KAMLESH KUMARversusSTATE OF BIHAR & ANR.

                  [2013] 12 S.C.R. 793


                   KAMLESH KUMAR                            A
                            v.
                STATE OF BIHAR & ANR.
           (Criminal Appeal No. 2083 of 2013)

                  DECEMBER 11, 2013
                                                            8
     [K.S. RADHAKRISHNAN AND A.K.SIKRI, JJ.]

    Negotiable Instruments Act, 1881:

      s. 138 - Dishonour of cheque - Legal notice not sent c
within 30 days of the knowledge of such dishonor- Held: The
right to present the same cheque for second time is available
to complainant - However, period of limitation is not to be
counted from the date when the cheque in question was
presented in the first instance or the legal notice was issued o
in that regard asmuchas the cheque was presented again -
After the cheque is returned unpaid, notice has to be issued
within 30 days of the receipt of information in this behalf- It
is clear from the averment made by the complainant himself
that he had gone to the bank for encashing the cheque and E ,
found that because of unavailability of sufficient balance in
the account, the cheque was bounced - In view of this
admission in the complaint about the information having been
received by the complainant about the bouncing of the
cheque on the date of presentation of the cheque itself, no F
 further enquiry is needed on this aspect - Thus, the
 complaint filed by him was not maintainable as the legal
 notice was not issued within 30 days from the date of
 information.

     Respondent no. 2 presented a cheque second time · G
on 10.11.2008. After it was dishonoured, he issued legal
notice dated 17.12.2008 to the appellant, and thereafter
filed a complaint on 7.1.2009, u/s 138 of the Negotiable

                            793                              H
     794      SUPREME COURT REPORTS           (2013] 12 S.C.R.

 A Instruments Act, 1881 against the appellant for dishonour
   of the said cheque. The appellant filed a petition u/s 482
   of the Code of Criminal Procedure, 1973 for quashing of
   the order dated 28.10.2009 whereby the Court ot
   Magistrate had taken cognizance of the complaint and
 B issued summons to the appellant. The case of the
   appellant was that he was a doctor by profession; that
   he found certain cheques, some signed and some
   unsigned, missing from his clinic in December 2006 in
   respect of which he gave information to the Sub-
 C Divisional Officer on 30.12.2006; that the cheque in
   question was also one of those stolen cheques. The High
   Court dismissed the petition holding that trial had
   commenced and two witnesses had already been
   examined and discharged.
 D         Allowing the appeal, the Court
        · HELD: 1.1. In the instant case, the complainant had
    not filed the complaint on the dishonor of the cheque in
    the first instance, but presented the said cheque again
  E for encashment. This right of the complainant in
    presenting the same very cheque for the second time is
    available to him under the provision of s.138 of N.I. Act.
    The act of the complainant in presenting the cheque
    again cannot be questioned by the appellant. [para 8-9]
· F [800-D; 801-C-D]

          MSR Leathers vs. S.Palaniappan & Anr. 2012
                  =
     (9) SCR 165 (2013) 1 sec 177 - relied on.

        1.2. However, period of limitation is not to be counted
. G from the date when the cheque in question was
    presented in the first instance on 25.10.2008 or the legal
    notice was issued on 27.10.2008, inasmuch as the
    cheque was presented again on 10.11.2008. For the
    purposes of limitation, in so far as legal notice is
  H concerned, it is to be served within 30 days of the receipt
      KAMLESH KUMAR v. STATE OF BIHAR               795

