SUSAN ZACHARIAH Vs. MUTHOOT CAPITAL SERVICES LTD

JUDGEMENT

(1.) The petitioners are accused Nos. 3 to 5 in C.C. No. 2737 of 2003 on the file of Judicial First Class Magistrate Court I, Kochi. The 1st respondent herein is the complainant in the above case. The case of the complainant is that the 1st accused is a partnership firm and 2nd accused is its Managing Partner and accused Nos. 3 to 5 are partners. The accused availed a hire purchase loan from the complainant company and as part payment towards the above loan, 1st accused issued a cheque dtd. 31.5.2003 for Rs. 1,74,000/- drawn in favour of the Canara Bank, Aluva Branch. But the above cheque was dishonoured with an endorsement 'exceeds arrangement'. Thereafter legal notice was issued, but not paid the amount and thereby committed offence under Section 138 of the N.I. Act. True copy of the complaint is marked as Annexure A1. This Crl. M.C. is filed to quash Annexure A1 complaint on the grounds, inter alia, that there is no statutory compliance under Section 138(b) and the averments in the petition are not in conformity with Section 141 of the N.I. Act. Sri. Shaijan Joseph, the learned counsel for the petitioner mainly submitted two points in support of the grounds pleaded.

(2.) Per contra, Sri. Mathew, the counsel appearing for the 1st respondent stiffly opposed the said arguments. The learned counsel fairly admitted that no notice has been issued against these partners but submits that notice has been issued against 1st accused firm and 2nd accused Managing Partner and it is sufficient to proceed against the petitioners also. So, the non-service of notice against petitioners 1 to 3 will not affect the maintainability of the complaint. According to him, the averment that 1st accused has issued cheque with 'consent' and 'connivance' of all other accused makes the allegation against others in conformity with Section 141(1) of the N.I. Act.

(3.) I have given my anxious consideration to the rival submissions made by the counsel for the petitioners and respondent. The first question to be considered is whether prosecution under Section 138 r/w Section 141 of the N.I. Act against the partner of a firm requires separate notice under Section 138(b), prior to the lodging of complaint This question has been decided divergently by the Division Benches of two High Courts. In Dilipkumar Jaiswal v. Debapriya Banerji,1992 2 KerLT 35, a Division Bench of Calcutta High Court held that notice issued to the company is sufficient and separate notice to the directors of the company is not required to be served, prior to the filing of the complaint. Later in Raman v. Sharun Chemicals,2007 1 KerLT 106 a Division Bench of Madras High Court in a reference held that individual notice under Section 138(b) is required against all partners, before prosecuting them. Though that Division Bench has considered so many decisions, , : 1992 (2) KLT 35 was not brought to the notice of the above Bench. But in between these two decisions, in Target Overseas Exports (P) Ltd. v. Iqbal, 2005 2 KerLT 45 the learned Single Judge of this Court held that "a person facing indictment under Section 141 is not entitled to notice under Section 138(b). The person who is entitled to notice is the drawer company and not the person who has not signed the cheque on behalf of the drawer."