Sec.138 of N.I.Act - Sec.27 of General clauses Act and Sec.114 of Evidence Act - Presumption of service of Statutory Notice under sec.138 - when it was given to correct address - then there is no need to plead specifically that the accused managed and got return the notice un served in the pleadings of complaint - High court erred in quashing the complaint basing on Shakti Travel & Tours which does not hold the field any more. - Apex court held that It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. and set aside the High court order=
High Court has quashed the complaint filed by him under Section 138 of the
Negotiable Instruments Act, 1881 (‘the NI Act’) being SCC No. 4118 of 2007
in the court of Chief Judicial Magistrate, First Class, Aurangabad.=
Addt. Sessions Judge court
The respondent-accused filed a criminal
revision application before the Additional Sessions Judge, Aurangabad
mainly on the assertion that the demand notice was not served on him. The
said criminal revision application was rejected.=
High court
The High Court quashed the complaint on a short ground that on
reading verification of the complaint dated 17/6/2011, it is explicit that
there are no recitals to demonstrate that the notice issued under Section
138 of the NI Act by the complainant was served upon the respondent-accused
on any specific date. The High Court observed that there is no proof that
either the notice was served or it was returned unserved/unclaimed and that
that there is no averment in the complaint about the same. The High Court
concluded that, therefore, there could not be a cause of action to
prosecute the accused under Section 138 of the NI Act.
For coming to this
conclusion, the High Court relied on the order of this Court in Shakti
Travel & Tours v. State of Bihar & Anr[1]. The extract on which the High
Court relied upon could be quoted :
“2. The accused who is the appellant, assails the order of the High Court
refusing to quash the complaint filed under Section 138 of the Negotiable
Instruments Act. The only ground on which the learned counsel for the
appellant prays for quashing of the complaint is that on the assertions
made in paragraph 8 of the complaint, it must be held that notice has not
been served and, therefore, an application under Section 138 could not have
been maintained. Undoubtedly, the accused has a right to pay the money
within 15 days from the date of the service of notice and only when it
fails to pay, is it open for the complainant to file a case under Section
138 of the Negotiable Instruments Act. That being the position and in the
complaint itself having not been mentioned that the notice has been served,
on the assertions made in para 8, the complainant itself is not
maintainable. We accordingly quash the complaint.”=
Apex court
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.1523 OF 2014
[Arising out of Special Leave Petition (Crl.)No.8783 of 2013]
M/s. Ajeet Seeds Ltd. … Appellant
Vs.
K. Gopala Krishnaiah … Respondent
J U D G M E N T
(SMT.) RANJANA PRAKASH DESAI, J.
1. Leave granted.
2. The appellant is the complainant. He has challenged the judgment and
order dated 21/03/2013 passed by the High Court of Judicature of Bombay,
Bench at Aurangabad in Criminal Writ Petition No.1131 of 2012 whereby the
High Court has quashed the complaint filed by him under Section 138 of the
Negotiable Instruments Act, 1881 (‘the NI Act’) being SCC No. 4118 of 2007
in the court of Chief Judicial Magistrate, First Class, Aurangabad.
3. For the purpose of disposal of this appeal, it is not necessary to
narrate all the facts of the case. Suffice it to say that the complaint
was filed alleging that the cheque issued by the respondent-accused for
repayment of a legally recoverable debt bounced. On 17/6/2011 learned
Magistrate issued process. The respondent-accused filed a criminal
revision application before the Additional Sessions Judge, Aurangabad
mainly on the assertion that the demand notice was not served on him. The
said criminal revision application was rejected. Being aggrieved by the
said order, the respondent-accused filed criminal writ petition in the High
Court under Section 482 of the Code of Criminal Procedure, 1973 (‘the
Cr.P.C.’). The High Court quashed the complaint on a short ground that on
reading verification of the complaint dated 17/6/2011, it is explicit that
there are no recitals to demonstrate that the notice issued under Section
138 of the NI Act by the complainant was served upon the respondent-accused
on any specific date. The High Court observed that there is no proof that
either the notice was served or it was returned unserved/unclaimed and that
that there is no averment in the complaint about the same. The High Court
concluded that, therefore, there could not be a cause of action to
prosecute the accused under Section 138 of the NI Act. For coming to this
conclusion, the High Court relied on the order of this Court in Shakti
Travel & Tours v. State of Bihar & Anr[1]. The extract on which the High
Court relied upon could be quoted :
“2. The accused who is the appellant, assails the order of the High Court
refusing to quash the complaint filed under Section 138 of the Negotiable
Instruments Act. The only ground on which the learned counsel for the
appellant prays for quashing of the complaint is that on the assertions
made in paragraph 8 of the complaint, it must be held that notice has not
been served and, therefore, an application under Section 138 could not have
been maintained. Undoubtedly, the accused has a right to pay the money
within 15 days from the date of the service of notice and only when it
fails to pay, is it open for the complainant to file a case under Section
138 of the Negotiable Instruments Act. That being the position and in the
complaint itself having not been mentioned that the notice has been served,
on the assertions made in para 8, the complainant itself is not
maintainable. We accordingly quash the complaint.”
