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

PRADEEP NANDRAIOG, 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. 0/o }_u·::Jct!n(;;J_!f re;:·e.r-1/C<.l' j _[udqn7ent orooounce(i on: 21st Set?teni{Je[c __ ,?/1." _j SHREE RAJ TRAVELS G1 T(IUIR5 LTD. 6( ORS .... Through: Mr.: JnH ,[;upta, witil Mr.jatin Zaveri, i-\g.?:!-vv r3l and M r.Ta nm.:ry 2 Aga:-w.di, DESTIN..l);T!ON or= IHt ·J\!OF:.LD (SUBCONTIII\JENT) PPJ\/ATE :_TD. . ... lr'.e':;l . .r Th ro'J qh P.11 i hotr<J i\ci li: I::.) ·- SHR.EE P,Aj TR.A\/ELS & LJD. 61 ORS. I I., ::J i I. versus OESTINi1.T!ON OF THE (SU BCONT: [\i PF.I\1.!\TE LTD. Thrcugn: Malhotra, J.'.. •. D"; TDfl'iC.L" <:::. '('·l!":.f< 1 -:n 'j !-', '- ' \ .'--'IJ ' I ·,r·· ., f_ J ex I ...) _, ,, I -·- -· l ·'-" " r;, ORS ..... Pf:titi c . . . -r h 1·· 11 .- ··- 1 -, ,,..:.. • , ·- -!- -·. C 1-"• ·, ' ·· • · _, 1 -, 1rOUCjii: '·•I :)•._·,1 ·.:..•I'-·1-J'-o, _,__J,,· ... .- ...... _ v·ftth ja,::in Zaven,. r .<,Yi.: L1g il and !V!I r.·l·c. n rn ay:.1 Ag.a r•J. (";1 ,, , ;6.,dvocates I ' t t ! ' versus DESTINATION OF THE \NORLD (SUBCONTINEI\JT) PP,IVATE LTD. . .... Respondent Through: Maihotra, Advoc.3te CRLM.C. 1171'-2011 SHREE RAJ TRAVELS & LTD.

