IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated: 28.07.2011 Coram THE HONOURABLE MS. JUSTICE K.B.K.VASUKI Crl.R.C.No.1403 of 2006 1.M/s.Surans Traders rep by its Managing Partner Mr.R.Sukumar 2.Mr.R.Sukumar, Partner M/s.Surans Traders, S/o.K.K.Ramalingam 3.Mr.K.K.Ramalingam, Partner M/s.Surans Traders, S/o.C.K.Kandasamy 4.Mr.R.Anand, Partner M/s.Surans Traders S/o.K.K.Ramalingam .. Petitioners/Appellants/Accused Vs. TTK.Tantex Limited (formerly known as M/s.TTK Textiles Limited) Rep by its Manager Exports Mr.Prem Natesan, No.6, Cathedral Road, Chennai-86. .. Respondent/Respondent/complainant Prayer :- Criminal Revision Petition filed under Section 397 r/w 401 of Cr.P.C. against the order made on 22.11.2006 in CA.No.66 of 2006 on the file of II Additional Sessions Judge, Chennai confirming the judgment and sentence made on 01.03.2006 in C.C.No.1642 of 2002 on the file of the VII Metropolitan Magistrate, George Town, Chennai. For Petitioners : MR.S.T.RAJA FOR M/S.Om Sai Ram For Respondent : M/s.S.Thanga Sivan ORDER The accused are the revision petitioners herein. The respondent herein filed private complaint against the accused under Section 138 of the Negotiable Instruments Act, by saying that the accused partnership firm had credit dealings and purchased hosiery products worth Rs.25,23,175/- vide invoices bearing Nos.200102 to 00014 dated 21.4.2001 and the 2nd accused issued five cheques on different dates on 03.09.2001, 06.09.2001 and 12.09.2001 on behalf of the accused concerned towards discharge of the outstanding. The complainant deposited first three cheques on 21.01.2002 for encashment and they were returned on 05.02.2002 with an endorsement 'account closed' which was duly informed to the complainant by the bankers on 11.02.2002. On being informed so, the complainant issued legal notice on 25.02.2002 and the same was acknowledged by other accused on https://hcservices.ecourts.gov.in/hcservices/ 05.03.2002, while accused 2 and 4 returned it. The accused neither paid the amount within fifteen days, but issued reply on 23.03.2002 wherein the outstanding and the issuance of the cheques are admitted but it is falsely stated that the cheques are not filled up and cheques are issued undated with an understanding that it should be presented after getting the approval of the accused. The complaint further says that the cheques are dated by the accused and the goods are taken delivery after satisfying the quality and the goods are thereafter exported at the cost and risk of the accused and the complainant is in no manner connected with the dispute between the accused and the alleged Srilankan buyer and the complainant is entitled to receive his money back and on the failure of the accused to discharge the liability, the accused committed the acts constituting the offence punishable under Section 138 of the Negotiable Instruments Act. 2. The complainant has in order to prove the case as narrated in the complaint examined the manager of the complainant firm and his witness as PW1 and PW2 and produced the copy of the Board resolution, Invoice bill, cheques in question, copy of the Advocate notice, acknowledgment card, reply notice, statement of the account and copy of the order dated 17.07.2002 of I Additional District Munsif Court as Exs.P1 to P21 and the defendant examined DW1 and DW2 and produced copy of the fax letter, acknowledgment letter, reply letter, Dhanalakshmi Bank letter, statement of accounts, letter from the complainant to the accused, Auction notice, police department notice as Exs.D1 to D11. The trial court has, on the basis of the evidence adduced before the same, arrived at a conclusion that the notice dated 25.02.2002 is the statutory notice and notice dated 3.12.2001 is not the statutory notice and the accused committed the offence under Sections 138 and 142 of the Negotiable Instruments Act by having failed to return the goods and failed to discharge his liability in spite of enough opportunity given by the complainant and found the accused guilty and convicted and sentenced the accused 2 to 4 partners. Aggrieved against the same, the accused preferred C.A.No.66 of 2006 and the appellate court dismissed the appeal by confirming the judgment and conviction of the trial court. Hence this criminal revision by the accused before this court. 3. The learned counsel for the accused seriously questioned the validity of notice dated 25.02.2002 purported to be the statutory notice and on that basis challenged the maintainability of the complaint as barred by limitation. It is further seriously argued that the cheques in question are issued only as security for the purchase from the complainant and the same are not issued for discharging any legally enforceable liability and the same are misused for unlawful enrichment. 