IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD WEDNESDAY, THE FIFTEENTH DAY OF DECEMBER TWO THOUSAND AND TEN PRESENT HON’BLE SRI JUSTICE G.V.SEETHAPATHY CRL.P.No.9655 of 2010 Between:- Sri Venkateswara N & S S Hospital Pvt. Ltd., (Axon Hospitals), Hyderabad and 3 others …Petitioners A n d The State of Andhra Pradesh, Rep. by Public Prosecutor, High Court of A.P., Hyderabad and another …Respondents HON’BLE SRI JUSTICE G.V.SEETHAPATHY CRL.P.No.9655 OF 2010 ORDER: This petition is filed under Section 482 Cr.P.C for quashing further proceedings against the petitioners/A-1, A-3 and A-4 in C.C.No.246 of 2010, on the file of the XX- Additional Chief Metropolitan Magistrate, Hyderabad. 2. Heard both sides. Perused the records. 3. The second respondent herein filed a private complaint before the learned Magistrate against the petitioners and another alleging offence under Section 138 of the Negotiable Instruments Act, 1882 (for short ‘the Act’. According to the second respondent-complainant, A- 1 is a private limited company running a hospital by name Sri Venkateswara N and SS Hospital Private Limited. At the request of accused, the complainant invested approximately Rs.1 crore towards share capital investment in the company on the assurance made by A- 2 to A-4 that they would issue shares in A-1 company. But A-2 to A-4 failed to keep up their promise and did not allot the shares and they promised to repay the money invested by the complainant with interest at 24% per annum. Towards discharge of the said debt, A-1 company issued two cheques bearing Nos.883767 dated 22-09-2010 and 883768 dated 29-09-2008 for an amount of Rs.12.50 lakhs and Rs.25 lakhs respectively on State Bank of India, Ameerpet Branch. The three Directors of the A-1 company i.e., A-2 to A-4 signed the cheques representing the A-1 company. When the two cheques were presented for collection at Andhra Bank, Kukatpally, they were returned for want of sufficient funds. The complainant addressed a letter to A-1 on 25-03-2009 requesting issue of demand draft. A-1 failed to issue the demand draft. The complainant issued a legal notice dated 15-04-2009. A-1 to A-4 received the notice on 17- 04-2009. The accused did not repay the amount but gave a reply on 11-05-2009 with false allegations. 4. The main contention of the petitioners is that the complaint is barred by limitation. According to them, the notice dated 25-03-2009 was served on the petitioners on 30-03-2009 and the complaint ought to have been filed before 14-05-2009, but the same having been filed on 27- 05-2009, is barred by limitation. The petitioners contend that the complainant calculated the period of limitation from the date of service of the second notice, which it is not permissible under law. 5. The learned counsel for the complainant, on the other hand, would submit that the statutory legal notice was issued only on 15-04-2009 and the same was served on the accused on 17-04-2009 and the complaint was filed on 27-05-2009 and the complaint having been filed on 27-05-2009 within the period of 30 days from the date of expiry of 15 days for making payment, is within time. He would further contend that the document dated 25-03-2009 sought to be relied on by the petitioners for the purpose of calculating the period of limitation is not a notice, much less a statutory notice, but is only a letter addressed by the complainant. 6. A perusal of the said document dated 25-03-2009 shows that it was only a letter addressed by the complainant to the petitioners wherein the complainant, after apprising the accused of the return of the two cheques for want of sufficient funds, only made a demand for issuance of a draft for Rs.25 lakhs and interest thereon for the period of default. The said letter was acknowledged by the accused on 30-03-2009 by way of endorsement on the letter wherein it is further stated that the accused would arrange to pay the money in a week’s time. As the accused failed to make the payment as promised, the complainant issued a statutory legal notice on 15-04-2009. It was received by the accused on 17-04-2009 and was replied to on 11-05-2009. In the said notice dated 15-04-2005, the complainant made a specific demand in terms of Section 138 of the Negotiable Instruments Act (for short ‘he Act’) demanding payment of the amount within 15 days from the date of receipt of notice and further stating that failing compliance the complainant would be constrained to initiate legal action under the provisions of the Act. Having regard to the contents of the letter dated 25-03- 2009 and the notice dated 15-04-2009 and the language in which they are couched, it must be held that the first document dated 25-03-2009 is onlya letter addressed by the complainant to the accused intimating the factum of return of the cheques and making a request to issue a demand draft for the amount of Rs.25 lakhs covered by the cheques. The said letter dated 25- 03-2009 cannot be construed to be a statutory legal notice issued in terms of Section 138 of the Act. It is only the notice dated 15-04-2009 got issued by the complainant through Advocate to the accused that conforms to the requirements of Section 138 of the Act and, therefore, can be construed as the statutory legal notice required to be issued under the provisions of the Act. When the period of limitation is calculated based upon the service of the said legal notice dated 15-04-2009, which was received by the accused on 17-04-2009, the complaint is filed within time. The accused received the said notice on 17- 04-2009 and did not pay the amount demanded within 15 days thereafter i.e., before 01-05-2009 and the complaint was filed within 30 days from the said date and is, therefore, in time. The contention of the petitioners that the complaint is barred by limitation is, therefore, untenable. 7. The learned counsel for the petitioners would invite attention to a unreported decision in D.BABU V. M/S BHARTIA INDUSTRIES LTD. (CRL.M.C.No.3214 of 2007), wherein the High Court of Delhi held 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. 8. The learned counsel for the respondent relied on a decision in M/S PADMINI POLYMERS LTD., V. UNIT TRUST OF INDIA[1], where in the High Court of Delhi held that the letter written by the complainant to the accused making him aware of the fact of dishonour of cheque, in the absence of any demand to make the payment within 15 days, cannot be construed as notice under Section 138 (C) and therefore limitation for filing the complaint would not start from the date of such letter but would start from the date of issuance of notice containing stipulation of making payment within 15 days. In the above case, the letter, in fact, made a reference to Section 138 of the Act, but the Court held that simply because a reference was given for initiating proceedings under Section 138 of the Act does not give a colour of notice as contemplated under Section 138 of the Act. Through that letter, only the fact that the cheques have been dishonoured was brought to the notice of the petitioners calling upon them to make the payment immediately. The said letter cannot be construed as legal notice contemplated under Section 138(c). 9. In the circumstances, it is held that proceedings against the petitioners/accused in C.C.No.246 of 2010, on the file of the XX-Additional Chief Metropolitan Magistrate, Hyderabad, are not liable to be quashed by invoking the inherent powers of the Court under Section 482 Cr.P.C. 10. In the result, the criminal petition is dismissed. ____________________ G.V.SEETHAPATHY, J 15th December, 2010 Lrkm. [1] 2003 CRI. L.J.1053