6.( ORS. . .... Petitioners Gupta, Sr.J.1.dvocate vvith !'v]l'.jaUn Zaveri, Mr.Gat•rc"/ A g a rw a ! a n d M r .T a n rna y 2 AgarwaL Advocates Through: versus DESTINATION OF THE VVORLDI(SUBCONTiNEINT) PRIVATE LTD. . .... Responde;:t Through: Malhotra, Ad\/CCiite CRLM .. C. 1113/2011 SHREE RAJ TRAVELS,& TOUHS LTD. &( ORS. .. ... Petitioners Gupta, Sr.Advocate with f\,1r .. Jabn Zaveri, Mr.Gaura.,; Agarvval and Mr.Tanmaya Agarwa,f, Advocates Through: versus DESTINATION OF THE \1\/0RLD (SUBCONTINENT) PRIVL\TE LTD. .. ... Responde·'"lt · Through: Mr.i\nindya Malhotra, CRLM.C 1114/2011 SHREE RAJ TRA"IIELS & TOUPS LTD. & ORS. . ..... ·Petitioners Through: Mr.Sur:il Gupta, Sr.Advocate with Mr.Jatin Zave,-i, Mr.Gaurcv t\ganNal and Mr.Tanmaya Aqa rvval, Advocates Crl.fVI.C.I\Io.l056/2011 15, conner.terJ Jli<'Jtt<:rs versus DESTINATION OF THE VVORLD PRIVATE LTD. .. ... Respondent Through: Mr.Anindya Advocate CRLM.C. 11 SHREE RAj TRAVELS & TOURS LTD. &-ORS .. . .... Petitioners Mr.SunH Gupta, Sr.Advocate with f\.1r.,Jabn Zaveri, and Mr.Tanmaya Through: Aga rvva II .. Advocates versus DESTII\IATION OF THE WORLD (SUBCONTINENT). PRiVATE LTD. . .... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C. 11161[2011 SHREE RAJ TRAVELS & TOUHS LTD. & ORS. .. ... Petitioners Mr.Sunill Gupta, Sr.Advocate with Zaveri, Mr.GaUI-av Agarwal and Mr.Tanmaya Agarwal, Advocates Through: versus DESTINATiON OF THE \1\/0RL.D (SUBCONT!NENT)PRIVATE LTD.. . .... Respondent Through: Mr.Anindya Malhotra, Advocate CRLM.C. SHREE F\Aj TRAVELS /S( TOURS LTD . & ORS. ..... Mr.Sunii Gupta, Sr.Advocate with Mi-.jlatin Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Through. Cri.IVI.C.No.1056/Z011 8t connected matters Page 3 ot 2.7 Advocates OF THE WORLD '(SUBCONTINENT) LTD. .. ... Respondenc Through: Mr.P111indya Advocate CRL.M.C. 1179/2011 SHREE RAJ TRAVELS &t TOUR.S LTD. & ORS. . .... Petitioners Mr.Sunil Gupta, Sr.Ao!vocate with Zaveri, Mr.Gaurav Agarwal and Mr.Tanmaya Agarwal, Advocates Through: versus DESTH\JATiON-OF THE \1\/0P:I_D PRIVATE LTD. . ..... Respondent Through: Mr.Anindya Malhotra, Advocate CRL.M.C. SHREE RAJ TRAVELS & LTD. & ORS. .. ... Petitioners Thr-ough: Gupta, Sr.Advocate with Mr.jatin Zaveri, Agarwc:d and Mr.Tanrnaya Agarwal, Advocates versus DESTINATION OF THE \NORLD (SUBCOi\lTINENT) PRIVATE LTD. .. ... Respondent Through: Mr.Anindya Advocate CRLM.C. 118:3/2011 51-!REE RAJ TR.A\!ELS &<TOURS LTD. 8( ORS. .. ... Petitioners Mr.Sunil, Gupta, Sr.Advocate with 1/ir.jabn Zaveri, Mr.Gaura\: Through: Cri.M.C.No.1056/2011 & connected Page 4 cf Z: t\ga(:Nal and Mr.Tanmaya Agarw;:;d, versus OF THE WORUD (0 LTD. .. ... Respondent Through: Mr.A.nindya Malhotra, Advocate CRLM.C. 11H6/2011 SHREE RAJ TRA,VELS f:_,, TOUP5 LTD. 5,, ORS. .. ... Petitioners M;-.SunH Gupta, Sr.Advocate with Zaveri, Mr.Gaurav Aganl'fal and Mr.Tanmaya Agarwal, Advocates Through: versus DESTINATION OF THE \NORLD (SUBCONTiNENT) PRIVATE LTD. .. ... Respondent Through: Malhotra, Advocate ·cRLM.C. SHREE RAJ TRAVELS & TOUHS LTD. c;, ORS. .. ... Petitioners Mr.SunH Gupta, Sr.Advocate with Zaveri, Mr.Gaurav Aga rwa and M r.Ta nrnaya A.ganr,.ral, A1dvocates h ,J roug, ,: versus OF THE \NORLD (SUBCONTINEl\lT)PRIVATE LTD. .. ... Respondent Through: l'V1r.Anindya Advocate CRL.M.C. 1188/2011 - JnEE R ,,-T.RA'-clc s:- 'TO ::1 h !i\ ,1 \/-\) i "\ \if L. ..:.l I 1'-' h - . & ORS. . .... Petitioners Through: rJJr.Sunii Gupta, Sr.Jl.dvocate Crl.M.C.No.1056/2011 1St connected matters F'<ige 5 :Jl z;r I with Mr.jatin Zaveri, Mr.Gdui·av Agarvval and Mr.Tanmaya AganArai, Advocates versu5 DESTINATIOI\! OF THE \NOHLD (SUBCOI\ITINENT) PRIVATE L··o. . .... Respondent Through: Mr.fldlindya Malhotra, CORA!i'lli: HONUBlE MR. jUSTIICE PHADEEP NANDRAjOG

¶1\1\/hether the Repo,·ters of !ucr:d papers mav b2 to see the judgment? -

¶2To be referred to Reporter or ndt?

¶3Whether the judgment should loe reported in the Digest? PRADEEP NANDRAiOG. _;1.

¶1Briefly stated tile facts ieading to of the :HlCI •t: captioned petitions are tl-'1at respondent i.e. 'Destinatior World (Subcontinent) Pvt. Ltd.' a connpany registered uncle: the Companies Act filed 15 comr::loillnts under Section 138 ·Jf the Negotiable Act, 1881 (hereinafter referred to as the 'N! Act'); 3 cheques bei11 9 the subject matter of eacll compld!int Petitioner No.1 Le. 'Shree Raj Tra ,,·21::: Tours Ltd.' a company registered under t!le Com1panies Act vvas impleaded as accused No.1 and petitioners 2 to 7 wer·e impleaded co-accused on the allegation that as Directo1·s they were incllarge of the day to da:/ affairs of the compar.y and hence were vicariously liable for the defaults Jf the company. Tile cornplaint was filed in the Court of Additici-!.')1 Chief Metropolitan (llerr-einafter referred to C!S tne CrUVI.C.I\Io.1056/2011 1St connecl:ed matte-rs 'ACMM') New Delhi, inter-alia, a·,,rerring that tlhe respo11dEnt company and the accused No.1 company had entered intc 2 agreements in tenlls whereof the accused No.1 compa ly .. had issued 45 cheques drawn on State Bank of lndicl . Mumbai Branch, in favour of tile respondent company, which cheques when present12d For encashment by the respondent company with its Banker !00 Bank New Delhi were dishonoured and upon the c:!1eques being returned the respondent company is::.ued 1·:otices ·contemp1atE::d undr:::,- proviso (b) to Section 138 Nl Jl\ct from Delhi to the a No.1 company which failed to make payment in respect cF the sum for which the cheques vvere drawn within 15 days of the receipt of the said notices. \Nitll respect to jurisdiction of tl")e Courts at Delhi rt vvas pleaded that for the reason the respondent company had presented the ch2ques in question for collection with banker !Bank situated in Delhi, the Court had the necessary