4. Per contra, the learned counsel for the respondent/ complainant by relying upon the orders made by the High Court in Crl.OP as confirmed by the Supreme Court and has by placing reliance upon the admission of the accused regarding his liability and the circumstances under which the cheques are issued, defended the order of the conviction and sentence of the courts below. https://hcservices.ecourts.gov.in/hcservices/ 5. Heard the rival submissions made on both sides. 6. The learned counsel for the accused raised both legal and factual objections against the correctness of the findings rendered by both the courts below. The legal objection raised is that the cause of action for filing the complaint arose during December 2001 with the issuance of notice dated 3.12.2001 and the complaint filed during April 2002 is barred by limitation. It is contended by the learned counsel for the petitioners/accused that the statutory notice Ex.P12 dated 25.02.2002 is not the first notice of its nature and the cheque in question was presented for collection on earlier occasion during November to December 2001 and the same was intimated to the accused through Ex.D3 letter dated 03.12.2001 thereby calling upon the accused to settle the amount within fifteen days on or before 18.12.2001 and the same is to be construed as the statutory notice as contemplated under Section 138 of the Negotiable Instruments Act and the cause of action for filing the suit commenced from 16th day on 19.12.2001 and the present complaint filed during April 2002 is hopelessly hit by limitation. 7. The learned counsel for the petitioners also in support of such contention cited the judgment of the Supreme Court reported in 1998 (II) CTC 462 in Ms Sadanandan Bhadran V. Madhavan Sunil Kumar. 8. Per contra, the learned counsel for the respondent/ complainant would, by relying upon the orders made in Crl.OP.No.16286 of 2004 dated 17.02.2005 as confirmed by the Supreme Court in SLP.No.64 of 2007 on 15.01.2010, contend that Ex.P12 notice dated 25.02.2002 is the statutory notice and the notice dated 03.12.2001 cannot be construed as statutory notice and the objection so raised is already decided by High Court by order dated 17.02.2005 made in Crl.OP as above referred to and the revision petitioners are hence not entitled to raise the same point. 9. The perusal of the records would reveal that the complaint arising out of which the present revision is filed on 01.04.2002 and the complaint proceeds as if the respondent firm is due to pay Rs.25,23,175/- to the complainant firm and the accused firm issued five cheques for due repayment of the same and the same was presented for collection on 25.01.2002 and the cheques were returned dishonoured on 05.02.2002 as account closed, which was duly informed to the complainant by his banker on 11.02.2002 and the statutory notice was issued on 25.02.2002 and the same was separately received by the accused 1, 2 and 4 and the accused 3 and 5, but the statutory notice was neither replied nor the liability was discharged. But the complaint is silent about the presentation of the cheques on earlier occasion i.e, on 15.11.2001 and about the earlier notice dated 03.12.2001 and the complaint proceeds as if the cheques are presented for the first time on the dates as above referred to. The accused after entering appearance in the complaint, filed Crl.OP.No.16286 of 2004 for quashing the proceedings by contending that the cause of action for filing the complaint arose after fifteen days time mentioned in notice dated 03.12.2001 expired on 18.12.2001, and the limitation for instituting the complaint started running from the next date onwards and the complaint ought to have been filed within https://hcservices.ecourts.gov.in/hcservices/ 30 days from 20.12.2001 or the present complaint ought to have been filed with a petition to condone the delay in filing the complaint and as the complaint is not filed either within the period of limitation or with a petition to condone the delay, the complaint is not maintainable. 10. However, our High Court by order dated 17.02.2005 rejected Crl.OP.No.16286 of 2004 on the ground that the notice dated 03.12.2001 does not speak about the particulars of the cheques in question, the cheques were not placed at the hands of the banker and the first notice dated 3.12.2001 cannot be considered as notice, as contemplated under proviso (b) to Section 138 of the N.I. Act. As the cheques were placed at the hands of the banker only on 25.01.2002 and dishonoured subsequently and the notice was issued on 25.02.2002 through the counsel for the complainant, the cause of action for litigation arose and the complaints were launched and thus, they were in order and the lower court was directed to dispose of the matter within a period of three months and the same was not disturbed by the Hon'ble Apex Court. The trial court negatived the defence in view of the earlier order passed by our High Court as confirmed by the Apex Court in SLP. 11. The same point was also raised before the lower appellate court. The lower appellate court also negatived the same, as not sustainable in view of the earlier orders of the High Court and Apex Court and the same point is also sought to be raised before the revisional Court and the same is also sought to be contested by the respondent/complainant on the strength of earlier orders of the High Court and the Apex Court on the basis of which the defence regarding limitation was negatived by the trial court and by the appellate court. 