ril 1'' l'ngrpr..JI'Ipnl" ·Of o, '- "- ....... L ·._, I ... \..-. - '--' ' Q ::.J ,_) ! • ,, II • .._. v -' .._ u L ' .r:r· .l-1 ' , . ' I I • ' I ' '' ' ( o,·rp \ 0 ! -., e r): ;;:::. (-0 r:. rn (-'· IJa ").::::, n I'' c,· c, ,·· 0('a·l-eu-, 1r'"r/O ( l !I rl (\P - • "-- L ' ..._. '-- I ,_ " f" f ,.._, ' - ' .._. - ./ - '-' '--·' I ' . .... ' - .! - t ' \... .. . .J '-'" ,..._.; \,._. Crl s., con;wcteci mat-::ers Page 21J of 2: ·l·rre-IP'''""n'- ·f,r·-,-· ---,.,,,--,-,r·l<·.::o,_· , ._va,IL Ji 1\)lv!trJ'-'--C ... • f CH::' l.\-::: .I I !ill j "iltl g i: ,,,·c;,jl'cl-'or· nf ·the ,ij UJ .......,.... ·-l.J I -....; ,. , criminal court.

¶24It is settled lavll that a decision is an autlhority for the point it decides and not what can be logically deduce.j therefr-om and the ratio of a decision has to be with reference to the facts of a ca·'::e and highlight on!-.; one decision of the Supren1e Court the decision reported as Dhod!Ja /fouse v SJ( 9 SCC 41. The matte!- r-egarding jiH-isollction can also be decided \N!th reference to Section 6, Section 7, 64 anc,i Section 72 of tr1e Ni "6 L . The reievarrt p<Jrtion of Section 6, Section 7 and Section 64 of !\!1 Act cF'i•:l Section 72 of the N! JJ,ct reads ·under:-- Section 6. Cheque: - A "cheque" is a of exchange drawn on a spec eol banker· and not expressed to be otilervvise than on demand and it '::-icludes the electronic image of a truncated c:heoue and a cheque in the electronic form. )( )( )( Section 7. The maker of a bill of exchange or Cheque is calied "cirawer"; person thereby directe:j to pay is calleol tile "Dravvee". )( )( )( Section

¶64Presentment for payment. ( 1) ]Prorn issory note::.,. bills of exdnange and cheques must be pres en ted for payment to the maker, acceptoi-or drawee ereof respectively, by or on beh.31f of the holder as pi-ovided. In c!efault of suchr presentment, tr12 Ct·i.!Vl.Cf\(cd056/2011 B,, mZitter·s Pag<:: .Zl of 1J ------:-:==:=z:;-_-J...._ .. __ other parties thereto are n Hable thereon to such holder ....... . )( X )( Section 72. Subject to e provisions of section 84 a cheque must it't order to charge the drawer, be presented at the bank upon which it is drawn before U1e relation betvveen 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 a!so of Section 138 of the Nl brings. out that in order to attract penal provisions of Section l3B of e Act a cheque i5 required to be presented fo1-encashnnent to the drawee Bank and that the payee Bank acts mel-eiy as an agent of the payee/compiainant fo1-the purposes of presenting the cheque in question to the dravvee Bank. The necessary corollary thereof is that no pa of cause of action. for the offence punishable under Section 138 of the 1\ct arises in the Court within the !,ocal limits cf vvr1ich the coUectiing Bank of the complainant i..e. payee Bank \s situated and thus saic; Court has no jurisdiction to try a con'lplaint under Sectior. 138 of the 1\11 Act filed by the coiTiiplainant.

¶28This takes me to the consic!el-atlon of second questior involved in the present case i.e. vvhether the court w!thir, local Hmits of wllich from where complainant llad sent a notice under proviso

(b) appended to Section 138 of the Act is situated has the jurisdiction to try a complaint filed under Section 138 ofthe N 1 Ac·'·· I l. '1' 1 IVl C 1·\lo 1056/'7011 ° -or ,,.-,-·rc:J ·"1"•t·,n· '- !. . . .._ \.... .:'ll ?age 2.2 of z;6

¶29I have already noted the observations made by the Supreme Court in Bl7askaran's case (supra) in the foregoing paras and would highlight th,SJt in paras 17 to 23 the Supreme Court has reflected upon the limitation within which the notice has to be to the accused. The Supreme Court was the expression 'giving a notice' in proviso

(b) to Section 1313 of the Ni J\ct, with reference to the 15 days/ time contemplated th1en loy whid. the requisite notice had to be servr::d, which time is now 3C days.