4. We have heard, at some length, Mr. S.S. Choudhari, learned counsel
appearing for the appellant. Counsel submitted that the High Court has
erred in quashing the complaint on the ground that complaint is silent
about service of notice. Counsel submitted that in C.C. Alavi Haji v.
Palapetty Muhammed & Anr.[2], a three Judge Bench of this Court has
conclusively decided this issue. It is held in this case that it is not
necessary to aver in the complaint that notice was served upon the accused.
The impugned order, therefore, deserves to be set aside.
5. We are inclined to agree with the counsel for the appellant.
6. In C.C. Alavi Haji, a three-Judge Bench of this Court was dealing
with the question referred by a two-Judge Bench for consideration. The
referring Bench was of the view that in D. Vinod Shivappa v. Nanda
Belliappa[3], this Court did not take note of Section 114 of the Evidence
Act in its proper perspective. It felt that presumption under Section 114
of the Evidence Act being a rebuttable presumption, the complainant should
make certain necessary averments to raise the presumption of service of
notice; that it was not sufficient for a complainant to state that a notice
was sent by registered post and that the notice was returned with the
endorsement ‘out of station’ and that there should be a further averment
that the addressee-drawer had deliberately avoided receiving the notice or
that the addressee had knowledge of the notice, for raising a presumption
under Section 114 of the Evidence Act. The following question was,
therefore, referred to the larger Bench for consideration.
“Whether in absence of any averments in the complaint to the effect that
the accused had a role to play in the matter of non-receipt of legal
notice; or that the accused deliberately avoided service of notice, the
same could have been entertained keeping in view the decision of this Court
in Vinod Shivappa’s case?”
7. Dealing with the above question, this Court referred to K. Bhaskaran
v. Sankaran Vaidhyan Balan[4], where this Court referred to Section 27 of
the General Clauses Act, 1897 (‘the GC Act’) and observed that since the NI
Act does not require that notice should only be given by ‘post’ in a case
where the sender has despatched the notice by post with correct address
written on it, Section 27 of the GC Act could be profitably imported and in
such a situation service of notice is deemed to have been effected on the
sender unless he proves that it was really not served and that he was not
responsible for such non-service.
8. This Court then referred to Vinod Shivappa’s case, where the above
aspects have been highlighted. This Court quoted the following paragraph
from Vinod Shivappa with approval.
“15. We cannot also lose sight of the fact that the drawer may by dubious
means manage to get an incorrect endorsement made on the envelope that the
premises has been found locked or that the addressee was not available at
the time when postman went for delivery of the letter. It may be that the
address is correct and even the addressee is available but a wrong
endorsement is manipulated by the addressee. In such a case, if the facts
are proved, it may amount to refusal of the notice. If the complainant is
able to prove that the drawer of the cheque knew about the notice and
deliberately evaded service and got a false endorsement made only to defeat
the process of law, the Court shall presume service of notice. This,
however, is a matter of evidence and proof. Thus even in a case where the
notice is returned with the endorsement that the premises has always been
found locked or the addressee was not available at the time of postal
delivery, it will be open to the complainant to prove at the trial by
evidence that the endorsement is not correct and that the addressee,
namely the drawer of the cheque, with knowledge of the notice had
deliberately avoided to receive notice. Therefore, it would be pre-mature
at the stage of issuance of process, to move the High Court for quashing
of the proceeding under Section 482 of the Code of Criminal Procedure. The
question as to whether the service of notice has been fraudulently refused
by unscrupulous means is a question of fact to be decided on the basis of
evidence. In such a case the High Court ought not to exercise its
jurisdiction under Section 482 of the Code of Criminal Procedure.”
