Case Note & Summary
The applicant, Prafulla Purushottam Gadge, filed five criminal applications under Section 482 of the Code of Criminal Procedure, 1973 (CrPC) seeking quashing of criminal proceedings in five separate complaints filed by the non-applicant, Buldana Urban Co-operative Credit Society Ltd., under Section 138 of the Negotiable Instruments Act, 1881 (NI Act). The complaints alleged that cheques issued by the applicant were dishonoured. The applicant contended that the demand notices sent by the complainant were returned with endorsements 'not claimed' or 'refused', and that the complainant failed to prove proper service. The court examined the issue of whether the proceedings could be sustained without proof of service of notice. The court held that under Section 138 NI Act, service of demand notice is a mandatory prerequisite. The complainant must prove that the notice was sent to the correct address and that the accused deliberately avoided service. Mere postal endorsements are insufficient. Since the complainant failed to adduce evidence of proper service, the proceedings were quashed as an abuse of process. The court allowed all five applications and quashed the respective criminal proceedings.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Service of Notice - Section 138 NI Act - The complainant must prove that the demand notice was properly served on the accused. Mere endorsement of 'not claimed' or 'refused' by the postal authorities is not sufficient to raise a presumption of service under Section 27 of the General Clauses Act, 1897, unless the complainant also proves that the notice was sent to the correct address and that the accused deliberately avoided service. (Paras 1-10) B) Criminal Procedure Code - Quashing of Proceedings - Abuse of Process - Section 482 CrPC - Where the complainant fails to prove service of demand notice, the criminal proceedings under Section 138 NI Act are an abuse of the process of law and liable to be quashed. (Paras 1-10)
Issue of Consideration
Whether the criminal proceedings under Section 138 of the Negotiable Instruments Act, 1881 can be sustained when the demand notice was returned with endorsement 'not claimed' or 'refused' and the complainant failed to prove proper service.
Final Decision
The court allowed all five criminal applications and quashed the respective criminal proceedings under Section 138 NI Act pending before the Judicial Magistrate First Class, Buldana.
Law Points
- Service of demand notice under Section 138 NI Act must be proved by complainant
- endorsement of 'not claimed' or 'refused' insufficient without further evidence
- presumption under Section 27 General Clauses Act not automatic
- quashing under Section 482 CrPC for abuse of process
