IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Criminal Appeal No. 1643 of 2001 Old No. 1726 of 1996 Dated of Decision: 26.03.2010 Smt. Tulsi Devi …Complainant/Appellant Versus State of U.P. and another …Respondents Present: None for the appellant. Mr. Nandan Arya, learned A.G.A. for the State. Mr. Gopal Krishan, Advocate for the accused/respondent no.2. Hon’ble Nirmal Yadav, J. This Criminal appeal has been filed against the judgment and order dated 06.08.1996 passed by the Judicial Magistrate, Kashipur, District Nainital thereby dismissing the Criminal complaint and acquitting the accused Rameshwar Chandra for the charge under section 138 of the Negotiable Instruments Act, 1881 (hereinafter to be referred as the Act). Brief facts of the case, as per complainant Smt. Tulsi Devi, are that she is sole proprietor of Tarai Cement Stores, Shishu Mandir Road, P.S. Bajpur District Nainital. Accused Rameshwar Chandra had purchased cement worth Rs.30,030/- from her store. Two cheques of Bareilly Corporation Bank, Bazpur dated 31.07.1993 and 31.03.1994 of Rs.15,000/- each were given in lieu of cement purchased and Rs.30/- was paid in cash. When the cheque dated 31.07.1993 bearing no.085507 was presented for encashment in Bareilly Corporation Bank, Bazpur, it was dishonoured on account of insufficient funds in the account of Rameshwar-accused. Thereafter, a notice dated 12.10.1993 was issued which was served upon the accused on 13.10.1993. Inspite of service of 2 the notice, accused did not make the payment, accordingly the present complaint was filed under section 200 Cr.P.C. in the court below against the accused. Smt. Tulsi Devi appeared as PW1 and Satish Kumar appeared as PW2. Accused was examined under section 313 Cr.P.C. and according to him, the false complaint has been filed by the complainant against him. Learned Trial Court after taking into consideration of all the facts and evidence on record, acquitted the accused- respondent for the charge under section 138 of the Act. Aggrieved by the aforesaid judgment, complainant has filed the present appeal. Heard Sri Gopal Krishan, learned counsel for the accused-respondent no.2 and Sri Nandan Arya, A.G.A. for the State/respondent no.1. However, none appeared on behalf of the complainant. Notice was duly served upon the complainant and Sri Mohd. Azim, Advocate also appeared on behalf of the complainant on earlier dates. It is pertinent to mention here that as per office report, lower court record in this case has been weeded out. Therefore, Sessions Judge, Udham Singh Nagar was directed to reconstruct the record. Thereafter, sincere efforts were made to reconstruct the record. However, it has been reported by Sessions Judge, U.S. Nagar that it is not possible to reconstruct the record in absence of any record available with the parties or with Court, accordingly, it was directed that the matter be listed for final hearing and be decided on the basis of material available on record. 3 While dismissing the criminal complaint and acquitting the accused-respondent, it was observed by learned Magistrate that Smt. Tulsi Devi had concealed the true facts from the court. She did not even disclose as to when the store was transferred in her name, whether it was before the issuance of the cheques or thereafter. However, she had to admit in the cross examination that Satish Kumar was the actual owner of the shop. Accused Rameshwar had purchased the cement from Satish Kumar and the cheques were also handed over by accused Rameshwar to Satish Kumar who was owner of the shop at that time. The cheques were handed over by Satish Kumar to Smt. Tulsi Devi when she purchased the shop from Satish Kumar. It is also not disputed that neither Smt. Tulsi Devi was cheque holder in due course nor she was indorsee thereof. There is nothing on the record that the endorser had added direction to pay the amount to or the order of, a specified person. In the present case, the cheque in question was not endorsed by payee i.e. Tarai Cement Store or Satish Kumar, in favour of complainant Smt. Tulsi Devi. In these circumstances, the complainant Smt. Tulsi Devi never became the holder of the cheque in question (in due course). Thus, the complainant is neither a payee nor the indorsee of the cheque, under section 138 of the Act. The payee or holder of the cheque, in due course, as the case may be, is entitled to make demand for the payment of the amount of the cheque by giving the notice in writing to the drawer of the cheque. If drawer of the said cheque fails to make the payment of the amount to the holder in due course, within a specified period, then the drawer of the said cheque would be entitled to punishment under section 138 of the Act. 4 Sections 9, 15 and 16 of the Act read as under :- “9. Holder in due course- “Holder in due course” means any person who for consideration become thee possessor of a promissory note, bill of change or cheque if payable, or bearer, or the payee or endorsee thereof, if payable to order, before the amount mentioned in it become payable, and without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title.” “15. Endorsement- When the maker or holder or a negotiable instrument signs the same otherwise then as such maker, for the purpose of negotiation, on the back or face thereof or on a slip of paper annexed thereto, or so signs for the same purpose a stamped paper intended to be completed as a negotiable instrument, he is said to indorse the the same, and is called the “indorser”. 16. Endorsement “in blank” and “in full” “indorsee” – If the indorser signs the name only, the endorsement is said to be “in blank” and if he adds a direction to pay the amount mentioned in the instrument to, or the order of, a specified person, of the endorsement is said to be “in full” and the person so specified is called the “indorsee” of the instrument. 5 (2) The provisions of the Act relating to a payee shall apply with the necessary modifications to an indorsee. From the perusal of the above provisions of the Act, it is clear that until and unless the notice is served by the holder in due course, of the cheque in question or by the payee, the provisions of the section 138 of the Act would not be applied. In the present case, it has been admitted by Smt. Tulsi Devi that Satish Kumar was owner of the Store when the cement was purchased by Rameshwar. Rameshwar handed over the cheques to Satish Kumar as he was actual owner of the Store. Two cheques were given to Smt. Tulsi Devi by Satish Kumar, when she purchased the shop from him. The cheques were not endorsed in favour of Smt. Tulsi Devi. Thus, she was neither payee nor holder in due course of the cheque in question. In these circumstances, this Court is of the opinion that learned Trial Magistrate has rightly dismissed the criminal complaint and acquitted the accused-respondent no.2 for the charge under section 138 of the Negotiable Instruments Act, 1881 and no ground for interference is called for. The judgment and order passed by the trial court is affirmed. Accordingly, the appeal is dismissed. (Nirmal Yadav, J.) JKJ 26.03.2010