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

PRADEEP NANDRAJOG, J. For orders, see Cri.M.C.No.1056/2011. 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 1;1: H HT {)F-H .. Hr: NIEIN fr !:--i()/J?(:3flt rec;·r--Yve,.-l on · Z.&h SeQttYI7bPr /1)]1 .. ·.::.: __ ,__ _.._. ·-- . -" ,_... # - j_Q!:/QfT)f'/1t oronouncecj on: 21st Seprf.le.rnber r lfi'rc;;(fil/·'lioJ] L, _, , L, , . L SHREE RAJ TRAVELS 0( TOUr LTD. OR5 Through: Mr.Sunil Gupta, Sr.Advocate with Mr.jatin Zaveri, Mr.Gaurav AganNr:;l and M1-.Tanrnayra Agan;val, vocates .. ,. ... Petitioner::; \lers,c.J5 DESTINJJ,TiON :-:THE \fi/OHLD PF).!Vt\TE UID. ,. ... Respc•nder t Through: Malhotra, ,L1,dvocate c P u Mt C l! J 6 f)! 0 11 \_,,,_L ,, ,, _,_ SHREE HAJ TRAVELS & TOUP<S LTD. ORS. . .... Petitioners 'T'n v·c r ,,-,, h • I I .1 )U::jl t. Mr.S ni 1 u , with M r· . .j in Zaveri, fv'i r. Ga urav Agan!lfad and Mr.Tanmaya , ... ··r-J I /I d'rnc:atec ,-'\ d \/\ C 1 r\ I ··- - . versus OF THE v'VCJ!=<, (.SU hi ENT;' FJ·FU\!,L\ TE L ...... Hespondent Throu,;Jh: Mr.JJ1nindya Malhotra, Advocate CHLM.C ll'll/2011 SHREE RAJ TRJ\\/ELS & TOUPS lTD. & ORS. .,, .. Petitioners 'fhrrl 'i';1r c,- /ltrh'""'"''·o ,_) ,..J :.:.;1 l I. \ \ ·.,..,.) '...J.1. j 1: <\..Ji' Q I ._) • H' lJ\_,ci l.t,,_ .,_, ";u-I 'Ill r· ... . , ... ,, VV!tll 11 'Iii .J: n La •: t:! L. q r \.;:nd u: a1r1d 1".-l·anmaya ,D. a a nt'va:;, ;'J._,d\locates C;-1. r\ 1. C. l'\Jo .105f/ ,:_:J 11 ::on r. rs i. Of2: versus DESTINATION OF THE \NOR (SUBCONTINEI\IT) PRIVATE ..... Respondent Through: Mr.Anindya Advocate CRLM.C 117)/2011 SHREE R/-\j TRAVELS Ex TOURS LTD. & ORS. .. ... Petitioners Mr.SunH Gupta, with Zaveri, Mr.Gaurav and Mr.Tanrnaya Through: Ag a rwa .L\dvocates versus DESTINIATIOf\1 OF THE V\fORLDI(SUBCONTH\lEINT) PRIVATE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, CRLM.C 111;1/2.011 SHREE RAJ TRAVELS & LTD. & OR.S. . .... PeUtioners Mr.Sunil Gupta, Sr.Advocate with Zaveri, Mr.Gaurav Agarwa I and M r.Tannnaya AgarwaL P1dvocates Through: versus DESTINATION OF THE \NORLD (SUBCONTINENT) L ..... Respondent Throug!l: Mr.Ani:1dlya .. 1t\dvocate CRLM.C. llll:l/2011 SHREE RAJ TRAVELS & TOURS & ORS. . ..... Petitioners Througr: Mr.Sunil Gupta, Sr.Advocate with Mr.jatin Zaveri, Agarwa! and Mr.Tanmaya .Aqarvva I, ;.:\dvocates - . Cr·l.f\/i.Cl\lo.1056/20J.l 81 connec:teri tTtCitt,"::'rs ·?age 7!. of 27 --:-! versus DESTINATION OF THE VIIOR.ILD (SUBCOI\ITIINENT) PRIVATE lTD. .. ... Respondent Through: Mr.Anindya Advocate . CRLM.C. lJL 75/2011 SHREE RAJ TRAVELS & TOURS LTD. 6c ORS .. , ... Petitioners Mr.SunH Gupta, Sr.Advocate with Mr.,jatin Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Agarvvall. Advocates "Through: versus DESTII\IAT!ON OF THE WORLD (SUBCONTiNENT) PRiVATE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, .Advocate CRLM.C. llJfjl/2011 SHREE Ri\J TRAVELS & TOUR.S LTD. lSc ORS. .. .... Petitioners Mr.Sunlll Gupta, Sr.Advocate with Mr.jabn Zaveri, Mlr.Gaurav Agarwal and Mr.Tanmaya Through: ,1\ga rwa I, Advocates versus DESTIN.,I\TiON OF THE \1\/0RLD (SUBCONTH\IENT)PRIVATE LTD.. .. ... Respondent Through: Mr.Anlndya Malhotra, ;(\dvocate CRLM.C. SHREE I:ZAJ TRAVELS & TOURS 61 ORS. ., ... Mr.Sunii Gupta, Sr.Ad\Jocate with Zaveri, Mr.Gaurav .A.garwal and Mf-.Tanmaya Til rough. Cri.IVI.C.No.1056/2011 81 conllt:c:ted matters ---.-! ,L\dvocates versu:::; OF THE WORL[l (SUBCONTINENT) PRiVATE LTD. ., ... Respondent Through: Mr.f\,nlndya Maihotra, Advocate CRLM.C. 1179/2011 SHREE RAJ TRAVELS 6( TOUR.S LTD. 5( ORS. . .... Petitioners Mr.Sunil Gupta, Sr.J\o1vocate with Mr.Jatin Zaved, Mr.{:;aurav Agarwal and Mr.Tanmaya Through: Aga rwa I, Advocates versus OF THE \1\/0PU_D PRiVATE LTD. . ..... Respondent Through: Mr.Anindya Malhotra, Aolvocate CRLM.C. SHREE RAJ TRAVELS & TOURS LTD. & ORS. .. . ., Petitioners Tht-ough: Gupta, Sr.Advocate with Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Agarvva I, f':\dvocates . versus DESTINATION OF THE \NORLD (SUBCONTINENT) PRiVATE LTD. .. ... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C. 118:3/2011 SHREE RAJ TP,AVELS 5( LTD. 6( ORS. .. ... Petitioners ThrmJgh: Mr.Sunii Gupta, Sr.Advocate with fvlr.jlatin Zaveri, Mr.c;aurav Cri.M.C.I\Jo.1056/2011 & connected matters Page 4 of 2!' -.! -,! /\garwal and Mr.Tanmaya Aga /\olvocates versus ( OF THE \NOHUD LTD. . .... RIE?spondent Through: Mr.A.nindya Malhotra, J\dvocate . CRLM.C. JL1H6g0ll r H R EE. p /\fTP,· II C! r r -rou R ,- L""-D \ : J \l-l) C L..J {2_,( 1 --;!; .._) II n 5( ORS. ThlrOiJgh: . .... Petitioners Mir.Sunil Gupta, Sr.,':\olvocate with Zaveri, Mr.Gaurav and Mr.Tanmaya 1-J,dvocates versus DESTINATION OF THE \NORLD PRIVATE LTD. .. ... Respondent Through: Mr.JJ\nindya Malhotra, Advocate C:RLM.C. 1187/2011 SHREE RAJ TRAVELS & TOURS LTD .. 6( ORS. .. ... Petitioners -rhrough: Gupta, Sr.J\dvocate with M1r.J]atln Zaveri, Mr.Gaurav Agar-wal and Mr.Tanmaya ,bga rwa I, versus DESTINATION OF THE \1\/0RLD LTD. .. ... Respondent Tllt-ough: Mr.Aninolya Mcdhotra, .Advocate (:RL.M.C. SHREE R/-\j THA\/EL:S 5( TOUR5 & ORS. .. ... Petitioners T'hrough: Mr.Sunli Gupta, Cri.i\!l.C.No.1056/2011 S,_ connectec! matters Page 5 of :l7' , ---r I •/ . ·, __ _