¶30Another decision of the StJpreme Court, reported as

(2009) 1 SCC 720 Harman Electronics Private Limited li National Panasonic India Private./ hnited is worth noting on the subject.

¶31In Hannan's case (supra) the question which had arisen before the Supreme Court was precisely tile same .question which arises for conslcllel-ation in tbe present petition i.e. whether the court within the limits of which the place from wllere the had 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 Ni Answerinq the aforesaid question · In the negative, the Supreme Court observed as under:- "12 .... .,The oniy question, therefore, vvl1ich arises for consideration is at as to whether sending of notice from Delhi would give rise to a cause of action for takingJ cognizance under the Negotiable lnstl-uments Act Crl.fVl.C.No.1056/201J 8( connect2d matters Page 23 of V

¶13It is one thing to say that sending of a notice is one of the ingJredients for rnainta,ining 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 Act, ingredients thereof are required to be proved. \/Vhat would constitute an offence stated i 11 main pro vi on. The proviso appended thereto, however,. imposes certain further conditions vvhich are required to be fulfilled before cognizance of the offence can be taken. If the ingredients for constitution of the offence laid down in proviso::; (a), (b) and (c) appended to Section 13E: of the NeQJot,iable Instruments a1-e intended to be applied in favour of the accused, thel-e cannot be any doubt that receipt of a notice woulld u mately rise to the cause of action for a complaint. /\s it is only on receipt of the notice that the accused at his own peril may refuse to pay the amount. Clauses (b) and (c) of the pr-oviso to Sect!on 138 therefore must be read gJether. of notice would not by Itself '9Jive rise to a cause of action but COITI!l1Unfcation of the notice would . ....... For constitution of an offence under Section 138 of the Act, the notice must be received by the accused. may be o!eemeol to have been 1-eceived in certain ·situations. The vvord "communicate'' inter alia means "to make known, inform, convey, etc".

¶20. .... f-1 court derives a jurisdiction only vvlllen the cause of action arose its jurisdiction. The same cannot be conferred by any act: of omission or commission on the part of the accused . . to.. drstinction must also be borne in mind betwe(.:::n the-:: ingredif::nt an offence and commission ci oart of e offence, V\/hile ---- issuance cf a ilOtice by the of a neqot1ab!e Cd.M.C.I\lo.1056/2011 matters Page of V -- J t) instrun'lent is necessarjG _ thPreoF is also imperative. Only on a se ce of such notice and failure on the p_art of the accused to pay the demanded anwunt a period of 15 days thereafter, commission of an offence completes. Givinq of ;1obce th_erefore,. cannot have a over tile service. is oniy from that view of tile matter that in Daln?ia Cen1ent (Bharat) Ltd v. Galaxy Traders & Agencies Ltd emphasis 1-1as been iaid on service of notice." (Ernphasis Supp//ed) 32:. At a fir-st blusi·: reading of the of the SdfXerne r-o--·, ll

¶1·1 B f-r-, c r.---=-1 r:::tr7 n o1 :::J ,-(-r· .:.:or"''.-· c: r: l .. c ,. \ ;-r. rr ·=-- \ • _.. I I ..:......_! I c _!_';:_·_··-· I ·- I (_.J I I l) "-':;_!..___!_ ·...__ Ci '-' e .. .... ) }-f u } .... i J :A _v strike to the reader· that there is a conf1,ict between the tnro decisions inasmuch as in Bhask?J.r:an's case (supra) it was held that tile expression 'giving of notice' occurTing in proviso (b) to Section 138 of 1\ct means 'sr:'nding of notice' whereas in /-!annan's case (supra) it V\/as heid that the said mr::ans of notice'<

