IN THE HIGH COURT OF JUDICATURE AT PATNA Cr.Misc. No.15518 of 2006 AJAY KUMAR PODDAR Versus THE STATE OF BIHAR & ANR ----------- For the Petitioner : Mr. Prabhakar Jha, Advocate. For the State : Mr. Jharkhandi Upadhayay, A.P.P. For O.P. No.2 : Mr. Pawan Kumar, Advocate. --------- O R D E R The petitioner who has been arrayed as the sole accused in Complaint Case No.329 of 2005 has prayed for the quashing of the order dated 9.6.2005 passed therein by Sri Santosh Kumar Pandey, Judicial Magistrate, First Class, Muzaffarpur, whereby he has taken cognizance against the petitioner under Section 406 I.P.C. and Section 138 of the Negotiable Instrument Act (hereinafter referred to as “the N.I. Act”). The complainant, one Md. Sabbir, impleaded herein as O.P. No.2, filed the aforesaid complaint on 22.2.2005 stating inter alia that he and the petitioner were long acquainted with each other and the petitioner in order to propagate his business frequently took loans from him which he would pay back in full soon thereafter and as a result thereof the complainant had developed unreserved and implicit faith on him. It is alleged that on 15.7.2004 the petitioner requested for a loan of Rs. three lacs on the pretext of an urgent requirement for expanding his business which he assured to repay within two months. As the complainant had full faith on the petitioner he immediately paid willingly a sum of Rs.1,50,000/- as loan and the balance Rs.1,50,000/- he gave after 15 days and the petitioner in return thereof gave a post- - 2 - dated cheque dated 15.10.2004 for the entire amount drawn on Canara Bank. When the complainant presented the cheque for payment, it was returned with an endorsement “insufficient fund”. The complainant then intimated the petitioner through a legal notice dated 26.10.2004 on receipt whereof the petitioner met the complainant and immediately paid him a sum of Rs.50,000/- in presence of witnesses and took back the old cheque. It is further alleged that the petitioner again issued a cheque no.0085650 dated 15.1.2005 drawn on Canara Bank for a sum of Rs.2,50,000/- but this cheque too on its presentation was not encashed on the ground that the petitioner had advised the Bank to “stop payment”. As the balance amount of the money given as loan had not been returned it has been alleged that the petitioner had committed a breach of trust. Assailing the impugned order the learned counsel for the petitioner raised an issue of illegality inasmuch as the learned Chief Judicial Magistrate had transferred the complaint case under Section 192 Cr.P.C. without examining the complainant which only perpetrated illegality. It goes without saying that Section 192 Cr.P.C. does not postulate that the Chief Judicial Magistrate only after recording the statement of the complainant on S.A. can transfer the case to any other Magistrate. It only lays down:- “192(1) Any Chief Judicial Magistrate may, after taking cognizance of an offence , make over the case for enquiry or trial to any competent Magistrate subordinate to him………….” - 3 - The expression “cognizance” has not been defined in the Code. When the Magistrate on receiving a complaint applies his mind for proceeding under Sections 200 to 203 Cr.P.C. he is said to have taken cognizance within the meaning of Section 190(1) (a) Cr.P.C. but when he refers the complaint to the police for investigation under Section 156(3) Cr.P.C. or issues a search warrant he cannot be said to have taken cognizance. It would thus appear that “taking cognizance” does not involve any formal action or action of any kind and no restricted interpretation can be given to the said phrase as action in taking cognizance may also take the form of refusing to initiate proceedings. In view of the discussions made above the issue raised by the learned counsel for the petitioner is devoid of any merit. Now to the merits of the case. The complainant in his complaint petition has himself admitted that a business relationship had developed between him and the petitioner in pursuance whereof he had advanced money to the petitioner by way of loan and the non-return thereof would give rise to civil consequences only and could not be classified as a breach of trust, there being an absence of the ingredients of an offence under Section 406 I.P.C.. It is admitted by the complainant that the earlier loans advanced had been returned by the petitioner and even in this case an amount of Rs.50,000/- had been returned by the petitioner in addition to a post dated cheque for Rs.2,50,000/-. In the aforesaid circumstances it cannot be said conclusively that the means rea of misappropriating the balance amount of loan was present and an offence under Section 406 I.P.C. has been - 4 - made out. In my opinion, no offence under Section 406 I.P.C. appears to have been made out and as such the cognizance taken thereunder cannot be sustained in law and is required to be quashed which I do accordingly. However, I have my reservations in respect of the offence under Section 138 of the N.I. Act. The specific stand of the petitioner is that he had informed the Bank to “stop payment” as he had lost the said cheque. The story propounded by the petitioner in his defence appears to be an amateurish plea of a man clutching at a bundle of straw to save himself from drowning. If the plea is to be believed then how was it that it was the complainant who had presented the said cheque and the Bank instead of confiscating it due to the reported loss had instead intimated about the “stop payment” instruction of the drawer. It must have been the petitioner who had handed over the cheque to the complainant and now having fallen into troubled waters was resiling therefrom. In the circumstances an offence under Section 138 of the N.I. Act cannot be said not to have been made out. In the result, the application succeeds in part to the extent that the cognizance taken under Section 406 I.P.C. is quashed but the cognizance taken for offence under Section 138 of the N.I. Act is maintained. (Abhijit Sinha,J) Patna High Court, Patna. Dated: The 29th of August, 2008. Pradeep Srivastava/A.F.R.