¶1<._, J ..). l with Mr.Jatin Zaveri, Mr.Ga urav Agarvval and Mr.Tanmaya AganNal, Advocates versus DESTINt\TION OF THE \NOH (SUBCOI\IT!NEI\iT) PR!VP1TE ..... Respondent Thi-ough: Mr.Jl111indya Malhotra, Advocate CORAM: Wv1JR. _p.JSTIICE PR.J\DEIE/1)1 VVhethel-the R.epo1·ters of papers may be allovved to see the judgrnent? To be referred to CZeporter or not? Whether tile judgment should be reported in the Digest? P'RJ\DEEP NAINDRAlOG, j.

¶1stated the facts leading to filing of the above captioned petitions are that respondent i.e. 'Destination of Wor-ld (Subcontinent) Pvt. Ltd.' a cornpany registered under the Companies Act fiied 15 CO!Tlp!lalints under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the 'N! Act'); 3 cheques beil'9 the subject matter of each complaint Petitioner No.1 i 'Sh·o-ee "-:,_, ,I " ..._. " .1 , I....,) .. I._ _. Tours i_td.'. a cornpany registered under the Companies ,Act was impleaded as accused 1\Jo.l and petitioners 2 to 7 vve:r-e irnpleaded as co-accused on the alleg1ation that as Ojrectors they were inc:harge of the day to day affairs of the company and hence vvere vicariously !iabl2 for the defaults of the CClnl!Jany. The COiliplaint W25 filecJ l!il e C:::ourt of /Additional Chic.f !\J1otrono':,:-;::n·, j\11at·JiS'l-,,-atP to as the '"-· l L t-l1t...Cu.l It··::)' l-.. ,..._ \! -1 -·II ol I 'I ,j Cri.M.C.I\Io.l056/20ll 8, iTialtPrs Pc1ge 5 ot 2./ ! --:- 'ACMM') Nev1i Delhi .. inter-alia, ,crJerhng that the responde,nt cornpany and the accused No.1 connpany had entered into 2 agreements in ten11s whereof the accused No.1 cornpa: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 100 Bank Niew Delhi/ were dishonoured and upon the cheques being returned the respondent company is::..ued contemplatE:d under proviso (b) to Section 138 1\11 /l1ct from Delhi to the accused No.1 company which failed to make payment in respect of the sum for which tile cheques vvere di"awn 15 da)iS of the of the said notices. \!\lith respect to the jurisdiction of the Courts at Delhi : 1t \Nas pieaded that for the reason the respondent had presented the chequEs in question for collection with its banker Bank situated in Delhi, the Court had the necessary jurisdiction.