¶33A careful ofthe tvvo decisions shows that is no conflict betvveen the said inasmuch as tlley !•ave been rendered in contexts. ThtE:: decision In Bhaskaran's case (supra) was rendered in t!1e context Jf stal-ting point of iirnitation period of days in oroviso (b) to Se_ctic n 13.8 of U:1e 1\11 Act and was in . . context i.e. the context of lirnitation tf1at it was heid by tr.•e Supreme Court that exp1-essl1on giving of notice' occurring in pro·v'i::o (h.) to Section1 138 of the IN! Act lTlearJS 'sending or notice'. T!le decision l.n Hannan's case (supra) . ! was rendered in til>=:? context of cause of action for fiilrlg .a complaint under Section 1"38 Ni1 /.}1ct jurisdiction of .a particular court in that co-nte)(L it was held by the Ct!.lVl C.No.1056/21l11 8t connec::ed mattc::rs ?age Z5 of J Supreme Court that e)qJression g'ivlng ol noNce' occurr!ng in prov1so (b) to 138 of the ,6.ct rne(:ans 'receipt or

¶34Now, same expr-ession can ve different meanings in different context as held b)/ e Suprreme Court in the decision repo1rted as fl1ajik ll!J'aiu;ndar v C{;andra Dev (2004) 12. SCC 8 wherein it was observed that a word occurri:-:g in a stE1tutory provision can have different rneaninQs in different context the sarne statute. Js ....) . Thus, the inevitable conclusion would be that the 4th act contenlplatedl as an ingn::olient of the offence as lligh!ightecl in Bhaskaran's ii.e. 'giving notice in writing to the drawer of cheque' denJanq'i!?g pay;nent of the cheque an?ount, for pur-poses of limitation would have a meaning as explained in Bhaskaran's and for purposes of jurisdiction would 1nave a meanlng1 as explained in ls/J;;;r A//oJ(S case (supra)_

¶36Before concluding I vvoutd De fading not to lodge a caveat. \/Vitll eiect1-onic bankinq and fadlity payable at par of clearance provided by bankers and especially ;n metropolitan cities, vvilere cheques are cleared by not bein,g presented to the dravvee bank but at nodal branohes of the concerned banks, tile subject nnatter of jurisdiction m2y have to be decided keeping in view the drawee bank has created an agency where th:::: cheque in question ts t!'ansmitted r-and e s when2 the dearance takes place would arquat:ly beco1Y1e the place where - ' CrUv1CNo.1056/2011 1St coi-!I-12Cteci m<Jtters fJage 26 of 27 '.I I :1,11, rr.r !il fl·;.·j· • r " (:, r f·tl • I i \ r J2 the cheque woulcl be requi1·ec1 to be tr·eated as presented to 'the bank' Le. the drawee bank. 0 in such circumstances, propedy constituted pieadings have to be found ir:J a complaint and lodging tl1e caveat I leave it at that for the debate to be properly argued in an appropriate case V\frth the necessary re!:2vant pleadingJs.

¶37I hold at on the pleadings in the complaint(s), no part of cause of action can be said to have accrued to the cornplainant at Delhi;_ that tile notice demanding Vifas posted from Delhi and that tile cheque vvas deposi;:ed v1tith the payee bank at Delhi vvould not constitute the acts contemplated as ingredients of an offence punishable under Section 138 Nl Act and i dispose of the petitions quashing theimpugned order(s) dated 14.2.2011 and direct learned ;0,CMM to return t!1e complaint(s) to che respondents for filing in a Court having territo:-ial 38, No costs. SEPTEMBER 21, 2011 mrn Cri.M_C.No_1056/2011 & connected matters -- ·,,. .. ,.(_ .. '? {PHADEEP NANDHAJOG) JUDGE Page 27 cf 27 - '!,

* IN THE HIGH COURT OF DELHI AT NEW DELHI % /udqment reserved on: lf1h September, 2011 /udqment pronounced on: 21st September, 2011 + CRL.M.C. 1173/2011 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 21. Whether the Reporters of local papers may be allowed to see the judgment? 22. To be referred to Reporter or not? 3. Whether the judgment should be reported in the Digest?