9. This Court then explained the nature of presumptions under Section
114 of the Evidence Act and under Section 27 of the GC Act and pointed out
how these two presumptions are to be employed while considering the
question of service of notice under Section 138 of the NI Act. The
relevant paragraphs read as under:
“13. According to Section 114 of the Act, read with Illustration (f)
thereunder, when it appears to the Court that the common course of business
renders it probable that a thing would happen, the Court may draw
presumption that the thing would have happened, unless there are
circumstances in a particular case to show that the common course of
business was not followed. Thus, Section 114 enables the Court to presume
the existence of any fact which it thinks likely to have happened, regard
being had to the common course of natural events, human conduct and public
and private business in their relation to the facts of the particular case.
Consequently, the court can presume that the common course of business has
been followed in particular cases. When applied to communications sent by
post, Section 114 enables the Court to presume that in the common course of
natural events, the communication would have been delivered at the address
of the addressee. But the presumption that is raised under Section 27 of
the G.C. Act is a far stronger presumption. Further, while Section 114 of
Evidence Act refers to a general presumption, Section 27 refers to a
specific presumption. For the sake of ready reference, Section 27 of G.C.
Act is extracted below:
“27. Meaning of service by post.- Where any Central Act or regulation made
after the commencement of this Act authorizes or requires any document to
be served by post, whether the expression ‘serve’ or either of the
expressions ‘give’ or ‘send’ or any other expression is used, then, unless
a different intention appears, the service shall be deemed to be effected
by properly addressing, pre-paying and posting by registered post, a letter
containing the document, and, unless the contrary is proved, to have been
effected at the time at which the letter would be delivered in the ordinary
course of post”.
14. Section 27 gives rise to a presumption that service of notice has been
effected when it is sent to the correct address by registered post. In view
of the said presumption, when stating that a notice has been sent by
registered post to the address of the drawer, it is unnecessary to further
aver in the complaint that in spite of the return of the notice unserved,
it is deemed to have been served or that the addressee is deemed to have
knowledge of the notice. Unless and until the contrary is proved by the
addressee, service of notice is deemed to have been effected at the time at
which the letter would have been delivered in the ordinary course of
business. This Court has already held that when a notice is sent by
registered post and is returned with a postal endorsement ‘refused’ or ‘not
available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee
not in station’, due service has to be presumed. [Vide Jagdish Singh Vs.
Natthu Singh (1992) 1 SCC 647; State of M.P. Vs. Hiralal & Ors. (1996) 7
SCC 523 and V.Raja Kumari Vs. P.Subbarama Naidu & Anr. (2004) 8 SCC 74] It
is, therefore, manifest that in view of the presumption available under
Section 27 of the Act, it is not necessary to aver in the complaint under
Section 138 of the Act that service of notice was evaded by the accused or
that the accused had a role to play in the return of the notice unserved.”
10. It is thus clear that Section 114 of the Evidence Act enables the
Court to presume that in the common course of natural events, the
communication would have been delivered at the address of the addressee.
Section 27 of the GC Act gives rise to a presumption that service of notice
has been effected when it is sent to the correct address by registered
post. It is not necessary to aver in the complaint that in spite of the
return of the notice unserved, it is deemed to have been served or that the
addressee is deemed to have knowledge of the notice. Unless and until the
contrary is proved by the addressee, service of notice is deemed to have
been effected at the time at which the letter would have been delivered in
the ordinary course of business.
11. Applying the above conclusions to the facts of this case, it must be
held that the High Court clearly erred in quashing the complaint on the
ground that there was no recital in the complaint that the notice under
Section 138 of the NI Act was served upon the accused. The High Court also
erred in quashing the complaint on the ground that there was no proof
either that the notice was served or it was returned unserved/unclaimed.
That is a matter of evidence. We must mention that in C.C. Alavi Haji,
this Court did not deviate from the view taken in Vinod Shivappa, but
reiterated the view expressed therein with certain clarification. We have
already quoted the relevant paragraphs from Vinod Shivappa where this Court
has held that service of notice is a matter of evidence and proof and it
would be premature at the stage of issuance of process to move the High
Court for quashing of the proceeding under Section 482 of the Cr.P.C.
These observations are squarely attracted to the present case. The High
Court’s reliance on an order passed by a two-Judge Bench in Shakti Travel &
Tours is misplaced. The order in Shakti Travel & Tours does not give any
idea about the factual matrix of that case. It does not advert to rival
submissions. It cannot be said therefore that it lays down any law. In
any case in C.C. Alavi Haji, to which we have made a reference, the three-
Judge Bench has conclusively decided the issue. In our opinion, the
judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the
field any more.
