HON’BLE SRI JUSTICE G.V.SEETHAPATHY Criminal Petition No.7469 of 2008 ORDER: This criminal petition is filed under section 482 Cr.P.C. for quashing further proceedings against the petitioner/accused in CC No.280 of 2006 on the file of the VII Metropolitan Magistrate, Cyberabad. 2. Heard the learned counsel for the petition and the learned counsel for the 2nd respondent. 3. The 2nd respondent herein filed private complaint against the petitioner alleging the offence under section 138 of the Negotiable Instruments Act (for short ‘the Act’) and the same was taken cognizance in CC No.280 of 2006. According to the 2nd respondent, the petitioner/accused borrowed Rs.1,00,000/- from the 2nd respondent and executed stamped receipt on 06.05.2004 and after repeated demands, the accused issued a cheque on 02.02.2006 for an amount of Rs.1,00,000/- drawn on Andhra Bank, Kendriya Sadan, Hyderabad and when presented for encashment, cheque was returned with memo dated 07.02.2006 with endorsement ‘account closed’. The complainant informed the accused about the same and on the request of the accused, the complainant again presented the cheque for a second time and even at that time also, the cheque was returned as ‘account closed’ along with a memo dated 18.04.2006. The complainant got issued registered notice on 30.04.2006, which was returned with endorsement ‘addressee left’ on 02.05.2006. The accused has therefore rendered himself liable for punishment under section 138 of the Act. 4. The main contention of the learned counsel for the petitioner is that there was no cause of action for filing the complaint and no notice was served on the petitioner as required under the statute before filing the complaint. 5. It is not disputed that the cheque dated 02.02.2006 was returned on 07.02.2006 with endorsement ‘account closed’. In a decision in ‘NEPC MICON Ltd. V. Magma Leasing Ltd.,[1]’ the apex Court held as follows: “The dishonouring the cheque on the ground that account is closed is the consequence of the act of the drawer rendering his account to a cipher. Hence, reading Section 138 and 140 together, it would be clear that dishonour of the cheque by a bank on the ground that account is closed would be covered by the phrase ‘the amount of money standing to the credit of that account is insufficient to honour the cheque’.” 6. In view of the above decision, return of the cheque endorsing as ‘account closed’ also falls within the ambit and scope of Sections 138 and 140 of the Act. 7. According to the complainant, he informed the return of the cheque to the accused and on the request of the accused, he again presented the same and on the second occasion also, the cheque was returned with endorsement as ‘account closed’ on 18.04.2006. Learned counsel for the petitioner would contend that the alleged oral intimation is false and the complaint is barred by limitation as no action was taken pursuant to the return of the cheque on 07.02.2006. 8. In ‘Prem Chand Vijay Kumar v. Yashpal Singh[2]’, the apex Court held as follows: “Clause (a) of the proviso to Section 138 does not put any embargo upon the payee to successively present a dishonoured cheque during the period of its validity. This apart, in the course of business transactions it is not uncommon for a cheque being returned due to insufficient funds or similar such reasons and being presented again by the payee after sometime, on his own volition or at the request of the drawer, in expectation that it would be encashed. The primary interest of the payee is to get his money and not prosecution of the drawer, recourse to which, normally, is taken out of compulsion and not choice. On each presentation of the cheque and its dishonour, a fresh right-and not a cause of action - accrues in his favour. He may, therefore, without taking pre-emptory action in exercise of his such right under clause (b) of Section 138, go on presenting the cheque so as to enable him to exercise such right at any point of time during the validity of the cheque.” 9. In the above case, it was further held that ‘on a plain reading of the Section 138 and 142 of the Act leaves no room for doubt that cause of action within the meaning of Section 142(b) arises - and can only arise - only once and the period of one month for filing the complaint will be reckoned from the day immediately following the day on which the period of 15 days from the date of the receipt of the notice by the drawer expires’. It was further held as follows: “As noted in Sadanandan Bhadran's case [(1998) 6 SCC 514] once a notice under clause (b) of Section 138 of the Act is "received" by the drawer of the cheque, the payee or holder of the cheque forfeits his right to again present the cheque as cause of action has accrued when there was failure to pay the amount within the prescribed period and the period of limitation starts to run which cannot be stopped on any account. One of the indispensable factors to form the cause of action envisaged in Section 138 of the Act is contained in clause (b) of the proviso to that section. It involves the making of a demand by giving a notice in writing to the drawer of the cheque "within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid". If no such notice is given within the said period of 15 days, no cause of action could have been created at all. Thus, it is well settled that if dishonour of a cheque has once snowballed into a cause of action it is not permissible for a payee to create another cause of action with the same cheque. I n Sil Import, USA v. Exim Aides Silk Exporters, Bangalore (1999 (4) SCC 567), it was held that the language used in Section 142 admits of no doubt that the magistrate is forbidden from taking cognizance of the offence if the complaint was not filed within one month of the date on which the cause of action arose. Completion of the offence is the immediate forerunner of rising of the cause of action. In other words, cause of action would arise soon after completion of the offence and period of limitation for filing of the application starts running simultaneously.” 