Bombay High Court
Dr. Sagar Raghunath Phatkare vs Nandini Ashok Rao And Anr on 29 June, 2026
J-WP-4384-2016 - K.docx
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIRCUIT BENCH AT KOLHAPUR
CRIMINAL APPELLATE JURISDICTION
CRIMINAL WRIT PETITION NO. 4384 OF 2016
1 Dr. Sagar Raghunath Phatkare ... Petitioner
BAMS, Aged - 41, Doctor,
Shree Clinic, Moghe Complex,
Shivaji Chowk, Devrukh,
Taluka - Sangameshwar, Dist. Ratnagiri
Versus
1. Smt. Nandini Ashok Rao
Housewife, At Post - Devrukh,
Taluka - Sangameshwar, Dist. Ratnagiri
2. The State of Maharashtra ... Respondents
WITH
CRIMINAL WRIT PETITION NO. 4386 OF 2016
1 Dr. Sagar Raghunath Phatkare ... Petitioner
BAMS, Aged - 41, Doctor,
Shree Clinic, Moghe Complex,
Shivaji Chowk, Devrukh,
Taluka - Sangameshwar, Dist. Ratnagiri
Versus
1. Smt. Nandini Ashok Rao
Housewife, At Post - Devrukh,
Taluka - Sangameshwar, Dist. Ratnagiri
2. The State of Maharashtra ... Respondents
WITH
CRIMINAL WRIT PETITION NO. 4387 OF 2016
1 Dr. Sagar Raghunath Phatkare ... Petitioner
BAMS, Aged - 41, Doctor,
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Shree Clinic, Moghe Complex,
Shivaji Chowk, Devrukh,
Taluka - Sangameshwar, Dist. Ratnagiri
Versus
1. Smt. Nandini Ashok Rao
Housewife, At Post - Devrukh,
Taluka - Sangameshwar, Dist. Ratnagiri
2. The State of Maharashtra ... Respondents
------------
Adv. S. C. Mangle a/w. Adv. Ashitosh S. Jambilkar for the Petitioner.
Adv. S.S. Chaudhari, A.P.P. for the Respondent-State.
------------
Coram : RANJITSINHA RAJA BHONSALE, J.
Reserved on : 8th May 2026.
Pronounced on : 29th June 2026.
JUDGMENT :
1. By the present three Petitions filed under Article 227 of the
Constitution of India and Section 482 of the Criminal Procedure Code (for
short, “Cr.P.C.”) (now 528 BNSS) the Petitioner seeks to quash and set-aside
the Orders all dated 21st July 2016 passed by the learned Judicial Magistrate
First Class, Devrukh, in S.C.C. No. 163 of 2016, S.C.C. No. 164 of 2016 &
S.C.C. No. 165 of 2026.
2. Record indicates that the Respondent No.1 (original complainant) has
been duly served. Though served, the Respondent No.1 did not appear. In
order to give an opportunity to the Respondent No.1 to appear and be
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represent, the matter was adjourned on 13 th March 2026. On 16th March
2026, when the matter was called out Advocate Ms. Neha G. Deshpande
appeared and undertook to file Vakalatnama on behalf of the Respondent
No.1 on or before 27th March 2026. As the Vakalatnama was not received
and filed within stipulated time, this Court by order dated 7 th April 2026, in
order to grant an opportunity to the Respondent No.1 to appear, adjourned
the matter to 30th April 2026.
3. On 30th April 2026, none appeared for the Respondent No.1. The
matter was heard and adjourned to 7 th May 2026 for further consideration.
On 7th May 2026 once again the Respondent No.1 chose not to appear.
4. By an Order dated 5th January 2017, this Court was pleased to stay the
proceeding before the learned Judicial Magistrate, First Class, Devrukh,
Ratnagiri. Considering the fact that (i) the Petition is of the year 2016, (ii)
the Respondent No.1 though served has chosen not to appear in the matter
and/or (iii) the lawyer for the Respondent No.1, who despite of the
undertaking to file Vakalatnama could not do so due to not receiving
instructions, the hearing of the matter was proceeded with.
5. The question which arises in the aforesaid Petitions is common and
therefore all the Writ Petitions are heard together and being disposed of by
the common Judgment.
