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Spic Southern Petrochemicals Industries Corporation Ltd. Vs. M/S A.K. Jajee Distributors of Seeds Fertilizer and Agricultural Equipment - Court Judgment

LegalCrystal Citation
CourtKarnataka Dharwad High Court
Decided On
Case NumberCrl.A No. 2546 of 2011
Judge
AppellantSpic Southern Petrochemicals Industries Corporation Ltd.
RespondentM/S A.K. Jajee Distributors of Seeds Fertilizer and Agricultural Equipment
Advocates:For the Petitioner: A.C. Chakalabbi, Advocate. For the Respondent: Shirkant T. Patil, Advocate.
Excerpt:
.....condone the delay - hence prayed for the dismissal of complaint -..........which grounds of attack was made by the accused in his defence. but, unfortunately on the point of limitation learned magistrate while taking cognizance itself has not applied his mind and even in the judgement no finding is given on this point. as the complaint itself is barred by the limitation, taking of cognizance of an offence against the accused for the offence punishable under section 138 of n.i. act itself is wrong as such, it deserves to be dismissed.” 5(g). the finding of the learned district judge is that the complaint is filed after the period of limitation, so taking cognizance is bad in law. submissions of learned advocates 6. the learned advocate for the complainant submits that the reasoning of the learned district judge in dismissing the complaint is not proper. if.....
Judgment:

GOVINDARAJUL, J

1. The subject place for consideration is in regard to interpretation of amendment of Negotiable Instrument Act 1881, by Act 55 of 2002, on the aspect of limitation.

2. The appeal is coming on for admission, both the sides have submitted the arguments on merits. So, case is taken up for final disposal.

3. The complainant in C.C. No. 537/2005 on the file of the Civil Judge (Junior Division) and JMFC is the appellant in this appeal.

4. The parties will be referred according to their ranking before JMFC.

FACTS OF THE CASE:-

5. The facts necessary for the consideration of the appeal are as under:

The case of the complainant is that it is a company incorporated under the provisions of the Companies Act, 1956. The company is engaged in the business of production and sale of fertilizer and pesticides.

5(a). It is the further case of the complainant that complainant has a branch at Bellary among other branches, in India. The accused has transacted with the complainant for the period commencing from January 2004 upto June 2004. The transaction so amounted resulted due, in sum of Rs. 19,41,462/-. This is the sum payable by the accused to the complainant. In pursuance of the said balance amount payable by the accused to the complainant, accused has issued three cheques namely: (i) cheque bearing No. 279409 dated 18/06/2004 in a sum of Rs. 6,29,855/- (ii) cheque bearing No. 279410 dated 18/06/2004 in as sum of Rs. 6,20,856/-, (iii) cheque bearing No. 279411 dated 18/06/2004 in a sum of Rs. 5,86,510/- all the cheques are drawn on UCO Bank, Gulbarga branch.

5(b). It is the further case of complainant that the cheques were presented for encashment, they returned un-paid with an endorsement of exceeds arrangement. The complainant got issued a legal notice on 02/07/2004, there was no reply. The cheques issued by the accused having returned un-paid with an endorsement of exceeds arrangement, the complainant contends that the accused has committed an offence punishable under Section 138 of the Negotiable instrument Act.

5(c). The presence of the accused is secured by the Learned JMFC. The Learned JMFC has permitted the parties to lead evidence. P.Ws. 1 to 3 are examined. Exs. P.1 to P.22 are marked. In response, D.W.1 examined is the accused. Ex.D 1 is marked.

5(d). `The Learned JMFC has believed the case of the complainant, has opined that the cheques are issued by the accused for the value of the goods purchased by him from the complainant, so the cheques are issued for the legally recoverable debt payable by the accused to the complainant. So the accused has committed an offence under Section 138 of the Negotiable Instrument Act, convicted the accused.

