TaxTMI 
TaxTMI 
2018 (5) TMI 2157
X X X X Extracts X X X X
X X X X Extracts X X X X
....garwal For the Respondent in (CRR Nos.3059/2013, 3061/2013, 3063/2013, 3068/2013 & 3069/2013) : Ms. Rituparna De Ghose And Ms. Joyti Singh For the Respondent in (CRR Nos.1956/2013,1957/2013, 1958/2013, 2010/2013, 3157/2013, 3158/2013, 2865/2013, 2592/2013 And 2593/2013) : Mr. Tirthankar Ghosh,Mr. Koushik Kundu,Mr. Satudru Lahiri, And Ms. Mrinali Majumder For the Union of India : Mr. Kaushik Chanda, Addl. Solicitor General,And Ms. Rajasshree Venkat Kundalia JUDGMENT 1. These bunch of applications filed under Section 482 of the Code of Criminal Procedure, 1973 (hereinafter referred to as the Cr.P.C.) have been assigned to this Bench by the Hon'ble Acting Chief Justice by an order dated November 13, 2017 on the basis of a reference made by a learned Single Judge of this Court (Tarun Kumar Gupta, J.) to decide the following issues in the backdrop of the relevant provisions of law:- "(1) Whether the amendment of Section 202 of the Code of Criminal Procedure, 1973 as enacted vide Section 19 of the Criminal Procedure (Amendment) Act, 2005 (25 of 2005) casts a mandatory duty upon the Magistrate to conduct an inquiry under Section 202 of the Code before issuing p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the issue of process against the accused, and either inquire into the case himself or direct an investigation to be made by a police officer or by such other person as he thinks fit, for the purpose of deciding whether or not there is sufficient ground for proceeding: Provided that no such direction for investigation shall be made- (a) where it appears to the Magistrate that the offence complained of is triable exclusively by the Court of Sessions; or (b) Where the complaint has not been made by a Court, unless the complainant and the witnesses present (if any) have been examined on oath under section 200.... 5. In all the aforesaid revisional applications a common plea has been taken alleging that the petitioners have been residing at a place beyond the territorial jurisdiction of the concerned Magistrate Court, but process were issued against them under Section 204 Cr.P.C. without making necessary mandatory inquiry as contemplated under sub-section (1) of the Section 202 Cr.P.C. It is their common plea that on that score alone the orders of issuance of process under Section 204 Cr.P.C. and subsequent proceedings cannot be sustained in law. 6. Mr. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r., reported in 2016 (5) SCALE 379, M/s. Nishka Properties (Pvt.) Ltd. & Anr. v. The State of West Bengal & Anr., reported in 2013 (3) CLJ (Cal) 390 and A. Devendran v. State of Tamil Nadu, reported in (1997) 11 SCC 720 in support of his above submissions. 12. With regard to the nature of inquiry under the aforesaid provisions of the Cr.P.C. qua an accused who resided outside the territorial limit of the Court of the concerned Magistrate, it is submitted by him that the objects and reasons appended to the amendment clarifies the purpose of amendment, which is to ascertain and find out as to whether or not there are sufficient grounds to proceed against the accused, and thus, to obviate any possibility of innocent persons being harassed by unscrupulous litigants and vexatious proceedings. According to him, in pre amendment stage, the learned Magistrate could take resort to provisions of Section 202 Cr.P.C. in law in respect of those cases where some shadow of doubt remained into the mind of the learned magistrate about the prima facie case. But after the amendment, even if at the stage of inquiry under Section 200 Cr.P.C., the learned Magistrate is satisfied that sufficient groun....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Act, 1881 for conferring certain privileges to the mercantile instruments contemplated under it and provided special procedure in case of the obligation under the instrument which was not discharged. Sections 142 and 143 of the said Act, 1881 brings some of the procedural provisions of the Cr.P.C. into the said Act, 1881 by way of legislation. According to him, under the provisions of sub-section (2) of Section 143 of the said Act, 1881 the procedure of summary trial as envisaged under Chapter XXI of Cr.P.C. will apply. In view of Sections 3 and 4 of the Cr.P.C., in absence of any contrary provision in the said Act, 1881 the general law qua inquiry under Sections 200 and 202 Cr.P.C. will apply. However, according to him, no Magistrate can take cognizance of an offence punishable under Section 138 of the said Act, 1881 on an oral complaint or on a police report. 18. According to him, under the amended provisions of Section 145 of the said Act, 1881, affidavit may be accepted as evidence during enquiry or trial. As a consequence, during enquiry under Section 200 Cr.P.C., instead of examining the complainant on dock, a Magistrate can accept the affidavit affirmed by him. Barring th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d is residing at a place beyond the area in which he exercises his jurisdiction and thereafter to enter enquiry into the case by himself or direct an investigation to be made by a police officer or by such other person as he thinks fit. It is further added by him that the insertion of the words "and shall, in a case where the accused is residing at a place beyond the area in which he exercises his jurisdiction" has been inserted by Section 19 of the Criminal Procedure (Amendment) Act, 2005 with effect from June 23, 2006 by the legislature to prevent innocent persons residing at far off places from harassment by unscrupulous persons from false complaints. According to him, though the use of the word "shall" in all circumstances is not decisive, bearing in mind the context or intention of the legislature the above provision is mandatory. 