Case Note & Summary
The petitioner, Jogen C. Thakkar, filed a criminal writ petition under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973, seeking quashing of Case No.251/S of 1997 pending before the Metropolitan Magistrate, 13th Court, Bhoiwada at Mumbai. The case arose from a complaint filed by respondent No.2, Ms. Priya Bhagwandas Advani, against the petitioner and others (respondent Nos.3 to 8) under Section 138 of the Negotiable Instruments Act, 1881, alleging dishonour of a cheque. The petitioner contended that the demand notice under Section 138 was not served on him but on a third party, M/s. Labdhi Promoters & Developers, and therefore the essential ingredient of service of notice was missing. The court examined the complaint and the notice, and found that the notice was addressed to the petitioner but was sent to the address of the partnership firm, not to the petitioner's address. The court held that service of notice on a third party does not constitute valid service under Section 138. Consequently, the court quashed the criminal proceedings against the petitioner, allowing the writ petition. The court also noted that the complaint did not disclose any other material to show that the petitioner had knowledge of the notice. The judgment was delivered by Justice J.H. Bhatia on 20th April 2011.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Service of Notice - The complainant must prove that the demand notice was served on the drawer of the cheque. Service on a third party, even if related, does not satisfy the requirement of Section 138. The court held that the proceedings were liable to be quashed as the notice was not served on the accused. (Paras 5-8)
B) Criminal Procedure Code - Quashing of FIR - Section 482 - Inherent Powers - The High Court can quash criminal proceedings if the complaint does not disclose the essential ingredients of the offence. Here, the notice was not served on the accused, hence the complaint was an abuse of process. (Paras 9-10)
Issue of Consideration
Whether the criminal proceedings under Section 138 of the Negotiable Instruments Act, 1881 can be sustained when the demand notice was not served on the accused but on a third party?
Final Decision
The court allowed the writ petition and quashed the criminal proceedings in Case No.251/S of 1997 pending before the Metropolitan Magistrate, 13th Court, Bhoiwada at Mumbai, against the petitioner.
Law Points
- Notice under Section 138 NI Act must be served on the drawer of the cheque
- not on a third party
- service of notice by UPC and registered post is sufficient if sent to correct address
- burden of proof of service lies on complainant
- presumption of service arises if notice is sent by registered post to correct address.
Case Details
2011 LawText (BOM) (04) 71
Criminal Writ Petition No. 874 of 2009
Mr. Mahesh Londhe i/b M/s. Sanjay Udeshi & Co. for petitioner; Ms. U.V. Kejriwal, APP for respondent No.1; Mr. R. Sathyanarayanan for respondent No.2
The State of Maharashtra, Ms. Priya Bhagwandas Advani, M/s. Labdhi Promoters & Developers, Kirti Ramesh Somaiya (HUF), Shri Ramesh Somaiya, Shri Ramesh Somaiya (HUF), Shri Harsha Ramesh Somaiya, Smt. Geeta R. Kothari
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Nature of Litigation
Criminal writ petition under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973, seeking quashing of criminal proceedings under Section 138 of the Negotiable Instruments Act, 1881.
Remedy Sought
Petitioner sought quashing of Case No.251/S of 1997 pending before the Metropolitan Magistrate, 13th Court, Bhoiwada at Mumbai.
Filing Reason
The petitioner contended that the demand notice under Section 138 of the Negotiable Instruments Act was not served on him but on a third party, and therefore the essential ingredient of the offence was missing.
Issues
Whether the criminal proceedings under Section 138 of the Negotiable Instruments Act, 1881 can be sustained when the demand notice was not served on the accused but on a third party?
Submissions/Arguments
Petitioner argued that the notice under Section 138 was not served on him but on M/s. Labdhi Promoters & Developers, a third party, and therefore the complaint does not disclose the essential ingredients of the offence.
Respondent No.2 (complainant) argued that the notice was sent to the correct address and that the petitioner had knowledge of the notice.
Ratio Decidendi
For an offence under Section 138 of the Negotiable Instruments Act, 1881, the demand notice must be served on the drawer of the cheque. Service on a third party does not satisfy the requirement of the section, and the proceedings are liable to be quashed if the notice is not served on the accused.
Judgment Excerpts
The notice was not served on the petitioner but on M/s. Labdhi Promoters & Developers, a third party. Therefore, the essential ingredient of service of notice under Section 138 of the Negotiable Instruments Act is missing.
The complaint does not disclose any material to show that the petitioner had knowledge of the notice. Hence, the proceedings are an abuse of process of law.
Procedural History
The petitioner filed Criminal Writ Petition No. 874 of 2009 before the High Court of Judicature at Bombay under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973, seeking quashing of Case No.251/S of 1997 pending before the Metropolitan Magistrate, 13th Court, Bhoiwada at Mumbai. The petition was heard and disposed of by judgment dated 20th April 2011.
Acts & Sections
- Negotiable Instruments Act, 1881: 138
- Code of Criminal Procedure, 1973: 482
