16 September 2007
Before accepting any case under section 138 of NIA what test are required at present. I want reference of case in which it is decided. If possible the copy of judgement of supreme court may also be provided.
2000-(099)-COMPCAS -0526 -AP NAGESHWARA RAO v. B. V. SUBBAIAH AND ANOTHER. Criminal Revision Cases Nos. 1086 and 1087 of 1998 and Criminal Revision Petitions Nos. 1083 and 1084 of 1998, decided on December 8, 1999. IN THE ANDHRA PRADESH HIGH COURT
M. Chandrasekhara Rao for the petitioner.
T. Rajendra Prasad for respondent No. 1.
Public Prosecutor for respondent No. 2.
JUDGMENT
K. B. SIDDAPPA J. - These revisions are connected. Therefore, they are disposed of by a common judgement.
The complainant is the father of one B. Kalpana who is having a promissory note in her favour for the amount she advanced to the accused. She endorsed on the promissory note "to collect" the contents of the promissory note. Thereupon, the complainant issued statutory notice to the accused. The accused issued cheques for the amount claimed. When the cheques were presented, they bounced and thereupon after the statutory period the criminal complaint against the accused was filed. The trial court after considering the evidence on record found the accused guilty of the offence punishable under section 138 of the Negotiable Instruments Act, and was directed to undergo R.I. for six months and to pay a fine of Rs. 500 and in default to suffer S.I. for three months, in each case. On appeal, the judgments and sentences were confirmed.
Hence, the revisions.
M. Chandrasekhar Rao, appearing for the petitioner/accused in both the revisions submitted that the complainant has no locus standi to file the complaint. It is true that he is admittedly a payee under the two cheques, but there is no enforceable debt as far as the petitioner and the payee are concerned. Therefore, the essential ingredients of section 138 of the Negotiable Instruments Act, are not made out by the complainant and the revisions are to be allowed. He also submitted that by the endorsement, the complainant becomes a holder. A holder cannot entertain any complaint. As per section 138 of the act, the words "any amount of money to any person" appearing in the main enacting clause are not defined and a mere holder or an endorsee without consideration cannot maintain the action.
In support of his contention, learned counsel for the petitioner relied upon the Bench judgment of this court in B. Mohan Krishna v. Union of India [1995] 1 ALD 393 (DB); [1996] 86 Comp Cas 487. In that case, the Bench held as follows (page 512 of Comp Cas):
"Section 138 is not couched in precise language. Apart from being vague, it is likely to be misinterpreted in a manner different from what was intended by the law making body, and this is because of the words 1payment of any amount of money to another person' appearing in the main enacting clause. The words 'another person' are not explained. This at the first blush gives an incorrect impression that the words 'another person' mean only a 'payee' and that the sweep of the offence is confined to the drawer and the payee. We, therefore, hold that both the payee and holder in due course are covered by the expression 'another person' but not a mere holder or endorsee without consideration."
The Bench of this court is specific that a mere holder or endorsee without consideration cannot come within the purview of the words "another person". Action can be maintained only by a payee or a holder or a holder in due course and no other person.
Referring to the above paragraph, Mr. Chandrasekhar Rao, submitted that the complainant in this case is a mere holder. Though he is a payee, he is a payee without consideration. The consideration is only due to his daughter. He is the holder without consideration. In other words, he is an endorsee without consideration. Therefore, the ratio of the Bench judgment cited above squarely applies to the facts and circumstances of this case and the complainant cannot be clothed with the authority to file the complaint.
At the first sight, the submission is quite feasible. But there is a twist in this case. The complainant is not a mere holder. It is true that he is the endorsee without consideration. But the endorsement here is "to collect". That endorsement clothes the complainant with the authority to issue notice and realise the amount by a filing civil suit and also a criminal complaint. Therefore, the ratio of the Bench judgment cannot squarely be applied to the facts of this case. In pursuance of the authority given to the complainant "to collect", he issued the notice and cheques were given in the name of the complainant. Therefore, he became the payee under the cheques. When the cheques bounced, certainly he can file the complaint to enforce his duty "to collect" the amount under the instrument. Such a step is taken by the complainant in this case. Therefore, it cannot be said that the complainant has no authority to file the complaint. I hold accordingly.
In this case, there is no dispute with regard to the facts. There is default on the part of the petitioner/accused. All the ingredients of section 138 of the Act are made out. It is brought to my notice that the complainant has already filed the suit and a considerable amount was already recovered. Moreover, immediately after service of summons, the petitioner/accused showed his readiness to pay all the amounts by way of demand drafts. The complainant was not inclined to receive the same. The photostat copies of the drafts are also filed before this court. Taking all these aspects into consideration, I confine the sentence to the period already undergone by the petitioner in both the cases. Further, no substantial fine can also be imposed in these cases because a major portion of the amount is already paid. In the circumstances, I uphold the fine amounts and the default clauses imposed by the court below. With the above modifications, the criminal revision cases are disposed of.
