High Court · 2025

1. Heard Sri Alok Tiwari, learned counsel for the applicants as well as Sri Pankaj Kumar Rai, learned State Law Officer for the State.

2. This application u/s 528 of BNSS has been preferred to quash/set-aside the entire proceeding of Complaint Case No. 3068 of 2023 pending before Chief Judicial Magistrate, Pilibhit (Venus Suppliers vs. M/s Laxman Prasad Contractor and another), U/S 138 of N.I. Act against the applicants as well as summoning order dated 20.04.2023 passed by Chief Judicial Magistrate, Pilibhit in the said proceeding and the order dated 07.04.2025 passed by Additional District & Session Judge, Court No. 4 (Special Judge E.C. Act), Pilibhit in Revision No. 96 of 2024.

3. Learned counsel for the applicants has submitted that a complaint was lodged by the opposite party no. 2 on 15.02.2023 against the applicants with an allegation that with respect to discharge of liability, the applicant no. 2 had drawn a cheque bearing no. 091304 dated 28.10.2022 of Rs. 8,30,000/- which on presentation in the bank stood dishonored on 17.11.2022 again the said cheque was presented in the bank which came to be dishonored on 14.12.2022 followed by a statutory demand notice dated 03.01.2023 and as per the allegations contained in the complaint in para 7, the same stood served on 12.01.2023 followed by a complaint under Section 138 of the NI Act on 15.02.2023 and thereafter, applicants came to be summoned on 20.04.2023 under Section 138 of the NI Act. Assailing the summoning order, the applicants preferred a criminal revision on 29.03.2024 which also resulted in the same fate i.e. dismissal.

4. Questioning both the orders, the present application has been filed.

5. Learned counsel for the applicants has submitted that the summoning order cannot be sustained for more than one reason. Submission is that as per the complaint itself the parties who has been arraigned as an accused was M/s Laxman Prasad Contractor and Nityanand who are applicants herein. He submits that as per the complaint, the opposite party no. 2 had drawn the cheque. Further submission is that no legally enforceable date or liability stands accrued against the applicants. Submission is also to the extent that there had been no service of statutory demand notice and thirdly, there is no legally enforceable debt, so as to attract the provisions of Section 138 of the NI Act particularly when there is nothing on record to show that any amount was outstanding and due and fourthly, the cheque was even not filed before the court below and the applicants have been summoned. It is further contended that the cheuqe was by way of security. At this stage, learned counsel for the applicants submits that non-bailable warrants have been issued, he submits that breathing time be accorded to file recall application.

6. Learned State Law Officer, on the other hand, submits that none of the contentions so sought to be raised has any legs to stand and the presumption under Section 139 of the NI Act is already there.

7. I have heard the submissions so made across the bar and perused the record.

8. The sole question which arises for determination is the extent of judicial intervention. Apparently, as per the allegations, a cheque stood drawn which came to be dishonored. On a pointed query being raised to the learned counsel for the applicants whether the grounds that no cheque was issued by the applicant no. 2 had been raised before the court below or not. The submission is that in the revision itself the ground was taken that no amount is due to be paid. Apart from the same there is nothing on record to suggest even otherwise that the ground has been taken in revision that legal notice was not served upon the applicant. Furthermore, the question as to whether the legal statutory demand notice has been served or not is a question of trial. In Ajeet Seeds Ltd. vs. K. Gopala Krishnaiah 2014 (12) SCC 685 which have been observed as under:- "10. It is thus clear that Section 114 of the Evidence Act enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. Section 27 of the GC Act gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business.

11. Applying the above conclusions to the facts of this case, it must be held that the High Court clearly erred in quashing the complaint on the ground that there was no recital in the complaint that the notice under Section 138 of the NI Act was served upon the accused. The High Court also erred in quashing the complaint on the ground that there was no proof either that the notice was served or it was returned unserved/unclaimed. That is a matter of evidence. We must mention that in C.C. Alavi Haji, this Court did not deviate from the view taken in Vinod Shivappa, but reiterated the view expressed therein with certain clarification. We have already quoted the relevant paragraphs from Vinod Shivappa where this Court has held that service of notice is a matter of evidence and proof and it would be premature at the stage of issuance of process to move the High Court for quashing of the proceeding under Section 482 of the Cr.P.C. These observations are squarely attracted to the present case. The High Courts reliance on an order passed by a two-Judge Bench in Shakti Travel & Tours is misplaced. The order in Shakti Travel & Tours does not give any idea about the factual matrix of that case. It does not advert to rival submissions. It cannot be said therefore that it lays down any law. In any case in C.C. Alavi Haji, to which we have made a reference, the three- Judge Bench has conclusively decided the issue. In our opinion, the judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the field any more."

9. Apart from the same, the question with regard to the fact that there is no legally enforceable debt or liability is concerned the same is not required to be gone at this stage in view of the fact that there is no convincible documents available on record as the same is also a mixed question of facts and law which needs to be thrashed out when the trial commences. The next objection that the original cheque was not before the court below is concerned, the court is not required to go into, in view of the summoning order where reference has been made of cheque and further, it is open for the applicants to raise all legal questions at the stage when the trial commences. As regards the issue that the cheuqe was with the opposite party no. 2 as security, thus, no offence under Section 138 of the NI Act is made out and summoning order is bad is concerned suffice it to say that the same is a matter of trial in M/s Womb Laboratories Pvt. Ltd. vs Vijay Ahuja 2022 (18) SCC 631 and in Sunil Todi vs. the State of Gujarat 2022 (16) SCC 762.

10. Accordingly, interference is declined, the application stands disposed of directing the applicants to submit a recall application by 08.08.2025. On the said recall application, the court below shall proceed to passed an appropriate order strictly in accordance with law subject to the compliance which the applicants is to make under the statute.

