REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
1 CRIMINAL APPEAL No. 1837 OF 2012
(Arising out of S.L.P. (Crl.) No. 8255 of 2010)
Indra Kumar Patodia & Anr. .... Appellant(s)
Versus
Reliance Industries Ltd. and Ors.. .... Respondent(s)
WITH
2 CRIMINAL APPEAL No. 1838 OF 2012
(Arising out of S.L.P. (Crl.) No. 9537 of 2010)
3
J U D G M E N T
P.Sathasivam,J.
1) Leave granted.
2) These appeals are filed against the common final judgment and order
dated 17/18.03.2010 passed by the High Court of Judicature at Bombay in
Criminal Appeal Nos. 287 and 288 of 2009 whereby the Division Bench held
that the complaint under Section 138 of the Negotiable Instruments Act,
1881 (in short “the Act”) without signature is maintainable when such
complaint was subsequently verified by the complainant.
3) Brief facts:
(a) Indra Kumar Patodia and Mahendra Kumar Patodia – the appellants
herein are accused in Criminal Complaint being CC No. 1866/SS of 2007
(1866/MISC/1998) filed before the 16th Court of Metropolitan Magistrate,
Ballard Estate, Bombay, for the offence punishable under Section 138 read
with Sections 141 and 142 of the Act.
Respondent No.3 herein is a
Company duly registered under the Companies Act, 1956, presently under
liquidation and official liquidator has been appointed by the High Court,
which has alleged to have issued the cheques to respondent No.1.
(b) Respondent No.1 is the complainant and the manufacturers of Partially
Oriented Yarn (POY) and other textile goods.
From time to time, Respondent
No. 3 used to place orders for the supply of POY to Respondent No. 1 and
had issued 57 cheques between 02.12.1997 to 09.03.1998 for the payment of
the same.
(c) The aforesaid cheques were deposited by the complainant on 05.04.1998
and were returned by the Bank on 06.04.1998 with the remark “exceeds
arrangement”.
Pursuant to the same,
Respondent No.1 issued a notice dated
16.04.1998 to the appellants and demanded the aforesaid amount for which
they replied that they have not received any statement of accounts
maintained by the complainant regarding the transactions with the accused.
In addition to the same,
Respondent No.3, vide letter dated 29.05.1998,
made various claims for the rate difference, discounts etc., in respect of
the transactions,
however, Respondent No.1 filed a complaint on 03.06.1998
being Complaint No. 1866/SS of 2007 (1866/MISC/1998) under Section 138 read
with Sections 141 and 142 of the Act.
On 30.07.1998, the Metropolitan
Magistrate recorded the verification statement and issued summons against
the appellants and respondent No.3 herein.
(d) The appellants preferred an application being C.C. No. 1332/9/1999
before the Metropolitan Magistrate, 33rd Court, Ballard Pier, Mumbai for
recalling the process issued against them.
By order dated 28.08.2003, the
Metropolitan Magistrate, dismissed the said application.
(e) Challenging the said order, the appellants and respondent No.3 herein
filed an application in the Court of Sessions for Greater Bombay at Bombay
bearing Criminal Revision Application No. 749 of 2003. By Order dated
08.10.2004, the Sessions Judge dismissed the said application as not
maintainable.
(f) By order dated 26.11.2008, the Metropolitan Magistrate dismissed the
complaint and acquitted the accused persons.
(g) Challenging the acquittal of the accused persons, respondent No.1
herein-the complainant, filed appeals being Criminal Appeal Nos. 287 and
288 of 2009 before the learned single Judge of the High Court.
The learned
single Judge, by order dated 09.07.2009, referred two points for
consideration by the larger Bench, viz.,
(1) In the matter of complaint
for the offence punishable under Section 138 of the Act
whether the
complaint without the signature of the complainant, inspite of verification
of complaint, is “non-entia” and whether no prosecution can lie on such
complaint?; and
(2) If answer to point No.1 is negative then
whether it is
a mere irregularity and it can be cured subsequently and whether such
subsequent amendment would relate back to the date of filing of the
complaint or whether it would hit by the Law of Limitation.
(h) By impugned common judgment dated 17/18.03.2010, the Division Bench
of the High Court, disposed of the matter by answering point No.1 in the
affirmative
holding that
the complaint under Section 138 of the Act is
maintainable and
when such complaint is subsequently verified by the
complainant and the process is issued by the Magistrate after verification,
it cannot be said that the said complaint is “non-entia” and the
prosecution of such complaint is maintainable.
