TaxTMI 
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TaxTMI 
2025 (8) TMI 249
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.... of the Judicial First Class Magistrate Court-II, Alathur. The above case was filed by the 2nd respondent herein alleging offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short "NI Act"). (Hereinafter, the revision petitioner is mentioned as the accused and the 2nd respondent is mentioned as the complainant). 3. The case of the complainant is that, the accused borrowed an amount of Rs. 3,00,000/- from the complainant, and to discharge the said debt, the accused issued a cheque bearing No.479097 of Catholic Syrian Bank Ltd., Perumbavoor Branch. When the cheque was presented by the complainant before the State Bank of India, Nenmara Branch, the same was dishonoured, stating that there is no sufficient fund in the account maintained by the accused. Though the complainant issued a lawyer notice, the accused did not pay the amount. Hence, the complaint was filed. 4. To substantiate the case, the complainant herself was examined as PW1. One witness was also examined on the side of the complainant. Ext.P1 to P6 are the exhibits marked on the side of the complainant. One witness was examined on the side of the defence as DW1, and Exhibit D1 is the exhibit....
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....dgment of the Apex Court in Thomas M.D v P.S.Jaleel and Another [2009 KHC 4398] held that, service of notice to the relatives of the accused is not sufficient especially when there is no evidence from the side of the complainant that, the accused was aware of the service of notice on his relatives. This Court also observed that, if there is no such evidence regarding the knowledge of the accused about the notice, it is to be presumed that a statutory notice under Section 138(b) of NI Act is not served on the accused. The relevant portion of the judgment is extracted hereunder: 9. From the above-extracted passage in the evidence of PW1, it is clear that the notice was served on the relative of the accused. PW1 has no case that the accused has knowledge of the receipt of the notice by his relative. If that is the case, it can be presumed at least that there is constructive notice. There is no such case for the complainant. If that is the case, it cannot be said that there is any service of notice to the petitioner. Moreover, there is no substantial compliance with Section 138(b) of the Act either. 10. The Apex Court in Thomas M.D. v. P.S. Jaleel and Another [2009 KHC 4398] has co....
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....statutory notice under Section 138(b) of the Negotiable Instruments Act, 1881 is not served on the accused. The upshot of the above discussion is that the conviction and sentence imposed on the petitioner are to be set aside." 9. The main contention of the complainant is that, this Court has not considered the dictum laid down by the Supreme Court in three decisions and also the dictum laid down by this Court in two decisions. I will consider all those cases hereinafter. The counsel for the complainant relied on the judgment of Vinod Shivappa's case (supra) and contended that, if notice is sent at the correct address, there is a presumption in favour of the complainant that the notice is served. Therefore, once the complainant proves that notice is sent to the accused at the correct address, the accused cannot contend that, he has not received the notice. It will be better to extract the relevant portion of Vinod Shivappa's case. "13. If a notice is issued and served upon the drawer of the cheque, no controversy arises. Similarly if the notice is refused by the addressee, it may be presumed to have been served. This is also not disputed. This leaves us with the third sit....
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....tice is returned with the endorsement that the premises has always been found locked or the addressee was not available at the time of postal delivery, it will be open to the complainant to prove at the trial by evidence that the endorsement is not correct and that the addressee, namely the drawer of the cheque, with knowledge of the notice had deliberately avoided to receive notice. Therefore, it would be pre-mature at the stage of issuance of process, to move the High Court for quashing of the proceeding under S.482 of the Code of Criminal Procedure. The question as to whether the service of notice has been fraudulently refused by unscrupulous means is a question of fact to be decided on the basis of evidence. In such a case the High Court ought not to exercise its jurisdiction under S.482 of the Code of Criminal Procedure." (Underline supplied) 10. First of all, it is to be noted that the principles laid down by the Apex Court are about the Jurisdiction of the High Court under Section 482 to quash the proceedings based on the contention that the notice is not served. The Apex Court observed that, if notice is served upon the drawer of the cheque, no controversy arises, and s....
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....ree-member bench of the Apex Court was considering a question referred by a two-member bench of the Apex Court. The question referred by the two-member bench of the Apex Court is narrated in paragraph 2 of the judgment in CC Alavi Haji's case (supra). "2. The matter has been placed before the three Judge Bench in view of a Reference made by a two Judge Bench of this Court, pertaining to the question of service of notice in terms of Clause (b) of proviso to S.138 of the Negotiable Instruments Act, 1881 (in short 'The Act'). Observing that while rendering the decision in D. Vinod Shivappa v. Nanda Belliappa, 2006 SCC (6) 456 : 2006 KHC 840 : 2006 (3) KLT 94 : AIR 2006 SC 2179 : JT 2006 (11) SC 187 : 2006 (2) KLD 612 : 2006 (3) SCC (Cri) 114 : 2006 CriLJ 2897 : 2006 (130) DLT 534, This Court has not taken into consideration the presumption in respect of an official act as provided under S.114 of the Indian Evidence Act, 1872, the following question has been referred for consideration of the larger Bench: Whether in absence of any averments in the complaint to the effect that the accused had a role to play in the matter of non receipt of legal notice; or that the accuse....