13. In the circumstances, the impugned judgment is set aside and the
instant complaint is restored. The appeal is allowed.
………………………………J.
(Ranjana Prakash Desai)
………………………………J.
(N.V. Ramana)
New Delhi;
July 16, 2014.
-----------------------
[1] (2002) 9 SCC 415
[2] (2007) 6 SCC 555
[3] (2006) 6 SCC 456
[4] (1999) 7 SCC 510
-----------------------
12
High Court has quashed the complaint filed by him under Section 138 of the
Negotiable Instruments Act, 1881 (‘the NI Act’) being SCC No. 4118 of 2007
in the court of Chief Judicial Magistrate, First Class, Aurangabad.=
Addt. Sessions Judge court
The respondent-accused filed a criminal
revision application before the Additional Sessions Judge, Aurangabad
mainly on the assertion that the demand notice was not served on him. The
said criminal revision application was rejected.=
High court
The High Court quashed the complaint on a short ground that on
reading verification of the complaint dated 17/6/2011, it is explicit that
there are no recitals to demonstrate that the notice issued under Section
138 of the NI Act by the complainant was served upon the respondent-accused
on any specific date. The High Court observed that there is no proof that
either the notice was served or it was returned unserved/unclaimed and that
that there is no averment in the complaint about the same. The High Court
concluded that, therefore, there could not be a cause of action to
prosecute the accused under Section 138 of the NI Act.
For coming to this
conclusion, the High Court relied on the order of this Court in Shakti
Travel & Tours v. State of Bihar & Anr[1]. The extract on which the High
Court relied upon could be quoted :
“2. The accused who is the appellant, assails the order of the High Court
refusing to quash the complaint filed under Section 138 of the Negotiable
Instruments Act. The only ground on which the learned counsel for the
appellant prays for quashing of the complaint is that on the assertions
made in paragraph 8 of the complaint, it must be held that notice has not
been served and, therefore, an application under Section 138 could not have
been maintained. Undoubtedly, the accused has a right to pay the money
within 15 days from the date of the service of notice and only when it
fails to pay, is it open for the complainant to file a case under Section
138 of the Negotiable Instruments Act. That being the position and in the
complaint itself having not been mentioned that the notice has been served,
on the assertions made in para 8, the complainant itself is not
maintainable. We accordingly quash the complaint.”=
Apex court
In C.C. Alavi Haji, a three-Judge Bench of this Court was dealing
with the question referred by a two-Judge Bench for consideration. The
referring Bench was of the view that in D. Vinod Shivappa v. Nanda
Belliappa[3], this Court did not take note of Section 114 of the Evidence
Act in its proper perspective.
that it was not sufficient for a complainant to state that a notice
was sent by registered post and that the notice was returned with the
endorsement ‘out of station’ and that there should be a further averment
that the addressee-drawer had deliberately avoided receiving the notice or
that the addressee had knowledge of the notice, for raising a presumption
under Section 114 of the Evidence Act.
The following question was,
therefore, referred to the larger Bench for consideration.
“Whether in absence of any averments in the complaint to the effect that
the accused had a role to play in the matter of non-receipt of legal
notice; or that the accused deliberately avoided service of notice, the
same could have been entertained keeping in view the decision of this Court
in Vinod Shivappa’s case?” =
in C.C. Alavi Haji v.Palapetty Muhammed & Anr.[2],
a three Judge Bench of this Court has
with the question referred by a two-Judge Bench for consideration. The
referring Bench was of the view that in D. Vinod Shivappa v. Nanda
Belliappa[3], this Court did not take note of Section 114 of the Evidence
Act in its proper perspective.
that it was not sufficient for a complainant to state that a notice
was sent by registered post and that the notice was returned with the
endorsement ‘out of station’ and that there should be a further averment
that the addressee-drawer had deliberately avoided receiving the notice or
that the addressee had knowledge of the notice, for raising a presumption
under Section 114 of the Evidence Act.
The following question was,
therefore, referred to the larger Bench for consideration.
“Whether in absence of any averments in the complaint to the effect that
the accused had a role to play in the matter of non-receipt of legal
notice; or that the accused deliberately avoided service of notice, the
same could have been entertained keeping in view the decision of this Court
in Vinod Shivappa’s case?” =
in C.C. Alavi Haji v.Palapetty Muhammed & Anr.[2],
a three Judge Bench of this Court has
conclusively decided this issue. It is held in this case that it is not
necessary to aver in the complaint that notice was served upon the accused.