6. Certain facts that would be necessary to consider the issues involved in
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the present Petitions are as under :
6.1. In the year 2015, the Petitioner allegedly borrowed loan of
Rs.18,00,000/- from the husband of the Respondent No.1 i.e. Ashok Rao. For
the repayment of the said loan, the Petitioner issued three cheques i.e. (a)
Cheque No. 002749, dated 10 th February 2016, drawn on the Bank of India,
for an amount of Rs.6,00,000/-, (b) Cheque No. 122826, dated 10 th February
2026, drawn on the Bank of Maharashtra for an amount of Rs.6,00,000/- and
(c) Cheque No. 002748, dated 12 th February 2016, drawn on the Bank of
India, Branch Devrukh, for an amount of Rs.6,00,000/-.
6.2. The said Mr. Ashok Rao expired on 25 th February 2016. The
Respondent No.1 deposited the aforesaid three cheques on 16 th April 2016
with the Janata Sahakari Bank Limited Pune, Branch Devrukh, where the
Respondent No.1 held a joint account with her late husband Mr. Ashok Rao.
That, the cheques were returned by the bank on 20 th April 2016 dishonored
with a remark “funds insufficient”.
6.3. The Respondent No.1 issued a demand notice dated 18 th May 2016 in
connection with the said dishonored cheques. On 19 th May 2016, the
Petitioner received the demand notices. On 1 st July 2016, the Respondent
No.1 filed complaints bearing S.C.C. No. 163 of 2016, S.C.C. No 164 of 2016
& S.C.C. No 165 of 2016 respectively, before the learned Judicial Magistrate
First Class, Devrukh, District Ratnagiri.
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6.4. By orders dated 21st July 2016, the learned Judicial Magistrate First
Class, Devrukh, District Ratnagiri was pleased to issue process against the
Petitioner in all the complaints for an offence punishable under Section 138
of The Negotiable Instruments Act, 1881 (for short, “N.I. Act“). The
Petitioner seeks to challenge the said orders of issuance of process.
7. Mr. Mangle, learned Advocate appearing for the Petitioner submits
that:-
7.1 It is an undisputed fact that, the cheques were given in the name of
late Mr. Ashok Rao, who is the husband of the Respondent No.1. That, the
cheques were admittedly deposited in the bank, after the death of Mr. Ashok
Rao and were subsequently dishonoured.
7.2. Under the provisions of N.I. Act, a notice for dishonor under Section
138 can be issued only at the instance of a “payee” or a “holder in due
course” as is contemplated under the provisions of N.I. Act. That,
Respondent No.1 cannot be termed as a “payee” and or a “holder in due
course” and for that reason, the proceedings under Section 138 of N.I. Act
were not maintainable.
7.3. The Respondent No.1 could not have initiated the proceedings under
Section 138, as the original cheques were issued in the name of her husband
and admittedly, it is not pleaded in the complaints or in the notices that the
cheques were endorsed for valuable consideration. In view of the aforesaid
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J-WP-4384-2016 – K.docxfacts, the complaints as filed ought not to have been entertained.
7.4. It was open for Respondent No.1 to initiate civil proceedings under the
law, as advised for recovery of the said amount, as the legal heir of the late
Mr. Ashok Rao. That, even for claiming the recovery of the said amount, it
would have been necessary for the Respondent No.1 to have the heirship
certificate or a succession certificate or a probate, as the case may be, to
establish her relationship and right with Mr. Ashok Rao for being a original
payee.
7.5. There is no order from the competent Civil Court in favour of
Respondent No.1, declaring her to be the legal heir of the original payee, the
complaints at the behest of Respondent No.1 for an offence punishable under
Section 138 of N.I.Act would not be acceptable.
8. As stated herein above, the learned Advocate for the Respondent No.1
though served has not filed the Vakalatnama nor appeared in the matter.
9. Mr. S. S. Chaudhari, learned A.P.P. appearing for Respondent No.2,
submits that, admittedly the money has been taken by the Petitioner. That, it
is his duty to repay the amounts. That, considering the interest of justice,
appropriate orders may be passed. She further submits that Respondent No.2
is a formal party and leaves the matter to the discretion of this Hon’ble Court.
10. Considering the above submissions, it would first be necessary to
consider the provisions of the Negotiable Instrument Act (N.I. Act) and the
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J-WP-4384-2016 – K.docxrights of the parties to initiate the proceedings under Section 138 of N.I. Act.