¶2it may be noted at the outset at aftel-the complaints were filed, the respondent com1)any filed a suit bearin·.;:J !\Jo.SS0/2010 in which petitioner, No.1 was impieaded as defendant before the High Court of Bombay for .3 decree to be passed in the sum for which the 45 cheques forming of the aforesaid complaints were issued. in the piaint jurisdiction of the Courts at IVlumbai was pleaded on e averment that tile agreement pursuant wher-eto the cileques were issued was executed at Mumbai as also that the cheques in questioh were drawn and issued at MumbaL Ci·l.IVI.CJ'Iio.1056/201i g, cor·,,lectec matte1·s Page 1 of '27 (

¶3Taking . cognizance of tille complaints, .the learned ACNJM SU/Tirnoned e petitioners to face trial for an offence punishable under Section 138 of e 1\J.i. Act

¶4Upon service of the sunnmons, the petitioners filed application(s) under Section 177 Cr.P.C. inter-ana stating that the courts at Delhi !lave no jurisdiction to tak:e cognizance of complaints· and prayed that complaints be to the respondent to be filed in tr.e court of competent jurisdiction. Together with the said application(s), petitioners 2 to 7 filed seeking exemption for personal appearance before Dismissing application(s) 1:·c:.eV!Iln ,\...... It' personal . appearance and keeping exemption pending, from fer consideration, application(s) filed under Section 177 Cr.P.C. vide order elated

25.05.2010 the learned ACMM issued bailable wa1Tants against petitio:ners 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 or-der dated

23.09.2010. i\ggrieved thereto, petitioners filed seeking Special Leave to Appeal before the Supreme Courc which were disposed of vide orcler: dated 14.1.2011 with direction to the learned at applications filed unde,- Section 177 Cr.P.C. would be disposed of within 2 weeks.

¶6Vide or-der dated

14.02.2011 learned ACMIV: dismissed the application(s) under Section 177 Cr.P.C. fiiec by the petitioner-s on the ground that in view of the dicturr, of law laid down by the SuprerTle Cour-t in e decisior, Cri.M.C.No 1056/2011 & connected matte1·:: Page B ofn ! G/ I reported as (2004) 7 SCC 338. /ildalat Prasad 11 Roop La! /inda! once the Magistrate has taken cognizance of a complaint he has no power to t"etum the same to the complainant with a direction that the same be filed in a court of competent jurisdiction.

¶7Aggrieved by the order dc1ted 14.02.2011 passed bif the !earned AC!V!M, the petitioners have filed tf1e above-captioned petition(s) under Section 482 Cr.P.C. this Court to hold that courts at have no jurisdiction to take cognizance of the complaints in question and seek directions to the learned ACMM to the same for filing befol-e the Court of Competentjuri':;diction.

¶8It is the case of tile petitioners that the cheques m question were dr-awn at MurnbaL Tile drawee bank is a:- Mumbai, notice issued by the respondent to the petitionee company was at Mumbai and thus merely the respondent posted the notice from and depositeci tile cheque wftll its bank at Delhi ·would not confec jurisdiction on Courts in Delhi.

¶9The issue has to be debated Nitfl to Sectlon 138 of tile Nl P,ct and the applicable provisions of the CodE· of Criminal Procedure i.e. Sections 177, 178 ancl 179 of the Code of Criminal Procedure.

¶10decision reported as 1999

(7) sec 51(! I(Bhaskaran Vs. Sl7a·ni;ara,_n_ Balan & At7{=., the Supreme Court. has opined, afte1" considering Sections 178 to Section 179 of the Code of Procedure, that an Ci"I.M.C.I'Jo.l056/2.011 ?x ccnnecierJ matters Page 9 of :z: .. ! ! I offence may be completed in clifferent localities and thus . . ' can be tried in any Court he;, n1g jurisdiction over said localities. To put it pithily, 1!n to territorial jurisdiction, qua an offence, law ;-ec:ognizes more than 1 court l1avi ng1 te!Titoria! 1 urisdiction a ndl the issue of territor! a: jurisdiction would have to be decided with reference tc whether a part of an offence '1Nas committed withi11 the territorial jurisdiction of a court. The issue is no res integra 2.nd r just need to note the decision of the Supreme Court in. KBhaskara17's case and highlight that the aforesaid is to be cuiled out from pa!-as 11 anol 1:2 of tfle said decision.

¶11The next logical questron ·would be, what are the contours of Section 138 of the Nl t pertaining to acts to be perforrr:1ed in relation to an offenr:::e contemplated by the said Section'? it ilard!v be 1-e-emphasized that It are acts of con'l.rnission or ornission which co stitute offences, ·with or vvlthout the requisite rnens rea. depending upon vvhether the offence is an absolute offence or not.