10. In the present case, no cause of action has arisen pursuant to the first return of the cheque on 07.02.2006 as no notice was given within the period of 15 days from 07.02.2006. The cause of action in the present case would arise pursuant to receipt of the notice dated 30.04.2006, which was issued after the cheque was dishonoured for a second time on 18.04.2006. The notice was however returned on 02.05.2006 with endorsement as ‘addressee left’. Within one month thereafter, the complaint is filed on 23.05.2006. 11. Learned counsel for the petitioner would next contend that as the notice was not served on the petitioner, there is no cause of action for the complaint. The notice was issued to the address of Anandanagar Colony, Khairatabad, Hyderabad. According to the petitioner, he was not residing at that address at the relevant time and he was residing at Sagar Nagar, Visakhapatnam. In support of the said plea, he seeks to rely upon the electricity bills and tax receipts to show the change of the address. In the complaint also, the address of the accused is noted as ‘Anandanagar Colony, Khairatabad, Hyderabad’, to which address the notice was sent and admittedly, summons were not served. The notice was returned with endorsement as ‘addressee left’. The complainant would contend that the accused was having knowledge of the notice and purposefully, he avoided the receipt of the notice. The question as to whether or not the accused had knowledge of the notice is a matter to be considered on evidence. 12. In ‘D.Vinod Shivappa v. Nanda Belliappa[3]’, the apex Court held as follows: “….We cannot also lose sight of the fact that the drawer may by dubious means manage to get an incorrect endorsement made on the envelope that the premises has been found locked or that the addressee was not available at the time when postman went for delivery of the letter. It may be that the address is correct and even the addressee is available but a wrong endorsement is manipulated by the addressee. In such a case, if the facts are proved, it may amount to refusal of the notice. If the complainant is able to prove that the drawer of the cheque knew about the notice and deliberately evaded service and got a false endorsement made only to defeat the process of law, the Court shall presume service of notice. This, however, is a matter of evidence and proof. Thus even in a case where the notice 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 Section 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 Section 482 of the Code of Criminal Procedure.” 13. In ‘C.C.Alavi Haji v. Palapetty Muhammed[4]’, the apex Court held as follows: “Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement ‘refused’ or ‘not available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee not in station’, due service has to be presumed. [Vide Jagdish Singh Vs. Natthu Singh; State of M.P. Vs. Hiralal & Ors. and V.Raja Kumari Vs. P.Subbarama Naidu & Anr.] It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice un-served.” 14. In the present case, the question as to whether or not there has been due service in the sense that the accused had knowledge of the notice and purposefully avoided to receive the same and the question as to whether or not the presumption available under section 114 of the Evidence Act and Section 27 of the General Clauses Act are available and whether or not it shall be presumed that the notice has been duly served on the accused notwithstanding the fact that it was returned with endorsement as ‘addressee left’ are all matters to be considered on evidence that may be adduced during the course of trial. 15. counsel for the petitioner invites attention of this Court to the decision in ‘Dalmia Cement (Bharat) Limited s. Galaxy Traders & Agencies Ltd[5]’, wherein it was held that ‘it is to be kept in mind that it is not the ‘giving’ of the notice, which makes the offence but it is the ‘receipt’ of the notice by the drawer which gives the cause of action to the complainant to file the complaint within the statutory period’. The above decision was referred in ‘Vinod Shbivappa’s case (3rd supra) and it was held that ‘none of the decisions considered above take a view different from the view we have taken. The question as to whether there was deemed service of notice, in the sense that the endorsement made on the returned envelope was a manipulated and false endorsement, is essentially a question of fact, and that must be considered in the light of the evidence on record. The High Court was thus right in rejecting the petitions filed by the appellant under Section 482 of the Code of Criminal Procedure.’ 16. In the light of the principles laid down in the above decisions and in the facts and circumstances of the present case, it is considered not a fit case to invoke inherent powers of the Court under section 482 Cr.P.C. and quash further proceedings against the petitioner/accused in CC No. 280 of 2006 on the file of the VII Metropolitan Magistrate, Cyberabad. 17. In the result, the criminal petition is dismissed. G.V.SEETHAPATHY, J Date: 15.12.2011 bss [1] (1999)4 SCC 253 [2] (2005) 4 SCC 417 [3] (2006) 6 SCC 456 [4] (2007) 6 SCC 555 [5] AIR 2001 SC 676