1 APPLN-103.11 IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE SIDE CRIMINAL APPLICATION NO.103 OF 2011 M.P. Sanghavi .... Applicant Vs. Yashwant Babu Pawar & Anr. .... Respondents Ms Shabana Shah i/b Shri O.A. Siddiqui for the Applicant. Shri Ganesh Gole for Respondent No.1. Ms M.M. Deshmukh, APP, for the State. CORAM: R.C. CHAVAN, J. DATED: AUGUST 01, 2011 P.C: 1. This is an application for leave to file appeal against acquittal of the respondent for the offence punishable under Section 138 of the Negotiable Instruments Act recorded by the learned Metropolitan Magistrate, 13th Court, Dadar, Mumbai on the ground, amongst others, that the cheque which was dishonoured was issued towards a time barred debt. The complainant is a money-lender who had advanced a sum of Rs.1,25,000/- as loan on 18-3-2005, which was to be repaid in 24 monthly instalments of Rs.8,000/- each, apart from Rs. 50,000/- which has been allegedly repaid in cash. Upon dishonour of the cheque, complaint was filed. The learned Magistrate held that the 2 APPLN-103.11 cheque in question was issued towards security for the year 2005. The money-lending licence for the relevant period was not produced. The statutory requirements of the Bombay Money- Lenders Act, 1946 were not complied with. Though the complainant had the authority to fill-up the blank cheque, the complainant could not have inserted the amount more than the actual liability of the accused. The amount of loan liability was not disclosed to the income- tax authorities and also that the cheque could not be issued for a time barred debt or liability. For the last proposition, the learned trial Judge had relied on a Judgment of the Kerala High Court which had been questioned in the Supreme Court and the Supreme Court held that they had perused the Judgment of the High Court of Kerala confirming the Judgment of the Additional Sessions Judge holding, amongst other things, that the cheque in question had been issued by the accused for a debt which was time barred by limitation and that therefore the penal provisions of Section 138 of the Act were not attracted. The Supreme Court concluded that on the facts of the case, as available on the record, and the clear and unambiguous provision in the explanation to Section 138, the Judgment of the lower Appellate Court, as 3 APPLN-103.11 confirmed by the High Court, is unassailable. The learned Magistrate observed that dismissal of S.L.P. by the Supreme Court with reasons would amount to law declared by the Supreme Court under Article 141 of the Constitution of India. The question as to whether writing a cheque itself amounts to a contract under Section 25(3) of the Contract Act has elicited divergent responses from this Court and the matter has now been referred to a Division Bench. Further, as far as the applicability of the provisions of the Bombay Money-Lenders Act is concerned, the advance of loan contained in sub-section (9) of Section 2 of the said Act itself excludes by virtue of Clause (f) thereof an advance in excess of Rs.3,000/- against a negotiable instrument. Therefore, non- compliance of the provisions of the Bombay Money-Lenders Act cannot result in non- recoverability of the amount of the cheque as to not reporting the loan to the income-tax authorities. A learned single Judge of this Court in Prakash Rao s/o Ganpat Rao v. Pedro Vincent Dias s/o Shri Caetano Dias & Anr., reported in 2010 (6) L.J.Soft (URC) 77 has already held that merely because the amount of loan is not reported to the income-tax authorities, it does not become unrecoverable. 4 APPLN-103.11 2. The learned counsel for the respondent placed reliance on a Judgment of this Court in Smt. Ashwini Satish Bhat v. Shri Jeevan Divakar Lolienkar & Anr., reported in 2000 (5) Bom.C.R. 9 where an Agreement for payment of Rs. 1,53,724/- was entered into on 13-6-1991. The amount was to be paid within one year. The cheque in question was issued on 19-7-1996 and the Court held that since there was no acknowledgement within three years from the date of loan, the loan was barred by limitation. It seems that it was not brought to the notice of the Court, first, that under the Agreement itself the amount was to be paid within one year of the date of the Agreement and not on the date of the Agreement. The limitation obviously would start running from the date on which the payment was due. Further, the Agreement itself provided that if the respondent failed to pay the amount within twelve months, it was simply to carry Bank interest from the date of the Agreement. Therefore, it should have been brought to the notice of the Court that the parties had already contemplated a situation where the amount would not be paid within one year and therefore, even at worst, since one year s time 5 APPLN-103.11 was prescribed, the limitation would run from the date when the payment was agreed to be made. 3. In the case in hand, the question of limitation should not have arisen since even according to the accused, as per his statement under Section 313 of Cr.P.C., he was to repay in 24 EMIs of Rs.8,000/-. So even if the loan was taken in the year 2005, the EMIs would continue for a period of two years thereafter. Since the payment was to be made in 24 EMIs, the date of advance, that is 18-3-2005, had no relevance. If the 24 EMIs are taken into consideration, the date on which the last EMI was to be paid would come to March, 2007 and therefore it could not be said that the cheque of Rs.1,23,000/-, drawn on 30-9-2008, that is within three years of the last EMI becoming due was in respect of a time barred debt. In view of this, leave granted. Appeal admitted. Call for the R & P.. Since the learned counsel appearing for the respondent states that he would be representing the respondent, action under Section 390 of Cr.P.C. is dispensed with. The application accordingly stands disposed of. (R.C. CHAVAN, J.)