J.B Garg, J.:— Kapil Mehra, Director M/s Nice Tools and Forgins, Private Limited, G.T Road, Ludhiana, has moved the present petition under Section 482 of the Code of Criminal Procedure, challenging the summoning order dated 1.2.1993 passed by Shri Tejwinder Singh, Judicial Magistrate I Class, Ludhiana in a complaint filed by Sanjeev Jain for offence under Section 138 of the Negotiable Instruments Act.
2. Briefly the petitioner has alleged that Sanjeev Jain, Director of M/s S.K Steels and Investment Private Limited, Ludhiana, supplied to him steel material weighing 9.83 metric ton valued at Rs. 1,14,519.50 P. vide bill No. 42 dated 3.9.1991; that the petitioner issued Cheque No. 040836 dated 25.2.1992 for Rs. 50,000/- and Cheque No. 040837 dated 28.2.1992 for Rs. 64,519/- of the State Bank of India, Miller Ganj, Ludhiana that because the goods supplied by the respondent turned out to be defective and there was also shortage in supply the payments of both the cheques was stopped by the petitioner by writing a letter dated 24.2.1992 to their bankers and a copy of this letter is Exhibit P-3, that the petitioner possessed sufficient capacity and balance to meet the aforesaid cheques as is evident from the extract of the ledger-folio (Annexure P-4).
3. The reply dated 14.12.1993 has been filed by Sanjeev Jain-respondent wherein it has been averred that two cheques were issued on the assurance that these would be honoured on presentation; that the cheque dated 28.2.1992 was dishonoured with the remarks ‘not arranged for’, that the commission of offence was completed as soon as the cheques were dishonoured.
4. The learned counsel for the petitioner has referred to Section 138 of the Negotiable Instruments Act, 1981, which after the amendment of 1988 reads as under:—
“138:— Dishonour of cheque for insufficiency, etc. of funds in the account:— Where any cheque drawn by a person on account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part of any debt or other liability, is returned by the bank unpaid, either because or the amount of money standing to the credit of that account is insufficient to honour the cheque or to be paid from that account by agreement that it exceeds the amount arranged made with that bank, such person shall be deemed to have committed an offence without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may extend to twice the amount of the cheque or with both.
Provided that nothing contained in this section shall apply unless:—
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation : For the purposes of this section, “debt or other liability” means a legally enforceable debt or other liability.”
5. It has been stressed that it is an essential ingredient that the amount of money was found insufficient to honour the cheque.
6. A perusal of the ledger-folio (Annexure P-4) shows that the petitioner possessed much more in the column of balance and it was not a case that the cheques were dishonoured on account of insufficiency of the funds. This question of fact regarding sufficiency of the funds has not been specifically controverted in the reply dated 14.12.1993 On the contrary, the plea or the petitioner had been that the quality of goods supplied was ‘defective’ and there was also shortage in supply and that is why, they had specifically instructed the Bankers to stop payments vide their letter dated 24.2.1992 (Annexure P-3).
7. The learned counsel for the petitioner has referred to Abdul Samad… v. Satya Narayan Mahawar…., 1990 (2) Recent Criminal Reports, 335, wherein also the payment was stopped for a specific reason and it was held that Section 138 of the Act was not applicable. In Bhageerathy v. V. Beena, 1993 (1) Recent Criminal Reports, 386, it was held that Section 138 of the Act is attracted if there was insufficiency of the amount in the account of the drawer of the cheque. The facts show that there was no insufficiency in the case now in hand.
8. The conclusion is that the present petition succeeds and the impugned order is hereby quashed.
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