K. Bhaskaran v. Sankaran Vaidhyan Balan[4],
where this Court referred to Section 27 of
the General Clauses Act, 1897 (‘the GC Act’) and observed that since the NI
Act does not require that notice should only be given by ‘post’ in a case
where the sender has despatched the notice by post with correct address
written on it, Section 27 of the GC Act could be profitably imported and in
such a situation service of notice is deemed to have been effected on the
sender unless he proves that it was really not served and that he was not
responsible for such non-service.
This Court has already held that when a notice is sent by
registered post and is returned with a postal endorsement ‘refused’ or ‘not
available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee
not in station’, due service has to be presumed. [Vide Jagdish Singh Vs.
Natthu Singh (1992) 1 SCC 647; State of M.P. Vs. Hiralal & Ors. (1996) 7
SCC 523 and V.Raja Kumari Vs. P.Subbarama Naidu & Anr. (2004) 8 SCC 74]
It is, therefore, manifest that in view of the presumption available under
Section 27 of the Act, it is not necessary to aver in the complaint under
Section 138 of the Act that service of notice was evaded by the accused or
that the accused had a role to play in the return of the notice unserved.”
Apex court held that
It is thus clear that Section 114 of the Evidence Act enables the
Court to presume that in the common course of natural events, the
communication would have been delivered at the address of the addressee.
Section 27 of the GC Act gives rise to a presumption that service of notice
has been effected when it is sent to the correct address by registered
post. It is not necessary to aver in the complaint that in spite of the
return of the notice unserved, it is deemed to have been served or that the
addressee is deemed to have knowledge of the notice. Unless and until the
contrary is proved by the addressee, service of notice is deemed to have
been effected at the time at which the letter would have been delivered in
the ordinary course of business.
The High Court also
erred in quashing the complaint on the ground that there was no proof
either that the notice was served or it was returned unserved/unclaimed.
That is a matter of evidence.
We must mention that in C.C. Alavi Haji,
this Court did not deviate from the view taken in Vinod Shivappa, but
reiterated the view expressed therein with certain clarification.
We have
already quoted the relevant paragraphs from Vinod Shivappa where this Court
has held that service of notice is a matter of evidence and proof and
it
would be premature at the stage of issuance of process to move the High
Court for quashing of the proceeding under Section 482 of the Cr.P.C.
These observations are squarely attracted to the present case.
The High
Court’s reliance on an order passed by a two-Judge Bench in Shakti Travel &
Tours is misplaced. The order in Shakti Travel & Tours does not give any
idea about the factual matrix of that case. It does not advert to rival
submissions. It cannot be said therefore that it lays down any law.
In
any case in C.C. Alavi Haji, to which we have made a reference, the three-
Judge Bench has conclusively decided the issue.
In our opinion, the
judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the
field any more.
In the circumstances, the impugned judgment is set aside and the
instant complaint is restored. The appeal is allowed.
necessary to aver in the complaint that notice was served upon the accused.
K. Bhaskaran v. Sankaran Vaidhyan Balan[4],
where this Court referred to Section 27 of
the General Clauses Act, 1897 (‘the GC Act’) and observed that since the NI
Act does not require that notice should only be given by ‘post’ in a case
where the sender has despatched the notice by post with correct address
written on it, Section 27 of the GC Act could be profitably imported and in
such a situation service of notice is deemed to have been effected on the
sender unless he proves that it was really not served and that he was not
responsible for such non-service.
This Court has already held that when a notice is sent by
registered post and is returned with a postal endorsement ‘refused’ or ‘not
available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee
not in station’, due service has to be presumed. [Vide Jagdish Singh Vs.
Natthu Singh (1992) 1 SCC 647; State of M.P. Vs. Hiralal & Ors. (1996) 7
SCC 523 and V.Raja Kumari Vs. P.Subbarama Naidu & Anr. (2004) 8 SCC 74]
It is, therefore, manifest that in view of the presumption available under
Section 27 of the Act, it is not necessary to aver in the complaint under
Section 138 of the Act that service of notice was evaded by the accused or
that the accused had a role to play in the return of the notice unserved.”
Apex court held that
It is thus clear that Section 114 of the Evidence Act enables the
Court to presume that in the common course of natural events, the
communication would have been delivered at the address of the addressee.