23. With regard to the mode of enquiry, it is submitted by him, that no specific mode or manner of enquiry is provided under Section 202 Cr.P.C. In the enquiry envisaged under Section 202 Cr.P.C. the witnesses are examined whereas under Section 200 Cr.P.C., examination of the complainant only is necessary with the option of examining the witnesses....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ble Instruments Laws (Amendment) Act, 1988, with the object of promoting and inculcating faith in the efficacy of banking system and its operation and giving credibility to negotiable instruments in business transactions. According to him, in our country, in a large number of commercial transactions the sanctity and credibility of issuance of cheques were eroded to a large extent resulting in incalculable loss, injury and inconvenience to the payee within and outside the country causing a serious setback. 30. According to him, when the above amendments came into existence, a complaint could be filed by the payee or holder in due course at 5 different places as observed by the Apex Court in the matter of K. Bhaskaran v. Sankaran Vaidhyan Balan & Anr., reported in (1999) 7 SCC 510. 31. In 2002, consequent upon further amendment of the said Act, 1881 taking effect from February 6, 2003, although the provision was made for condonation of the period of limitation, yet there was no change so far as the territorial jurisdiction for filing of complaint cases in respect of the dishonoured cheques were concerned. The above aspect was under consideration by the Hon'ble Supreme Court....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ty or false implication are tenable has already been settled by the Hon'ble Supreme Court. 36. Reference is made by Mr. Ghosh to the decisions of S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla & Anr., reported in (2005) 8 SCC 89, Standard Chartered Bank v. State of Maharashtra & Ors., reported in (2016) 6 SCC 62 and Tamil Nadu Newsprint and Papers Ltd. v. D. Karunakar & Ors., reported in (2016) 6 SCC 78 in support of his above submissions. 37. It is submitted by Mr. Kaushik Chanda, learned Additional Solicitor General that the provisions of Section 202 Cr.P.C. is mandatory in nature. According to him, the amendment of Section 202 Cr.P.C., as enacted by virtue of Section 19 of the Criminal Procedure (Amendment) Act, 2005, casts a mandatory duty upon the Magistrate to conduct an enquiry under the aforesaid provision before issuing process under Section 204 of the Code in respect of an accused who resides outside the territorial limit of the Court of the learned Magistrate concern. It is also submitted by him that in view of the pronouncement of the Hon'ble Supreme Court the above provision cannot be interpreted in any other way. 38. Reliance is placed by Mr. Chanda on t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ely. Our attention has further been drawn to the fact that all the provisions of Sections 143, 144, 145 and 147 begin with a non obstante clause. Therefore, according to him, the said Act, 1881, provides for a separate procedure of summary trial adhering to the directions of the Hon'ble Supreme Court given in the matter of Indian Bank Association (supra). It is further submitted by him that the procedure of summary trial is adopted under Section 143 subject to the qualification "as far as possible", thus, leaving sufficient flexibility so as not to affect the quick flow of the trial process. According to him, while following the procedure of summary trial, the non obstante clause in Section 145 of the said Act, 1881 allows for evidence of the complaint to be given on affidavit in absence of the accused. This would have been impermissible in a summary trial under the Cr.P.C. in view of the provisions of Sections 251 and 254 read with Section 273 Cr.P.C. However, the accused is fully protected as under sub-section (2) of Section 145 of the said Act, 1881, he has the absolute unqualified right to have the complainant and any or all of his witnesses summoned for cross-examination. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sdiction, you must exercise the jurisdiction (as the 2nd section of this Act says in terms, though it was not necessary) according to the provisions of the Act. 49. The above settled principles of law was applied by the Privy Council in interpreting the law relating to criminal procedure in the matter of Nazir Ahmad v. King Emperor, reported in AIR 1936 PC 253 and the relevant portion of the above decision is quoted below: ...It can hardly be doubted that a Magistrate would not be obliged to record any confession made to him if, for example, it were that of a self-accusing madman or for any other reason the Magistrate thought it to be incredible or useless for the purposes of justice. Whether a Magistrate records any confession is a matter of duty and discretion and not of obligation. The rule which applies is a different and not less well recognised rule, namely, that where a power is given to do a certain thing in a certain way the thing must be done in that way or not at all. Other methods of performance are necessarily forbidden. This doctrine has often been applied to Courts- 1 Ch. D. 426 (19) at p.431- and although the Magistrate acting under this group of section....