¶2may be noted at the outset tfl1at after the complaint5 were filed, the respondent company filed a suit bearin] · No.SS0/2.010 in which petitioner r'Jo.l was as defendant before tile High Court of Bombay praying for a decree to be passed in the sum for vvhich the "'' 1-5 cheques forming subject-matter ·of tile aforesaid ·complaints were issued. tile plaint, jurisdiction of th,:: Courts at IVlumbai vvas pleaded on the averment that agreement pursuant whereto tile cheques were issued wa; executed at Mumbai as also that: the cheques in question were drawn and issued at MumbaL Cri.!VLC.No.1056/2011 8, con'lecteci matte1·s Page'lcfZ' •

¶3Taking cognizance of the complaints, tile learned ACMM surT1moned the petitioners to face trial for an offen·=c: punishable under Section 138 of the N.l. Act.

¶4. Upon service of the summons, the petitioners filed application(s) under Section 1T7 Cr.P.C. inter-alia statinc1 -' that the courts at Delhi have no jurisdiction to take cognizance of complaints and prayed that complaints be to the respondent to be filed ir u-e court of competent jur.isdiction. Together with the said application(s), petitioner-s 2 to 7 filed appHcation(s) seeking exemption for personal appear--ance before Cour·=· Dismissing application(s) exemption frorn personal . appearance and keeping pending. fer consideration, application(s) filed under Section 177 Cr.P.C vide order dated 25.05.2010 the learned ACMM bailable warrants against petitioners 2 to 7.

¶5Aggrieved by the order dated 25.05.2010, petitioner:; 2 to 7 filed petition(s) under Section 482 Cr.P.C. before thi:; Court, which petitions were dismissed vide order dated

23.09.2010. Aggrieved thereto. peUtior1ers filed petitions seeking Special Leave to Appeal before tile Suprell'e which were disposed of vide oncler dated 14.1.2011 with a direction to the learned tl1at applications filed unde-Section 177 Cr.P.C. would be disposed of within 2 weeks.

¶6Vide order dated

14.02.2011 learnecl ACMIV dismissed the application(s) unde1· Secti-On 177 Cr.P.C. filec by the petitioners on the grounci IJ:at view of t,he dictur( of law !aid olown by the Supreme Court in the decision Cri.M.C.No.l056/2011 & connected matter: Page l:S or Z7 reported as (2004) 7 SCC: 338: Prasad 11 Roop La/ Jindal once the Magistrate taken cognizance of :; complaint he has no power to return the same to rh-=- complainant with a direction that the same be filed in a court of competent jurisdiction.

¶7Aggrieved by the order dated 14.02.2011 passed b\; the !earned ACMM, the have filed the above-captioned petition(s) under· Section 4B2 Cr.P.C. requiring this Court to hold that courts at Delhi have no jurisdiction to take cognizance of the complaints in question and se•2k directions to the learned ACMM to return the same for before the Court of

¶8It is the case of the petitioners that the cheques 1r1 question were drawn at Mumbai. The. drawee bank is Mumbai, notice issued by the respondent to the company was received at Mumbai and thus merely because the respondent posted the notice from and depositecl tile cheque with its bank at Delhi would not conf'·2i-jurisdiction on Courts in Delhi.

¶9The issue has to be debated Nit!l reference to Sectiori 138 of the Nl Act and the applicable provisions of the C,JdE: of Criminal Procedure i.e. Sectiorns 177, 178 and 179 of the Code of Criminal Procedure.

¶10reported as 1999 (7') sec 510 KBl1askaran V5. Sl7a"r7k_aran Vaidf1van Balan & Supreme Court: has opined, afte1· considering Sections 17t to Section 179 of the Code of Procedure, that ar Cri.M.C.I'Jo.1056/2011 & connectPd offence be completed in different localities and thus can be tried. in any Court hc;J-,;,ing jurisdiction over se1ic! localities. To put it prthily, i1n relation to territoria jurisdiction, qua an offence, la\11( :-ecognizes more tf-1an J court !laving territorial jurisdiction and the issue of territor! a:· jur-isdiction would have to be decided vvith reference tc vvhether a part of an offence \f\fclS committed withl'l territorial jurisdiction of a court. The issue is no ion,:JP:r integra and l just need to note the olecision of the Supreme Court in. KBhaskarad.s case (supra) and highlight that ·=he aforesaid is to be cuiied out fron1 paras 11 and 12 of the said decision.

¶11The next logical question 'lilfOUild be, what arE. the contours of Section 138 of the Nl /-let pertaining to acts to ce performed in relation to an offence contemplated 1:::y the said Section'? It llardly be re-em(Jhasized that it are acts cf commission or omisslon vv:llich cor',stitute offences, 'Wit!i c:; without the requisite rTlens :-ea, depending upon 'Nhether the offence is an absolute offence or not.