¶12Let me tilus note Section 13Ei, !\:]1 l\ct which reads as under:-\/\!here any cheque dravvn !oj; a person on 2n account maintai :led by him with a banker for payment of any amount of to another person from out of tllat account for discharSJe, i11 whole or in pa of any debt or other liabiiity; is 1-eturned by the bank unpaid, either because of the anwunt of money standing . to tile credit of that account: insufficient to honour the cheCFJe or that it exceeds the arnount arranged to be paid fmrn that account by an , Cr-LIVi.C.No.1056/2.D11 & connecl:er:l ?age 10 lfll -·:! agreernent made with that bank, such person shall be deemed to have com rnitted an offence and shall witnout to any other provisions of· this Act, . : be punished wirth imprisonment for a term whkh may extend to two year, or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall app1y unless-

(a) The cheque has been 1xesented to the bank within a per-iod of six months f1"0nn the date on which it is drawn or within the period of its validity, whichever is earlier,

(b) Th·e payee or the ilolder-Induce course of tr1e cheque,, as the case may be,, makes a demand for the payment 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 o-F information by him from the lt}ank regarding the return of the cheques as unpaid, and

(c) The dravver of such cheque fails to make the payment of the said amount: of money to the payee or, as the case may be, to the holder in due course of the cheque, \,vithin fifteen days of the receipt of the said notice. · Explanation: Fol-the purpose of this section. "debt or other liability" means a legally . enforceable debt or other liatdllity.,

¶13In Bhaskararis case (supra) the Stipreme Cocwt haol an occasion to deal with the issue of territorial jurisdiction in · relation to Section 138 of the Nl and of necessity, the discussion the Supreme Court to various acts of commission and omissioni· whkh constituted the offence punishable under Section 138 6f the Nl /\ct and \/vould be to highiigl-;t at in para JL.c:! of the CrUVLC.f\!o.1056/2011 {Jy_ connected ?age 1:1\. of27 l [ decision, the Supreme Court that there are : . . ' acts which are the components of the offence punishablE under Section 138 of the 1\il Act and :1 re-produce the same from para 1·4 oF the decision of the Supreme Court. They read as under:-

(i) drawinq of the cheque,

(ii) · presentation of the cheque to the bank,

(iii) returning the clleque loy the drawee bank,

(iv) giving notice in vvriting to the drawer of the cheque demanding payment of the cheque amount,

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

¶14After holding that acts constitute the. components of an offence under 138 of the Nl Act, in paras 15 and 16 the Supreme Court observed as under:- ll15. 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 differ-ent But a concatenation of all the above five is a sine qua non "for the con1pietion of the offence under Section 138 of tile Code. .In this context a reference to Section 178( d) of the Code is useful. _ it is extr·acted below:

¶16Thus it is clear, if the five different acts were done in five diffei"ent localities any one of the courts exercising jurisdiction in one of the five local areas can become the place of for the offence under Section 138 e A.ct. In other words, the complainant can choose any one of Cr!.M.C.No.1056/20E &. connected matter.:; Page 12 cf ll -.! -.! those courts having jurisdiction over any one of the local areas within the territorial limits of which any one of tl1ose five acts was done. As amplitude stands so widened and so expansive it is an idle exercise to raise jurisdictional question rega1ding offence under Section· of · e Act." (En?phasis Supplied) l

¶15On the issue of service of notice t"equired to be given by the complainant to the accu:sed, tile Supreme Court observed as under:- "17. The more important point to be dedded in this case is wl1etl1er the cause of action has arisen at all as notice sent by complainant to the accused

1.Nas returned as "unc!aimed". The conditions pertaining to the notice to be given to the drawer, have been formulated and incorporated in clauses (b) to {c) of the pmviso to Section 138 of e Act. The said cia uses are extracted below:

¶18On the part of the payee he has to make a demand by {/giving a notice'' in that was only requirement to complete offence on the failure of the drawer to pay the cheque amount within 15 days from the date of such "1giving", the travails of the prosecution would have been very mucll lessened. But the legislature says that failure on the part of the drawer to pay the amount should be within 15 days "of the receipt" of the said notice. is, therefol-e, clear that "ghring notice" in context is not the same as receipt of notice. Giving is a process of which receipt is the accompHsllnnent. is for the payee to perform the former process by e notice to the drawer at the correct address Cr!.rvi.C.No.1056/2011 St connected matters Page 1J of 2.1

¶20If a strict interpretabon 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 sent the notice on the correct address, a trickster clheque drawer would get the premium to avoid the notice by different stl-ategies and he could escape :from the legal consequences of Section 138 of the ,Act. it must be borne in mind that e court should not adopt an interpretation which helps a dishonest evader and clips an honest payee as that would defeat the very legislative measr,Jre. 21 ..... The context envisaged in Section 138 of the Act invites a liberal retation for the person who has tile statutol")f obligation to give notice because he is presumed to be the loser in the tr-ansaction and it is for his inter-est the very provision is made by the leG1islature. The words in clause (b) of the proviso to Section 138 of the Act show that the payee has the statutory to "make a demancl/F by 91iving notice. The thru:st In the clause is on the need to "make a dernand". it is only the rnode for making such demand which the legislature has prescriberj .. £\ payee can send the notice for doing his part for giving the notice. Once it is clespatched his part is over and the next depends on ·what the sendee does. ·