12. In my considered view the findings so rendered by the courts below is not legally and factually sustainable for the following reason. It may be true that the objection regarding maintainability of the complaint on the ground of limitation is raised and decided against the accused by the High Court and the order of the High Court was confirmed by the Supreme Court. But, those orders were passed at the initial stage upon application filed to quash the proceedings and one of the grounds for which the High Court was pleased to reject the contention was for want of sufficient particulars in this regard. However, the same will not take away the right of the accused to raise the same point on merits, after due evidence is adduced on both sides. 13. Our Hon'ble Apex Court in its recent judgment reported in 2007 (1) MWN (cr.) DCC 19 (SC) in S.M.S. Pharmaceuticals Ltd., Vs. Neeta Bhalla and another while dealing with the maintainability of the petition for quash after the dismissal on merits of two consecutive discharge petitions, is pleased to reject the contention against the maintainability of the quash application. The Supreme Court following the observation of the Supreme Court in the earlier judgment reported in 1975 (3) SCC 706 in Superintendent and Remembrancer of Legal Affairs, West Bengal V. Mohan Singh and others, observed that when there is changed set of circumstances, second https://hcservices.ecourts.gov.in/hcservices/ application would be maintainable and that the principles of res judicata was not attracted. 14. Further, the reading of the order of the High Court would reveal that the entire facts was not placed before the High Court wherein PW1 had in the course of his cross examination categorically admitted that out of five cheques the present cheque in question and the other two cheques were separately presented for collection on 15.11.2001 and the cheques were returned for want of sufficient funds and the cheques mentioned in letter dated 03.12.2001 are the cheques so returned, but the return memo and debit invoice given by the bank concerned were not filed in this case. The accused firm was by notice dated 03.12.2001 called upon the accused to settle the amount on or before 18.12.2001 and the cheques were again represented for collection on 05.02.2002 and were again returned as account closed and the notice dated 25.02.2002 was issued only after the return of the cheques on the second occasion. The evidence of PW1 to that effect, is extracted here under : ''///// 15/11/2001 njjpapy; tHf;F fhnrhiy jhf;fy; bra;ag;gl;L vjphpapd; fzf;fpy; nghjpa gzkpy;yhj fhuzj;jhy; jpUg;gg;gl;lJ/ kw;w ,U fhnrhiyfSk; mt;thnw 15/11/2001 md;W jhf;fy; bra;ag;gl;L nghjpa gzkpy;iy vd;w fhuzj;jhy; jpUg;gg;gl;lJ/ t';fp bfhLj;j hpl;ld; bknkh ,e;j tHf;fpy; ehd; jhf;fy; bra;atpy;iy/ vkJ t';fp bfhLj;j blgpl; ml;itRk; ePjpkd;wj;jpy; jhf;fy; bra;ag;gltpy;iy/ 3/12/2001 njjpapl;l fojj;jpy; vjphp v';fSf;F bfhLf;f fhnrhiyfspy; rpy kjpf;fg;glhky; jpUg;gg;gl;lJ vd;why; rhpjhd;/ 18/12/2001 njjpf;Fs; jpUg;gg;l;l fhnrhiyfSf;fhd bjhifapid brYj;jntz;Lbkd; eh';fs; me;j fojj;jpy; nfl;Ls;nshk; vd;W brhd;dhy; rhpjhd;/ tHf;if Vg;uy; 2002?k; Mz;L jhf;fy; bra;ag;gl;lJ/ fhyjhkjkhf g [fhh; jhf;fy; bra;ag;gl;ljhf ePjpkd;wj;jpy; eh';fs; mDkjp nfhhp kD VJk; jhf;fy; bra;atpy;iy/ 2?tJ Kiwahf 5/2/2002 njjpapy; kPz;Lk; tRYf;fhf jhf;fy; bra;njhk; vd;why; rhpjhd;/ 2?tJ Kiwahf jhf;fy; bra;ag;gl;l fhnrhiy mf;ft[z;l; Fnsh!;L fhuzk; fhl;o jpUg;gg;gl;lJ/ vjphp gzk; bfhLf;fntz;Lk; vd;W Fw;wg;gphptpy; g[fhh; bfhLj;jjhf epidtpy;iy/ 2?tJ Kiw fhnrhiy t';fpahy; jpUg;gg;gl;lnghJ 25/2/2002 md;W tHf;fwp"h; mwptpg;g[ bfhLj;njhk;/'' 15. The categorical statement of PW1 would reveal that after return of the cheque unpaid on earlier occasion, statutory notice Ex.D3 dated 03.12.2001 was issued for dishonour of the cheques and the noticee was called upon to pay the entire amount due within fifteen days i.e, on or before 18.12.2001 failing which to face appropriate legal action. It may be true that no particulars regarding the date and number of the cheques, date of presentation and the date of dishonour are furnished in the earlier notice. But those details are furnished by PW1 in the witness box, wherein it is firmly admitted that few of the cheques given to the complainant