¶12Let me thus note Section L3Ei, Act whici'1 rea,::s .-:J::> under:-\Nhere any cheque drawn by a person on c.n account maintained by him 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 tile bank unpaid, either because of the arnount of money standin9 . to the credit of that accounl: insuffioent to llonour the cheque or that it e)(Ceeds the amount arranged to be paid frorn that account by an , Crl:tVI.C.l\lo.1056/2011 & connected matters Pag'2 1C 0f Z."J agreernent made with tlla:= bank, such person shall be dee'rtl'ed to have committed an offence and shall without to any other of· this Act, be punished w1ith 1mpnsonment for a term 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 unless-

(a) The cheque has been presented to the bank within a period of six from the date on which it is drawn or within the period of its validity, 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 a notiCe, jn 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 the said amount, of: money to the payee or, as the case may be, to the holder in due course of tile cheque, within fifteen days of the receipt of the said notice. · Explanation: For the purpose of this section. "debt or other liability" means a legally enforceable debt or other liabillity. /{

¶13In Bl7askaran's case (supra) the Supreme Court had en occasion to c!eal with the issue of territorial jurisdiction in relation to Section 138 of the Nl and of necessity, the discussion required the Supreme Court to iden_tiify various acts of commission and crr1rssion whkh constituted the offence punishable under Sectjon 138 of the Nl 1-\ct and suffice would lt be to lligl1iigl1t that in para 14 of the Cri.IVI.C.No.1056/2011 & connected maUe:s Page 11 ;Jf 27 r1 [ decision, the Supreme Court that there are 5 acts which are the components of the offence punishable under Section 138 of the Nl Act and re-produce the same from para 14 o·f the decision of the Supreme Court. Tl1ey read as under:-

(i) drawing of the cheque,

(ii) presentation of the cheque to tile bailk:,

(iii) returning the cheque by the drawee bank ..

(iv) giving notice in writing to 1:ll1e drawer of the cheque demandin_g payment of the cheque amount,

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

¶14After holding that acts wouid constitute components of an offence under Secbon 138 of the Nl Act, in paras 15 and 16 the Supreme Court absented as under:- "15. it is not necessary that a H 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 diffel-ent But a concatenation of all the above five is a sine qua non for tl1e completion of tile offe'nce under Section 138 ·of the Code. .In ti1is context a reference to Section 178( d) of the Code is useful. It is extracted below:

¶16Thus it is clear, if the five different acts were done in five different localities any one of the coUI-ts exercising jurisdiction in one of the five local areas can become the place of trial for the offence under Section 138 of tl1e Act. In other words, the complainant can any one of Cri.M.C.No.1056/201l & connected matter.:; Page lZ those courts having jurisdiction over any one of the local areas within thr2 territorial limits of which any one of those fi\1e acts was done. As amplitude stands so and so expansive it is an idle exercise to raise jurisdictional question rega1ding offence under Section of the Act." (En?phasis Supplied)

¶15On the issue of service of notice required to be give1: by the complainant to the the Supreme Ccurt observed as under:- "17. The more important point to be decided this case is wl'lether the cause of action has arisen at all as notice sent by complainant to the accusecf \Nas . returned as "unclaimed". The conditions pertaining to the notice to be given to the drawer, have been formulated and incorporated in clauses (b) to {c) of the proviso to s·ection 138 of the Act. The said clauses are extracted below:

¶18On the part of the payee he has to make a demand by a nobce'' in writing. that was the only requirement to complete offence on the failure of tile drawer to pay t.lle cheque amount within 15 clays from the elate of such "tgiving" ,- the of the prosecution would have been very mucil lessened. But the legislature says that failure on the part of the drawer to pay the amount should be within 15 clays "of tile receipt" of the said notice. it is, therefore, clear that ''giving notice" in the context is not the same as receipt of notice. Giving is a process of which receipt is accomplishment. It is for tile payee to perform the former process by sencl11ng notice to the drawer at tile correct address . . Crl.fV1.C.No.1056/2011 8t connected matters · 20. If a strict interpretabori. is given that the drawer should have actually 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 cheque drawer would get the premium to avoid the notice bv different str·ategies and he could escape from legal consequences of Section 138 of the Act. it must be borne ih mind that the court should not adopt an interpretation which helps a dishonest evader arid clips an honest payee as that would defeat the very legislative measure. 21 ..... The context envisaged in Section 138 of the Act invites a liberal interpretation for the person who has the statutot-y to give notice because he is presumed to be the loser in the transaction and it is for his interest the very pt-ovision is made by the 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" by giving noticE. The thrust in the clause is on tile need to "make a demc1nd". It is only the nnode for making such deman1,d which the legislature has prescribed. A payee can send the notice for doing part for giving the notice. Once it is despatched his part is over and the next depends on wheitthe sendee does.

¶22It is well settled that a notice refused to be accepted by th·e addressee can be presumed to have beeh served on him (vide 1-farcharan Singh v. Sh!vranf2 and jago'ish Singh\/. l\latthu Singh3).