5(e). The used has preferred Criminal Appeal No. 52/2008 on the file of the Fast Track Court –I. The Learned District Judge has heard the parties. One of the contentions urged before the Learned District Judge is that the complaint is filed after the period of limitation. So, the complainant was under a duty to explain by sufficient cause, the reason to file the complaint after the period of limitation. No such sufficient cause is placed before the Court to condone the delay. So, prayed the dismissal of the complaint.

5(f). The Learned District Judge has found fault with Learned JMFC. The reasoning of the Learned District Judge on the subject reads as follows:

“………in compliance to the statutory requirement, statutory notice was issued under Ex.P.6 and demand was made and meted all other assertions on which grounds of attack was made by the accused in his defence. But, unfortunately on the point of limitation Learned Magistrate while taking cognizance itself has not applied his mind and even in the judgement no finding is given on this point. As the complaint itself is barred by the limitation, taking of cognizance of an offence against the accused for the offence punishable under Section 138 of N.I. Act itself is wrong as such, it deserves to be dismissed.”

5(g). The finding of the Learned District Judge is that the complaint is filed after the period of limitation, so taking cognizance is bad in law.

SUBMISSIONS OF LEARNED ADVOCATES

6. The Learned Advocate for the complainant submits that the reasoning of the Learned District Judge in dismissing the complaint is not proper. If there was an error committed by the JMFC in taking cognizance of the complaint, the accused after entering appearance ought to have urged the said ground, sought for dismissal of the complaint. Having not done, the conduct of the accused would probablize that the has not chosen to urge the said ground. Be that as it may, even during the course of the trial, the settled law is that the subject in regard to the maintainability or a preliminary objection has to be raised at the initial stage, no such method is adopted by the Learned Advocate for accused. Even further in the defence evidence, a vague denial is found rather than the material to prove and support the stand of accused on the aspect of limitation, So, pray for restoring the conviction order recorded by the Learned JFMC.

6(a). On the other hand , the Learned Advocate for the accused place reliance on (a) M/S. SIL IMPORT USA vs. M/S EXIM AIDES SILK EXPORTERS (AIR 1999 SC 1609), (b) M/S SAKETH INDIA LIMITED VS. M/S. INDIA SECURITIES LIMITED (AIR 1999 SC 1090).

6(b). The Learned Advocate submits that the applicability of law o limitation to a case filed under the provisions of the Section 138 of the negotiable Instrument Act is not disputed. The application of the Limitations Act being not disputed, there is a duty on the Court in accordance with Section 3 of the Limitation Act to give a finding even though it is not urged by the accused. Assuming for the argument sake, it is not urged by the Advocate for the accused, it is open for the accused to urge the said subject of limitation before District Judge. It is a statutory duty of the Court rather than a plea urged by the Learned Advocate for the accused. It is also further contended that under Section 3 of the Limitation Act, if the cause of action is barred by limitation, the case has to be dismissed. So. Entertaining of the subject by the Learned District Judge is proper. Add that apex Court has considered this subject, has held that a complaint brought beyond the period of limitation is not maintainable, so, pray for dismissal of the appeal.

7. The submission probablize, the subject in regard to the interpretation of proviso to Section 142 is placed before the court. So, exercising power under Section 378 of the Code of Criminal Procedure, leave is granted to prosecute the appeal.

8. Section 386(a) of the Code of Criminal Procedure authorize the Appellant court while hearing an appeal to confirm the sentence, reverse the order, direct further enquiry or direct for retrial or if the Court finds him guilty pass necessary sentence in accordance with law. In view of the above mandate under Section 386 Cr.P.C., the Court intends to consider the submissions addressed by the Learned Counsels.

LEGISLATIVE INTENT FOR INCORPORATING

PROVISO TO SECTION 142

9. Chapter 17 of the Negotiable Instrument Act is inserted by the Banking, Public Financial Institutions and negotiable Instrument Laws (Amendment) Act 1988. It has come into effect from 01/04/1989. Five sections are added under the Amendment Act insofar as the negotiable instrument Act, 1881 are concerned.