of information by the drawee from the bank regardi!'lg the A
return of.the cheque as unpaid. Therefore, after the
cheque is returned unpaid, notice has to be issued within
30 days of the receipt of information in this behalf. That
is the period of limitation provided for issuance of legal
notice calling upon the drawer of the cheque to make the 8
payment. After the sending of this notice 15 days time is
to be given to the noticee, from the date of receipt of the
said notice to make the payment, if that is already not
done. If noticee fails to make the payment, the offence can
 be said to have been committed and in that event cause C
 of action for filing the complaint would accrue to the
 complainant and he is given one month time from the
 date of cause of action to file the complaint. [para 11]
 [804-C-G]
       1.3. After the judgment was reserved, the D
  complainant filed the affidavit alleging that he received
  the bank memo of the bouncing of cheque on 17.11.2008
  and therefore legal notice sent on 17.12.2008 was within
  the period 30 days from the date of information. However,
  it is clear from the averment made by the complainant E
  himself that he had gone to the bank for encashing the
  cheque on 10.11.2008 and found that because of
  unavailability of sufficient balance in the account, the
  cheque was bounced. In view of this admission in the
· complaint about the information having been received by F .
  the complainant about the bouncing of the cheque on
  10.11.2008 itself, no further enquiry is needed on this
  aspect. [para 13] [805-C-F]
     1.4. It is, thus, apparent that the complainant received
 the information about the dishonor of the cheque on G
 10.11.2008 itself. However, he did not send the legal
 notice within 30 days therefrom. Thus, the complaint filed
 by him was not maintainable as it was filed without
 satisfying all the three conditions laid down in s.138 of
 the N. I. Act as explained in para 12 of the judgment in H
                                                       '
    796       SUPREME COURT REPORTS                [2013] 12 S.C.R.


A the case of MSR Leathers. The impugned order of the
  High Court is set aside. As a consequence, petition filed
  by the appellant u/s 482, Cr.P.C. is also allowed and the
  complaint of the complainant is dismissed. [para 14-15]
  [806-C-E]
B                         Case Law Reference:
          2012 (9) SCR 165         relied on              para 8
        CRIMINAL APPELLATE JURISDICTION : Criminal Appeal
    No. 2083 of 2013.
c       From the Judgment and Order dated 01.11.2012 of the
    High Court of Patna in CRLM No. 6772 of 2011.
        Manan Kr. Mishra, Akhilesh Kumar Pandey, Sudhanshu
    Saran, Swati Chandra for the Appellant
D
         Samir Ali Khan, Nitin Kumar Thakur, Anilendra Pandey,
    D.K. Thakur for the Respondents.
          The Judgment of the Court was delivered by
          A.K. SIKRI, J. 1. Leave granted.
E
       2. The appellant herein is facing trial in the complaint filed
  by respondent No.2 under Section 138 of the Negotiable
  Instruments Act (N.I. Act for short). According to the appellant,
  criminal complaint is not maintainable and no such proceedings
F could be launched against him. He, therefore, approached the
  High Court of Judicature at Patna in the form of a petition under
  Section 482 of the Cr.P.C. for quashing of the order dated
  28.10.2009 whereby the Court of Magistrate had ta~en
  cognizance of the complaint filed by the respondent No.. 2
G issued summons to the appellant. This petition, however, has
  been dismissed by the High Court vide impugned judgment
  dated 1.11.2012. The solitary reason given by the High Court
  while dismissing the petition is that trial has already
  commenced and two witnesses have already been examined
H and discharged. Hence, at this stage it would not be proper to
       KAMLESH KUMAR v. STATE OF BIHAR                        797
                 [A.K.SIKRI, J.]
interfere with the trial. Various contentions which were raised       A
by the appellant questioning the very maintainability of the
complaint under Section 138 of the N.I. Act are not gone into
by the High Court with the observations that those contentions
would be available to the appellant before the trial court, subject
to the rebuttal of respondent No.2.                                   B

3. Mr. Mishra, learned senior counsel appearing for the
appellant submitted that even on admitted facts the complaint
was untenable as it was clearly time barred and not filed within
the stipulated period prescribed in law and therefore the High        C
Court could not have scuttled the issue raised by the appellant
by merely relegating the appellant to the trial court when the
issue could be decided on the admitted facts on records. He,
further, submitted that the appellant had approached the High
Court without loss of any time and if during the pendency of the      D
petition filed by the appellant under Section 482, Cr.P.C., two
witnesses had been examined in the meantime, that factor
could not have weighed against the appellant.