¶22It is well settled t!1at a notice refused to be accepted by the addressee can be presumed to have been served on him (vide Narcharan Singh v. Shlvranf2 and jagdish Singh v 1\latthu

¶23the notice is returned as unciiaimed and not as refused. VVili there be any difference bet'lnreen the so far as e presumption of service is m this Cr!.!VI.Ci\io.1056/2011 IS( connecter! matters :14 of 'll ! --;! connection a (eference 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 shoulcJl be given only by II t" N tl I i i " " I . ' . pos . " one lt-2,E:ss :11e pnncq) e 1ncorporatea m Section 27 (quoted abov2) can profitably be imported in a case where e sender has despatched the notice by post with the address written on it. Then it can be deemed to have been senJed on the sendee unless he proves that it was not really served and that he was not r·esponsi ble for such non..:service. Any otf1er inter-oretation can leacl to a very tenuous ' - position as the drawer of tile cheque vvho is liable to pay the amount would resort to the strategy of subter-fuge by successfully avoiding the notice.

¶25Thus, a notice is returned by the sendee as such would be the commETiCin<g date in reckoning the period of 15 days contemplated in clause (c) to the proviso of Sectior'l 138 of the Act. Of course such would be ·vvithcut pt-ejudice _to the right of the drawer of the cheque to show at he had no knowledge that tfle notice vvas brought to address. In the present case the accused did not even attempt to oliscl1arge tile lourden to rebut presumption." :(En7,ohasis Supplied) 1/()

¶16The expr·essions: /presentatic:m of t/Je cheque to the Bank' a.nd I if the five acts were done in five different localities any one of tl;e courts exerc/sing jurisdiction in one of the five local areas can becorne the o/ace of trial /cor tl7e under Sect/on 138 or the to . . h' · 1 •- -,.--,c: }il }K::- ---en '(-·i-i r·)l' '1 -/,-. .,Je .u .... ,!IO 1r. 1Jc.lo_, -·." . ,.J l•c...J,:,.·e .... _.\(=)1 case (supra) have been understood many to mean that conr:r::::tecliTI<:,t!.ers Pc!ge 15 o1= 27 1/ the Court within local limits of which the payee Bank' i.e. th(:=: Bank vvllen? the ·Complainant cleposited the cheque is situated has the jurisdiction to try the complaint under-Section 138 of the Act, and the understanding appears to be fortified by the observation::: of the Supreme Court in paras 15 and 16 that if the 5 acts as the ingredient of an offence under 138 of the Ni ,1.\ct were done in 5 differ-ent localities, any one of the court exercising jurisdiction in any one ofthe 5 areas would have jurisdicbon.

¶17But, it is appai-ent that the oloservatiqns 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 pel-forrned The acts can 1oe performed, as would be explained hereinafter, onlly at 4 would immediately state that act No.2 and act No.3 to only one place i.e. the place where the clravvee bank is located.

¶18The second and the tl1ird act, of the 5 listed by the Supreme Court, as constituting offence under Section' 138 of the f\11 Act are: (a) presentation1 of the cheque to the bank; and (b) retur-ning the cheque unpaid by the dra\tiJee bank.

¶19The third act is the return of tile cheque unpaid by the drawee bank and thus there is no scope for any argument as to which bank is contemplated V\rith reference to the said act. The second act pertains to the act of presentation of cheque to the bank. l highlight tnat Ui112 twin vvords used .are 'the bank. Cri.M.CNo.1056/2011 Gt connected rnatters Page 16 of 7:.1 --.!

¶20the decision reported as 2001 (3) SCC 609 Shri !shar Allov Steels Ltd. Vs. /avaswals Neco {td, a 3 Judge Bench of the Supreme Court, 1·1aving 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 Section 138 of the Ni Act. VI/as it the drawee bank or e qayee bank? The Supreme Court answered the question in the foHqwing words:-

(a) \/\/hat is ITH::ant 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 of attracting penal provisions of Section 138 of the Act?, are the questions to be deterrnined by this Court in this appeal. hac; h--. l"nti.Ct:"rrl t-'1at-to an " ij v I ........ ! ! .• ,_.,

1.. '-· I I._ ' l. rt l ( - . - ' offence _under Section 138 of the Act, it is rna ndatory that the cheque is. presented to "the bank" within a period of six n'lonths from the date on whicr11 it is drawn or within the period of its validity, whiche\/er is earlier. is the cheque drawn which has to be presented to "the bank" withirf the period specified therein. When a post-dated cheque is written or drawn, it is only a bill of exchangJe. e post-9.ated cheque become a cheque under the Act on the date which is written orn thF: saiol cheque ancl the six months' Crl.M.C.l\lo.1056/2011 8( c:mnected m.'ltters -·;! period has to be reckonecJr for the purposes of Section 138 of the Act, from the date.

¶8Section 138 provides that '1Nhere 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 standir1g to the of that account is insufficient to llonour the cl1eque or that it exceeds tile amount arranged to be paid fron1 that account by an agreennent made \1\dth that bank, sucll person shall be deemed to have com miitted an offence pun ish able vvith imprisonnlent as prescribed tl1erein subject to the conditions mentioned rn clauses (a), (b) and

(c) of the proviso. Section 3 of the Act defines the "banker' to include any person acting as a bankei-and any post office savings bank. Sect1on 72 of the .Act provides that a cheque must, in o1·der to tf-1e drawer,, be presented at the bank upon vvhich it is drawn before the relations between the di-awer and his !cJlanker has been altered to the p1·ejudice of the drawer.