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rsons would be rendered nugatory. The section, therefore, by conferring on magistrates the power to record statements or confessions, by necessary implication, prohibited a magistrate from giving oral evidence of the statements or confessions made to him. 51. In the matter of State of Jharkhand & Ors. v. Ambay Cements & Ors. (supra) it has been held by the Hon'ble Supreme Court that where a statute is penal in nature it must be strictly construed and followed and the relevant portion of the above decision is quoted below:- 26. Whenever the statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to severe consequences, such requirement would be mandatory. It is the cardinal rule of interpretation that where a statute provides that a particular thing should be done, it should be done in the manner prescribed and not in any other way. It is also settled rule of interpretation that where a statute is penal in character, it must be strictly construed and followed. Since the requirement, in the instant case, of obtaining prior permission is mandatory, therefore, non-compliance ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of such offences as are within his competence to inquire into or try. 192. Making over of cases to Magistrate.- (1) Any Chief Judicial Magistrate may, after taking cognizance of an offence, make over the case for inquiry or trial to any competent Magistrate subordinate to him. (2) Any Magistrate of the first class empowered in this behalf by the Chief Judicial Magistrate may, after taking cognizance of an offence, make over the case for inquiry or trial to such other competent Magistrate as the Chief Judicial Magistrate may, by general or special order, specify, and thereupon such Magistrate may hold the inquiry or trial. 54. Under the provisions of Section 190 Cr.P.C. the competent Magistrate may take cognizance of any offence, subject to the provisions of Chapter XIV Cr.P.C., any Chief Judicial Magistrate is empowered under Section 192 Cr.P.C. to transfer the case for inquiry after taking cognizance to a competent Magistrate subordinate to him. Needless to point out that under the provisions of sub-section (2) of Section 12 Cr.P.C., an Additional Chief Judicial Magistrate shall have all or any of the powers of a Chief Judicial Magistrate under Cr.P.C. or unde....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ce complained of was triable exclusively by the Court of Session; or where the complaint had not been made by a Court, unless the complainant and the witnesses present (if any) had been examined under Section 200 Cr.P.C. Sub-section (1) of Section 202 Cr.P.C. has been amended by the Criminal Procedure (Amendment) Act, 2005, inserting the following words; and shall, in a case where the accused is residing at a place beyond the area in which he exercises his jurisdiction. The note of clause of the aforesaid amendment runs as follows: false complaints are filed against persons residing at far of places simply to harass them. In order to see that innocent persons are not harassed by unscrupulous persons, this clause seeks to amend sub-section (1) of Section 202 to make it obligatory upon the Magistrate that before summoning the accused residing beyond his jurisdiction. He shall enquire into the case himself or by such other person as he thinks fit, for finding out whether or not there was sufficient ground for proceeding against the accused. The above amended provision came into force with effect from June 23, 2006 under notification No. S.O.923(E) dated June....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of finding out whether or not, there was sufficient ground for proceeding against the accused before issuing summons in such cases. (See also: Shivjee Singh v. Nagendra Tiwary & Ors. MANU/SC/0433/2010 : AIR 2010 SC 2261; and National Bank of Oman v. Barakara Abdul Aziz & Anr. MANU/SC/1123/2012 : JT 2012 (12) SC 432)." 59. In the matter of Vijay Dhanuka & Ors. (supra) the Hon'ble Supreme Court repeated and reiterated the above settled principles of law as under:- 11. Section 202 of the Code, inter alia, contemplates postponement of the issue of the process "in a case where the accused is residing at a place beyond the area in which he exercises his jurisdiction" and thereafter to either inquire into the case by himself or direct an investigation to be made by a police officer or by such other person as he thinks fit. In the face of it, what needs our determination is as to whether in a case where the accused is residing at a place beyond the area in which the Magistrate exercises his jurisdiction, inquiry is mandatory or not. 12. The words "and shall, in a case where the accused is residing at a place beyond the area in which he exercises his jurisdiction" w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....concerned, from harassment by unscrupulous persons from false complaints. The use of expression "shall", looking to the intention of the legislature to the context, is mandatory before summons are issued against the accused living beyond the territorial jurisdiction of the Magistrate. 