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Ashwin Negandhi v/s M/s. D.G. Metal Product & Others

    Criminal Application No.1267 of 2008 with Criminal Application No.1268 of 2008 with Criminal Application No.1269 of 2008 with Criminal Application No.1270 of 2008 with Criminal Application No.1271 of 2008 with Criminal Application No.1272 of 2008 with Criminal Application No.1273 of 2008 with Criminal Application No.1274 of 2008 with Criminal Application No.1275 of 2008 with Criminal Application No.1276 of 2008 with Criminal Application No.1277 of 2008 with Criminal Application No.1278 of 2008

    Decided On, 25 February 2009

    At, High Court of Judicature at Bombay

    By, THE HONOURABLE MR. JUSTICE A.S. OKA

    For the Applicant: A.D. Chandrabose, Advocate. For the Respondents: R1 to R3, S.V. Marvadi i/by S.P. Narkar, Advocate, Ms. A.T. Javeri, Y.S. Shinde, J.P. Yagnik, P.A. Pol, APP.



Judgment Text

PC:


1. Yesterday, I have heard the submissions of the learned counsel appearing for the parties. Today, the applications are kept for passing orders. It is not in dispute that the facts of all these applications are more or less identical. Therefore, I am referring to the facts of Criminal Application No.1267 of 2008.


2. These are the applications under sub section 4 of section 378 of the Code of Criminal Procedure, 1973 (hereinafter referred to as "the said Code of 1973"). The applicant filed a complaint alleging commission of offence under section 138 read with section 141 of the Negotiable Instruments Act, 1881 (hereinafter referred to as "the said Act of 1881") against first to third respondents. In the complaint it is stated that the first respondent is a partnership firm of which second and third respondents are the partners. Reliance has been placed on a deed of partnership admission-cum-retirement dated 25th November 2004 under which the applicant retired from the partnership business of M/s.D.G.False Flooring Systems with effect from 30th September 2004. It is asserted in the complaint that in terms of the said deed of partnership admission-cum-retirement dated 25th November 2004 a post dated cheque was issued by the accused. The said cheque was dishonoured and therefore present complaint has been filed. The learned Magistrate passed an order of acquittal. The learned Magistrate held that it is not established that the cheque in question was issued by the accused for discharging the legally recoverable liability. The learned Judge after going through the deed of partnership admission-cum- retirement dated 24th November 2004 (hereinafter referred to as "the said deed") observed that the applicant and one Swapna Dhar, the father of second and third accused were running the partnership business in the name and style of M/s.D.G.False Flooring Systems. By the said deed, the applicant retired from the said partnership with effect from 30th September 2004 and the mother of the 2nd and 3rd respondents was admitted as a partner. Under the said deed the parents of accused nos.2 and 3 agreed to pay a compensation towards the capital invested by the complainant in the said firm and also agreed to pay monthly compensation of Rs.80,000/- towards use of machinery and factory premises belonging to the applicant. The learned Judge held that the accused nos.1 to 3 are not the parties to the said deed and there is no reference in the said document about payment of compensation by the accused for the use of machinery. The learned Judge, therefore, proceeded to hold that accused nos.2 and 3 never admitted that they have accepted the liability of M/s.D.G.False Flooring Systems.


3. The learned counsel appearing for the applicant has taken me through the averments made in the complaint as well as assertions made in the affidavit in lieu of examination-in-chief. He invited my attention to the terms and conditions incorporated in the said deed. In particular he invited my attention to the Annexure-A to the said deed. He pointed out that the cheques in question were issued by the accused on the basis of said Annexure-A to the deed. He submitted that the certain cheques were issued by the parents of respondents 2 and 3 for which separate complaints were filed by the applicant. He pointed out that the very fact that the accused in present cases adopted the cross examination of the applicant in the said complaints filed against the parents shows that the accused in these cases accepted the liability to pay the amounts due and payable by the parents of accused nos.2 and 3. He submitted that inference will have to be drawn that accused nos.2 and 3 have accepted the liability of their parents and issued cheques. He placed reliance on decision of Andhra Pradesh High Court in case of B. Ramachandra Reddy Vs. Abid Ali and another (2007-All MR [Cri]-29). He submitted that in view of this decision, the second and third accused will be liable as they had undertaken to discharge the legal liability of their parents incorporated in the said deed by issuing cheques which are subject matter of these applications. The learned counsel therefore submitted that the impugned judgment and order is perverse and inference is called for.


4. The learned counsel appearing for the accused relied upon the decision of this Court in case of Hiten Sagar and another vs. IMC Ltd. and another (2001[3]-Mh.L.J.-659). He submitted that the case made out by the applicant in the demand notice and complaint is totally different. He pointed out that in any case there is no liability of the accused nos.2 and 3. He submitted that in view of the aforesaid decision of this Court, the learned Trial Judge was right in recording the finding that the guilt of the accused is not established.