¶23the notice is r-eturned as undaimed and not as refused. \J\/ill there be any signincant difference betvveen tt1e tv1ro so far as the presumption of service is r::oncerned? !n this Crl.iVI.C.No.1056/2011 & mane-s Hoi ";_7 .. :. ,_ connection a reference 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 gi\ren only by "post". Nonetheless the. pri :lC; pie 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 have been senied on the sendee unless he proves that it vvas not really served and that he was not for such non-service. f.\ny other interpretation can Jeacl to a very tenuous position as the dra\IIJer of the cheque vvho is liable to pay the amount would resort to the strategy of by successfuHy avoiding the notice.

¶25Thus, when a notice is returned by the sendee as undaimed such date would be commencing date in reckoning the period of 15 days contemplated in clause (c) to the proviso of Section1 138 of the Act. Of course such reckoning would be without prejudice to the right of the drawer of the cheque to ::. 1llOVIf that he had no knowledge that the notice 1rvas brought to his address. In the present case the accused did not even attempt to· discharge th'e burden to rebut presumption .. ·' (Etnphasis Supplied)

¶16The expr·essions: }...1resentation of t/1e cheque to t.he Bank/ a.nd 'if the five different acts were done in _/ive different localities any one of the· courts exerciS/r.lg jurisdiction in one of the five loca/ areas can becot77e the p/ace of trial for the otFence unde-Section 138 ol the .4ct' '-.c be found in paras 14 and J 6 1"=='5pectiveiy in case (supra) have been U1'lderstcJo1 by many to mean t!-ii3t Cri.M.C.No.l056/2011 & conre:cted n12tLers z, I the CoUit within local limits· of wnich the payee Bank i e Bank whete the complainant rleposited the cheoue i; situated has. the jurisdiction to try the complaint ur'de-Section 138 of the Nl Act, and the understanding appears to be fortified by the observations of the Supreme Court in paras 15 and 16 that if the 5 acts as tilE' ingredient of an offence under Sect'ion 138 of the were clone in 5 different localities, any one of the court exercising jurisdiction in any one of tile 5 local areas 'Jvculc: have jurisdiction.

¶17But, it is apparent that the in para 15 and 16 are an obiter as it is not : places where the S constituting an offence under Section 138 of the Act can possibly be performed. The act:; can be performer::], as would be explained hereinafter, 01111y at 4 piaces and vvoL;id immediately state that act No.2 and act No.3 t0 oniy one place i.e. the place where the drawee bank is located.

¶18The second and the third act, of the 5 listed by the Supreme Court, as constituting thr:2 offence under Section 138 of the Nl A.ct are: (a) presentation of the cheque t::;. the bank; and (b) returning the chequr:= unpaid by the dravvee bank.

¶19The third act is the retur-n of tile cheque unpaid by tile bank and thus there is no scope for any ar<gui-nent as to which bank is contemplated wit1!1 reference to the said act. The second act pertains to act of presentation of cheque to tile bank. i highlight til:jt the twin words used are 'the bank'. Cri.M.C.No.1056/2011 connected mc:tters

¶20the decision reported as 2001 (3) SCC 609 Shri !sl7ar Allov Steels Ltd. Vs. !a.vaswals Neco ltd., a 3 Judge Bench of the Supreme Court, !'laving as a member of the Bench the author of the judgment in Bhaskaran's case (supra), dealt with and as to what would be meant by 'the bank' as mentioned in Section 138 of the Ni Act. Was it the drawee bank or the payee bank? The Supreme Court answered the question in the following words:- "2.

(a) \/\/hat is 111eant by, ''the bank" as mentioned in clause (a)l of the proviso to Section 138 of the Negotiable !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 cheque is to be presented for purposes of attracting penal provisions of Section 138 of the Act?, are the questions to be determined by this Court in this appeal.

¶7n has further tc: noticec! that to make an offence .. under Section 138 of the Act, it is mandatory that the cheque is presented to "the bank" within a period of six months from the date on which1 it ls drawn or within the period of its validity, whichever is earlier, is the cheque drawn which has to be presented to "the bank" the period specified therein. When a post-dated cheque is written or drawn, it is only a bill of exchange. The post-elated cheque become a cheque under the Act on tile date which is written on the said cheque a ncl the six montlls' Cri.M.C.No.1056/2011 8t connected m.'lttei'S Page 17 of "".!.7 periocl has to be reckoned, for the purposes of Section 138 ofthe Act from the said date.

¶8Section 138 provides that \Aihere any cheque drawn by a· person on an account maintained bv hirn with a ".banker' for payment of any amoun-t 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 becau5e of the amount of money standing to the creok of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid frorr: that account by an agreement made with that bank, such person shall be deemed to have commiitted an offence punishable with imprisonment as prescribed tl1erein subject to the conditions mentioned in dauses (a), (b) and

(c) of the proviso. Sectior-1 3 of the Act defines the "banker' to include any person acting as a banker arid any post office savings bank. Sectfon 72 of the Act provides that a cheque must, in order to charge the drawei-,, be presented at tl1e bank upon which it is drawn before the relations between the d,-awer and banker has been altered to the prejudice of the dr-awer.