61. It will not be out of context to consider the fact that the learned Single Judge while referring this bunch of cases to us, placed reliance on the decisions of Shyamal Kumar Goswami & Anr. (supra) heavily. The decision of Shyamal Kumar Goswami & Anr. (supra) is based on the decisions of Rameshwar Jute Mills Ltd. v. Sushil Kumar Daga & Ors., reported in 2009 (2) CHN 138 and Biswanath Maheswari v. Nabbharat Tea Processing Pvt. Ltd., reported in 2010 (2) CHN 257. We are in disagreement with the above finding in view of the fact that the decision of Rameshwar Jute Mills Ltd. (supra) has been set aside by the Hon'ble Supreme Court by an order dated April 2, 2013 passed in the matter of Umesh Verma v. The Rameshwara Jute Mills Limited & Ors. (in re:-SLP (Crl.) No. 4432 of 2009). Further, in view of the decisions of the Hon'ble Supreme Court in the matter of Shivjee Singh (supra), National Ban....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ade. To find out the above, the Magistrate himself may hold an inquiry under Section 202 of the Code or direct an investigation to be made by a police officer. The dismissal of the complaint under Section 203 is without doubt a pre-issuance of process stage. The Code does not permit an accused person to intervene in the course of inquiry by the Magistrate under Section 202. The legal position is no more res integra in this regard. More than five decades back, this Court in Vadilal Panchal v. Dattatraya Dulaji Ghadigaonker with reference to Section 202 of the Criminal Procedure Code, 1898 (corresponding to Section 202 of the present Code) held that the inquiry under Section 202 was for the purpose of ascertaining the truth or falsehood of the complaint, i.e. for ascertaining whether there was evidence in support of the complaint so as to justify the issuance of process and commencement of proceedings against the person concerned. 66. The amended provision of sub-section (1) of Section 202 Cr.P.C. came up for consideration of the Hon'ble Supreme Court in the matter of National Bank of Oman (supra) and the following observation made in the above decision is hereunder:- ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....necessary with the option of examining the witnesses present, if any. 18. This exercise by the Magistrate, for the purpose of deciding whether or not there is sufficient ground for proceeding against the accused, is nothing but an inquiry envisaged under Section 202 of the Code. In the present case, as we have stated earlier, the Magistrate has examined the complainant on solemn affirmation and the two witnesses and only thereafter he had directed for issuance of process. In view of what we have observed above, we do not find any error in the order impugned. In the result, we do not find any merit in the appeals and the same are dismissed accordingly. 68. In Vijay Dhanuka (supra) the aforesaid principle has been repeated and reiterated in the observation that under Section 200 Cr.P.C. the examining of complainant only is necessary with the option of examining the witnesses present, if any. Though no specific mode or manner of enquiry is provided under Section 202 Cr.P.C., in an enquiry under Section 202 Cr.P.C., the witnesses are examined for the purpose of deciding whether or not there is sufficient ground of proceeding against the accused. The relevant portion of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....a learned Magistrate against an accused who is residing at a place beyond the area in which he exercises his jurisdiction without conducting an enquiry under Section 202 Cr.P.C., the matter is required to be remitted to the learned Magistrate concerned for passing fresh orders uninfluenced by the prima facie conclusion reached by the Appellate Court. Reference may be made to the decision of National Bank of Oman (supra) and the relevant portion of the above decision is quoted below:- 12. All the same, the High Court instead of quashing the complaint, should have directed the Magistrate to pass fresh orders following the provisions of Section 202 Cr.P.C.. Hence, we remit the matter to the Magistrate for passing fresh orders uninfluenced by the prima facie conclusion reached by the High Court that the bare allegations of cheating do not make out a case against the accused for issuance of process under Section 418 or 420 IPC. The CJM will pass fresh orders after complying with the procedure laid down in Section 202 Cr.P.C., within two months from the date of receipt of this order." D. Whether objections with regard to non-compliance of the amended provisions of sub-section....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing an application by the accused before the Learned Magistrate concerned for dismissal of the complaint under Section 203 Cr.P.C. or a reconsideration of the material available on record is impermissible on receipt of summons approaching the Court for the reason that by then Section 203 is over and the learned Magistrate concerned has proceeded further to Section 204 Cr.P.C. 74. In Adalat Prasad v. Rooplal Jindal & Ors., reported in (2004) 7 SCC 338, a three Judges Bench of the Hon'ble Supreme Court took into consideration the provisions of Sections 200, 202 and 204 Cr.P.C. for explaining the above provisions. The Apex Court observed as follows:- 15. It is true that if a Magistrate takes cognizance of an offence, issues process without there being any allegation against the accused or any material implicating the accused or in contravention of provisions of Sections 200 and 202, the order of the Magistrate may be vitiated, but then the relief an aggrieved accused can obtain at that stage is not by invoking Section 203 of the Code because the Criminal Procedure Code does not contemplate a review of an order. Hence in the absence of any review power or inherent power....