¶9The use of the \Nords "a ba1nk'' and "the bank" in the section is an indicatol-of the intention of the leqis!ature. The former is an indirect (sic indefinite) article and tile is prefixed by a direct (sic definite) artide. intended to have the same meanings for "a bank" and "the bank", was no cause or occasion for mentioning] it distinctly and differently loy using two different artides. it is worth noticing that the word "banker" in Section 3 of the Act is prefixed by the indefinite articie "a" and the word "bank" wlle1·e the cheque is intended to be presented under Section 138 is prefixed by the definite a cile "the". The same section permits a person to a cheque on an account maintained by hirn with "a bank'' and er:.M.C.!\io.l056/20E 8t :::onnec::ed matters P3ge 18 of Zl i makes him liable for C!-inntin1 prosecution if it is returned by "the bank" 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 specify1ng or particularising effect as opposed to indefinite or generaiising fo1-ce of "a" or '''an". determines what particular thing is meant; that is, what particular tl1lng we are to assume to be meant '''The" is always mentioned to denote a particular thing or a person. "The'' would, therefore, refer implicitly to a specified bank and not any bank. "The bank" referred to in clause

(a) to the proviso to Secbon 138 of e t\ct would mean the drawee bank on which the cheque Is dravvn and not all banks where the cl1eque is presented for collection including the bank of the payee, in whose favour the cheque is issued.

¶10it, however, does not mean that the cheque is always to be presented to the drawer's bank on wh'1icl1 the cheque is issu . The payee of the cheque has the option to pn:sent the cheque in any br:ulk including the collecting bank \1\IIlere he has his account but to attract criminal liability of thP drawer of the cheque such collecting bank is obliqed to_Joi-esent the cheque in the drawee or pavee £?ani: on whlch cheque is dra\tVIl within the rperiod of six months from tile date on whicll it is shown to have been . - .... The non-pr-esentaUon of the cheque tc the draw·ee bank within the period specified in tile section would absolve the person issuing the cheque of his criminal liabHity under Section 138 .of the Act, who shall otherwise may be Hable to pay the cheque amount to the payee in a civil action ·initiated under th(::: t\ combined readinq of Sections 72 and 138 of the Act would leave no doubt in our mind that tr11e !avv mandates tile cb_equ.e_ to at bank on which it is drawn if the drawer is to be held criminally liable. Such presentation is Crl.r/i.C.No.1055./2011 8z connected matters Pag:: CJ r:: 27 ---.-! -·;! necessarily to be made within six months at_ the bank on which the is drawn whether presented pel-c:onally or through another bankl · namely, the· coliectinq of the QQ__yee.''' (Emphasis Supplied) ·

¶21Thou9h the decision in Al//oJ/s case (supra) hciS been rendered in the context of limitation for presentation of a cheque, the said decision brings out in no uncerta n terms that Section 138 of the t\Ct contemplates that a cheque is required to be presented for encasllment to the dr-awee Bank and that the Bank, merely acts as an agent of the payec:/cornplainant for the purposes of presenting the cheque in questi(Jin for encashme1r1t to th2 dr-awee Bank.

¶22Thus, the 2nd act to which th12 Supreme Court referred to in Bhaskararr's case as one of the 5 vvhich constitutes th,2 offence under Section of tllle I\H A,ct vvas presentation of the cheque e drawee bank and needless to state the act whiich consbtutes an of tile offence is the return crf; e cheque unpaid by the drawee bank and thus it becomes crystal clear that the and 3rd act constituting the offence would relate to only one place i.e. the place where t!le drawee bank is locateol.

¶23These are my humble (easons to hoid that the observations in paras 15 and 16 have to be read as an orbiter and thus the 5 acts conten",i.plated as constituting thP offence are cap?ble of being performed not in 5 but only in 4 places and since d·2Posit of the cheque with the payee bank is not an act contemplated as an ingredient of the offence, the place vvh:en:: t!1e payee bank is located \Nc;uid be Cr!.M.C.I\Io.1056/20ll connected mat::ers Page Z!J of -.! irrelevant for tJurposes of detenn!r1dng jurisdiction of the criminal court.

¶24It Is settled lavv that a decision is an authority for the point it decides and not what can be logicaHy deduced therefrom and the i-atio of a dec:iskm has to be gatherecl with reference to the facts of a and highLight only one decision of the Suprerne Court being the decision reported as Dhodha House 11 5_)\._i1ja/ngi(2006) 9 SCC 41.

¶25The matter regarding jtirisdict1on can also be decided with reference to Section 6, :3er:::tion 7, 64 and Section 72 of the Nl Act.

¶26The relevarrt. portion of. 6, Section 7 and Section 64 of l\l! Act a,·,.j Section 72 of the N! Act reads ·under:-- Section 6. Cheque: - A "cheque" is a biH of exchange drawn on a spec eol banker· and not expressed to be payable, otherwise than on demand and it Includes the electronic image of a truncated cheque and a cheque in the electronic for·m. )( )( )( Section 7. The maker of a bill of exchange or Cheque is called "drawer"; person thereby dil-ected to pay is the "Drawee". )( )( )( Section

¶64Presentment for payment.

