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Ajit v. Kirti
Factual and Procedural Background
This revision petition was filed by the applicant/complainant challenging the order dated 19.12.2003 passed by the III Additional Chief Judicial Magistrate (A.C.J.M.), Indore, in Criminal Case No. 2277/2002. The impugned order discharged non-applicant No. 1, Smt. Kirti, wife of non-applicant No. 2 Rajiv Agarwal, on the ground that the cheque involved was not signed by her. The applicant contended that Smt. Kirti had raised a loan and held a joint bank account with her husband, and the cheque was issued from that joint account. The Trial Court allowed an application under Section 245 of the Criminal Procedure Code (Cr.P.C.) filed by Smt. Kirti and discharged her prematurely. The applicant challenged this discharge, arguing that Section 245 Cr.P.C. was not applicable as the case was a summons trial, not a warrant trial.
Legal Issues Presented
- Whether the Trial Court erred in discharging non-applicant No. 1, Smt. Kirti, on the ground that the cheque was not signed by her, despite the cheque being drawn on a joint account held by her and her husband.
- Whether an application under Section 245 Cr.P.C. was maintainable in a summons trial under the facts of this case.
- The legal interpretation of the term "drawer" under Section 7 and the applicability of Section 138 of the Negotiable Instruments Act in the context of joint bank accounts.
Arguments of the Parties
Applicant's Arguments
- Smt. Kirti Agarwal had taken a loan from the applicant and held a joint bank account with her husband at State Bank of Bikaner and Jaipur, Indore branch.
- The cheque in question was issued under the signature of non-applicant No. 2, Rajiv Agarwal, but the account holder named on the cheque was Smt. Kirti Agarwal.
- Payment was to be made from the joint account, and either account holder was entitled to sign the cheque.
- The Trial Court erred by discharging Smt. Kirti at a premature stage based on an application under Section 245 Cr.P.C., which was not maintainable as it applies only to warrant trials, whereas the offence was triable summarily.
Non-Applicants' Arguments
- Smt. Kirti Agarwal did not issue or sign the cheque and hence could not be held responsible as the drawer under Section 7 of the Negotiable Instruments Act.
- Reliance was placed on the Kerala High Court judgment in G. Hari and Ors. v. John Promod Alexander and Anr., 2000 Cr. I.J. 1658, to support the contention that the drawer must be the person who signed the cheque.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| K.M. Mathew v. State of Kerala, I (1992) CCR 316 (SC) = AIR 1992 SC 2206 | Clarification on the applicability of Section 245 Cr.P.C. and whether a Court can review its own order in absence of a specific provision in the Cr.P.C. | The court referred to this judgment to emphasize that Section 245 Cr.P.C. applies only to warrant trials and is not maintainable in summons trials, thus the Trial Court erred in allowing the application under this section. |
| Neelmani v. Benett Colman Mills, 1998 SCC (Crl.) 1551 | Consideration of the Supreme Court Larger Bench on the review of orders in criminal proceedings. | Referenced to support the principle regarding review of orders in criminal cases and to reinforce the inapplicability of Section 245 Cr.P.C. in the present case. |
| G. Hari and Ors. v. John Promod Alexander and Anr., 2000 Cr. I.J. 1658 (Kerala High Court) | Definition of "drawer" under Section 7 of the Negotiable Instruments Act and responsibility for issuing a cheque. | The court distinguished this precedent on facts, noting it was inapplicable as the account there was not joint and the cheque was not issued by the person who was both the loan taker and account holder. |
Court's Reasoning and Analysis
The court analyzed Sections 7 and 138 of the Negotiable Instruments Act in conjunction with the facts. It noted that the loan was taken by Smt. Kirti Agarwal, who held a joint bank account with her husband. The cheque was signed by the husband but drawn on the joint account in which Smt. Kirti was named as an account holder. The court observed that in joint accounts, either account holder may sign cheques, and the law recognizes such signing as valid for payment and liability purposes. The court further clarified that the term "drawer" is used in the provisos to Section 138, but the main section focuses on payment from the account, supporting the view that liability extends to the loan taker in a joint account context. Additionally, the court held that the Trial Court erred in applying Section 245 Cr.P.C., which is applicable only to warrant trials, whereas the present case was a summons trial. The court also distinguished the precedent relied upon by the non-applicants, as it involved a non-joint account and different facts. Consequently, the court set aside the discharge order and directed the Trial Court to proceed against both non-applicants according to law, while cautioning that its observations in this order should not influence the Trial Court's final decision.