Further, it was held that
since the answer to point No.1 was in affirmative, it was not necessary to
decide point No.2 and directed to place the appeals for deciding the same
on merits.
(i) Aggrieved by the said decision, the appellants have filed the above
appeals by way of special leave before this Court.
4) Heard Mr. Bhagwati Prasad, learned senior counsel for the appellants
and Mr. Uday U. Lalit, learned senior counsel for respondent No.1, Ms.
Asha Gopalan Nair, learned counsel for respondent No.2 and Ms. Sangeeta
Kumar, learned counsel for respondent No.3.
5) Mr. Bhagwati Prasad, learned senior counsel for the appellants after
taking us through the relevant provisions of the Negotiable Instrument Act,
1881, the Code of Criminal Procedure, 1973 (in short ‘the Code’) and the
order of the learned single Judge as well as the reference answered by the
Division Bench raised the following contentions:
i) the complaint under Section 141 in respect of dishonour of cheque
under Section 138 of the Act without signature of the complainant is not
maintainable;
ii) there is no provision in the Act regarding verification. Even
otherwise, the verification was signed by the complainant after expiry of
the limitation period, hence, the impugned complaint is liable to be
rejected; and
iii) inasmuch as the Act is a special Act, it must prevail over procedures
provided in the Code.
On the other hand, Mr. Lalit, learned senior counsel for the contesting
first respondent-the complainant contended that in the light of the
language used in Section 2(d) read with various provisions of the Code and
Section 142 of the Act, the complaint, as filed and duly verified before
the Magistrate and putting signature therein, satisfies all the
requirements. He further submitted that the conclusion of the Division
Bench upholding the complaint and the issuance of summons for appearance of
the accused are valid and prayed for dismissal of the above appeals.
6) We have carefully considered the rival submissions and perused all
the relevant materials.
7) From the rival contentions, the only question for consideration
before this Court is that
whether the complaint without signature of the
complainant under Section 138 of the Act is maintainable when such
complaint is verified by the complainant and the process is issued by the
Magistrate after verification.
8) The word “complaint” has been defined in Section 2(d) of the Code
which reads thus:
“2 (d) “complaint” means any allegation made orally or in writing to a
Magistrate, with a view to his taking action under this Code, that
some person, whether known or unknown, has committed an offence, but
does not include a police report.”
Keeping the above definition in mind, let us see the scheme of the statute
and the legislative intent in bringing the Act.
9) The Act was amended by Banking, Public Financial Institutions and
Negotiable Instruments Laws (Amendment Act) 1988 wherein new Chapter XVII
was incorporated for penalties in case of dishonour of cheques due to
insufficiency of funds in the account of the drawer of the cheque.
These
provisions were incorporated in order to encourage the culture of use of
cheques and enhancing the credibility of the instrument.
The insertion of
the new Chapter and amendments in the Act are aimed at early disposal of
cases relating to dishonour of cheques, enhancing punishment for offenders,
introducing electronic image of a truncated cheque and a cheque in the
electronic form as well as exempting an official nominees director from
prosecution under the Act.
For our purpose, Section 142 of the Act is
relevant which reads thus:
“142. Cognizance of offences.- Notwithstanding anything contained in
the Code of Criminal Procedure, 1973 (2 of 1974)-
(a) no court shall take cognizance of any offence punishable under
section 138 except upon a complaint, in writing, made by the payee or,
as the case may be, the holder in due course of the cheque;
(b) such complaint is made within one month of the date on which the
cause of action arises under clause (c) of the proviso to section 138:
Provided that the cognizance of a complaint may be taken by the
Court after the prescribed period, if the complainant satisfies the
Court that he had sufficient cause for not making a complaint within
such period.
(c) no court inferior to that of a Metropolitan Magistrate or a
Judicial Magistrate of the first class shall try any offence
punishable under section 138.”
As pointed out, the controversy in our case, concentrates on construction
of Section 142(a) of the Act and in particular phrase “a complaint in
writing” employed therein.
It provides that notwithstanding anything
contained in the Code, no Court shall take cognizance of any offence
punishable under Section 138 of the Act except upon a “complaint in
writing” made by the payee or as the case may be the holder in due course
of the cheque.
The important question in the instant case is
what is meant
by ‘complaint in writing’.
Whether complaint should be in writing
simpliciter or complaint being in writing requires signature below such
writing.