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....there is no "accomplishment" as observed by the Apex Court in CC Alavi Haji's case (supra) and K.Bhaskaran's case (supra). It is true that in CC Alavi Haji's case (supra), the Apex Court observed that the court should not adopt an interpretation which helps a dishonest evader and clips an honest payee, as that would defeat the very legislative measure. The Apex Court also observed that the thrust in the clause is on the need to "make a demand", which is only the mode for making such a demand, which the legislature has prescribed. A payee can send the notice for doing his part for giving notice. Once it is dispatched, his part is over, and the next depends on what the sendee does. 14. If the sendee proves that the notice is not received by him but by a third person and he is not aware of the receipt of the notice by the third person, it cannot be said that there is sufficient compliance with Section 138(b) of the NI Act. The Apex Court in C.C. Alavi Haji's case (supra) observed that service of notice is deemed to have been effected on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. That is what was stated i....
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....s that it was served to a third person. In such circumstances, this Court held that the mandatory notice was not served to the accused. 15. In C.C. Alavi Haji's case (supra), the Apex Court also considered Section 27 of the General Clauses Act, 1897 (for short, G.C Act) and held that; where the payee dispatches the notice by registered post with correct address of the drawer of the cheque, the principle in Section 27 of the G.C. Act would be attracted and the requirement of Clause (b) of proviso to Section 138 of the Act stands complied with and cause of action to file a complaint arises on the expiry of the period prescribed in Clause (c) of the said proviso for payment by the drawer of the cheque. But it is clearly stated by the Apex Court in paragraph 10 of the judgment in C.C. Alavi Haji's case (supra) that, it would be without prejudice to the right of the drawer to show that he had no knowledge that the notice was brought to his address. 16. The counsel for the petitioner, relying on paragraphs 14 and 15 of the judgment in C.C. Alavi Haji's case (supra), submitted that the burden is on the accused to prove that the notice is not served to him. It will be better to extract p....
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.... requirements have been complied with. It is then for the drawer to rebut the presumption about the service of notice and show that he had no knowledge that the notice was brought to his address or that the address mentioned on the cover was incorrect or that the letter was never tendered or that the report of the postman was incorrect. In our opinion, this interpretation of the provision would effectuate the object and purpose for which proviso to Section 138 was enacted, namely, to avoid unnecessary hardship to an honest drawer of a cheque and to provide him an opportunity to make amends." 17. As far as the burden to the accused to rebut the preliminary presumption based on Section 27 of the General Clause Act is concerned, it stands settled in the light of the dictum laid down in the above judgment. But if, on the evidence of the complainant itself, it is proved that the notice is served to a third person and there is no explanation for the complainant to the effect that the accused was aware of such serving of notice to the third person, it cannot be said that there is service of notice. Hence, I am not in a position to say that the dictum laid down by this Court in Saju's cas....
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....cused can offer the amount within 15 days of the receipt of the summons and close the case. But, that is not the situation where the debt is disputed and the entire case of the complainant is alleged as false. In such cases, if a pre-condition notice is received, the accused can warn the complainant that the allegation in the complaint is false and if any prosecution is initiated, he will take appropriate steps against the complainant. Therefore, in cases where the debt and transaction which leads to the issuance of a cheque is disputed, paragraph 17 of the dictum laid down by the Apex Court is not applicable. That is a situation where the debt is admitted, and the accused is not getting notice before initiating prosecution. Therefore, I am of the considered opinion that the dictum laid down by this Court in Saju's case (supra) is not against the principle laid down by this Court in C.C. Alavi Haji's case (supra). 20. Then the learned counsel relied on the judgment in M/s. Indo Automobiles' case (supra). That was also a case in which the Apex Court was considering a situation in which High Court quashed the proceedings on the ground that no notice was served to the accused. The Ap....
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.... above discussion, I see no reason to reconsider the dictum laid down by this Court in Saju's case (supra). Now, I will consider the facts in this case. This Court perused the evidence adduced by the complainant, who was examined as PW1. A specific question was put to the complainant in the chief examination to the effect that Ext.P3 is not a legal notice and the same was not received by the accused. He indeed denied the same, but Ext.P5 is the postal acknowledgement card. As per the postal acknowledgement card, notice is received by one 'Amina'. The complainant in the re-examination deposed that Ext.P3 notice was sent to the correct address of the accused, and in Ext.P5, the notice was received by the mother of the accused, who is 'Amina'. 23. But in the further cross-examination by the accused, PW1 denied the suggestion that 'Amina' is the sister of PW1. But, she only states that notice was sent, and she has no case that the accused is aware of the receipt of notice by 'Amina'. Unless there is evidence to show that the accused is aware of the notice sent by the complainant, this Court cannot conclude that notice is served to the accused. I can understand if PW1 d....