are presented for collection on earlier occasion on 15.11.2001 were returned for want of sufficient funds and the same was intimated by his banker along with return memo and debit invoice. The admission made by PW1 would reveal that these particulars were not furnished to the High Court on earlier occasion. The High Court was hence on the basis of available particulars expressed its view that the cheques were not handed over to the custody of the banker and the notice https://hcservices.ecourts.gov.in/hcservices/ dated 03.12.2001 was hence not issued for dishonour of the cheques. The serious legal objection agitated herein on the basis of the facts now made available herein is that Ex.D3 is the first statutory notice for dishonour of the cheques and as the complainant called upon the accused to settle the amount within 15 days on or before 18.12.2001, cause of action for filing the complaint as contemplated under proviso (b) to Section 138 of the Negotiable Instruments Act arose on or after 18.12.2001 and 30 days limitation for filing the complaint has to be hence reckoned with the expiry of fifteen days on 18.12.2001 and the complaint ought to have been filed within 30 days from 18.12.2001 or with a petition to condone the delay in filing the compliant on 08.04.2002 and the failure to do either of the same would render the present complaint to be not maintainable. 16. The observation laid down by the Hon'ble Supreme Court in 1998 (II) CTC 462 and 2007 (1) MWN (cr.) DCC 19 (SC) (cited supra) by the revision petitioner is squarely applicable to the facts of the present case. The facts of the case reported in 1998 (II) CTC 462 cited above and the facts of the present case are identical. In the case cited above, the cheque was on the first occasion presented for collection on 05.01.1991 and was returned for want of sufficient funds and statutory notice was issued on 15.01.1991 calling upon him to pay the aforesaid amount and no action was initiated as the drawer of the cheque requested some time for payment. As he did not keep up his promise, the cheque was again represented for collection on 04.05.1991 again the cheque was dishonoured for want of sufficient funds. Second notice was issued on 09.05.1991 and on the failure of the noticee to pay the amount the complaint was filed on 30.06.1991 under section 138 of the Negotiable Instruments Act, on that complaint cognizance was taken. 17. The maintainability of the complaint was questioned by way of quash petition, and the same was contested upto Supreme Court. The question falls for consideration of the Supreme Court was whether the dishonour of the cheque on each occasion of its presentation gives rise to fresh cause of action within the meaning of 142(b) of the Act. The Supreme Court after detailed discussion as to what is generic and wider meaning of the term 'cause of action' under Section 20 of CPC and restrictive meaning of 'cause of action' under Section 142(b) of the Act clearly laid down that "as per the generic and wide sense, cause of action means every fact which it is necessary to establish to support a right or obtain a judgment and each of the relevant facts would constitute a part of the cause of action, but that clause (b) of Section 142 gives it a restrictive meaning in that, it refers to only one fact which will give rise to the cause of action and that is the failure to make payment within fifteen days from the date of the receipt of the notice. The reason behind giving such a restrictive meaning is not far to seek. Consequent upon the failure of the drawer to pay the money within the period of fifteen days envisaged under clause (c) of the proviso of Section 138, the liability of the drawer for being prosecuted for the offences he has committed arises and the period of one month for filing the complaint under Section 142 is to be reckoned accordingly. The combined reading of the above two sections of the Act leaves no room for doubt that "cause of action within the meaning of Section 142(c) https://hcservices.ecourts.gov.in/hcservices/ arises and can arise only once.......; for dishonour of one cheque, there can be only one offence and such offence can be committed by the drawer immediately on his failure to make the payment within fifteen days of the receipt of the notice served in accordance with clause (b) of the proviso to Section 138. That necessarily means that for similar failure after service of fresh notice on subsequent dishonour the drawer cannot be liable for any offence nor can the first offence be treated as non est so as to give the payee a right to file complaint treating the second offence as the first one. At that stage it will not be a question of waiver of the right of the payee to prosecute the drawer but of absolution of the drawer of an an offence, which stands already committed by him again....; The acceptance of the concept of successive causes of action is that it will make the period of limitation under clause (c) of Section 142 otiose, for, a payee who failed to file his complaint within one month and thereby forfeited his right to prosecute the drawer, can circumvent the above limitative clause by filing a complaint on the basis of a fresh presentation of the cheque and its dishonour. Since in the interpretation of statutes, the Court always presumes that the legislature inserted every part thereof for a purpose and the legislative intention is that the every part should have effect the above conclusion cannot be drawn for that will make the provision for limiting the period of making the complaint nugatory." 