10) The object and scope of Sections 138 and 142 of the Act has been
considered by this Court in Pankajbhai Nagjibhai Patel vs. State of Gujarat
and Another, (2001) 2 SCC 595. In that case, Judicial Magistrate of the
First Class, after convicting an accused for an offence under Section 138
of the Act sentenced him to imprisonment for six months along with a fine
of Rs.83,000/- The conviction and sentence were confirmed by the Sessions
Judge in appeal and the revision filed by the convicted person was
dismissed by the High Court. When the SLP was moved, the counsel confined
his contention to the question whether a Judicial Magistrate of the First
Class could have imposed sentence of fine beyond Rs. 5,000/- in view of the
limitation contained in Section 29(2) of the Code. Learned counsel for the
respondent contended the decision of this Court in K. Bhaskaran vs.
Sankaran Vaidhyan Balan, (1999) 7 SCC 510 to the effect that power of
Judicial Magistrate of First Class is limited in the matter of imposing a
sentence of fine of Rs. 5,000/- is not correct in view of the non obstante
clause contained in Section 142 of the Act. After hearing both the
parties, this Court held that Section 138 of the Act provides punishment as
imprisonment for a term which may extend to one year or fine which may
extend to twice the amount of cheque or with both. Section 29(2) of the
Code contains limitation for a Magistrate of First Class in the matter of
imposing fine as a sentence or as part of sentence. After quoting Section
29(2) of the Code as well as Section 142 of the Act, this Court has
concluded thus:
“6. It is clear that the aforesaid non obstante expression is intended
to operate only in respect of three aspects, and nothing more.
The
first is this: Under the Code a Magistrate can take cognizance of an
offence either upon receiving a complaint, or upon a police report, or
upon receiving information from any person, or upon his own knowledge
except in the cases differently indicated in Chapter XIV of the Code.
But Section 142 of the NI Act says that insofar as the offence under
Section 138 is concerned no court shall take cognizance except upon a
complaint made by the payee or the holder in due course of the cheque.
7. The second is this: Under the Code a complaint could be made at any
time subject to the provisions of Chapter XXXVI.
But so far as the
offence under Section 138 of the NI Act is concerned such complaint
shall be made within one month of the cause of action.
The third is
this:
Under Article 511 of the First Schedule of the Code, if the
offence is punishable with imprisonment for less than 3 years or with
fine only under any enactment (other than the Indian Penal Code) such
offence can be tried by any Magistrate. Normally Section 138 of the NI
Act which is punishable with a maximum sentence of imprisonment for
one year would have fallen within the scope of the said Article.
But
Section 142 of the NI Act says that for the offence under Section 138,
no court inferior to that of a Metropolitan Magistrate or Judicial
Magistrate of the First Class shall try the said offence.
8. Thus, the non obstante limb provided in Section 142 of the NI Act
is not intended to expand the powers of a Magistrate of the First
Class beyond what is fixed in Chapter III of the Code.
Section 29,
which falls within Chapter III of the Code, contains a limit for a
Magistrate of the First Class in the matter of imposing a sentence as
noticed above i.e. if the sentence is imprisonment it shall not exceed
3 years and if the sentence is fine (even if it is part of the
sentence) it shall not exceed Rs 5000.”
11) It is also relevant to refer a decision of this Court in M.M.T.C.
Ltd. and Another vs. Medchl Chemicals and Pharma (P) Ltd. and Another,
(2002) 1 SCC 234. The question in that decision was whether a complaint
filed in the name and on behalf of the company by its employee without
necessary authorization is maintainable. After analyzing the relevant
provisions and language used in Sections 138 and 142(a) of the Act, this
Court held that such complaint is maintainable and held that want of
authorization can be rectified even at a subsequent stage. This Court
further clarified that the only eligibility criteria prescribed by Section
142 is that the complaint must be by the payee or the holder in due course.
This Court held that this criteria is satisfied as the complaint is in the
name and on behalf of the appellant-Company. It was further held that even
presuming, that initially there was no authority, still the company can, at
any stage, rectify the defect. It was further held that at a subsequent
stage the company can send a person who is competent to represent the
company and concluded that the complaint could thus not have been quashed
on this ground.