Section 27 of the GC Act gives rise to a presumption that service of notice
has been effected when it is sent to the correct address by registered
post. It is not necessary to aver in the complaint that in spite of the
return of the notice unserved, it is deemed to have been served or that the
addressee is deemed to have knowledge of the notice. Unless and until the
contrary is proved by the addressee, service of notice is deemed to have
been effected at the time at which the letter would have been delivered in
the ordinary course of business.
The High Court also
erred in quashing the complaint on the ground that there was no proof
either that the notice was served or it was returned unserved/unclaimed.
That is a matter of evidence.
We must mention that in C.C. Alavi Haji,
this Court did not deviate from the view taken in Vinod Shivappa, but
reiterated the view expressed therein with certain clarification.
We have
already quoted the relevant paragraphs from Vinod Shivappa where this Court
has held that service of notice is a matter of evidence and proof and
it
would be premature at the stage of issuance of process to move the High
Court for quashing of the proceeding under Section 482 of the Cr.P.C.
These observations are squarely attracted to the present case.
The High
Court’s reliance on an order passed by a two-Judge Bench in Shakti Travel &
Tours is misplaced. The order in Shakti Travel & Tours does not give any
idea about the factual matrix of that case. It does not advert to rival
submissions. It cannot be said therefore that it lays down any law.
In
any case in C.C. Alavi Haji, to which we have made a reference, the three-
Judge Bench has conclusively decided the issue.
In our opinion, the
judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the
field any more.
In the circumstances, the impugned judgment is set aside and the
instant complaint is restored. The appeal is allowed.
2014 – July. Part – http://judis.nic.in/supremecourt/filename=41790
RANJANA PRAKASH DESAI, N.V. RAMANA
REPORTABLEIN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.1523 OF 2014
[Arising out of Special Leave Petition (Crl.)No.8783 of 2013]
M/s. Ajeet Seeds Ltd. … Appellant
Vs.
K. Gopala Krishnaiah … Respondent
J U D G M E N T
(SMT.) RANJANA PRAKASH DESAI, J.
1. Leave granted.
2. The appellant is the complainant. He has challenged the judgment and
order dated 21/03/2013 passed by the High Court of Judicature of Bombay,
Bench at Aurangabad in Criminal Writ Petition No.1131 of 2012 whereby the
High Court has quashed the complaint filed by him under Section 138 of the
Negotiable Instruments Act, 1881 (‘the NI Act’) being SCC No. 4118 of 2007
in the court of Chief Judicial Magistrate, First Class, Aurangabad.
3. For the purpose of disposal of this appeal, it is not necessary to
narrate all the facts of the case. Suffice it to say that the complaint
was filed alleging that the cheque issued by the respondent-accused for
repayment of a legally recoverable debt bounced. On 17/6/2011 learned
Magistrate issued process. The respondent-accused filed a criminal
revision application before the Additional Sessions Judge, Aurangabad
mainly on the assertion that the demand notice was not served on him. The
said criminal revision application was rejected. Being aggrieved by the
said order, the respondent-accused filed criminal writ petition in the High
Court under Section 482 of the Code of Criminal Procedure, 1973 (‘the
Cr.P.C.’). The High Court quashed the complaint on a short ground that on
reading verification of the complaint dated 17/6/2011, it is explicit that
there are no recitals to demonstrate that the notice issued under Section
138 of the NI Act by the complainant was served upon the respondent-accused
on any specific date. The High Court observed that there is no proof that
either the notice was served or it was returned unserved/unclaimed and that
that there is no averment in the complaint about the same. The High Court
concluded that, therefore, there could not be a cause of action to
prosecute the accused under Section 138 of the NI Act. For coming to this
conclusion, the High Court relied on the order of this Court in Shakti
Travel & Tours v. State of Bihar & Anr[1]. The extract on which the High
Court relied upon could be quoted :
“2. The accused who is the appellant, assails the order of the High Court
refusing to quash the complaint filed under Section 138 of the Negotiable
Instruments Act. The only ground on which the learned counsel for the
appellant prays for quashing of the complaint is that on the assertions
made in paragraph 8 of the complaint, it must be held that notice has not
been served and, therefore, an application under Section 138 could not have
been maintained. Undoubtedly, the accused has a right to pay the money
within 15 days from the date of the service of notice and only when it
fails to pay, is it open for the complainant to file a case under Section
138 of the Negotiable Instruments Act. That being the position and in the
complaint itself having not been mentioned that the notice has been served,
on the assertions made in para 8, the complainant itself is not
maintainable. We accordingly quash the complaint.”