2000-(099)-COMPCAS -0526 -AP NAGESHWARA RAO v. B. V. SUBBAIAH AND ANOTHER. Criminal Revision Cases Nos. 1086 and 1087 of 1998 and Criminal Revision Petitions Nos. 1083 and 1084 of 1998, decided on December 8, 1999. IN THE ANDHRA PRADESH HIGH COURT
M. Chandrasekhara Rao for the petitioner.
T. Rajendra Prasad for respondent No. 1.
Public Prosecutor for respondent No. 2.
JUDGMENT
K. B. SIDDAPPA J. - These revisions are connected. Therefore, they are disposed of by a common judgement.
The complainant is the father of one B. Kalpana who is having a promissory note in her favour for the amount she advanced to the accused. She endorsed on the promissory note "to collect" the contents of the promissory note. Thereupon, the complainant issued statutory notice to the accused. The accused issued cheques for the amount claimed. When the cheques were presented, they bounced and thereupon after the statutory period the criminal complaint against the accused was filed. The trial court after considering the evidence on record found the accused guilty of the offence punishable under section 138 of the Negotiable Instruments Act, and was directed to undergo R.I. for six months and to pay a fine of Rs. 500 and in default to suffer S.I. for three months, in each case. On appeal, the judgments and sentences were confirmed.
Hence, the revisions.
M. Chandrasekhar Rao, appearing for the petitioner/accused in both the revisions submitted that the complainant has no locus standi to file the complaint. It is true that he is admittedly a payee under the two cheques, but there is no enforceable debt as far as the petitioner and the payee are concerned. Therefore, the essential ingredients of section 138 of the Negotiable Instruments Act, are not made out by the complainant and the revisions are to be allowed. He also submitted that by the endorsement, the complainant becomes a holder. A holder cannot entertain any complaint. As per section 138 of the act, the words "any amount of money to any person" appearing in the main enacting clause are not defined and a mere holder or an endorsee without consideration cannot maintain the action.
In support of his contention, learned counsel for the petitioner relied upon the Bench judgment of this court in B. Mohan Krishna v. Union of India [1995] 1 ALD 393 (DB); [1996] 86 Comp Cas 487. In that case, the Bench held as follows (page 512 of Comp Cas):
"Section 138 is not couched in precise language. Apart from being vague, it is likely to be misinterpreted in a manner different from what was intended by the law making body, and this is because of the words 1payment of any amount of money to another person' appearing in the main enacting clause. The words 'another person' are not explained. This at the first blush gives an incorrect impression that the words 'another person' mean only a 'payee' and that the sweep of the offence is confined to the drawer and the payee. We, therefore, hold that both the payee and holder in due course are covered by the expression 'another person' but not a mere holder or endorsee without consideration."
The Bench of this court is specific that a mere holder or endorsee without consideration cannot come within the purview of the words "another person". Action can be maintained only by a payee or a holder or a holder in due course and no other person.
Referring to the above paragraph, Mr. Chandrasekhar Rao, submitted that the complainant in this case is a mere holder. Though he is a payee, he is a payee without consideration. The consideration is only due to his daughter. He is the holder without consideration. In other words, he is an endorsee without consideration. Therefore, the ratio of the Bench judgment cited above squarely applies to the facts and circumstances of this case and the complainant cannot be clothed with the authority to file the complaint.
At the first sight, the submission is quite feasible. But there is a twist in this case. The complainant is not a mere holder. It is true that he is the endorsee without consideration. But the endorsement here is "to collect". That endorsement clothes the complainant with the authority to issue notice and realise the amount by a filing civil suit and also a criminal complaint. Therefore, the ratio of the Bench judgment cannot squarely be applied to the facts of this case. In pursuance of the authority given to the complainant "to collect", he issued the notice and cheques were given in the name of the complainant. Therefore, he became the payee under the cheques. When the cheques bounced, certainly he can file the complaint to enforce his duty "to collect" the amount under the instrument. Such a step is taken by the complainant in this case. Therefore, it cannot be said that the complainant has no authority to file the complaint. I hold accordingly.
In this case, there is no dispute with regard to the facts. There is default on the part of the petitioner/accused. All the ingredients of section 138 of the Act are made out. It is brought to my notice that the complainant has already filed the suit and a considerable amount was already recovered. Moreover, immediately after service of summons, the petitioner/accused showed his readiness to pay all the amounts by way of demand drafts. The complainant was not inclined to receive the same. The photostat copies of the drafts are also filed before this court. Taking all these aspects into consideration, I confine the sentence to the period already undergone by the petitioner in both the cases. Further, no substantial fine can also be imposed in these cases because a major portion of the amount is already paid. In the circumstances, I uphold the fine amounts and the default clauses imposed by the court below. With the above modifications, the criminal revision cases are disposed of.
17 September 2007
Thank you for giving the details of case. Actually in addition above I am in need of tests decided by the supreme court for accepting any case under section 138 of NIA 2002
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