TaxTMI 
TaxTMI 
2019 (7) TMI 1617
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Since all the complaints pertain to different cheques issued by the accused in favour of the complainant and the grounds raised for quashing of the complaints and summoning orders are common, therefore, these petitions are being decided by this common judgment. The details of the cheques involved in these petitions are as under:- S.No Complaint Nos. Cheque No. Date Amount 1. NACT/5698-2017 005108 005109 27.06.2017/ 27.07.2017 Rs. 59,227/- Rs. 65,507/- 2. NACT/5703-2017 005110 25.08.2017 Rs. 90,447/- 3. NACT/5172-2017 005106 25.05.2017 Rs. 7,4024/- 4. NACT/5173-17 005097 26.08.2017 Rs. 3,88964/- The facts in brief are being extracted from CRM-M-14537-2018. The complainant (respondent No.2) namely, Narender Singh filed a criminal complaint on the ground that he was employed as an Engineer (Design) by M/s Gallium Industries Ltd.(accused No.1) through an appointment letter dated 05.08.2010 and worked with the said company till 31.03.2017, when he resigned. At that time, the account of the employee was settled and a sum of Rs. 2,89,205.54/- was outstanding towards salary etc. In order to discharge the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....therefore, no offence is made out and Court below committed serious error in law in proceeding to summon the petitioner as an accused. Attention of the Court is invited to the order dated 21.07.2017 (Annexure P-5) passed by National Company Law Tribunal, New Delhi (in short "NCLT") to contend that at the instance of Indusind Bank, the proceedings for initiation of Corporate Insolvency Resolution Process (CIRP) commenced under the provisions of Insolvency and Bankruptcy Code, 2016 (for short 'IBC 2016') whereby the prohibitory order was passed in respect of the assets of the corporate debtor (accused No.1). It is also pointed out that Sh.Vijender Sharma stood appointed as Interim Resolution Professional. According to him, in these circumstances, the complaint brought by respondent/complainant is not maintainable. It is also argued by the learned counsel that the statutory notice dated 04.10.2017 (Annexure P-3) was promptly responded to by the petitioner through reply dated 16.10.2017 and the complaint itself acknowledged this fact, however, neither the same was produced before the Court nor the trial Court desired to examine it by directing the complainant to produce the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for 19 [a term which may be extended to two years], or with fine which may extend to 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 period of six months from the date on which it is drawn or within the period of its validity, whichever 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, to the drawer of the cheque, 20[within thirty days] of the receipt of information by him from the bank regarding the return of the cheque 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 the cheque, within fifteen days of the receipt of the said notice. The above provision has been dealt with in detail by the Hon'ble Supreme Court on numbe....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., the answer would obviously be in the affirmative because cheque is dishonoured as the amount of money standing to the credit of that account was nil at the relevant time apart from it being closed. Closure of the account would be an eventuality after the entire amount in the account is withdrawn. It means that there was no amount in the credit of that account on the relevant date when the cheque was presented for honouring the same. The expression the amount of money standing to the credit of that account is insufficient to honour the cheque is a genus of which the expression that account being closed is specie. After issuing the cheque drawn on an account maintained, a person, if he closes that account apart from the fact that it may amount to another offence, it would certainly be an offence under Section 138 as there was insufficient or no fund to honour the cheque in that account; Further, cheque is to be drawn by a person for payment of any amount of money due to him on an account maintained by him with a banker and only on that account cheque should be drawn. This would be clear by reading the Section along with provisos (a), (b) & (c )." In the above case, befo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of Section 138 NI Act reveals that the first and foremost requirement to maintain the complaint under Section 138 NI Act is that the cheque issued by the account holder must be from the account maintained by account holder with the drawer-Bank for discharge in whole or in part of any debt or other liability. The expression "account maintained by him" as appearing in Section 138 of NI Act carries great significance and meaning. The dictionary meaning of "Maintain" (as contained in Oxford Dictionary) is defined as:- the act of making the state or situation continue. Therefore, the said expression "account maintained by him" cannot be construed narrowly to mean that if the account belongs to the accused, the necessary ingredient would be complete. This expression "account maintained by him" must necessarily include that the said account is not only alive and operative, but the account holder is capable of executing command to govern the financial transactions which include the clearance of cheques etc. The authority and control of the account holder upon the account must exist on the effective date i.e. when the cheque becomes valid for presentation in the bank. It is settled la....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... vide Registered A.D. Post dated 06.10.17 on last known and correct addresses of the accused persons. The said legal notice was duly served upon the accused persons on 09.10.17 in the ordinary course of postal delivery. The accused persons instead making payment got issued false and frivolous reply dated 16.10.2017 through their counsel. The alleged provision of law as cited in false and frivolous reply dated 16.10.2017 is not applicable and false defence has been put forth to evade legitimate payment of the complainant." A perusal of the above makes it clear that the complainant did not disclose the contents of the reply dated 16.10.2017 and drew a veil over this important aspect of the case. The said reply dated 16.10.2017 (Annexure P-4) clearly revealed that because of prohibitory orders by NCLT New Delhi, the account in question stood blocked and therefore, the request was made to the complainant to withdraw the legal notice. It was further requested that as and when the accused would get the permission to operate the account of the company, the payment in respect of the cheques in question would be made to the complainant. It is also relevant to note that the sa....