12) It is clear that the non obstante clause has to be given restricted
meaning and when the section containing the said clause does not refer to
any particular provisions which intends to over ride but refers to the
provisions of the statute generally, it is not permissible to hold that it
excludes the whole Act and stands all alone by itself. In other words,
there requires to be a determination as to which provisions answers the
description and which does not. While interpreting the non obstante
clause, the Court is required to find out the extent to which the
legislature intended to do so and the context in which the non obstante
clause is used. We have already referred to the definition of complaint as
stated in Section 2(d) of the Code which provides that the same needs to be
in oral or in writing. The non obstante clause, when it refers to the Code
only excludes the oral part in such definition.
13) According to us, the non obstante clause in Section 142(a) is
restricted to exclude two things only from the Code i.e. (a) exclusion of
oral complaints and (b) exclusion of cognizance on complaint by anybody
other than the payee or the holder in due course. Section 190 of the Code
provides that a Magistrate can take cognizance on a complaint which
constitutes such an offence irrespective of who had made such complaint or
on a police report or upon receiving information from any person other then
a police officer or upon his own knowledge. Non obstante clause, when it
refers to the core, restricts the power of the Magistrate to take
cognizance only on a complaint by a payee or the holder in due course and
excludes the rest of Section 190 of the Code. In other words, none of the
other provisions of the Code are excluded by the said non obstante clause,
hence, the Magistrate is therefore required to follow the procedure under
Section 200 of the Code once he has taken the complaint of the payee/holder
in due course and record statement of the complainant and such other
witnesses as present at the said date. Here, the Code specifically
provides that the same is required to be signed by the complainant as well
as the witnesses making the statement. Section 200 of the Code reads thus:
“200. Examination of complainant.- A Magistrate taking cognizance of
an offence on complaint shall examine upon oath the complainant and
the witnesses present, if any, and the substance of such examination
shall be reduced to writing and shall be signed by the complainant and
the witnesses, and also by the Magistrate:
Provided that, when the complaint is made in writing, the
Magistrate need not examine the complainant and the witnesses-
(a) if a public servant acting or purporting to act in the discharge
of his official duties or a Court has made the complaint; or
(b) if the Magistrate makes over the case for inquiry or trial to
another Magistrate under section 192:
Provided further that if the Magistrate makes over the case to another
Magistrate under section 192 after examining the complainant and the
witnesses, the latter Magistrate need not re-examine them.”
Mere presentation of the complaint is only the first step and no action can
be taken unless the process of verification is complete and, thereafter,
the Magistrate has to consider the statement on oath, that is, the
verification statement under Section 200 and the statement of any witness,
and the Magistrate has to decide whether there is sufficient ground to
proceed. It is also relevant to note Section 203 of the Code which reads
as follows:
“203. Dismissal of complaint.- If, after considering the statements on
oath (if any) of the complainant and of the witnesses and the result
of the inquiry or investigation (if any) under section 202, the
Magistrate is of opinion that there is no sufficient ground for
proceeding, he shall dismiss the complaint, and in every such case he
shall briefly record his reasons for so doing.”
It is also clear that a person could be called upon to answer a charge of
false complaint/perjury only on such verification statement and not mere on
the presentation of the complaint as the same is not on oath and,
therefore, need to obtain the signature of the person. Apart from the
above section, the legislative intent becomes clear that “writing” does not
pre-suppose that the same has to be signed. Various sections in the Code
when contrasted with Section 2(d) clarify that the legislature was clearly
of the intent that a written complaint need not be signed. For example,
Sections 61, 70, 154, 164 and 281 are reproduced below:
2 “61. Form of summons.
Every summons issued by a court under this Code shall be in writing,
in duplicate, signed by the presiding officer of such court or by such
other officer as the High Court may, from time to time, by rule
direct, and shall bear the seal of the court.
3 70. Form of warrant of arrest and duration.
(1) Every warrant of arrest issued by a court under this Code shall be
in writing, signed by the presiding officer of such court and shall
bear the sea] of the court.
(2) Every such warrant shall remain in force until it is cancelled by
the Court which issued it, or until it is executed.
4
5 154. Information in cognizable cases.
(1) Every information relating to the commission of a cognizable
offence, if given orally to an officer in charge of a police station,
shall be reduced to writing by him or under his direction, and be read
over to the informant; and every such information, whether given in
writing or reduced to writing as aforesaid, shall be signed by the
person giving it, and the substance thereof shall be entered in a book
to be kept by such officer in such form as the State Government may
prescribe in this behalf. …..
6 164. Recording of confessions and statements.
Xxx xxxx
(4) Any such confession shall be recorded in the manner provided in
section 281 for recording the examination of an accused person and
shall be signed by the person making the confession; and the
Magistrate shall make a memorandum at the foot of such record to the
following effect-
7 281. Record of examination of accused.