¶9The use of the \Nords "a bank" and "the bank" in the section is an .indicator of the intenbon of the legislature. The former. is an indirect (sic indefinite) articie and the is prefixed by a direct (sic definite) artide. if the legislature intended to have the sam(:: meanings for "a bank" and "the bank", then: was no cause or occasion for·. mentioning) it distinctly and differently by using two different articles. It is worth noticing that the wol-d "banker" in Section 3 of the Act is prefixed by tile indefinite article "a" and the word "bank'' wl1ere the cheque is intended to be presented under Section 138 is prefixeci by the definite artide '''the". The same section permits a person to a cheque on an account n1aintained by hirn "a bank" and Cri.I\Jl.C.No.1056/2011 8( makes him liable for crirT1inal 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. "Trr-re" is the word used before nouns, with a specifying or particularising effect as opposed to indefinite or generaiising force of "a" 01- '''an". rrt 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 or a person. "The" would, therefore, refe1· implicitly to a specified banlk: and not any bank. "The bank" referred to in clause

(a) to the proviso to Section 138 of the Act would mean the drawee bank on which the cheque is drawn anc' not all banks vvhere the crr1eque is presented for collection including the b1ank of the payee. ir whose favour the cheque is i::;sued.

¶10it, however, does not mean that the is always to be presented to the drawer's bank on whkh the cheque is issued. The payee of thE cheque has the option to pn:sent the cheque !,1 any bank including the collecting bank where he has his account but to attract the criminal liability of the drawer of the cheque such collecting bank is obliged to _rgresent the cheque in the drawee or pavee bank on which cheque is drawn within the period of six months from the date on whicli it is shown to have been issued ........ The non-presentatjon of the cheque to the drawee bank within the period specified in the section would absolve tl1e person issuing the cheque of his criminal liabil,ty under Section 138 of the Act, who shall otherwise may be liable to pay the cheque amount to the payee in a civil action initiated under the A combined readinq of Sections 3, 72 and 138 of the 1-l.ct would leave no doubt in our mind that the mandates the cheque to at the barik on which it is drawn if the drawer is to be held criminally liable. Such presentation iS Ci'I.M.C.No.l056/2011 & connected m?.tterc /' l) ' ' L , necessarily to be made six months at the bank on which the is drawn, whether presented personally or th,-ouqh namely, collecting bank of the payee." (Emphasis Supplied)

¶21the decision in lshar JJ!!IoJ/s case (supra) 'lo5 been rendered in the context cf .limitation for presentaticn of a cheque, tl1e said decision brings out in no uncert:J1 r: terms that Section 138 of tile 1\H .A.ct contemplates that c cheque is required to be present·2d for encashment to the drawee Bank and tll·at the Bank, merely ar.::ts as an agent of the payee/complainant for the purposes oF presenting the cheque in questir:;1n for encashment to tn::· drawee Bank.

¶22Til US, the 2nd act to which the S.upreme Court "·efen-e j to in Bl7askaran's ca::e: as one of the 5 whicr1 const!tut:2s t.i1-:: offence under Section of tlile Act vvas til:: pr-esentation of the cheque l':o the drawee bank an::J need\.ess to state the 3'd act constitutes an of the offence· Is t!'1e return of the cheque unpaid by th·: drawee bank and t!1us it becomes cry·stal clear that the and 3 1-d act constituting the offence \1\IOLlld relate to cn\y on': place i.e. the p!ace vvhere the drawee bank is located.

¶23These are my humble l(easons to hold that lJ1e observations· in paras 15 and 16 have to be read CiS an orbitet-and thus the 5 acts conterr1_plated as constituting the offence are of being performed not in 5 but oniy in 4 places and since deposit of the cheque with the !J bank is not an act conternplatec! as; an ingredient 'chc: offence, the place vvi1ere the payee bank located would be· Crl.M.C.No.1056/2011 8( connected mat',ers irrelevant for purpose=; of deteiTnirdng jurisdiction of the criminal court.

¶24It is settled law that a decision is an authority -=or the point it decides and ·not wllat can be logically deduce] tl1erefrom and the ratio of a dec:isijon has to be 9athered with reference to the facts of a and highlight 0111; one decision of the Supreme Court being the dec1sio l reported as Dhodha House II S:K

(2006) 9 sec 4l

¶25The matter regarding jurisdiction can also be dec;c!ed with refe'rence to Section 6, ecbon 7, Secbon 64 and Section 72 of the Nl )},ct.

¶26The relevant portion of Section 6, Section and Section 54 of ar·;d 72 of the Nl J'Kt read:_; ·under:- Section 6. Cheque: - A ":::heque" is a bill of exchange drawn on a specified banker· and not expressed to be payable otherwise than on demand and it mciudes the eiectronic image of o truncated cheque and a cheque in the electronic form. )( )( . )( Section 7. The maker of a biH of exchange or Cheque is ca II ed tile- "ci rawer"; per:: of-, thereby· directed to pay is called tile "Drawee". X )( Section

¶64Presentment for payment.