    4. In order to understand the controversy, we may give            E
basic facts which are undisputed.

     5. The complaint under Section 138 of the N.1. Act is filed
by respondent No.2 on the basis of cheque bearing No.003285
drawn on Bank of India, Mahua Branch where the appellant
holds Bank Account bearing No.23371. This cheque was for a F
sum of Rs.3,45,000/-. The complainant had presented this
cheque on 25.10.2008 which was returned dishonoured by the
Bank. The defence on merits set up by the appellant is that he
is a doctor by profession who is having his private practice. He
found that certain cheques, some signed and some unsigned, G
were missing from his clinic in December 2006 in respect to
which he had even given information to the Sub-Divisional
Officer, Mahua, on 30th December 2006. Cheque No. 003285 ·
was also one of those stolen cheques. We have stated this
 defence of the appellant just for record and are not going into H
    798       SUPREME COURT REPORTS               [2013] 12 S.C.R.


A this explanation of the appellant or influenced by it. We only tend
  to examine as to whether on admitted events, complaint is not
  maintainable.

        6. The cheque in question was presented on 25.10.2008.
B After it was dishonoured, complainant issued notice dated
  27 .10.2008 to the appellant. The appellant did not accede to
  the demand contained in the said notice. Even the complainant
  chose not to file any complaint under Sectron 138 of the N. I.
  Act at that time. Instead, he presented same very cheque again
c for encashment through his banker on 10.11.2008. It bounced
  this time as well because of insufficient funds. Another legal
  notice dated 17.12.2008 was sent to the appellant. As this legal
  notice also did not invoke any positive response from the
  appellant, this time the complainant filed the complaint dated
o 7.01.2009. The summary of the aforesaid events, accordingly,
  is as under:-
          Date                     Events

          25.10.2008               Cheque presented
E
          27.10.2008               Legal Notice
          10.11.2008               2nd presentation
          17.12.2008               Legal Notice
F
          07.01.2009               Complaint filed
        7. On the basis of the aforesaid facts, the submission of
  Mr. Mishra was that the complaint was not filed within the
  limitation prescribed under Section 138 read with Section 142.
G of the N. I. Act. To appreciate this contention, we first state the
  aforesaid provision which reads as under:
                "138. Dishonour of cheque for insufficiency,.etc.
          of funds in the account.-Where any cheque drawn by a
H         person on an account maintained by him with a banker for
   KAMLESH KUMAR v. STATE OF BIHAR                    799
             [A.K.SIKRI, J.]
payment of any amount of money to another person from A
out of that account for the discharge, in whole or in part,
of any debt or other liability, is returned by the bank unpaid,
either because of the amount of money standing to the
credit of that account is insufficient to honour the cheque
or that it exceeds the amount arranged to be paid from that · s
account by an agreement made with that bank, such person
shall be deemed to have committed an offence and shall,
without prejudice to any other provision of this Act, be
punished with imprisonment for a term which may be ·
extended to two years, or with fine which may extend to c         ,
twice the amount of the cheque, or with both:

Provided that nothing contained in this section shall apply
unless-

(a) the cheque has been presented to the bank within a        D
period of six months from the date on which it is drawn or
within the period of its validity, whoever is earlier;

(b) the payee or the holder in due 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 in writing,    E
to the drawer of the cheque, [within thirty days] of the
receipt of information by him from the bank regarding the
return of the cheque as unpaid; and

(c) the drawyer of such cheque fails to make the payment      F
of the said amount of money to the payee or, as the case
may be, to the holder in due course of the cheque, within
fifteen days of the receipt of the said notice.

142. Cognizance of offences.- Notwithstanding anything        G
contained in the Code of Criminal Procedure, 1973 (2 of
1974)-

(a) no court shall take cognizance of any offence
punishable under section 138 except upon a complaint. in
writing, made by the payee or, as the case may be. The        H
    800       SUPREME COURT REPORTS                  [2013) 12 S.C.R.