18. The Supreme Court has in para 10 laid down the principles that "we are of the opinion that the above two provisions, Sections 138 and 142 can be harmonised, with the interpretation that on each presentation of the cheque and its dishonour a fresh right and not cause of action accrues in his favour. He may, therefore without taking preemptory action in exercise of his such right under clause (b) of Section 138, go on presenting the cheques so as to enable him to exercise such right at any point of time during the validity of the cheque. But, once he gives a notice under clause (b) of Section 138 he forfeits such right for in case of failure of the drawer to pay the money within the stipulated time he would be liable for offence and the cause of action for filing the complaint will arise, the period of one month for filing the complaint will be reckoned from the day immediately following the day on which the period of fifteen days from the date of receipt of the notice by the drawer, expires." 19. Applying the principles so laid down, the Supreme Court in para 11 of the judgment is pleased to dismiss the complaint on the sole ground that the appellant had earlier taken recourse to clause (b) of Section 138 of the Act but did not avail of the cause of action that arose in his favour under Section 142(b) of the Act. 20. As rightly argued by the learned counsel for the petitioners that ratio decidenti laid down by Hon'ble Supreme Court in the judgment above referred to is squarely applicable to the facts of the present case which renders the present complaint to be rejected as barred by limitation. 21. On facts, the objection raised is that there is serious dispute between the parties regarding the quality of the goods https://hcservices.ecourts.gov.in/hcservices/ supplied for which the amount is due and there were negotiations between the parties and there was also request on the part of the accused firm not to present the cheques for collection and there was also suit filed for restraining the complainant from presenting the cheques for collection as such the ingredients of Section 138 is not attracted. 22. The accused in support of such contention relied upon Exs.P18 reply dated 23.03.2002 issued by the revision petitioners to the complainant, Ex.P21 decree dated 17.07.2002 made in OS.No.664 of 2001, Ex.D1 notice dated 04.08.2001 issued by accused firm to the complainant, Ex.D2 dated 7.11.2001 issued by accused firm to the complainant firm, Ex.D8 dated 27.4.2001 issued by the complainant to the second accused Ex.D9 dated 18.12.2001 issued by complainant firm to accused firm, Ex.D10 proceedings issued by Srilanka Ports Authority and the notice issued to the accused under Sections 160 and 91 Cr.P.C by the police department on 18.02.2002 to appear for enquiry along with relevant records. 23. The exchange of notices between the complainant and the accused firm and proceedings of port authority above mentioned would reveal that the accused firm had throughout complained of about the inferior quality of the goods supplied and there was negotiations between both the firms for the return of the goods and even in notice dated 3.12.2001, the complainant agreed to take back the entire stocks however at the risk and responsibility and at the cost of the accused firm to send it back. There were also exchanges of fax between both the firms and through the fax dated 4.8.2001 and 7.11.2001, the accused insisted the complainant firm to take back the stock and not to present any of the cheques. The complainant firm also in its letter dated 18.10.2001 agreed that the goods may be retuned instead of payment but at the cost and risk of the accused and the goods shall reach the complainant firm at the same condition as delivered to the accused, with reservation of right to recover the dimension value of the goods if any. The complainant firm also gave complaint to CCB, Coimbatore and the same was as seen from DW11 evidence treated as petition and the respondents 2 and 3 are called for enquiry along with the documents connected with the business transaction for the hearing on 19.12.2002 at City Crime Branch and