KAILASH CHANDRA MISHRA Vs. AJITSINH ULHASRAO BABAR

JUDGEMENT

(1.) The petitioner is before this Court seeking for issuance of a writ of certiorari and to quash the Criminal Case No. 83/2004 pending before the Chief Judicial Magistrate, Daman in the State of Uttaranchal and further issuance of a direction upon the opposite party No. 1 not to take any action against the petitioner so far as the business transaction with the opposite party No. 2 is concerned with reference to the cheque which has been given to the opposite party towards security.

(2.) The facts of the case in brief are that the petitioner is a proprietor of M/s. Premier Distributors situated at Plot No. N/4, 169, IRC Village, Nayapalli, Bhubaneswar, dealing with materials including plastic goods in the Districts of Cuttack, Balasore and Jagatsinghpur by opening different branches in the above places. He is doing business since long by establishing its firm. During the business transaction, petitioner and the opposite party-company entered into an agreement with the terms that the opposite party-company will supply the goods to the petitioner on credit with security of Bank cheque without giving date and amount and payment of cost of goods will be paid by installments basis after its sale in the market. Accordingly opposite party-company supplied the goods to the petitioner since January, 2003 from its plant at Januganj, Balasore, Orissa by issuing invoices and bills and payment was made time to time by draft and cheque and also cash to the authorized representative of the opposite party No. 2 till 31st December, 2003. It is stated that during the transaction between the petitioner and the opposite party No. 2, payment has been made through Bank drafts, cheques against cost of the goods supplied to the petitioner. Opposite party No. 2 has also issued acknowledgment of acceptance of cheques and drafts and also cash from time to time. When the petitioner hard pressed to supply the reconciliation statement for finalization of accounts, the opposite party No. 2 intimated the petitioner that in future all the payment should be made through bank drafts to meet the immediate requirement of the establishment. On the demand of the petitioner, the opposite party No. 2 did not submit the reconcile statement adjusting the defective goods received back by them and tried to avoid it with a mala fide intention to cheat the petitioner and to avoid to receive the defective goods and also to face the customers grievances. Thereafter the petitioner immediately told them not to use the cheque, which has been deposited with the opposite party No. 2 as security in future without reconciling the account statement. As opposite party No. 2 did not reply to the petitioner, he immediately wrote another letter confirming that if no reconciliation statement of accounts will be received within 7 days of receipt of the letter, he will not be responsible for any other liabilities and will take legal action against them. All of a sudden, after lapse of one and half years, the petitioner received a notice from the learned Chief Judicial-Magistrate First Class, Daman through the District Superintendent of Police, Bhubaneswar along with copy of Criminal Case No. 83 of 2004 to appear before the learned Magistrate on 6.4.2005. On a perusal of the Criminal case, it came to the knowledge of the petitioner that opposite party No. 1 styling himself as Power of Attorney Holder of opposite party No. 2 has preferred the complaint petition before the learned Chief Judicial Magistrate First Class, Daman alleging that the petitioner has committed offence under Section 138 of the Negotiable Instruments Act, 1881 read with Section 142 of the Cr.P.C. for having dishonoured the cheque. The same is produced along with the notice. It is indicated in the complaint petition that opposite party No. 1 has utilized the cheque which was submitted to the opposite party No. 2 at the time of business transaction as security of supply of goods giving date and an amount of Rs. 11,27,087/- and had presented it at the bank at Bhubaneswar, which has been returned back to them due to "insufficient funds". It has also been indicated in the complaint petition that the registered letter was sent by opposite party No. 1 to the petitioner on 17.4.2004 and also a letter Under Certificate of Posting, but it has been returned back with remark that the petitioner was always absent and therefore the petitioner is liable to be punished under Section 138 of the Negotiable Instruments Act, 1881. It is the case of the petitioner that he never received any notice and letter from the said opposite party No. 1 indicating that M/s. Wim Plast Ltd. which presently functioning at Daman but not at Balasore and he has never made any business transaction with opposite party No. 1 nor has ever presented the cheque to the said opposite party No. 1. He had given the cheque without date and amount as the security as per the contract with opposite party No. 2, which is still functioning at Januganj, Balasore. Hence, it is submitted that the complaint petition filed by opposite party No. 1 under Section 138 of Negotiable Instruments Act, 1881 at Daman by utilizing the cheque is not maintainable in the eye of law. It is further stated that the opposite party No. 2 while dealing with the petitioner has clearly indicated that whatever differences will be made between them such differences will be dealt at Balasore.

(3.) On the basis of the complaint lodged by opposite party No. 1, learned Chief Judicial Magistrate First Class, Daman has taken cognizance under Section 138 of the N.I. Act, 1881 against the petitioner which is illegal and it is beyond its jurisdiction and against the settled principles of law. It is stated that the learned Chief Judicial Magistrate First Class, Daman has not considered and appreciated the mandatory requirement, on the part of the opposite party No. 2 to be complied with to take cognizance under Section 138 of the N.I. Act, 1881. Therefore, the criminal case referred toand the summons issued in the said case to the petitioner is not sustainable in the eye of law.