4. We have heard, at some length, Mr. S.S. Choudhari, learned counsel
appearing for the appellant. Counsel submitted that the High Court has
erred in quashing the complaint on the ground that complaint is silent
about service of notice. Counsel submitted that in C.C. Alavi Haji v.
Palapetty Muhammed & Anr.[2], a three Judge Bench of this Court has
conclusively decided this issue. It is held in this case that it is not
necessary to aver in the complaint that notice was served upon the accused.
The impugned order, therefore, deserves to be set aside.
5. We are inclined to agree with the counsel for the appellant.
6. In C.C. Alavi Haji, a three-Judge Bench of this Court was dealing
with the question referred by a two-Judge Bench for consideration. The
referring Bench was of the view that in D. Vinod Shivappa v. Nanda
Belliappa[3], this Court did not take note of Section 114 of the Evidence
Act in its proper perspective. It felt that presumption under Section 114
of the Evidence Act being a rebuttable presumption, the complainant should
make certain necessary averments to raise the presumption of service of
notice; that it was not sufficient for a complainant to state that a notice
was sent by registered post and that the notice was returned with the
endorsement ‘out of station’ and that there should be a further averment
that the addressee-drawer had deliberately avoided receiving the notice or
that the addressee had knowledge of the notice, for raising a presumption
under Section 114 of the Evidence Act. The following question was,
therefore, referred to the larger Bench for consideration.
“Whether in absence of any averments in the complaint to the effect that
the accused had a role to play in the matter of non-receipt of legal
notice; or that the accused deliberately avoided service of notice, the
same could have been entertained keeping in view the decision of this Court
in Vinod Shivappa’s case?”
7. Dealing with the above question, this Court referred to K. Bhaskaran
v. Sankaran Vaidhyan Balan[4], where this Court referred to Section 27 of
the General Clauses Act, 1897 (‘the GC Act’) and observed that since the NI
Act does not require that notice should only be given by ‘post’ in a case
where the sender has despatched the notice by post with correct address
written on it, Section 27 of the GC Act could be profitably imported and in
such a situation service of notice is deemed to have been effected on the
sender unless he proves that it was really not served and that he was not
responsible for such non-service.
8. This Court then referred to Vinod Shivappa’s case, where the above
aspects have been highlighted. This Court quoted the following paragraph
from Vinod Shivappa with approval.
“15. We cannot also lose sight of the fact that the drawer may by dubious
means manage to get an incorrect endorsement made on the envelope that the
premises has been found locked or that the addressee was not available at
the time when postman went for delivery of the letter. It may be that the
address is correct and even the addressee is available but a wrong
endorsement is manipulated by the addressee. In such a case, if the facts
are proved, it may amount to refusal of the notice. If the complainant is
able to prove that the drawer of the cheque knew about the notice and
deliberately evaded service and got a false endorsement made only to defeat
the process of law, the Court shall presume service of notice. This,
however, is a matter of evidence and proof. Thus even in a case where the
notice is returned with the endorsement that the premises has always been
found locked or the addressee was not available at the time of postal
delivery, it will be open to the complainant to prove at the trial by
evidence that the endorsement is not correct and that the addressee,
namely the drawer of the cheque, with knowledge of the notice had
deliberately avoided to receive notice. Therefore, it would be pre-mature
at the stage of issuance of process, to move the High Court for quashing
of the proceeding under Section 482 of the Code of Criminal Procedure. The
question as to whether the service of notice has been fraudulently refused
by unscrupulous means is a question of fact to be decided on the basis of
evidence. In such a case the High Court ought not to exercise its
jurisdiction under Section 482 of the Code of Criminal Procedure.”
9. This Court then explained the nature of presumptions under Section
114 of the Evidence Act and under Section 27 of the GC Act and pointed out
how these two presumptions are to be employed while considering the
question of service of notice under Section 138 of the NI Act. The
relevant paragraphs read as under:
“13. According to Section 114 of the Act, read with Illustration (f)
thereunder, when it appears to the Court that the common course of business
renders it probable that a thing would happen, the Court may draw
presumption that the thing would have happened, unless there are
circumstances in a particular case to show that the common course of
business was not followed. Thus, Section 114 enables the Court to presume
the existence of any fact which it thinks likely to have happened, regard
being had to the common course of natural events, human conduct and public
and private business in their relation to the facts of the particular case.
