TaxTMI 
TaxTMI 
2019 (8) TMI 1012
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.... an amount of Rs. 1,25,000/­ issued by the applicant towards consideration for registered sale deed dated 17/09/2009, executed in respect of a shop purchased in the name of wife of the applicant, had been dishonoured, due to insufficiency of funds. The non­-applicant had issued notice dated 17/03/2010, in respect of dishonour of the said cheque, which was received by the applicant on 30/03/2019, and when the applicant failed to pay the cheque amount to the non­-applicant within the time period specified under Section 138 of the said Act, he filed the aforesaid complaint against the applicant. 3. The non­-applicant examined himself as witness in respect of his case while the applicant examined himself in support of his defence. The defence raised on behalf of the applicant before the Court of the Judicial Magistrate First Class, was that the aforesaid cheque had been issued as security for the price of the shop, which was in fact paid by cash to the non­-applicant. It was claimed that the applicant had paid Rs. 25,000/­ cash on 10/09/2009 and Rs. 1,00,000/cash on 17/09/2009 to the non­-applicant and the sale deed was executed on 17/09/2009. It was claime....
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....n the wife of the applicant and the non­-applicant and, therefore, there was nothing to really connect the applicant with the said offence. The learned counsel further submitted that the non­-applicant was required to prove that the applicant was indeed proprietor of "Suraj Traders" and in the absence of such proof, the applicant could not have been convicted for offence under Section 138 of the aforesaid Act. The learned counsel further submitted that in view of the passage of time and the fact that the applicant is the only bread winner of his family, a lenient view could be taken in the matter and sentence could be reduced to the period already undergone. The learned counsel for the applicant relied on the judgments of the Hon'ble Supreme Court in the cases of Milind Shripad Chandurkar .vs. Kalim M. Khan reported in 2011(4) SCC 275, Priyanka Nagpal .vs. State (NCT of Delhi) reported in 2018(2) SCC 249 and judgments of this Court in the cases of Philip J. vs. Ashapura Minechem Ltd. & Anr. reported in 2016 ALL MR (Cri) 1802 and A.C. Narayanan Vs. The State of Maharashtra & Anr. reported in 2017 ALL MR (Cri) 4925. 8. Per contra, Mr. Aditya Deshpande, learned Advocate a....
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.... dispute about the fact that the aforesaid cheque finds mention in the registered sale deed dated 17/09/2009, executed in respect of shop premises in favour of wife of the applicant, wherein the applicant has signed as witness to the said document. There is also no dispute about the fact that the said cheque for an amount of Rs. 1,25,000/­ was dishonoured and that there was compliance on the part of the non­-applicant as regards the service of statutory notice to the applicant. Accordingly, the requirements of Section 138 of the aforesaid Act stood satisfied, pursuant to which the non­-applicant filed such complaint against the applicant. 10. Since, there is no dispute about the fact that the applicant had signed on the said cheque, the presumption under Sections 118 and 139 of the aforesaid Act came into operation in the present case. The said provisions read as follows : "118. Presumptions as to negotiable instruments - Until the contrary is proved, the following presumptions shall be made :­ (a) of consideration - that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotia....
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....plaint was not maintainable. 13. A perusal of Section 141 of the aforesaid Act shows that it refers to "Company" and it is explained that the said term means any body corporate and includes a firm or other association of individuals. A Director in relation to a firm is clarified to mean a partner in the firm. The said provision specifies the liability when offences are committed under Section 138 of the said Act by a Company, a firm, a body corporate or other association of individuals. There is no mention of a proprietary concern in the said provision. 14. In this context, much emphasis has been placed on behalf of the applicant on judgment of the Hon'ble Supreme Court in the case of Milind Shripad Chandurkar.vs. Kalim M. Khan (supra). A perusal of the said judgment shows that when a proprietary concern is a complainant, as a payee in the context of Section 142 of the aforesaid Act read with Section 7 thereof, it has been held that the person filing the complaint must necessarily establish his/her connection with the sole proprietary concern. In the said judgment, on facts, the Hon'ble Supreme Court found that the appellant had miserably failed to prove any nexus or conn....
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....nechem Ltd. & Anr. (supra) and A.C. Narayanan Vs. The State of Maharashtra & Anr. (supra) is also wholly misplaced, because the said judgments specifically pertain to a situation where the offence was committed by a Company. The Hon'ble Supreme Court in the case of Raghu Lakshminarayanan .vs. M/s Fine Tubes reported in (2007) 5 Supreme Court Cases 103, in the context of Sections 138 and 141 of the aforesaid Act, specifically held that a proprietary concern is not covered under the said provisions and that the distinction between a partnership firm and a proprietary concern is very well known. Therefore, the said contention raised on behalf of the applicant that the complaint in the present case was not maintainable due to the proprietary concern Suraj Traders not being made a party, is found to be wholly unsustainable and it is rejected. 17. As regards the merits of the case, the applicant has contended that the aforesaid cheque was handed over to the non­-applicant by way of security and that the sale consideration for the said shop of Rs. 1,25,000/­ was actually paid to the non­-applicant by cash. It was also contended that the modus operandi of the non­-appl....
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....given by the applicant to the non­-applicant by way of security. In these circumstances, it becomes evident that the defence raised by the applicant that the cheque in question was issued by way of security, is wholly unsustainable. Even in the answers to questions put to the applicant under Section 313 of the Cr.P.C., the applicant stated that he had indeed issued the cheque under his own signature and that he admitted the aforesaid sale deed. 20. Such material on record clearly demonstrates that there is no substance in the contention raised on behalf of the applicant on merits in the presence case. The presumptions that arose in full force against the applicant under Sections 118 and 139 of the aforesaid Act have not been rebutted in any manner by the applicant and, therefore, it cannot be said that the Courts below committed an error in convicting and sentencing the applicant. 21. After the arguments in the present case were over and the case was closed for judgment, along with the notes of arguments, the learned counsel for the applicant has sought to rely upon judgment of the Hon'ble Supreme Court in the case of Priyanka Nagpal .vs. State (NCT of Delhi) (supra), to ....