11. Sections 7, 8, 9, 138 & 139 of N.I. Act are required to be considered.
The sections are reproduced, herein below for convenience and read as
under:-
Section 7: “Drawer” and “Drawee” – The maker of a bill of exchange or
cheque is called the “drawer”; the person thereby directed to pay is called
the “drawee”.
“7. “Drawee in case of need”: – When in the Bill or in any indorsement
thereon the name of any person is given in addition to the drawee
to be resorted to in case of need, such person is called a “drawee in
case of need”.
“Acceptor”. – After the drawee of a bill has signed his assent upon
the bill, or if there are more parts thereof than one, upon one of
such parts, and delivered the same, or given notice of such signing
to the holder or to some person on his behalf, he is called the
“acceptor”.
“Acceptor for honour”. – When a bill of exchange has been noted
or protested for non-acceptance or for better security, and any
person accepts it supra protest for honour of the drawer or of any
one of the indorsers, such person is called an “acceptor for
honour”.
“Payee”. – The person named in the instrument, to whom or to
whose order the money is by the instrument directed to be paid, is
called the “Payee”.
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Section 8: “Holder”. – The “holder” of promissory note, bill or
exchange or cheque means any person entitled in his own name to
the possession thereof and to receive or recover the amount due
thereon from the parties thereto.
Where the note, bill or cheque is lost or destroyed, its holder is
the person so entitled at the time of such loss or destruction.
Section 9: “Holder in due course”. – “Holder in due course” means
any person who for consideration became the possessor of a
promissory note, bill of exchange or cheque if payable to bearer, or
the payee or indorsee thereof, if payable to order, before the
amount mentioned in it became payable, and without having
sufficient cause to believe that any defect existed in the title of the
person from whom he derived his title.
Section 138. Dishonour of cheque for insufficiency, etc., of funds in the
account. – Where any cheque drawn by a person on an 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 of the amount of
money standing to the credit of that account is insufficient to
honour the cheque or that it exceeds the amount arranged to be
paid from that account by an agreement made with that bank,
such person shall be deemed to have committed an offence and
shall, without prejudice to any other provisions of this Act, be
punished with imprisonment for a term which may be extended to
two years, or with fine which may extend to twice the amount ofosk 8 of 24
J-WP-4384-2016 – K.docxthe 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 thirty 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.
139. Presumption in favour of holder.– It shall be presumed, unless the
contrary is proved, that the holder of a cheque received the cheque
of the nature referred to in section 138 for the discharge, in whole
or in part, of any debt or other liability.”
12. Perusal of the provisions of N.I. act would indicate that under Section
7, the term “payee” is defined to be the person named in the instrument, to
whom or to whose order the money is by the instrument directed to be paid.
Section 8 defines “Holder” to mean the holder of a promissory note, bill or
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exchange or cheque means any person entitled in his own name to the
possession thereof and to receive or recover the amount due thereon from the
parties thereto. It is further provided that, where the note, bill or cheque is
lost or destroyed, its holder is the person so entitled at the time of such loss
or destruction. Section 9 of N.I. Act defines the term “Holder in due course”
to mean any person who for consideration became the possessor of a
promissory note, bill of exchange or cheque if payable to bearer, or the payee
or indorsee thereof, if payable to order, before the amount mentioned in it
became payable, and without having sufficient cause to believe that any
defect existed in the title of the person from whom he derived his title.
13. Section 138 provides for dishonor of cheque for insufficiency, etc., of
funds in the account. It is provided that, where any cheque drawn by a
person on an 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 of the amount of money standing to the credit of
that account is insufficient to honour the cheque or that it exceeds the
amount arranged to be paid from that account by an agreement made with
that bank, such person shall be deemed to have committed an offence and
shall, without prejudice to any other provision of this Act, be punished with
imprisonment for a term which may be extended to two years, or with fine
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which may extend to twice the amount of the cheque, or with both. Clause
(a) of the proviso to Section 138 provides that, nothing in the section would
apply unless the cheque has been presented to the bank within six months
from the date on which it is drawn or within the period of its validity
whichever is earlier. Clause (b) of the proviso specifically states that, the
provisions of Section 138 of N.I. Act shall not apply unless 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 thirty days of the receipt of information by
him from the bank regarding the return of the cheque as unpaid. Clause (c)
of the proviso to Section 138 specifically states that, the provisions of Section
138 of the N.I. Act shall not apply unless 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. The provisions of the Section 138 of the Act would
be applicable to a debt or other liability which is legally enforceable or other
liability.