Holding and Implications
The revision is allowed.
The order discharging non-applicant No. 1, Smt. Kirti Agarwal, is set aside. The Trial Court is directed to continue proceedings against both non-applicants, husband and wife, in accordance with the law. This decision clarifies that in cases involving joint accounts, either account holder may be held liable under Section 138 of the Negotiable Instruments Act when a cheque is issued for repayment of a loan taken by either party. The judgment also establishes that applications under Section 245 Cr.P.C. are not maintainable in summons trials. No broader precedent beyond the parties involved is established, and the Trial Court must disregard the observations made in this order during final disposal.
1. This revision has been filed by the applicant/complainant against the order dated 19.12.2003 passed by III A.C.J.M., Indore in Criminal Case No. 2277/2002 whereby discharged the non-applicant No. 1 Smt. Kirti, wife of Rajiv Agarwal, the non-applicant No. 2 on the ground that the cheque was not signed by her.
2. The contention of the learned Counsel for applicant is that non-applicant No. 1 Smt. Kirti Agarwal has raised the loan from the applicant and she was having joint account in State Bank of Bikaner and Jaipur, Branch Sanyogitaganj, Indore. He has also submitted that the cheque was issued under the signature of non-applicant No. 2 Rajiv Agarwal, the husband of the non-applicant No. 1 and both were having joint account. He has also submitted that in the cheque, name of account holder is mentioned as Smt. Kirti Agarwal. The learned Counsel has also submitted that payment is to be made from the concerned account for which the cheque was issued. The learned Trial Court has failed to consider this aspect and discharged the non-applicant No. 1 Smt. Kirti Agarwal in a premature stage on an application filed by the non-applicant Smt. Kirti Agarwal under Section 245 of the Cr.P.C. and as a matter of fact this application was not maintainable because Section 245 can be applied only in a warrant trial whereas the offence involved is a summons trial.
3. On the other hand, the learned Counsel for non-applicants has submitted that since the cheque was not issued by the non-applicant No. 1 Smt. Kirti, she cannot be held responsible because she was not the drawer of the said cheque and Section 7 is providing definition of drawer. The learned Counsel has placed reliance on the judgment passed by the Kerala High Court in G. Hari and Ors. v. John Promod Alexander and Anr., 2000 Cr. I.J. 1658.
4. Having heard the learned Counsel for parties and after giving my anxious consideration to Sections 7 and 138 of the Negotiable Instruments Act as well as the facts of this case, the facts emerged are that the non-applicant No. 1 Smt. Kirti has taken loan of rupees one lac from the applicant. She was having joint account in the Bank with her husband, non-applicant No. 2 Rajiv Agarwal and this loan was repaid by cheque and on the said cheque, name of the non-applicant No. 1 Smt. Kirti is mentioned as holder of account and signature was done by non-applicant No. 2 Rajiv Agarwal. Both can sign on the cheque or either of one can sign on the cheque because it was a joint account. The law maker have used in the main body of Section 138 regarding payment of money from out of the account. Here in the main section, the word drawer or drawee is not mentioned. This is mentioned in the provisos (b) and (c). In the present case, both the non-applicants are husband and wife. They are having joint account. Therefore, any one can issue the cheque and in view of this Court legally this will be considered as a cheque issued by the person who has raised the loan. Apart from this, the application under Section 245, Cr.P.C. was not maintainable because this provision is meant for warrant trial in a case instituted otherwise than on a police report. The judgment passed by the Supreme Court in K.M. Mathew v. State of Kerala, I (1992) CCR 316 (SC)=AIR 1992 SC 2206, has been referred to the Larger Bench by the Supreme Court in case of Neelmani v. Benett Colman Mills, 1998 SCC (Crl.) 1551. The issue involved in this case is whether the Court can review its own order when in Criminal Procedure Code, there is no specific provision for review.
5. The judgment cited by the learned Counsel for non-applicants passed G. Hari's case (supra) is not applicable in the present case because in G. Hari's case (supra), the account was not in the joint name and cheque was not issued by the person who is also the account holder along with the person whose name is mentioned as account holder and who has raised the loan.
6. In the light of the above mentioned facts and feature as well as legal position, the order passed by the learned Trial Court discharging the non-applicant No. 1 Smt. Kirti is set aside and the Trial Court is directed to proceed against both the non-applicants in accordance with the law. However, it is made clear that the Trial Court shall not take into consideration at the time of final disposal of the case, any of the observations made by this Court in this order.
7. The revision is allowed in the terms as indicated hereinabove.
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