10. The Learned author Bashyam and Adiga on the Negotiable Instrument Act in 18th Edition at page no.734 summarizes the object of introduction of Section 138 to 142 of the N.I. Act. It reads as follows:

This chapter has been inserted with a view to enhance the acceptability of cheques in settlement of liabilities by making the drawer liable for penalties in case of bouncing of cheques due to insufficiency of funds in the accounts or for the reason that it exceeds the arrangements made by the drawer, with adequate safeguards to prevent harassment of honest drawers”.

The object of the Act summarized would cover bouncing of the cheques on the ground of insufficiency of funds or the subject of exceeding arrangement made by the drawer. The subject placed in this case is in the second category. The object further clarifies the reason for amendment is to provide adequate safeguard and is required to be made for avoiding harassment to the hones drawers.

11. Proviso to Section 142 is added under amendment brought in to the Negotiable Instrument (Amendment) Act,2002. Section 142 after amendment reads as follows:

 “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 complain, in writing, madeby the payee, or, as the case may be, the holder in due course aof the cheque;

(b) such complaint is made within one month of the date of 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 I class shall try any offence punishable under Section 138”.

The statement of objects for adding of the proviso reads as follows:

“These provisions were incorporate with a view to encourage the culture of use of cheques and enhancing the credibility of the Instrument. The existing provisions in the Negotiable Instruments Act, 1881, namely sections 138 to 142 in Chapter XVII have been found deficient in dealing with dishonour of cheques. Not only the punishment provided in the Act has proved to be inadequate, the procedure prescribed for the Courts to deal with such matters has been found to be cumbersome. The Courts are unable to dispose of such cases expeditiously in a time bound manner in view of the procedure contained in the Act”.

The proviso added is the subject for interpretation by the Court in this appeal.

12. The =Learned Advocate for the accused has placed reliance on M/S SIL IMPORT USA vs. M/S. EXIM AIDES SILK EXPORTERS (SUPRA). The Apex Court has also considered the subject of accrual of cause of action on the dishonour of cheque while interpreting Section 142 of the Negotiable Instrument Act. Their Lordships have held the date of receipt of fax cannot be ignored for the purposes or accrual of the cause of action.

13. The other ruling relied on by the Learned Advocate is in the case of M/S SAKETH INDIA LIMITED vs. M/S INDIA SECURITES LIMITED (SUPRA) is while interpreting Section 142(b), the Apex Court has held the complaint against the dishonour of the cheque has to be filed within a period of one month from the date of dishonour of the cheque.

14. the ruling of the Apex Court in M/S SIL IMPORT USA vs. M/S. EXIM AIDES SILK EXPORTERS (SUPRA) is in regard to a notice by fax dated 11/06/1996. In M/s Saketh India Limited, the cheque complained was prior to 15/10/1995, complaint was filed on 15/11/1995. So, the ruling cited by the Learned Advocate for the accused have not considered the scope of the Negotiable Instruments (Amendment)Act, 2002.

15. The proviso declare that cognizance of the complaint maybe taken by the Court after the period of limitation, if the complainant satisfies the Court that sufficient cause is shown in regard to the delay.

16. So, it is in regard to the interpretation of how a proviso that is added later has to be construed, in the light of the statement of objects while introducing Chapter 17, the objects, as the one stated in the Negotiable Instruments (Amendment) Act, 2002.

17. The Apex Court in UNIONOF INDA vs. SANKALCHAND HIMMAT LAL SHETH AND OTHERS (1978 (1) SCR 423) has considered the subject of consent in Article 222(1) of the Constitution of India. While considering the subject, the Apex Court has considered the subject of interpretation of statues, held that in such a situation, the construction must be examined in it s context and in the sense which the Legislature has in view, The following are principles summarized to arrive at the legislative intention.