A         holder in due course of the cheque;

          (b) such complaint is made within one month of the dale
          on which the cause of action arises under clause (c) of the
          proviso to Section 138:
B         [Provided that the cognizance of a complaint may be taken
          by the Court after the prescribed period, if the complainant
          satisfies the Court that he had sufficient cause for not
          making a complaint within such period.)

c         (c) no court inferior to that of a Metropolitan Magistrate or
          a Judicial Magistrate of the first class shall try any offence
          punishable under section 138.)"

       8. In the present case, the complainant had not filed the
  complaint on the dishonor of the cheque in the first instance,
0 but presented the said cheque again for encashment. This right
  of the complainant in presenting the same very cheque for the
  second time is available to him under the aforesaid provision.
  This aspect is already authoritatively determined by this Court
  in MSR Leathers vs. S.Palaniappan & Anr. (2013) 1 SCC
E 177. Specific question which was formulated for consideration
  by the Court and referred to three Judge Bench in that case,
  the following question for detemlination was as under:

               "Whether the payee or holder of a cheque can initiate
F         prosecution for an offence under Section 138 of the
          Negotiable Instruments Act, 1881 for its dishonor for the
          second time, if he had not initiated any action on the earlier
          cause of action?"

G        This question was answered by the three Judge Bench in
    the aforesaid matter in the following manner:

                "What is important is that neither Section 138 nor
          Section 142 or any other provision contained in the Act
          forbids the holder or payee of the cheque from presenting
H         the cheque for encashment on any number of occasions
       KAMLESH KUMAR v. STATE OF BIHAR                     801
                 [A.K.SIKRI, J.]
    within a period of six months of its issue or within the A
    period of its validity, whichever is earlier. That such
    presentation will be perfectly legal and justified was not
    disputed before us even at the Bar by the learned counsel
    appearing for the parties and rightly so in the light of the
    judicial pronouncements on that question which are all B
     unanimous. Even Sadanandan case, the correctness
    whereof we are examining, recognized that the holder or
    the payee of the cheque has the right to present the same
    any number of times for encashment during the period of
    six months or during the period of its validity, whichever is c
    earlier."

     9. To this extent, there cannot be any quarrel and the act
of the complainant in presenting the cheque again cannot be
questioned by the appellant. However, we find that when the
cheque was presented second time on 10.11.2008 and was             0
returned unpaid, legal notice for demand was issued only on
17 .12.2008 which was not within 30 days of the receipt of the
information by him from the Bank regarding the return of the
cheque as unpaid. Non-issuance of notice within the limitation
prescribed has rendered the complaint as not maintainable.         E

      10. In MSR Leathers (supra), this Court analyzed the
provisions of Sections 138 and 142 of the N.I. Act in the
following manner:
                                                                   F
          "The proviso to Section 138, however, is all important
    and stipulates three distinct conditions precedent, which
    must be satisfied before the dishonor of a cheque can
    constitute an offence and become punishable. The first
    condition is that the cheque ought to have been presented      G
    to the bank within a period of six months from the date on
    which it is drawn or within the period of of its validity,
    whichever is earlier. The second condition is that the payee
    or the holder in due course of the cheque. as the case may
    be. ought to make a demand for the payment of the said
                                                                   H
    802       SUPREME COURT REPORTS                   (2013) 12 S.C.R.

A         amount of money by giving a notice in writing. to the drawer
          of the' cheque. within thirtv days of the receipt of information
          by him from the bank regarding the return of the cheque
          as unpaid. The third condition is that the drawer of such a
          cheque should have failed to make payment of the said
B         amount of money to the payee or as the case may, to the
          holder in due course of the cheque within fifteen days of
          the receipt of the said notice. It is only upon the satisfaction
          of all the three conditions mentioned above and
          enumerated under the proviso to Section· 1'38 as clauses
c         (a), (b) and (c) thereof that an offence under Section 138
          can be said to have been committed by the person issuing
          the cheque.