(l)]Promissory notes, biHs of exchange and cheques must be presented for payment to the maker, acceptor or drawee thereof respectively, by or on beh2lf of the holder as hereinafter provided. !n default of such1 presentment Cri.fVI.Ci\lo.1056/2011 8t conrlf'cteci rr:znters other part(e.s thereto are nut nable thereon to such holder ....... . X )( )( Section 72. Subject to prov1s1ons of section 84 a cheque must, in order to charge the drawer, be presented at the bank upon whic!h 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 also of Section 138 of the Nl Act out that in order to attract penal provisions of Section 138: ·Ci'f the Act a chequc2 is required to be presented enc:asrhment to the drawee Bank and that the payee Bank acts merely as an agent of the payee/complainant for the purposes of presenting cheque in question to the dravvee Bank. The necessar-y corollary thereof is "that no part of cause of action for the offence punishable under SectioP 138 of the Act ',rl the Court within the ,local limits of which the coHecting Bank ofthe i.e. payee Bank is situated and thus saic Cou1-t has no jurisdiction to try a complaint under Sect!or 138 of the Nl Act filed by the complainant.

¶28This takes me to tile consideration of second questior involved ln the present case i.e, whether the court with i r local liimits of which p!ace from where the: complainant had sent a notice under prov'sc

(b) appendecl to Section 138 of the .Act is situated has jurisdiction to try a complaint filed under Section 138 NlAct. Cri.1Vl.C.I\Io.1056/20U & connected l'latt::!rc:

¶29I have already noted the observations made by tre Supreme Court in Bhaskaran's case (supra) in the foregoing paras and would highlight that in paras 17 to 23 the Supreme Court has reflected upon the limitation 1Nitilin which the notice has to be ghren to the accused. The Supreme Court was considerin'J the expression 'givin9 a notice' in proviso

(b) to Section 138 of the Nl J\ct with reference to the 15 days' time contemplated then by vvr:icr; the requisite notice had to be served, which time is now -:?( days.

¶30Another decision of the SLpt"eme Court, reported as

(2009) 1 SC:C 720 Harman Electronics Private Lirnitec' v National Panasonic India Private / io1ited is worth noting on the subject.

¶31In Hannan's case (supra) the question which had arisen before the Supreme Cour,= was precisely the 5arne .question which arises for consideration in the presen:= petition i.e. whether the court within the of vvhicl-, the place from where the !1ad sent a :lclicc contemplateol under-pr_oviso (b) to Section 138 of the 1\P .il.ct is situated has the jurisdiction to try a complaint filed under Section 138 of the Act. trne aforesaid question in the negative, the Supreme Court observed as under:- "12. . .... The on iy question,, therefore, which arises for consider-ation is ·that as to wl1ether sending of notice from Delhi would give rise to a cause of action for taking cognizance under the Negotiable jnstruments Act. CrUVl.C.No.1056/2011 r'St connected matters Page 23 ot n

¶13it is one thing to say that sending of a notice is ·one· of the inQJredients for maintainino 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 comrntted an offence under Section 138 of the Negotiable Act, i ng red ients thereof are req uireol to !Je proved. VVhat would an offence is stated in main The proviso appended thereto, however, imposes cert3 in further conditions which are required to be fulfilled before cognizance of the offence ca:n be taken. If the ingredients For constitution of the: offence laid down in provisos

(a), (b) anal (c) appended to Section 13B of the Negotiable Instruments A1ct are intended to be applied in favour of the ae<;:used, there cannot be any doubt that receipt of a notice woulld ultimately ,give rise to the cause of action for fi!irng a complaint Jfj,s t 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 proviso to Section 138 therefore must be read together. issuance of notice would not by itself qiive rise to a cause of action but communication of the notice would . ....... For constitution of an offence under Section 138 of the Act, tile 1rnust be received by the accused. !t may be jeemed to have been ,-eceived in certain situations. The word "communicate'·' inter-alia means "to make known, inform, convey, etc".

¶20. .. :. t-\ court derives c:: jurisdiction only when the cause of action arose its jurisdiction. The same cannot be con-Ferred by any act of omission or commission on the part of the accused. ,!.}, distinction must also be borne in mind between the ingredient of an offence commission of a pan= cf ;r:he offence. VVhil2 _issuance of a notice by thE holder of a negotiable Cri.M.C.!\Io.1056/2011 & connected matters Pag2 2.4 o' 27 is necessary,. service thereof is al5:o Imperative. :Only on a service of such notice and failure on the part of the accused to pay the demanded arnount withdl a period of 15 days thereafter, commission of an offence completes. Giving of notice, therefore, cannot have· any precedent over the service. It is only from that view of the matter that in Daln7ia Cement (Bharat) Ltd. v. Galaxy Traders S Agencies Ltd emphasis has been laid on service of notice." (Ernphasis Supplied) Court in .llfJaskar,?n and lfanr;a.n,.s cases (Stipra) ;t IT;3y strike to the reader that there is a conflict between t:1e t1vc decisions inasmuch as in 817askaran's case (supra) it ·Jv3:: held that the expression 'gi!/ing of notic;e' occu:--ing ir proviso (b) to Section 138 of the Act means ·sending or notice' whereas in Hannan's case (supra) it was held t1-1at the said expression means 'receipt ol notice'.