5. I have given careful consideration to the submissions. I have perused the notes of evidence and other relevant documents. It must be noted here that the first accused is a firm M/s.D.G.Metal Product and it is stated in the complaint that second and third accused are the partners of first accused firm. In the notice of demand which preceded filing of the complaint, the advocate for the applicant had stated that by the said deed the applicant retired from the partnership business of M/s.D.G.False Flooring Systems with effect from 30th September 2004. In the notice it was stated that the applicant and the father of the second and third accused were the partners of M/s.D.G.False Flooring Systems and under the said deed dated 25th November 2004, the mother of the second and third accused became a partner of M/s.D.G.False Flooring Systems. In the second paragraph it is stated that as per the said deed, the accused herein had agreed to pay compensation for the use of machineries of the applicant in the factory premises of the applicant and towards the compensation for use of the machinery, post dated cheques which were subject matter of these complaints were issued.


Paragraph 2 of the said notice reads thus:-


"2. In pursuance of the said deed, you agreed to pay the compensation for the use of the machineries of our client in the factory premises of our client and accordingly you have issued post dated cheque as more particularly recorded in the said deed."


In the complaint, the applicant has referred and relied upon the said deed and it is contended that the cheque was issued in pursuance of the said deed.


6. In the affidavit in lieu of examination-in-chief, in paragraph 2 thereof the applicant has referred to the fact that the parents of accused nos.2 and 3 were the partners in M/s.D.G.False Flooring Systems. It is specifically stated by the applicant that for the liability of their parents, Sovik Dhar (the accused no.2) and Shantini Dhar (accused no.3) on behalf of M/s.DG Metal Products (accused no.1) issued Post-Dated cheques. In paragraph 3, the applicant referred to the said deed dated 25th November 2004. As noted earlier, the said deed relates to the partnership firm M/s.D.G.Flooring Systems and not the first accused firm. The 2nd and 3rd respondents (accused) were not admittedly concerned with the said M/s.D.G.Flooring Systems in any manner.


7. It will be necessary to refer to the cross examination of the applicant. In the cross examination the applicant admitted that after his retirement from the firm M/s.D.G.False Flooring Systems he had allowed the first accused firm to continue the business in his premises and he also allowed the first accused to use his equipments. In the cross examination he further stated that the first accused was using a floor of the building against which first accused has issued cheques of compensation.


8. It will be necessary to refer to the deed dated 25th November 2004. None of the accused are parties to the said deed. The said deed notes that the applicant retired from the said firm M/s.D.G.False Flooring Systems and the mother of second and third accused joined as partner alongwith the father of the second and third accused. The specific contention of the applicant is that the cheques in question were issued in accordance with the said deed.


The paragraph 4 of the complaint reads thus:-


"4. I say that in pursuance of the said Deed, Accused had issued post-dated Cheque as more particularly recorded herein after the details are as under."


In the second paragraph of his affidavit in lieu of examination in chief the applicant stated that "for the liability of their parents, Sovik Dhar and Shantini Dhar on behalf of M/s.DG Metal Products issued Post-Dated cheque, hereinafter referred to as Accused No.2, Accused No.3 and Accused No.1 firm respectively". There is no evidence on record to show that the second and third accused had undertaken the liability of their parents under the said deed. It will be necessary to refer to the decision of this Court in the case of Hiten Sagar (supra). This Court held that principle of criminal law is that the penal provision of statute has to be strictly construed and wider interpretation or connotation cannot be given. This Court held that on a reading of section 138 of the said Act it is clearly spelt out that the cheque must be drawn in discharge of the liability of the drawer of the cheque. This Court held that if the drawer has drawn the cheque for discharge of the liability of another person without creating any document, it will not and it would not come under section 138 of the said Act of 1881.


9. In the present case, even going by the assertions in the complaint and affidavit in lieu of examination in chief it is apparent that the cheques were allegedly drawn by the accused nos.2 and 3 in discharge of the liability of their parents under the said deed. The second and third respondents are the partners of first respondent firm. The liability of the parents under the said deed is in connection with another partnership firm. There is neither any documentary nor any oral evidence on record to show that the second and third accused had taken over the liability of their parents under the said deed. Reliance was sought to be placed by the counsel for the applicant on the decision of Andhra Pradesh High Court in case of B.Ramchandra Reddy (supra). The Andhra Pradesh High Court relied upon the decision of Kerala High Court wherein it was held that the cheque issued by a drawer in discharge of another man?s debt or liability could also come within the scope of section 138 of the said Act. Relying upon the said decision of Kerala High Court, the Andhra Pradesh High Court held that the cheque issued by the son in discharge of liability of father can also be a subject matter of complaint under section 138

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of the said Act. 10. However, in the light of the law laid down by this Court in case of Hiten Sagar (supra) which is a binding precedent, the case made out by the applicant on the basis of the decision of Andhra Pradesh High Court cannot be accepted. 11. In the circumstances, the view taken by the learned Trial Judge that the applicant has failed to prove that the cheques in question were issued in discharge of the legally recoverable debt or liability is certainly a possible view which could have been recorded on the basis of evidence on record. No case is made out for grant of leave. The applications are rejected. 12. It must be made clear that the observations made in this order are for limited purposes of considering the prayer for grant of leave. The said observation shall not be construed to mean that any adjudication has been made by this court on the rights and liabilities of the parties. It is also clarified that the complaints filed by the applicant against the parents of accused nos.2 and 3 and appeals and other proceedings arising out of the same will be decided independently without being influenced by the observations made herein.
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