                Section 142 of the Negotiable Instruments Act
          governs taking of cognizance of the offence and starts with
D         a non obstante clause. It provides that no court shall take
          cognizance of any offence punishable under Section 138
          except upon a complaint, in writing, made by the payee
          or, as the case may be, by the holder in due course and
          such complaint is made within one month of the date on
E         which the cause of actiop arises under clause (c) of the
          proviso to Section 138. In terms of clause (c) to Section
          142, no count inferior to that of a Metropolitan Magistrate
          or a Judicial Magistrate of the First Class is competent to
          try any offence punishable under Section 138.
F
                 A careful reading. of the above provisions makes it
          manifest that a complaint under Section 138 can be filed
          only after cause of action to do so has accrued in terms
          of clause (c) of the proviso to Section 138 which, as noticed
          earlier, happens no sooner than when the drawer of the
G
          cheque fails to make the payment of the cheque amount
          to the payee or the holder of the cheque within 15 days of
          the receipt of the notice required to be sent in terms of
          clause (b) of the proviso to Section 138 of the Act.
H               The presentation of the cheque and dishonor thereof
   KAMLESH KUMAR v. STATE OF BIHAR                     803
             [A.K.SIKRI, J.]
within the period of its validity or a period of six months is A
just one of the three requirements that constitutes "cause
of action" within the meaning of Sections 138 and 142 (b)
of the Act, an expression that is more commonly used in
civil law than in penal statutes. For a dishonor to culminate
into the commission of an offence of which a court may B
take cognizance. there are two other requirements.
 namely. (a) service of a notice upon the drawer of the
cheque to make payment of the amount covered by the
cheque. and (b) failure of the drawer to make any such
payment within the stipulated period of 15 days of the c
 receipt of such a notice. It is only when the said two
 conditions are superadded to the dishonor of the cheque
that the holder/payee of the cheque acquires the right to
 institute proceedings for prosecution under Section 138 of
the Act. which right remains legally enforceable for a period
                                                               0
of 30 days counted from the date on which the cause of
action accrued to him. Therefore, there is, nothing in the
 proviso to Section 138 or Section 142 for that matter, to
 oblige the holder/payee of a dishonoured cheque to
 necessarily file a complaint even when he has acquired an
 indefeasible right to do so. The fact that an offence is E
 complete need not necessarily lead to launch of
 prosecution especially when the offence is not a
 cognizable one. It follows that the complainant may, even
when he has the immediate right to institute criminal
 proceedings against the drawer of the cheque, either at F
the request of the holder/payee of the cheque or on his own
volition, refrain from instituting the proceedings based on
the cause of action that has accrued to him. Such a
decision to.defer prosecution may be impelled by several
considerations but more importantly it may be induced by G
 an assurance which the drawer extends to the holder of
the cheque that given some time the payment covered by
 the cheques would be arranged, in the process rendering
 a time-consuming and generally expensive legal recourse
 unnecessary. It may also be induced by a belief that a H
    804       SUPREME COURT REPORTS                [2013] 12 S.C.R.


A         fresh presentation of the cheque may result in encashment
          for a variety of reasons including the vicissitudes of trade
          and business dealings where financial accommodation
          given by the parties to each other is not an unknown
          phenomenon. Suffice it to say that there is nothing in the
B         provisions of the Act that forbids the holder/payee of the
          cheque to demand by service of a fresh notice under
          clause (b) of the proviso to Section 138 of the Act, the
          amount covered by the cheque, should there be a second
          or a successive dishonor of the cheque on its
C         presentation."