Consequently, the court can presume that the common course of business has
been followed in particular cases. When applied to communications sent by
post, Section 114 enables the Court to presume that in the common course of
natural events, the communication would have been delivered at the address
of the addressee. But the presumption that is raised under Section 27 of
the G.C. Act is a far stronger presumption. Further, while Section 114 of
Evidence Act refers to a general presumption, Section 27 refers to a
specific presumption. For the sake of ready reference, Section 27 of G.C.
Act is extracted below:
“27. Meaning of service by post.- Where any Central Act or regulation made
after the commencement of this Act authorizes or requires any document to
be served by post, whether the expression ‘serve’ or either of the
expressions ‘give’ or ‘send’ or any other expression is used, then, unless
a different intention appears, the service shall be deemed to be effected
by properly addressing, pre-paying and posting by registered post, a letter
containing the document, and, unless the contrary is proved, to have been
effected at the time at which the letter would be delivered in the ordinary
course of post”.
14. Section 27 gives rise to a presumption that service of notice has been
effected when it is sent to the correct address by registered post. In view
of the said presumption, when stating that a notice has been sent by
registered post to the address of the drawer, it is unnecessary to further
aver in the complaint that in spite of the return of the notice unserved,
it is deemed to have been served or that the addressee is deemed to have
knowledge of the notice. Unless and until the contrary is proved by the
addressee, service of notice is deemed to have been effected at the time at
which the letter would have been delivered in the ordinary course of
business. This Court has already held that when a notice is sent by
registered post and is returned with a postal endorsement ‘refused’ or ‘not
available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee
not in station’, due service has to be presumed. [Vide Jagdish Singh Vs.
Natthu Singh (1992) 1 SCC 647; State of M.P. Vs. Hiralal & Ors. (1996) 7
SCC 523 and V.Raja Kumari Vs. P.Subbarama Naidu & Anr. (2004) 8 SCC 74] It
is, therefore, manifest that in view of the presumption available under
Section 27 of the Act, it is not necessary to aver in the complaint under
Section 138 of the Act that service of notice was evaded by the accused or
that the accused had a role to play in the return of the notice unserved.”
10. It is thus clear that Section 114 of the Evidence Act enables the
Court to presume that in the common course of natural events, the
communication would have been delivered at the address of the addressee.
Section 27 of the GC Act gives rise to a presumption that service of notice
has been effected when it is sent to the correct address by registered
post. It is not necessary to aver in the complaint that in spite of the
return of the notice unserved, it is deemed to have been served or that the
addressee is deemed to have knowledge of the notice. Unless and until the
contrary is proved by the addressee, service of notice is deemed to have
been effected at the time at which the letter would have been delivered in
the ordinary course of business.
11. Applying the above conclusions to the facts of this case, it must be
held that the High Court clearly erred in quashing the complaint on the
ground that there was no recital in the complaint that the notice under
Section 138 of the NI Act was served upon the accused. The High Court also
erred in quashing the complaint on the ground that there was no proof
either that the notice was served or it was returned unserved/unclaimed.
That is a matter of evidence. We must mention that in C.C. Alavi Haji,
this Court did not deviate from the view taken in Vinod Shivappa, but
reiterated the view expressed therein with certain clarification. We have
already quoted the relevant paragraphs from Vinod Shivappa where this Court
has held that service of notice is a matter of evidence and proof and it
would be premature at the stage of issuance of process to move the High
Court for quashing of the proceeding under Section 482 of the Cr.P.C.
These observations are squarely attracted to the present case. The High
Court’s reliance on an order passed by a two-Judge Bench in Shakti Travel &
Tours is misplaced. The order in Shakti Travel & Tours does not give any
idea about the factual matrix of that case. It does not advert to rival
submissions. It cannot be said therefore that it lays down any law. In
any case in C.C. Alavi Haji, to which we have made a reference, the three-
Judge Bench has conclusively decided the issue. In our opinion, the
judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the
field any more.
13. In the circumstances, the impugned judgment is set aside and the
instant complaint is restored. The appeal is allowed.
………………………………J.
(Ranjana Prakash Desai)
………………………………J.
(N.V. Ramana)
New Delhi;
July 16, 2014.
-----------------------
[1] (2002) 9 SCC 415
[2] (2007) 6 SCC 555
[3] (2006) 6 SCC 456
[4] (1999) 7 SCC 510
-----------------------
12