“The normal rule of interpretation is that the words used by the legislature are generally a safe guide to its intention. Lord Reid in Westmunster bank Ltd vs. Zang(3) observed that “ no principle of interpretation of statues is more firmly settled than the rule that the court must deduce the intention of parliament from the words used in the Act”. Applying such a rule, this Court observed in S.Narayanassamy vs. G. Pannerselvam(4) that “ where the statues meaning is clear and explicit, words cannot be interpolated.” What is true of the interpretation of an ordinary statue is not any the less true in the case of a constitutional provision , and the same rule applies equally to both. But if the words of an Instrument are ambiguous I nth sense that they can reasonably bear more than one meaning, that is to say, if the words are semantically ambiguous, or if a provision, if read literally, is patently incompatible with other provisions of that Instrument, the Court would be justified in construing the words in a manner which will make the particular provision purposeful. That, in essence is the rule of harmonious construction. In M. Pentaiah vs. Veeramallappa(5) this Court observed;

“Where the language of statute, in its ordinary meaning and grammatical construction leads to a manifest contradiction of the apparent purpose of the enactment or to some inconvenience or absurdity, hardship or injustice presumably not intended, a construction may be put upon it which modifies the meaning of the words, and even the structure of the sentence…”

But, if the provision is clear and explicit, it cannot be reduced to a nullity by reading into it a meaning which it does not carry and, therefore, “ Courts are very reluctant to substitute words in a statue or to add words to it, and it has been said that they will only do so where there is a repugnancy to good sense”. (5) In the view which I am disposed to take, it is unnecessary to swell upon Lord Denning’s edict in Seaford Court Estates Ltd., vs. Asher(6) that when a defect appears in a statue, a Judge cannot simply fold his hands and blame the draftsman, that he must supplement the written word so as to give force and life to the intention of the legislature and that he should ask himself the question how, if the make4s of the Act had themselves come across the particular ruck in the texture of it, they would have straightened it out. I may only add, though even that does not apply, that Lord Denning would up by saying, maybe not by way of recanting that “a Judge must not alter the material of which the Act is woven, but he can and should iron cut the creases.”

18. IN B.P. KHEMKA PRIVATE LIMTED vs. BIRENDRA KUMAR BOWNIE AND ANOTHER (1987 AIR 1010) the Apex Court has considered as to how the remedial statues has to be interpreted, while dealing with the word ‘shall’ and ‘may’, directed to find legislative intent.

19. In SATHEEDEVI vs. PRASANNA AND ANOTHER (Civil appeal No. 4347 of 2010) THE Apex court has laid down the following ratio to find out the legislative intent of statues.

“The first and primary rule of construction is that the intention of the legislature must be found in the words used by the legislature itself. If the words used are capable of one construction, only the, it would not be open to the Courts to adopt any other hypothetical construction on the ground that such hypothetical construction is more consistent with the alleged object and policy of the Act. The words used in the material provisions of the statue must be interpreted in their plain grammatical meaning and it is only when such words are capable of two construction that the question of giving effect to the policy or object of the Act can legitimately arise-Kanai Lal Sur vs. Paramnidhi Sadhukhan 1958 SCR 360. The other important rule of interpretation is that the court cannot re-write, re-cast or re-frame the legislation because it has no power to do so. The Court cannot add words to a Statute or read words which are not therein it. Even if there is a defect or an omission in the statute, the Court cannot correct the defect or supply the omission-Union of India vs. Deoki nandan Aggarwal 1992 supp(1)SCC 323, Shyam Kishori Devi vs. Patna Municipal Corporation (1996) 3 SCR 366”.

20. The object of Negotiable Instrument Act, Amendment Act,2002 is to enhance the credibility of the use of the Cheque; to avoid delay in considering the cases under Section 142 of the negotiable Instruments Act. 1881. The object of the legislature found in the proviso to Section 142 has to be ascertained from the language employed in the proviso itself.