        11. It is thus clear that period of limitation is not to be
  counted from the date when the cheque in question was
  presented in the first instance on 25.10.2008 or the legal notice
  was issued on 27.10.2008, inasmuch as the cheque was
D presented again on 10.11.2008. For the purposes of limitation,
  in so far as legal notice is concerned, it is to be served within
  30 days of the receipt of information by the drawyee from the
  bank regarding the return of the cheque as unpaid. Therefore,
  after the cheque is returned unpaid, notice has to be issued
E within 30 days of the receipt of information in this behalf. That
  is the period of limitation provided for issuance of legal notice
  calling upon the drawer of the cheque to make the payment.
  After the sending of this notice 15 days time is to be given to
  the noticee, from the date of receipt of the said notice to make
F the payment, if that is already not done. If noticee fails to make
  the payment, the offence can be said to have been committed
  and in that event cause of action for filing the complaint would
  accrue to the complainant and he is given one month time from
  the date of cause of action to file the complaint.
G
        12. Applying the aforesaid principles, in the present case,
  we find that cheque was presented, second time, on
  10.11.2008. The complainant, however, sent the legal notice
  on 17 .12.2008 i.e. much after the expiry of the 30 days. It is
H clear from the complaint filed by the complainant himself that
       KAMLESH KUMAR v. STATE OF BIHAR                      805
                 [A.K.SIKRI, J.]
he had gone to the bank for encashment the cheque on                A
10.11.2008 but the cheque was not honoured due to the
unavailability of the balance in the account.

     13. The crucial question is as to on which date the
complainant received the information about the dishonour of the     B
cheque. As per the appellant the complainant received the
information about the dishonour of the cheque on 10.11.2008.
However, the respondent has disputed the same. However, we
would like to add that at the time of arguments the aforesaid
submission of the appellant was not refuted. After the judgment     c
was reserved, the complainant has filed the affidavit alleging
therein that he received the bank memo of the bouncing of
cheque on 17 .11.2008 and therefore legal notice sent on
17 .12.2008 is within the period 30 days from the date of
information. Normally, we would have called upon the parties        D
to prove their respective versions before the trial court by
leading their evidence. However, in the present case, as rightly
pointed out by the learned senior counsel for the appellant, the
complainant has accepted in the complaint itself that he had
gone to the bank for encashment of cheque on 10.11.2008 and         E
the cheque was not honoured due to insufficient of funds,
thereby admitting that he came to know about the dishonor of
the cheque on 10.11.2008 itself. It is for this reason that
appellant has filed reply affidavit stating that this is an after
thought plea as no material has been filed before the court
                                                                    F
below to show that the bank had issued memo about the return
of cheque which was received by the complainant on
17 .11.2008. The specific averment made in the complaint in
this behalf is as under:

     "Subsequently the complainant again went to encash the         G
     cheque given by the accused on 10.11.2008 which again
     bounced due to unavailability of balance in the accused
     account."

     It is, thus, clear from the aforesaid averment made by the     H
    806      SUPREME COURT REPORTS               [2013] 12 S.C.R.

A complainant himself that he had gone to the bank for encashing
  the cheque on 10 .11 .2008 and found that because of
  unavailability of sufficient balance in the account, the cheque
  was bounced. Therefore, it becomes obvious that he had come
  to know about the same on 10 .11 .2008 itself. In view of th is
B admission in the complaint about the information having been
  received by the complainant about the bouncing of the cheque
  on 10.11.2008 itself, no further enquiry is needed on this aspect.

       14. It is, thus, apparent that he received the information
C about the dishonor of the cheque on 10.11.2008 itself. However,
  he did not send the legal notice within 30 days therefrom. We,
  thus, find that the complaint filed by him was not maintainable
  as it was filed without satisfying all the three conditions laid
  down in Section 138 of the N. I. Act as explained in para 12 of
  the judgment in the case of MSR Leathers, extracted above.
0
       15. We have, thus, no hesitation in allowing this appeal and
  setting aside the impugned order of the High Court. As a
  consequence, petition filed by the petitioner under Section 482,
  Cr.P.C. is also allowed and the complaint of the complainant
E is dismissed.

    R.P.                                           Appeal allowed.