14. A perusal of Section 138 clearly indicate that a complaint under
Section 138 would be initiated only by the payee or the holder in due course.
In the present case, the Respondent No.1 is neither the payee nor the holder
in due course. The perusal of the complaint filed under Section 138 by the
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Respondent No.1 indicates that, there is no pleadings to the said effect. The
Respondent No.1 in the complaint, in paragraph No.4, has only stated that
the cheques were given in the name of the husband of the Respondent No.1.
In paragraph No.6 of the complaint, it is stated that the husband of the
Respondent No.1 expired on 25th February 2016. The cheques have been
deposited on 16th April 2016. In the complaint, Respondent No.1 has not
stated that, she was the “payee” or the “holder in due course”. There is no
endorsement on the said cheques or otherwise even in the notice dated 17 th
May 2016.
15. Perusal of the order(s) of issuing process dated 21 st July 2016 read as
under :
“Order below Exh.1 in S.C.C. No.163/2016
Read complaint and statement of complainant on oath below
Exh.2 by way of affidavit. Perused the documents on record. Heard
Learned Adv. Sulochana D. Kinare for complainant. The
complainant has made out prima facie case that accused has issued
cheque bearing cheque no.002749 in his favour and it was
dishonoured for want of funds in the account of the accused. The
complainant has thereafter issued notice to the accused within
stipulated period and demanded the cheque amount and the
notice is served on accused on the date 19.5.2016 and thereafter,
accused has failed to pay cheque amount to complainant within
stipulated time. So, complainant has made out prima facie case
against accused for the offence p/u/s.138 of Negotiableosk 12 of 24
J-WP-4384-2016 – K.docxInstruments Act, 1881. Hence I pass the following order : –
-:ORDER:-
Issue process against accused Sagar Raghunath Fatkare,
R/o.Guravwadi road, Middle Lane, Devrukh, Tal. Sangmeshwar,
Dist.Ratnagiri for the offence
p/u/s. 138 of Negotiable Instruments Act on P.F. r/o.
Sd/-
Devrukh (S.N. Sarde)
Date : 21/07/2016 J.M.F.C., Devrukh"
That, in S.C.C. Nos. 164 of 2016 and 165 of 2015, same order is
passed except the number of cheque i.e. Cheque Nos. 122826 & 002748.
16. A prima facie perusal of the order(s) would indicate that, the order(s)
proceed on a completely incorrect premise that, the cheques were issued in
favour of the complainant and it is only for want of funds that, the accused
has failed to pay cheque amount to the complainant and therefore, a prima
facie case against the accused for the offence punishable under Section 138
of N.I. Act has been made out. On the basis of the said reasons, the process
has been issued.
17. Perusal of the order would prima facie indicate that the question, as to,
whether the complainant was the “payee” or the “holder in due course” has
not even been considered or gone into by the learned Judicial Magistrate
First Class, Devrukh. The order has proceeded on the basis that, the cheques
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have been issued in the name of the complainant.
18. The rebuttal presumption under Section 139 of the NI Act is that, it is
presumed unless the contrary is proved is that the holder of the cheque
received the cheque for discharge of whole or any part of any debt or other
liability. I note here that, the said presumption is in favour of the holder of
the cheque. The term “holder” is defined under Section 8 to mean, any
person entitled in his own name to the possession of the cheque and to
receive or recover the amount due thereon from the parties. In case of the
loss or destruction of the cheque, it is again the holder of the cheque who is
entitled to make a claim. A conjoint reading of Section 139 and Section 8
would indicate that the presumption of receiving a cheque in discharge in
whole or part of any debt or other liability is in favour of the holder.
19. Section 142 of N.I. Act deals with cognizance of offences and begins
with a non obstante clause. Under clause (a) of Section 142, it is specifically
provided that no court shall take cognizance of any offence punishable under
section 138 except upon a complaint, in writing, made by the payee or, as the
case may be, the holder in due course of the cheque. In other words, Section
142 (1)(a) prescribes a eligibility criterion for taking cognizance of the
offences under the said Act. The N.I. Act being a special statute, under
Section 142 prescribes the manner in which cognizance of an offence can be
taken. The NI Act, a special statute prescribes for the manner and the
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procedural aspect and the section begins with an non obstante clause.
