G. MANOHAR AND ANOTHER Vs. S. MAHALINGAM

JUDGEMENT

(1.) THE two accused in C.C.No. 22174 of 1989 on the file of the XIV Metropolitan Magistrate, Egmore, Madras, on a complaint given by the respondent herein, for an offence under Section 138 of the Negotiable Instruments Act, 1881, as amended by the Banking Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988, (Act 66 of 1988) have filed this application, invoking the inherent powers of this Court under Section 482 of the Criminal Procedure Code, to quash the above proceedings.

(2.) THE allegations in the complaint are as follows: The petitioners are stockists for the respondent -company, which is manufacturing cement and they owed the respondent a sum of Rs. 1,48,045/ - on the purchase of cement from the respondent. On 12.10.1989, the petitioners issued a cheque for the above sum in favour of the respondent drawn on the Bank of Baroda. The cheque was presented for payment, but was returned unpaid to the Collecting Bank, the State Bank of India, Madras -34 with an endorsement 'Stopped payment'. After issuing the statutory notice, as the amount was not paid, the complaint was Laid against the petitioners, who on receiving summons from the trial Court, have filed this petition for quashing the above proceedings.

(3.) PER contra, Thiru A. Natarajan for M/s. Anand Das Gupta, learned counsel for the respondent would urge that though the return of the cheque unpaid for want of funds or for exceeding over draft arrangements, is a necessary ingredient of the offence under Section 138 of the Act, still that fact had to be proved by the complainant only during trial, by summoning the necessary documents from the Bank and neither the complainant nor the Court, was bound by the rubber -stamp endorsement made by the Bank as to the cause for the return of the cheque and as such, proceedings ought not to be quashed, when the petitioners knowing fully well that they had no funds, had sought to circumvent the provisions of the Act by a "Stop payment" order, while in reality, the cheque had been returned unpaid only for want of funds. According to the learned counsel in these circumstances, the respondent should be given an opportunity to prove, by summoning the bank officials and the bank records that the cheque had been returned, really for want of funds and that the prosecution should not be stifled at its very threshold.