X X X X Extracts X X X X
X X X X Extracts X X X X
....articles and record, does not have substance worth consideration. In case a representation is made by the person aggrieved and the same is rejected by the competent statutory authority, and such and order is communicated to the person aggrieved, making repeated representations will not enable the party to explain the delay. 78. In view of the above we have no hesitation to arrive at a conclusion that the first occasion for an aggrieved accused to raise objection for issuing summon against him comes after the provision of Section 204 is invoked. Since Cr.P.C. does not contemplate a review of an order passed by the learned Magistrate concerned taking cognizance of an offence issuing process without there being any allegation against accused or any material implicating the accused or any contravention of the provisions of Sections 200 and 202, the remedy lies in invoking Section 482 Cr.P.C. However, keeping in mind the object underlined in Section 465 Cr.P.C. that if on any technical ground any party to the criminal proceedings is aggrieved he must raise the objection thereof at the earliest stage, we hold that in the event of failure on the part of an aggrieved party to raise obje....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n 138 of the Act by the drawee or the holder of the cheque in due course. The relevant portion of the above decision is quoted below:- 6. ...Thus it has to be presumed that a cheque is issued in discharge of any debt or other liability. The presumption can be rebutted by adducing evidence and the burden of proof is on the person who wants to rebut the presumption. This presumption coupled with the object of Chapter XVII of the Act which is to promote the efficacy of banking operation and to ensure credibility in business transactions through banks persuades us to take a view that by countermanding payment of post-dated cheque, a party should not be allowed to get away from the penal provision of Section 138 of the Act. A contrary view should render Section 138 a dead letter and will provide a handle to persons trying to avoid payment under legal obligations undertaken by them through their own acts which in other words can be said to be taking advantage of one's own wrong. If we hold otherwise, by giving instructions to banks to stop payment of a cheque after issuing the same against a debt or liability, a drawer will easily avoid penal consequences under Sect....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... A fact is said to be proved when,'after considering the matters before it, the court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists.' Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'. The above view has been repeated and reiterated by the Hon'ble Supreme Court in Rangappa v. Sri Mohan, reported in (2010) 11 SCC 441. 81. In Dashrath Rupsingh Rathod (supra) the Hon'ble Justice Vikramjit Sen observed that the Parliament consciously introduced Chapter XVII by virtue of the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 for the purpose of converting civil liability into criminal content, inter alia, by deeming fiction of culpability in terms of the pandect comprising Sections 138 and succeeding sections.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....1 no Court inferior to that of a Metropolitan Magistrate or Judicial Magistrate of the first class should try an offence under Section 138 of the said Act, 1881. 83. It will not be out of context to observe that the non-obstante clause, when it refers to Cr.P.C. only excludes the 'oral complaint' of the definition under Section 2 (d) of Cr.P.C. However, the learned Magistrate concerned is required to follow the procedure under Section 200 of the Code once he has taken the complaint of the payee/holder in due course and recorded the statement of the complainant and such other witnesses as present at the said date. Reference may be made to the decision of Indra Kumar Patodia & Anr. (supra) and the relevant portion of the above decision is quoted below:- 18. It is clear that the non obstante clause has to be given restricted meaning and when the section containing the said clause does not refer to any particular provisions which it intends to override but refers to the provisions of the statute generally, it is not permissible to hold that it excludes the whole Act and stands all alone by itself. In other words, there requires to be a determination as to which provisions....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ust be given priority over the punitive aspect. 60.4. All the subordinate courts should follow the directives of the Supreme Court issued in several cases scrupulously for effective conduct of trials and speedy disposal of cases. 