Allowed

Smt Puja Bali v. State of Rajasthan and Anr.

Rajasthan HC21 Sept 2016CRLMP/5116/2015

Case brief

AI extract

What is this about?

Quarter Sessions Court allowed criminal miscellaneous petition filed by a joint account holder against her own cognizance and revisional order. Court quashed proceedings relying on Supreme Court precedent that Section 138 applies only to the drawer of a cheque who signs it.

What did the court decide?

Order of cognizance dated 01.09.2015 and consequential order dated 24.03.2015 against the petitioner, and the petition for special leave petition, are set aside.

Smt Puja Bali Vs State of Rajasthan and Anr. — Cheque Dishonour | Rajasthan HC (2016)

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S.B. CRIMINAL MISC. PETITION NO. 5116/2015

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IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR.

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ORDER

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S.B. CRIMINAL MISC. PETITION NO. 5116/2015

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WITH

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S.B. CRIMINAL MISC. STAY APPLICATION NO. 4815/2015

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Smt. Puja Bali W/o Sh. Ajay Kumar Bali, resident of House No. 464, Moti Mahal, Scheme No. 2, Lajpat Nagar, Alwar, Rajasthan.

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Accused Petition/Accused

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Versus

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State of Rajasthan through P.P

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Smt. Sushila Devi W/o Sh. Kuldeep Yadav, R/o 112, Chetan Enclave, Jaipur Road, Alwar, Rajasthan.

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Respondents

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DATE OF ORDER : 21.09.2016

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HON'BLE MR. JUSTICE MOHAMMAD RAFIQ

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Mr. Ajay Goyal, for the petitioner. Mr. N.S. Dhakad, Public Prosecutor, for Respondent No. 1- State.

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Mr. Bharat Yadav, for Respondent No. 2-complainant.

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REPORTABLE

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BY THE COURT:

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This petition has been filed by Smt. Puja Bali challenging order of cognizance dated 24.03.2015 passed by Civil Judge & Chief Judicial Magistrate, Alwar(for short ‘the trial court’) and order dated 01.09.2015 passed by the Additional District and Sessions Judge, No. 3, Alwar(for short ‘the revisional court’). By the first order, the trial court has taken cognizance

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S.B. CRIMINAL MISC. PETITION NO. 5116/2015

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against the petitioner and her husband Ajay Kumar Bali under Section 138 of Negotiable Instruments Act(for short 'the Act') and by second order, the revisional court has dismissed the revision petition.

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Learned counsel for the petitioner argued that the petitioner has been added as accused in the aforesaid proceedings only because she was joint account holder with her husband whereas the cheque, which was dishonoured, was signed by her husband. Learned counsel for the petitioner has relied upon the judgment of the Supreme Court in Mrs. Aparna A. Shah Vs. M/s. Sheth Developers Pvt. Ltd. & Anr. 2013 (2) DCR 417 wherein it has been held that under Section 138 of Negotiable Instruments Act, in case of issuance of cheque from joint account, a joint account holder cannot be prosecuted unless the cheque has been signed by each and every person who is a joint account holder. Learned counsel argued that even though the petitioner has a joint bank account with her husband, but indisputably the cheque was signed by her husband and not by the petitioner. Similar view has also been taken by Kerala High Court in Devi Vs. Haridas, 2005 (1) DCR 151 .

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Learned Public Prosecutor as well as learned counsel for Respondent No. 2 opposed the petition and submitted that this

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S.B. CRIMINAL MISC. PETITION NO. 5116/2015

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objection can be raised even before the trial court, which court would deal with the same while deciding the matter finally.

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Having regard to the fact that the issue involved in the present case is squarely covered by the judgment of the Supreme Court in Mrs. Aparna A. Shah(supra), this Court does not deem it appropriate to allow the proceedings to continue against the petitioner only because she happens to be wife of the main accused as well as joint account holder with him. In a joint family, husband and wife can operate joint bank account and only for that reason, she cannot be prosecuted, particularly when she was not signatory of the cheque which has bounced.

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The Supreme Court in Aparna(supra) in para 23 observed as under:

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“23. We also hold that under Section 138 of the N.I. Act, in case of issuance of cheque from joint accounts, a joint account holder cannot be prosecuted unless the cheque has been signed by each and every person who is a joint account holder. The said principle is an exception to Section 141 of the N.I. Act which would have no application in the case on hand. The proceedings filed under Section 138 cannot be used as an arm twisting tactics to recover the amount allegedly due from the appellant. It cannot be said that the complainant has no remedy against the appellant but certainly not under Section 138. The culpability attached to dishonour of a cheque can, in no case “except in case of Section 141 of the N.I. Act” be extended to those on whose behalf the cheque is issued. This Court reiterates that it is only the

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S.B. CRIMINAL MISC. PETITION NO. 5116/2015

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drawer of the cheque who can be made an accused in any proceeding under Section 138 of the Act. Even the High Court has specifically recorded the stand of the appellant that she was not the signatory of the cheque but rejected the contention that the amount was not due and payable by her solely on the ground that the trial is in progress. It is to be noted that only after issuance of process, a person can approach the High Court seeking quashing of the same on various grounds available to him. Accordingly, the High Court was clearly wrong in holding that the prayer of the appellant cannot even be considered. Further, the High Court itself has directed the Magistrate to carry out the process of admission/denial of documents. In such circumstances, it cannot be concluded that the trial is in advanced stage.”

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Kerala High Court in Devi(supra) has also taken similar view in order to be deemed to be liable under Section 138 of the Act, the cheque must be one drawn by the inductee on an account maintained by him/her. He/she becomes liable only if he/she, the drawer of the cheque is given notice as insisted by Section 138(b) of the Act and he/she, the drawer, does not make payment within the period stipulated under Section 138(c) of the Act. This conclusion appears to be inevitable that only a drawer of the cheque can be held liable under Section 138 of the Act. 'Drawer' has been defined under Section 7 of the Act to mean 'the maker of the bill of exchange or cheque'. In the present case obviously the petitioner cannot be considered to be drawer of cheque because she was not signatory of the cheque which was

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S.B. CRIMINAL MISC. PETITION NO. 5116/2015

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dishonoured.

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The Supreme Court in Mrs. Aparna A. Shah(supra) held that under Section 138 of the Act, joint account holder cannot be prosecuted for offence under Section 138 of the Act unless cheque is bearing his/her own signature. This principle is exception to Section 141 of the Act, which would have no application in the present case. The Supreme Court held that it is the only drawer of the cheque which would be made accused in proceedings under Section 138 of the Act.

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In view of above, proceedings against the accusedpetitioner Smt. Puja Bali cannot be allowed to proceed further. Present petition deserves to succeed and the same is allowed. Order of cognizance dated 01.09.2015 passed by the trial court to the extent of petitioner Smt. Puja Bali is liable to be quashed and the same is accordingly quashed. Consequential order dated 24.03.2015 passed by the revisional court is also set aside.

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Stay application stands disposed off.

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(MOHAMMAD RAFIQ),J.

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Manoj, S.NO.20.

Smt Puja Bali v. State of Rajasthan and Anr.

Case brief

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Smt Puja Bali v. State of Rajasthan and Anr.

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