¶33A careful reading o-f the tvvo decisions shows that is no conflict betvveen the said inasmuch o1s i'ave been renderec\ :n contexts. The decision in Bhaskaran's case (supra) was rendered in the. context Jf sta ng poirit of of 15 days prescri •Jed in proviso (b) to Section 138 of Uv::-: r,n Act and was in na: context i.e. H1e context of limitation that it was held oy t-.e Supreme Court tllat e)qJ!-ession giving of noricc::" occurring in proviso (b) to Section 138 of the Nl Act 'sending of notice'. The decision in Harn1an's cas,e was rendered in the context c:f cause of action for filir;g a complaint under Section 138 Nl 1:1ct within of a particular court anc\ in ti--.ct it was held by u-.e O!.IV1 C.No.1056/20l1 8t connected m.=ntr.:rs :Page ?..5 or c}:7 Supreme t:::ourt that expression gfvlng ol not/ce' occurring in proviso (b) to 138 of the Nl ,L\ct IT!'2ans 'receipt .

¶34Now, same expression can have different in different context as held by· tt1e Supreme 'court in 1 lle decision reported as Majik La! /V/aju;ndar v Chandra Dey (2004) 12 SCC 448 wherein it was obse,-veci that a word i1·1 a s.tc;,tutory provision can have different meanings in different context the sarn:=: statute.

¶35Thus, the inevitable concJusion would be that the act contemplated · as an ingredient of the offence as highlighted in Bhaskaran's casc2 i1.e. 'giving notice in writi,lg to the dra we/ of cheque' den7anciJng pay;nent of the cheo,Je amount, for purposes of limitation! would have a meaning as explained in Bhaskaran's case and for purposes of jurisdiction would have a as explained in lsl73r A//oJ(S case (supra).

¶36Before concluding I vvould oe failing not to lodge a caveat. With banking and facility payable at pdr of clearance provided by bankers· and especially n metropolitan cities, vvllere cheques a1-e cleared by not beir-g presented to the drawee bank but at nodal branches of concerned banks, tile subject matter of jurisdictior, may have to be decidec keeping in vievv that the dravvee ba:1k has created an agency wllere the cheque in question ·s t1··c;nsmitted for clea(ance and U:e situs whe1-e the takes place would then arguably become the place Crl.M.C.No.1056/2011 8t connected Page Zfi ot 27 I ,, I I ·.:.1. ;.1 (I ·.J I h !;__ the cheque woulcl be required to be treated as presented ·:o 'the bank' Le, the drawee bank. t;3ut, in such circumstances, constituted pleadings llave to be found in a complaint and lodging tile caveat, i leave it at that for the debate to be properly argued in an appropriate case VIit:l the necessary relevant pleadings. 37, hold on the in the complaint(sL nJ part of cause of action can he s.aid to have accrued to complainant at Delhi; that tile notice demanding paym2nt was posted from Delhi and HloJt the cheque was with the payee bank at Delhi vvould not constitute the contemplated as ingredients of an offence punishable u!-i ]er Section Act and tllus i dispose of the petitions quashing the.impugned order(s) dated 14.2.2011 and di1·2c: learned ACMM to return complaint(s) to ·:he respondents for filing in a Court having territ:rial juhsdiction.

38.. No costs. SEPTEMBER 21; 2011 mm Cri.M.C.No.1056/2011 & connected nvntet"s - :· r;· ., ... <'--' ;:'.:-\'·'.;-.,_ .... , (\ ij (PRADEEP NANDRAJOG) .. JlUDGE Page 27 r:f ::U

* IN THE HIGH COURT OF! DELHI AT NEW DELHI % Judgment reserved on: Jffh September, 2011 Judgment pronounced on: 21st September, 2011 + CRL.M.C., 1183/2011 SHREE RAJ TRAVELS & TOURS LTD. & ORS. . .... Petitioners Through: Mr.Sunil Gupta, Sr.Advocate with Mr.jatin Zaveri, Mr.Gaurav Aga1rwal and Mr.Tanmaya Agarwal, Advocates versus DESTINATION OF THE WORLD (SUBCONTINENT)PRIVATE LTD. .. ... Respondent Through: Mr.ftJnindya Malhotra, Advocate CORAM: HON'BLE MR. JUSTICE PRADEEP NANDRAJOG 7. Whether the Reporters of local papers may be allowed to see the judgment? 8. To be referred to Reporter or not? 3. Whether the judgment should be reported in the Digest?