60.5. Remitting the matter for de novo trial should be exercised as a last resort and should be used sparingly when there is grave miscarriage of justice in the light of illegality, irregularity, incompetence or any other defect which cannot be cured at an appellate stage. The appellate court should be very cautious and exercise the discretion judiciously while remanding the matter for de novo trial. 60.6. While examining the nature of the trial conducted by the trial court for the purpose of determining whether it was summary trial or summons trial, the primary and predominant test to be adopted by the appellate court should be whether it was only the substance of the evidence that was recorded or whether the complete record of the deposition of the witness in their chief-examination, cross-examination and re-examination in verbatim was faithfully placed on record. The appellate court has to go through each and every minute deta....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the aforementioned provision must be read with sub-section (1) of Section 145. It, therefore, merely points out to the discretionary power of the court conferred upon it by reason thereof. The court, however, has no other option but to summon and examine any person who has given evidence on affidavit as to the facts contained therein if an application is filed either by the prosecution or the accused. Section 145 must be read reasonably. Section 296 of the Code of Criminal Procedure although refers to an evidence of a formal character, no doubt contains a pari materia provision. ......... 19. If an affidavit in terms of the provisions of Section 145 of the Act is to be considered to be an evidence, it is difficult to comprehend as to why the court will ask the deponent of the said affidavit to examine himself with regard to the contents thereof once over again. He may be cross-examined and upon completion of his evidence, he may be re-examined. Thus, the words "examine any person giving evidence on affidavit as to the facts contained therein, in the event, the deponent is summoned by the court in terms of sub-section (2) of Section 145 of the Act", in our opin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing each of the ingredients of the offence under Section 138 of the said Act, 1881 as follows:- (i) That a person drew a cheque from an account maintained by him with the banker; (ii) That such a cheque when presented to the bank is returned by the bank is unpaid; (iii) That such a cheque was presented to the bank within a period of six months from the date it was drawn or within the period its validity whichever is earlier; (iv) That the payee demanded in writing from drawer of the cheque the payment of the amount of money due under the cheque; and (v) Such a notice of payment is made within a period of 30 days from the date of receipt of the information by the payee from the bank regarding the return of the cheque as unpaid. According to the Hon'ble Supreme Court, the only other ingredient which is required to be proved to establish the commission of offence under Section 138 is that inspite of the demand notice, the drawer of the cheque failed to make the payment within a period of 15 days from the date of receipt of the demand. The relevant portion of the above decision is quoted below:- 23. The scheme of the pr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion 138 of THE ACT before initiating prosecution. Because it is already held by this Court that failure to comply with any one of the steps contemplated under Section 138 would not provide "cause of action for prosecution". Therefore, in the context of a prosecution under Section 138, the concept of taking cognizance of the offence but not the offender is not appropriate. Unless the complaint contains all the necessary factual allegations constituting each of the ingredients of the offence under Section 138, the Court cannot take cognizance of the offence. Disclosure of the name of the person drawing the cheque is one of the factual allegations which a complaint is required to contain. Otherwise in the absence of any authority of law to investigate the offence under Section 138, there would be no person against whom a Court can proceed. There cannot be a prosecution without an accused. The offence under Section 138 is person specific. Therefore, the Parliament declared under Section 142 that the provisions dealing with taking cognizance contained in the Cr.P.C. should give way to the procedure prescribed under Section 142. Hence the opening of non-obstante clause under Section 142....