(l)]Promissory notes, bills of exchange and cheques must be presented for payment to the maker, acceptot-or drawee tllereof respeiC:tively, by or on behalf of the holdet-as hereinafter provided. !11 default of such1 presentment, Ct·i.l\iLCi'Jo.1056/2011 & COil<'1ecteci matters .n of 23 -·;! other parties thel-eto are iliable thereon to such holder ....... . )( )( )( Section 72. Subject tc) e provisions of section 84 a cheque must in order to charge the . ' drawer, be pi-esented at the bank upon which it is drawn before the relation lbetvlfeen the drawer and his banker has been adtered to the prejudice of the drawer.

¶27A co-joint l-eading of Sections 6, 7, 64 and 72 as of Section 138 of the Nl Act brings out that in order to penal provisions of Section 13B e t\,ct a cheque is required to be presented fo,- encashment to me drawee Bank and that the payee Bank acts as an agent of the payee/compiainant fo1-the purposes of presenting cheque in question to the dravvee. Bank. The corollary thereof is that no pa of cause of action for the offence punlsllable under Section l3B of the A.ct arises in the Cour-t within the ocal li.mits of which the Bank: of the i.e. payee Bank is situated and thus saic Court has no jurisdiction to try a connplaint under Sectior 138 of the Nl filed by the co lainant.

¶28This takes me to the considel-ation of second questior Involved in the pr-esent case i.e. wllether the court w!thir local liimits of which from where complainant had sent a notice under provisc

(b) appended to Section 138 of e 1\ll is situated has thE jurisdiction to try a complaint filed under Section 138 of the Nl Act. o-1.1Vl.C.I'Jo.l056/20U &. ;'"'l.:;,tter:; ?age :2:2 of 27

¶29! have already noted the observations made by the Supreme Court in Bhaskaran's case (supra) in the for-egoing paras and would highlight that in paras 17 to 23 th;r:: Supreme. Court has reflected iup,Jn the limitation within which the notice has to be 9i!ven to the accused. The Supreme Court was considerin9 the expression 'giving a notice' in proviso

(b) to Section 138 of the Ni 1\ct, vvith reference to the 15 days· time coi-Iternplated tr11en by which the requisite notice had to be servr::d, which is novi 3C days.

¶30Another decision of the Supreme Court, reported as.

(2009) 1 sec 720 Harman Electronics Pdvate L/rnited II National Panasonic !ncJia Private LiJ_TJited is \f\/ortll noting on the subject.

¶31in Hannan's case (supra) the question which had arisen before the Supreme Court was· precisely the same ,question wrlich arises for conslclleration in the oresent petition i.e. vvhet!1er the court wit!hin e of vvhich . the place from where the had sent a notice· contemplated under proviso (b) to Section 138 of Ni Act is situated has tile jurisdiction to try a complaint filed under Section 138 of the Act. Answering! the aforesaid question Jn tile negative, the Supreme Cou observed as under:- "12 ...... The only question, therefore, vvhich arises for considei-ation is at as to whether sending of notice from Delhi would give rise to a cause of action for takin9 cognizance under the Negotiable lnstruments ,Ll\ct Ct-1 fv1.C.Nc,.l056/201:L 8t :::om;ecced matters Page 2.3 of 27 --;!

¶13It [s one thing to say tflat sending of a notice is one of the ing1reo!ients 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. VVhat would constitute an offence · is stated in main provisfon. The proviso appended thereto, however, imposes certain furthe·r conditions which are required to be fulfilled before cognizance of e offence can be taken. If the ingredients for constitution of the offence I aid down in provisos

(a),

(b) a ndl (c) appended to Section 13E: of the NegJotiable Instruments 1-\ct are intended to be applied in favour of the accused, there:: cannot be any doubt that receipt of a notice WOI.Jild u mately rgive rise to the cause of action for n ing a complaint. ;!\s it is. only on of the notice that the accused at his own peril may refuse to pay the amount. Clauses (b) and (c) of tile prov,iso to Section 138 therefore must be read together. issuance of notice would not by itself rise to a cause of action but cor'.:rnunication of the notice would. . . . , ... For constitution of an offence under Section 138 of the Act, the notice must be received by . - the accused. It may be deemed to have been 1-eceived in certain situations. The vvord "communicate" inter alia means "to make known, infoml, convey, etc" ..

