Case Note & Summary
The petitioners, Mukeshbhai Balabhai Patel and his wife Ranjanben, filed a 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 Complaint No. 186/SW/2012 pending before the Metropolitan Magistrate, 37th Court, Andheri, Mumbai, and all consequential proceedings. The complaint was filed by Jayesh Ratilal Jogia (respondent no. 2) against the petitioners and others under Section 138 of the Negotiable Instruments Act, 1881, alleging dishonour of a cheque for Rs. 25,00,000 issued by the petitioners. The petitioners contended that the statutory demand notice under Section 138 was not served at their correct address. The notice was sent to an office address at Bhavnagar, Gujarat, which was closed and where the petitioners no longer carried on business. The petitioners argued that they had no knowledge of the notice and therefore the complaint was not maintainable. The court examined the provisions of Section 138 of the Negotiable Instruments Act, which requires that the payee must make a demand for payment by giving a notice in writing to the drawer of the cheque within 30 days of the receipt of information of dishonour. The court noted that the notice must be sent to the correct address of the drawer. In this case, the notice was sent to an address that was not the current business address of the petitioners. The court held that service of notice at a closed office address does not constitute valid service. Consequently, the court quashed the criminal complaint and all proceedings arising therefrom. The criminal application filed by Mrs. Roopal Rajesh Madhani for similar relief was also disposed of as infructuous.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Service of Demand Notice - Proper service of demand notice is a prerequisite for prosecution under Section 138 - Notice sent to an address where the accused no longer carries on business is not valid service - The court quashed the proceedings as the notice was sent to a closed office address and the accused had no knowledge of the notice (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 not served at the correct address of the accused.
Final Decision
The court quashed Criminal Complaint No. 186/SW/2012 and all proceedings arising therefrom. Criminal Application No. 186 of 2017 was disposed of as infructuous.
Law Points
- Service of demand notice under Section 138 of the Negotiable Instruments Act
- 1881 must be at the correct address of the drawer
- Notice sent to a closed office address is not valid service
- Quashing of criminal proceedings for lack of proper notice