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... above issue was under consideration of the Hon'ble Supreme Court. According to the Apex Court, three categories of persons can be fastened with penal liability through legal fiction envisaged in Sections 138 read with the provisions of Section 141 of the said Act, 1881 as follows:- (i) The company which committed the offence, (ii) Everyone who was in charge of and was responsible for business of the company, (iii) Any other person who is a director or a manager or a secretary or officer of the company, with whose connivance or due to whose neglect the company has committed the offence. The relevant portion of the above decision is quoted below:- "10. Three categories of persons can be discerned from the said provision who are brought within the purview of the penal liability through the legal fiction envisaged in the section. They are: (1) The company which committed the offence, (2) Everyone who was in charge of and was responsible for the business of the company, (3) any other person who is a director or a manager or a secretary or officer of the company, with whose connivance or due to whose neglect the company has committed the offenc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e examined by the learned Magistrate and he has to be satisfied that there are averments which bring the case within the purview of Section 141 of the said Act, 1881, only then he would issue the process. On the basis of the above finding the Apex Court further undertook the question of requirement of averments in a complaint which has to be considered on the basis of the provisions contained in Sections 138 and 141 of the said Act, 1881 read in the light of the power of a Magistrate referred to in Sections 200 and 204 of the Code of Criminal Procedure and arrived at a further conclusion that a Magistrate has to consider the complaint before issuing process and he has the power to reject it at the threshold suggests that a complaint should make out a case for issue of process and keeping in mind the guideline as prescribed therein. The necessary portions of the above decision are quoted below:- 5. Section 203 of the Code empowers a Magistrate to dismiss a complaint without even issuing a process. It uses the words "after considering" and "the Magistrate is of opinion that there is no sufficient ground for proceeding". These words suggest that the Magistrate has to apply hi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....liability under Section 141 of the Act is sought to be fastened vicariously on a person connected with a company, the principal accused being the company itself. It is a departure from the rule in criminal law against vicarious liability. A clear case should be spelled out in the complaint against the person sought to be made liable. Section 141 of the Act contains the requirements for making a person liable under the said provision. That respondent falls within the parameters of Section 141 has to be spelled out. A complaint has to be examined by the Magistrate in the first instance on the basis of averments contained therein. If the Magistrate is satisfied that there are averments which bring the case within Section 141, he would issue the process. We have seen that merely being described as a director in a company is not sufficient to satisfy the requirement of Section 141. Even a non-director can be liable under Section 141 of the Act. The averments in the complaint would also serve the purpose that the person sought to be made liable would know what is the case which is alleged against him. This will enable him to meet the case at the trial. 19. In view of the above d....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ferred to Sections 138 and 141 of the Act, Sections 203 and 204 Cr.P.C. and observed (SCC p. 96, para 5) that a complaint must contain material to enable the Magistrate to make up his mind for issuing process and if this were not the requirement, consequences would be far-reaching. If a Magistrate has to issue process in every case, the burden of work before the Magistrate as well as the harassment caused to the respondents to whom process has to be issued would be tremendous. It has been observed therein that Section 204 Cr.P.C. commences with the words "if in the opinion of the Magistrate taking cognizance of an offence there is sufficient ground for proceeding" and that apart, the words "sufficient ground for proceeding" again suggest that ground should be made out in the complaint for proceeding against the respondent. The three-Judge Bench has ruled that it is settled law that at the time of issuing of the process, the Magistrate is required to see only the allegations in the complaint and where the allegations in the complaint or the charge-sheet do not constitute an offence against a person, the complaint is liable to be dismissed. 93. The same view was repeated and reite....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d proviso to Section 143 becomes necessary, where sentence of one year may have to be awarded and compensation under Section 357(3) is considered inadequate, having regard to the amount of the cheque, the financial capacity and the conduct of the accused or any other circumstances. 96. In view of the above and taking into consideration the non-obstante clauses used in Sections 142, 142 (a), 143, 144, 145 and 147 of the said Act, 1881, as also finding that the scheme framed by the legislature in initiating a proceeding under Section 138 is different from that of the Cr.P.C., we arrive at an irresistible conclusion that the legislature has taken care of the interest of the complainant and the accused by exempting the complainant from facing the general rigors of Cr.P.C. at pre-summoning stage under Section 202 Cr.P.C. as amended under Section 19 of the Criminal Procedure (Amendment) Act, 2005 and protecting the accused by insisting upon the complainant to produce best possible stage at the pre-summon stage. 97. Necessary to point out that in view of the law laid down by the Apex Court in the case of Bhaskar Industries Ltd. v. Bhiwani Denim & Apparels Ltd. And Others, reported i....