The High Court · 2025

Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to quash the above case i.e., CC No. 377 of 2018 on the file of the Court of the Spl. Magistrate court, Karimnagar. l.A. NO: 1 OF 2019 Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to grant interim stay of all further proceedings in CC No. 377 of 2018 on the file of Court of the Spt. Magistrate Court, Karimnagar. This Petition coming on for hearing, upon perusing the Memorandum of Grounds of Criminal Petition and upon hearing the arguments of Sri Ponnam Ashok Goud, Advocate for the Petitioner and Sri Vivekananda Reddy, Asst. Public Prosecutor on behalf of the Respondent No.'l none appeared for the Respondent No.2. The Court made the following: ORDER THE HONOURABLE SRI JUSTICE K.SUR.ENDER CRIMINAL PETITION No.7O67 OF 2019 ORDER: This Criminal Petition is llled by petitioner/accused seeking to quash the proceedings against her in C.C.No.377 of 2018, on the frle of Special Magistrate Court, Karimnagar. The offence alleged against the petitioner is under Section 138 of the Negotiable Instruments Act, 1881, (for short 'NI Act)

2. Heard learned counsel for the petitioner and Sri M.Vivekananda Reddy, learned Assistant Public Prosecutor for respondent No.l-State. Perused the record.

3. Petitioner is questioning the proceedings in complaint for the offence under Section 138 of NI Act, which was initiated by respondent No.2 before the Magistrate Court.

4. According to the complaint, petitioner is well known to respondent No.2 and due to the said acquaintance, an amount of Rs.5,OO,O0O/- was obtained as loan by petitioner from respondent No.2. A cheque for Rs.5,OO,OO0/- was handed over to respondent No.2 by petitioner. The said 2 KS,J CRLP 7067 2019 cheque, when presented for realization of amount, the cheque was returned unpaid on the ground of "insufficient funds".

5. l,egal notice was sent to the petitioner, and since petitioner failed to make good the paynnent of the cheque amount, the complaint was filed.

6. The only ground raised by the learned counsel for the petitioner is that, in the notice sent to the petitioner after the cheque for Rs.5,OO,OOO/- was returned, the demand was made only for Rs. 26,000|- to be paid through the D.D. The said demand of Rs.26,000/- in the notice will not fulfill the requirement under Section 138 of NI Act, to launch prosecution.

7. learned counsel appearing for the petitioner relied on the judgment of the Hon'lcle Supreme Court in Ro'hul Builders u. Arihant Fertilizers and Chemicals and Another 1, wherein, it was held as follows: " 1O. Service of a notice, it is trite, is imperative in character for maintaining a complaint. It creates a legal Iiction. Operation of Section 138 of the Act is limited by the proviso. When the proviso applies, the main Section would not. Unless a notice is served in conformit5r with Proviso (b) t (2008) 2 scc a2r J KS,J cRr,P 1067 2019 appended to Section 138 of the Act, the complaint petition would not be maintainable. The Parliament while enacting the said provision consciously imposed certain conditions. One of the conditions was service of a notice making demand of the pa5rment of the amount of cheque as is evident from the use of the phraseolog, "payrnent of the said amount of money". Such a notice has to be issued within a period of 3O days from the date of ieceipt of information from the bank in regard to the return of the cheque as unpaid. The statute envisages application of the penal provisions. A penal provision should be construed strictly; the condition precedent where for is service of notice. It is one thing to say that the demand may not only represent the unpaid amount under cheque but also other incidental expenses like costs and interests, but the same would not meal that the notice would be vague ald capable of two interpretations. An omnibus notice without speci$ring as to what was the amount due under the dishonored cheque would not subserve the requirement of law. Respondent No. 1 was not called upon to pay the amount which was payable under the cheque issued by it. The amount which it was called upon to pay was the outstanding amounts of bills, i.e., Rs. 8,72,409/-. The notice was to respond to the said demand. Pursuant thereto, it was to offer the entire sum of Rs. a,72,4O9/ -. No demand was made upon it to pay the said sum of Rs. 1,OO,O00/- which was tendered to the complainant by cheque dated 3O.O4.200O. What was, therefore, demanded was the entire sum and not a part of it." ( /

8. The Honble Supreme Court was dealing with a case where notices were sent without specirying the amount. The notice stated that the amount mentioned on the cheque had to be paid. The Honble Supreme Court held that such demand will not fulfill the necessary requirement of 'demand I \ 4 KS,J CRLP 7067 2019 for payment of amount' by sending notice. In the present case, demald was made for Rs.26,000/- only. Relying on the judgment of the Hon'ble Supreme Court in Rahul Builders's case( 7 supra), the legal notice sent to the petitioner is bad in law, and does not fulfill the requirements of Section 138 of NI Act

9. Accordingly, the Criminal Petition is allowed, quashing the proceedings in C.C.No.377 of 2Ol8 on the file of Special Magistrate Court, Karimnagar, against the petitioner herein. Miscellaleous applications pending, if any, shall stand closed. //TRUE COPY// Sd/- V. KAVITHA STANT REGISTRAR Ssl SECTION OFFICER To,

1. The Addl. Judicial First Class Magistrate' at Karimnagar' 2. The Station House Officer' lll Town Police Station' Karimnagar' 3. The Spl. Magistrate Court' Karimnagar' 4. One CC to Sri. Ponnam Ashok Goud' Advocate [OPUC] 5. Two CCs to Public Prosecutor' High Court for the State of Telangana [OUT] 6. Two CD CoPies' YlRJgh l, i-\E S IA 7'€' HIGH COURT DATED:0710212025 ORDER GRLP.No.7067 of 2019 t'.\ t.:in' it. li{ 2 6 tPil 2025 * 0E5 ALLOWING OF THE CRIMINAL PETITION, e6 L,t