Considering the said provisions it would be necessary for the courts to take
cognizance of the offence and the liability as per criterion prescribed by the
statute and to ensure that, the same is complied and satisfied with in letter
and spirit.
20. In this regard it would also be necessary to refer to the Judgment of
this Court (Aurangabad bench) passed in Vishnupant s/o Chaburao Khaire
Vs. Kailas S/o Balbhir Madan in Criminal Writ Petition No. 842 of 2009 dated
25th January 2010 has observed that :-
“27. The present Respondent complainant is not the person
named in the instrument nor he is a person to whom or to
whose order money by the instrument is directed to be paid.
Admittedly, there is no endorsement on the cheque by the
deceased payee in favour of the Respondent complainant. So,
it is not that the amount under the instrument was directed
to be paid to him. The holder in due course is defined as the
person who for consideration is entitled to the possession of
the bearer cheque or payee or endorsee thereof. It is
submitted that as a legal representative of the deceased
payeefather, the respondent complainant, is entitled to
possession of the valuable security/movable property left by
his deceased father and also to receive or recover the amount
thereunder. It is not disputed that the complainant could
have filed a civil suit on the basis of the dishonoured cheque
for recovery of the amount stated in the said cheque. Theosk 15 of 24
J-WP-4384-2016 – K.docxquestion is whether the respondent complainant could file
complaint in view of specific wording of Section 142(a). It is
argued that the respondent complainant has not become
possessor of the property for consideration, but it is because
of death of his fatherpayee. He is also not endorsee.
28. If we consider the scheme of Chapter XVII of the
N.I.Act regarding penalties in case of dishonour of certain
cheques for insufficieny of funds in the account, it is clear
that under proviso (b) to Section 138 of the N.I.Act the payee
or the holder in due course of the cheque, as the case may
be, is to make a demand for the payment of the said amount
of money by giving a notice in writing, to the drawer of the
cheque, within [thirty] days of the receipt of information by
him from the bank regarding the return of the cheque as
unpaid. As per proviso (c), if the drawer of such cheque fails
to make payment of the amount due under the cheque to the
payee or to the holder in due course as the case may be
within fifteen days of receipt of notice, then the offence is
complete. It may be noted that this requires that the person
demanding the amount must have right to demand the
money and secondly, he must be in a position to give full
discharge to the person who is to make the payment. If a
person to whom payment is to be made is not in a position in
law to give full discharge and indemnity for payment made,
nonpayment to him cannot be an offence.
29. We may refer to certain provisions of the Succession
Act in this respect. Section 211 speaks that the executor or
administrator, as the case may be, of a deceased person is hisosk 16 of 24
J-WP-4384-2016 – K.docxlegal representative for all purpose, and all the property of
the deceased person vests in him as such. Section 273 of the
Succession Act is regarding conclusiveness of probate or
letters of administration. As per this section, probate or
letters of administration shall have effect over all the
property and estate, movable or immovable, of the deceased,
throughout the [State] in which the same is or are granted,
and shall be conclusive as to the representative title against
all debtors of the deceased, and all persons holding property
which belongs to him, and shall afford full indemnity to all
debtors, paying their debts and all persons delivering up such
property to the person to whom such probate or letters of
administration have been granted. Similarly, under Section
381, succession certificate with respect to debts and
securities specified therein, is conclusive as against person
owing such debts or liable on such securities and affords full
indemnity to all persons as regards all payments made or
dealings had, with the person to whom the certificate is
granted. In other words, only in case the legatee or heir is
armed with succession certificate or probate or letters of
administration, he would be entitled to give full discharge
and indemnity to the drawer of the cheque. Unless he can
give such indemnity it cannot be said that he has authority to
issue notice and non payment of amount mentioned in the
notice within 15 days is an offence.
30. By demise of payee itself, it cannot be said that any of
the heirs or legatees get right to issue notice under proviso
(b) to Section 138 of the N.I. Act and then lodge a complaint
osk 17 of 24
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enters into the shoes of the deceased payee.
31. When we consider the rights of the heirs or legatees to
recover the amount of debt and securities of the deceased,
we must also recognize right of the debtor and person
holding security to have full indemnity and full discharge in
case he makes payment to such legal heir or legatee. We find
such indemnity and full discharge of liability provided to
maker, acceptor or endorsee respectively of a negotiable
instrument on payment under Section 82 of the N.I.Act.