The proviso provides for (i) taking cognizance of the complaint after the period of limitation; (ii) if the complainant satisfies the Court that there is sufficient cause in making complaint within the said period.

21. Section 3 of the Limitation Act reads as under:

“Bar of Limitation – (1) subject to the provisions contained in sections 4 to 24 (inclusive), every suit instituted, appeal preferred, and application made after the prescribed period shall be dismissed, although limitation has not been set-up as a defence.

(2) for the purpose of this Act –

(a) A suit is instituted-

(i) In an ordinary case, when the plaint is presented to the proper officer;

(ii) In the case of pauper, when his application for leave to sue as a pauper is made ; and

(iii) In the case of a claim against a company which is being wound-up by the Court, when the claimant first sends in his claim to the official liquidator;

(b) any claim by way of a set-off or a counter claim, shall be treated as separate suit and shall be deemed to have been instituted-

(i) In the case of a set-off, on the same date as the suite in which the set-off is pleaded;

(ii) in the case of a counter claim, on the date on which the counter claim is made in Court;

(c) an application by notice of motion in a High court is made when the application is presented to the proper officer of that Court”.

Section 5 of the Limitation Act reads as under:

“5 Extension of Prescribed Period in Certain Cases: Any appeal or any application, other than an application under any of the provi9sions of Order XXI of the Code of Civil procedure, q908 (5 0f 1908), may be admitted after the prescribed period, if the appellant or the applicant satisfies the Court that he had sufficient cause for not preferring the appeal or making the application within such period.

So, the principles under Section 5 of the Limitation Act are adopted by the Legislature while incorporating the proviso. There is a departure from the general law in regard to the applicability of the Limitation Act to a case under Negotiable Instrument Act. Under the general law, Section 3 of the Limitation Act, directs the Court to give a finding on limitation whereas the proviso authorize the Court to consider whether there is a sufficient cause for delay in filing the complaint.

22. The rigour under Section 3 of the limitation Act bars the legal remedy, the enforceability of the right accrued whether under a contract or under any other situation. Whereas the proviso in Negotiable Instrument Act guarantees the legally recoverable debt. By the incorporation of the proviso, the legislative intent is further clarified giving an impression to the entire world that the transaction under the cheques in this Country is reliable, i.e., credibility is added by the amendment.

23. So, any interpretation contrary to the legislative intent to being in, indefiniteness, uncertainty of the payment under the cheque, is not appropriate.

24. So, the submission of the Learned Advocate for the accused that there is a duty case on the Court to give a finding on the aspect of limitation, even without a point being urged before the Court is not apt. So, it is rejected.

25. Even otherwise, the Learned District Judge having come to a conclusion that the complaint is filed after a period of five days, the Learned District Judge ought to have considered the mandate under Section 386(a) Cr.P.C. The Power under Section 386(a) of Cr.P.C authorize the District Judge for further enquiry also. So, the said power being not exercised by the Learned ?District Judge in the facts, the reasoning of the Learned District Judge is not in consonance with the object of Amendment Act of 2002. In other words, the Learned District Judge has failed to exercise his duty, after having come to a conclusion that there is a delay of 5 days in filing the complaint.

26. The subject can be analyzed from yet another angle also. The subject of limitation is a question of fact and law. So, it is for the parities to plead facts, prove the facts pleaded. In the process of proof of the facts, the Court has to consider the facts pleaded with the evidence. The Learned District Judge has not approached the subject in his recognized principle of appreciation of evidence. So, there is no merit in the submission of the Learned Advocate for the accused that the complaint being filed after a period of five days, the complaint is liable to be dismissed. So, it is rejected.

27. In the light of the above findings, the appeal is accepted. The judgment recorded by the Learned District Judge in Crl. A.NO.52/2008 is set-aside. The judgment of conviction recorded by the Principal Civil Judge (Junior Division) and JMFC in C.C. No.537/2005 is restored.


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