(1) Whenever the accused is examined by a Metropolitan Magistrate, the
Magistrate shall make a memorandum of the substance of the examination
of the accused in the language of the court and such memorandum shall
be signed by the Magistrate and shall form part of the record…..”
A perusal of the above shows that the legislature has made it clear that
wherever it required a written document to be signed, it should be
mentioned specifically in the section itself, which is missing both from
Section 2(d) as well as Section 142.
14) The General Clauses Act, 1897 too draws a distinction between writing
and signature and defines them separately. Section 3(56) defines signature
and Section 3(65) defines writing which reads thus:
“In this Act, and in all Central Acts and Regulations made after the
commencement of this Act, unless there is anything repugnant in the
subject or context,-
56. "Sign" with its grammatical variations and cognate expressions,
shall, with reference to a person who is unable to write his name,
include, "mark", with its grammatical variation and cognate
expressions,
65. Expressions referring to "writing" shall be construed as including
references to printing, lithography, photography and other modes of
representing or reproducing words in a visible form,”
Writing as defined by General Clauses Act requires that the same is
representation or reproduction of “words” in a visible form and does not
require signature. “Signature” within the meaning of “writing” would be
adding words to the section which the legislature did not contemplate.
15) In the case on hand, the complaint was presented in person on June 3,
1998 and on the direction by the Magistrate, the complaint was verified on
July 30, 1998 and duly signed by the authorized officer of the Company-the
complainant. As rightly pointed out by the Division Bench, no prejudice
has been caused to the accused for non-signing the complaint. The
statement made on oath and signed by the complainant safeguards the
interest of the accused. In view of the same, we hold that the
requirements of Section 142(a) of the Act is that the complaint must
necessarily be in writing and the complaint can be presented by the payee
or holder in due course of the cheque and it need not be signed by the
complainant. In other words, if the legislature intended that the
complaint under the Act, apart from being in writing, is also required to
be signed by the complainant, the legislature would have used different
language and inserted the same at the appropriate place. In our opinion,
the correct interpretation would be that the complaint under Section 142(a)
of the Act requires to be in writing as at the time of taking cognizance,
the Magistrate will examine the complainant on oath and the verification
statement will be signed by the complainant.
16) It is the contention of Mr. Bhagwati Prasad, learned senior counsel
for the appellant that the limitation period expired on the date of
verification and the complaint cannot be entertained. In view of the above
discussion, we are unable to accept the said contention.
17) In Japani Sahoo vs. Chandra Sekhar Mohanty, (2007) 7 SCC 394, in para
48, this Court held that “so far as the complainant is concerned, as soon
as he files a complaint in a competent court of law, he has done everything
which is required to be done by him at that stage. Thereafter, it is for
the Magistrate to consider the matter to apply his mind and to take an
appropriate decision of taking cognizance, issuing process or any other
action which the law contemplates”. This Court further held that “the
complainant has no control over those proceedings”. Taking note of
Sections 468 and 473 of the Code, in para 52, this Court held that “for the
purpose of computing the period of limitation, the relevant date must be
considered as the date of filing of the complaint or initiating criminal
proceedings and not the date of taking cognizance by a Magistrate or
issuance of process by a Court”.
18) In the light of the scheme of the Act and various provisions of the
Code, we fully endorse the above view and hold that the crucial date for
computing the period of limitation is the date of filing of the complaint
or initiating criminal proceedings and not the date of taking cognizance by
the Magistrate. In the case on hand, as pointed out earlier, the complaint
was filed on June 3, 1998 which is well within the time and on the
direction of the Magistrate, verification was recorded by solemn
affirmation by authorized representatives of the complainant and after
recording the statement and securing his signature, the learned Magistrate
passed an order issuing summons against the accused under Sections 138/142
of the Act.
19) In the light of the above discussion, taking note of various
provisions of the Act and the Code which we have adverted above,
we hold
that the complaint under Section 138 of the Act without signature is
maintainable when such complaint is verified by the complainant and the
process is issued by the Magistrate after due verification. The
prosecution of such complaint is maintainable and we agree with the
conclusion arrived at by the Division Bench of the High Court.
Consequently, both the appeals fail and are dismissed.
………….…………………………J.
(P. SATHASIVAM)
………….…………………………J.
(RANJAN GOGOI)
NEW DELHI;
NOVEMBER 22, 2012.
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