32. So in my considered opinion, only a person who is
authorized by succession certificate, letters of administration
or probate granted by the court, is entitled to call upon the
drawer to pay the amount of dishonour cheque, by issuing
notice under proviso(b) of to Section 138 of the N.I.Act and
he would be entitled to file complaint under Section 142 of
the Act as he would be then really entering into the shoes of
the deceased payee.”
21. The Hon’ble Supreme Court in the case of Naresh Potteries Vs. Aarti
Industries & Anr.1 has observed that:-
“11. The solitary question that we are called upon to answer is as to
whether the complaint filed by the appellant herein under section
138 of the Negotiable Instruments Act is in accordance with the
requirement under section 142 of the Negotiable Instruments Act.
1 (2025) 256 Comp Cas 606 : 2025 SCC OnLine SC 18
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12. The relevant provision of the Negotiable Instruments Act that
falls for our consideration is as follows:
“142. Cognizance of offences.–(1) Notwithstanding anything
contained in the Criminal Procedure Code, 1973 (2 of 1974),
— (a) no court shall take cognizance of any offence
punishable under section 138 except upon a complaint, in
writing, made by the payee or, as the case may be, the holder
in due course of the cheque;…”
13. Ordinarily, under section 190 of the Code of Criminal
Procedure, a Magistrate is empowered to take cognizance of an
offence upon receiving a complaint of facts which constitute such
offence. Prior to taking such cognizance, in accordance with and as
provided by section 200 of the Code of Criminal Procedure, the
Magistrate is required to examine upon oath the complainant and
witness present, if any. However, section 142 of the Negotiable
Instruments Act creates a legal bar on the court from taking
cognizance of any offence punishable under section 138 of the
Negotiable Instruments Act except upon a complaint, in writing,
made by the payee, or as the case may be, the holder in due course
of the cheque.
14. The law on the subject-matter at hand is no longer res integra
and has been well-settled by a series of judgments passed by this
court.
15. This court in the case of National Small Industries Corporation
Ltd.v. State (NCT of Delhi) [2008 SCC OnLine SC 1710] had an
occasion to consider the validity of a complaint under section 138
of the Negotiable Instruments Act and the satisfaction of the
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requirement under section 142 thereof, as well as to determine as
to who could be considered to be the complainant/representative in
a case where the complaint is to be filed by an incorporated body.
This court held as follows :
“The term ‘complainant’ is not defined under the Code.
Section 142 of the Negotiable Instruments Act requires a
complaint under section 138 of that Act to be made by the
payee (or by the holder in due course). It is thus evident that
in a complaint relating to dishonour of a cheque (which has
not been endorsed by the payee in favour of anyone), it is the
payee alone who can be the complainant. The Negotiable
Instruments Act only provides that dishonour of a cheque
would be an offence and the manner of taking cognizance of
offences punishable under section 138 of that Act. However,
the procedure relating to initiation of proceedings, trial and
disposal of such complaints, is governed by the Code. Section
200 of the Code requires that the Magistrate, on taking
cognizance of an offence on complaint, shall examine upon
oath the complainant and the witnesses present and the
substance of such examination shall be reduced to writing
and shall be signed by the complainant and the witnesses.
The requirement of section 142 of the Negotiable Instruments
Act that the payee should be the complainant, is met if the
complaint is in the name of the payee. If the payee is a
company, necessarily the complaint should be filed in the
name of the company. Section 142 of the Negotiable
Instruments Act does not specify who should represent theosk 20 of 24
J-WP-4384-2016 – K.docxcompany, if a company is the complainant. A company can be
represented by an employee or even by a non-employee
authorised and empowered to represent the company either
by a resolution or by a power of attorney…
Resultantly, when in a complaint in regard to dishonour
of a cheque issued in favour of a company or corporation, for
the purpose of section 142 of the Negotiable Instruments Act,
the company will be the complainant, and for purposes of
section 200 of the Code, its employee who represents the
company or corporation, will be the de facto complainant. In
such a complaint, the de jure complainant, namely, the
company or corporation will remain the same but the de facto
complainant (employee) representing such de jure
complainant can change, from time to time. And if the de
facto complainant is a public servant, the benefit of
exemption under clause (a) of the proviso to section 200 of
the Code will be available, even though the complaint is
made in the name of a company or corporation.”