¶20. .... f-\ court der-ives a jtHisdict:ion only when the cause of action arose vvithin its jurisdiction .. The same cannot be conferred by any act of omission or commission on the part of the accused. A distinction must also be borne in mind loetvveer1 the of an offence and commission of a part of e offence. VILhile .issuance of a notice by the of ... fL[Iegotiable o-I.M.C.I\Io 1056/2011 & connected matters Page 24 of Z? -.-! jD instrun!"lent is necessarY..t service thereof is a!so imperative. Only on a of such notice and failure on the part of the accused to pay the demanded anwunt within a period of 15 days thereafter, commission of an offence completes. !:!ivinq of n_obce have anv:_PL_eceqent over the service. it is oniy from that view of the n1atter that in Daln7ia Ce;nent (Bharat) Ltd v. Galaxy Traders & AgenCies Ltd emphasis has been laid on service of notice." (Elnphasis Supplled)

¶32At a fhst blush r:::'adina of the decisions of the Sur;rerne f' IJ u-·t I' J'l p l-r-.. c,(/-:1 r··rn rl d /(-[ ":] r(YI' ;:o /"" 1 c; '-:' c: 0 s (,. c i' i \J .i'l' rr •. y \....._.. ..=.?...! , a . ...),'\ c . 1 a 1 1 ''-::_.!.....!. '-' C•J .._) c::.... . 2l Lu }- C.11 .... 1 , a strike to the reader that there is a confHct between the two decisions inasmuch 2·5 in Bhask(Jran's case (supra) it was held that the exp:-ession 'gilling of notice' occurring in proviso (b) to Section 138 of the Act means 'sending of notice/ whereas in Hannan's case (supra) it was held that the said expression means' olnotice/.

¶33A careful l-eading of the two decisions shows that the-e is no conflict between the said dr::cisions inasmuch as they have IJeen rendered in different contexts. The decision in Bhaska_ran's case (supra) was rendered in t!1e context ,Jf starting point of l!n:itation period of 15 days prescribed HI proviso (b) to Section l3H of the ikt and it was in that context i.e. the context of limitation that it was held by tr1e Supreme Cou that expr-essiion givingr of notice:!·' occurnng in proviso (h.) to Sectlon1 138 of the 1[\U Act means 'sending ol The decision in /-Iannan's case (supra) vvas rendered in the context of cause of action for filing :a complaint uncje; Section 138 f\!lil ./'let of .a co.IJI ... ;.. a-l·,-l ;-t l"'·'c ro· \/ .... L ·-· t_ .. -· I. Lll .. ...-1 ... .... /I,._ ..... , ·I ' ( )' ' Cr!.IVI C.No.1056/2!i11 Bt c_onnected matters Page :zs of ::7 .. -! Supi-eme cu--p·t ·t·llo L., . I . c. _ ,:: expression gl!/J:ng ol notice r occurring in provrso (b) to Se(=:bon 138 of the Nl Act means I receipt at notice'.

¶34Now, same e.x:pr·ession can have different meanings in different context as held by the Supreme Court in the decision reported as Malik .L-:;1 l}!f_gjwndar v Gourarqa C,handra Dev (2004) 12 SCC ·C!-48 wherein it was observed that a word occu1Tit:g in a .s. ry provision can r1ave different meanings in different context the saxne statute. 35, Thus,. the inevitable conclusion would be that the 1 th ··+ act contemplated as an ingredient of the offence as llighlightecl in B/7askaran's case ii.e. 'giving notice in writi7g to tl7e drawer of cheque' dernanci/ng pay1nent of the cheqJe an?ount for pui-poses of !imitation vvould have a meaning as explained in Bhaskarads case and for purposes of jurisdiction would have a meat'dng; as explained In /shar A//oJ/S case (supra).

¶36Before concluding I oe failing not to lodge a caveat. \NiH: electronic bankinq and facility payable at par of clearance provided by bankers and especially ,n metropolitan cities, vvllere cheques are cleared by not beir.g presented to tile dra\.vee bank: but at nodaJ branches of t!-'.e concerned banks, the subject nnatte1r of jurisdiction may have to be olecidec keeping in vi'evv that the dravvee bar.k has created an agency where the cheque in question :s tr-ansmitted f()i-clearance and e s where the clearance takes place would then ar-guably be(::ome the p_lace vvher2 Cri.M.C.No.lOSEi/2.011 s, col-:ileC'ced ;-,,atters Page 25 of -.- ill' ' y·l I J the cheque vvoulcl be requir-ed to be treated as presentEd to 'the bank' Le. the dl-awee bank. B in such circumstances, properly constituted pleadings have to be found ir.1 a complaint and lodging the caveat i !eave it at that for 'the debate to be prooerly argued in an appropriate case v.rith the necessary relevant pleading!s.

¶37I hold that on the pleadings in the comp!alnt(s), ·no pa of CcHJse of action can be said to have accrued to the complainant at Delhi: that tile notice demanding payment 'Nas posted from Deihl and tllo!t e cheque vvas depDsi'::ed vvith the payee bank at Delhi vvould not constitute the acts contemplated as ingJredients of an offence punishable Section Act and thus i dispose of the petitions quashing the impugned order(s) dated 14.2.2011 and d!r2ct learned ;L\CMM to return complaint(s) to respondents for filing in a Cou!-t having territorial jurisdiction.

38.. No costs. SEPTEMBER 21, 2011 mm C:!.M.C.No.1056/2011 & m.atters \.·· I(PRADEEP J]UDGE 27 cf 27 !

* % + IN THE HIGH COURT OF DELHI AT NEW DELHI Judgment reserved on: ltfh September, 2011 Judgment pronounced on: 21st September, 2011 CRL.M.C. 1176/2011 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 15. Whether the Reporters of local papers may be allowed to see the judgment? 16. To be referred to Reporter or not? 3. Whether the judgment should be reported in the Digest?