(emphasis supplied)”
22. Considering the facts of the present case and the provisions of N.I. Act
and the case laws, as stated above, it would be clear that the N.I. Act provides
that it is only the “payee” or the “holder in due course”, who can institute a
complaint under Section 138 of N.I. Act. In the present case, admittedly, the
cheques have been deposited after the death of the husband of Respondent
No.1. It is not the case of the Respondent No.1 that, she was armed with an
osk 21 of 24
J-WP-4384-2016 – K.docxorder of a Court or a judicial order proceeded to file the complaint(s) under
Section 138 of N.I. Act, neither is the Respondent No.1 the “payee” or nor is
there any endorsement indicating that the Respondent No.1 is “holder in due
course”.
23. In view of the aforesaid facts and circumstances, the Respondent No.1
could not have initiated the proceedings under Section 138 of the N.I. Act.
The Respondent No.1 ought to have approached the civil court seeking
appropriate declaration making her entitle to comply with the provisions of
N.I. Act, so as to enable her to file and prosecute the proceedings under
Section 138 of N.I. Act.
24. The inherent powers under Section 482 of the Code of Criminal
Procedure are to be exercised with care and caution and the judicial
discretion has to be exercised in a fair judicious manner and in cases which
warrant exercise the invocation of the inherent powers to either prevent the
abuse of process of law or in the interest of justice.
25. The Hon’ble Supreme Court in the case of State of Haryana & Ors.
Vs.Bhajan Lal & Ors.2, while enumerating the powers under Section 482 of
the Indian Penal Code and Article 226 of the Constitution of India, in
Paragraph No.102 has observed as under :-
“102. In the backdrop of the interpretation of the various
relevant provisions of the Code under Chapter XIV and of the
2 1992 Supp (1) SCC 335osk 22 of 24
J-WP-4384-2016 – K.docxprinciples of law enunciated by this Court in a series of decisions
relating to the exercise of the extraordinary power under Article
226 or the inherent powers under Section 482 of the Code
which we have extracted and reproduced above, we give the
following categories of cases by way of illustration wherein such
power could be exercised either to prevent abuse of the process
of any court or otherwise to secure the ends of justice, though it
may not be possible to lay down any precise, clearly defined and
sufficiently channelized and inflexible guidelines or rigid
formulae and to give an exhaustive list of myriad kinds of cases
wherein such power should be exercised.
(1) Where the allegations made in the first information
report or the complaint, even if they are taken at their
face value and accepted in their entirety do not prima
facie constitute any offence or make out a case against
the accused.
(2) Where the allegations in the first information report
and other materials, if any, accompanying the FIR do
not disclose a cognizable offence, justifying an
investigation by police officers under Section 156(1) of
the Code except under an order of a Magistrate within
the purview of Section 155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR
or complaint and the evidence collected in support of
the same do not disclose the commission of any offence
and make out a case against the accused.
(4) Where, the allegations in the FIR do not constitute a
cognizable offence but constitute only a non-cognizable
offence, no investigation is permitted by a police officer
without an order of a Magistrate as contemplated
under Section 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are
so absurd and inherently improbable on the basis of
which no prudent person can ever reach a just
conclusion that there is sufficient ground for
proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of
the provisions of the Code or the concerned Act (under
which a criminal proceeding is instituted) to the
institution and continuance of the proceedings and/or
where there is a specific provision in the Code or theosk 23 of 24
J-WP-4384-2016 – K.docxconcerned Act, providing efficacious redress for the
grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended
with mala fide and/or where the proceeding is
maliciously instituted with an ulterior motive for
wreaking vengeance on the accused and with a view to
spite him due to private and personal grudge..”
26. That, the present case would fall under category (6) of the categories
as enumerated in Paragraph No.102 of the judgment of State of Haryana &
Ors. Vs.Bhajan Lal & Ors. (supra). Therefore, by exercising the jurisdiction
vested under Section 482 of Cr.P.c., I am inclined to quash the proceedings in
question.
27. All the Petitions are allowed in terms of prayer clause (b) of each
Petition.
28. As the Respondent No.1 was served and has not appeared, let the said
order be informed to the Respondent No.1 to enable her to take appropriate
steps, if advised.
[ RANJITSINHA RAJA BHONSALE, J. ]
Digitally signed
by OMKAR
OMKAR SHIVAHAR
SHIVAHAR KUMBHAKARN
KUMBHAKARN Date:
2026.07.06
13:30:04 +0530
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