11. Till the disposal of the recall application seeking recall of the non-bailable warrants, no coercive action shall be taken against the applicant in the Complaint Case No. 3068 of 2023 pending before Chief Judicial Magistrate, Pilibhit (Venus Suppliers vs. M/s Laxman Prasad Contractor and another), U/S 138 of N.I. Act against the applicants as well as summoning order dated 20.04.2023 passed by Chief Judicial Magistrate, Pilibhit in the said proceeding and the order dated 07.04.2025 passed by Additional District & Session Judge, Court No. 4 (Special Judge E.C. Act), Pilibhit in Revision No. 96 of 2024.

12. The protection accorded to the applicant is only available subject to compliance of the terms and conditions and timeline as provided herein and in case of default, the order shall stand vacated without reference to the Bench.

13. It is is open for the applicant to contest the said proceedings taking all legal and factual grounds and this Court has no reasons to disbelieve that the same shall be decided in accordance with law. Order Date :- 28.7.2025 Rajesh RAJESH KUMAR High Court of Judicature at Allahabad

1. Heard Sri Alok Tiwari, learned counsel for the applicants as well as Sri Pankaj Kumar Rai, learned State Law Officer for the State.

2. This application u/s 528 of BNSS has been preferred to quash/set-aside the entire proceeding of Complaint Case No. 3068 of 2023 pending before Chief Judicial Magistrate, Pilibhit (Venus Suppliers vs. M/s Laxman Prasad Contractor and another), U/S 138 of N.I. Act against the applicants as well as summoning order dated 20.04.2023 passed by Chief Judicial Magistrate, Pilibhit in the said proceeding and the order dated 07.04.2025 passed by Additional District & Session Judge, Court No. 4 (Special Judge E.C. Act), Pilibhit in Revision No. 96 of 2024.

3. Learned counsel for the applicants has submitted that a complaint was lodged by the opposite party no. 2 on 15.02.2023 against the applicants with an allegation that with respect to discharge of liability, the applicant no. 2 had drawn a cheque bearing no. 091304 dated 28.10.2022 of Rs. 8,30,000/- which on presentation in the bank stood dishonored on 17.11.2022 again the said cheque was presented in the bank which came to be dishonored on 14.12.2022 followed by a statutory demand notice dated 03.01.2023 and as per the allegations contained in the complaint in para 7, the same stood served on 12.01.2023 followed by a complaint under Section 138 of the NI Act on 15.02.2023 and thereafter, applicants came to be summoned on 20.04.2023 under Section 138 of the NI Act. Assailing the summoning order, the applicants preferred a criminal revision on 29.03.2024 which also resulted in the same fate i.e. dismissal.

4. Questioning both the orders, the present application has been filed.

5. Learned counsel for the applicants has submitted that the summoning order cannot be sustained for more than one reason. Submission is that as per the complaint itself the parties who has been arraigned as an accused was M/s Laxman Prasad Contractor and Nityanand who are applicants herein. He submits that as per the complaint, the opposite party no. 2 had drawn the cheque. Further submission is that no legally enforceable date or liability stands accrued against the applicants. Submission is also to the extent that there had been no service of statutory demand notice and thirdly, there is no legally enforceable debt, so as to attract the provisions of Section 138 of the NI Act particularly when there is nothing on record to show that any amount was outstanding and due and fourthly, the cheque was even not filed before the court below and the applicants have been summoned. It is further contended that the cheuqe was by way of security. At this stage, learned counsel for the applicants submits that non-bailable warrants have been issued, he submits that breathing time be accorded to file recall application.

6. Learned State Law Officer, on the other hand, submits that none of the contentions so sought to be raised has any legs to stand and the presumption under Section 139 of the NI Act is already there.

7. I have heard the submissions so made across the bar and perused the record.

8. The sole question which arises for determination is the extent of judicial intervention. Apparently, as per the allegations, a cheque stood drawn which came to be dishonored. On a pointed query being raised to the learned counsel for the applicants whether the grounds that no cheque was issued by the applicant no. 2 had been raised before the court below or not. The submission is that in the revision itself the ground was taken that no amount is due to be paid. Apart from the same there is nothing on record to suggest even otherwise that the ground has been taken in revision that legal notice was not served upon the applicant. Furthermore, the question as to whether the legal statutory demand notice has been served or not is a question of trial. In Ajeet Seeds Ltd. vs. K. Gopala Krishnaiah 2014 (12) SCC 685 which have been observed as under:- "10. It is thus clear that Section 114 of the Evidence Act enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. Section 27 of the GC Act gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business.

11. Applying the above conclusions to the facts of this case, it must be held that the High Court clearly erred in quashing the complaint on the ground that there was no recital in the complaint that the notice under Section 138 of the NI Act was served upon the accused. The High Court also erred in quashing the complaint on the ground that there was no proof either that the notice was served or it was returned unserved/unclaimed. That is a matter of evidence. We must mention that in C.C. Alavi Haji, this Court did not deviate from the view taken in Vinod Shivappa, but reiterated the view expressed therein with certain clarification. We have already quoted the relevant paragraphs from Vinod Shivappa where this Court has held that service of notice is a matter of evidence and proof and it would be premature at the stage of issuance of process to move the High Court for quashing of the proceeding under Section 482 of the Cr.P.C. These observations are squarely attracted to the present case. The High Courts reliance on an order passed by a two-Judge Bench in Shakti Travel & Tours is misplaced. The order in Shakti Travel & Tours does not give any idea about the factual matrix of that case. It does not advert to rival submissions. It cannot be said therefore that it lays down any law. In any case in C.C. Alavi Haji, to which we have made a reference, the three- Judge Bench has conclusively decided the issue. In our opinion, the judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the field any more."

9. Apart from the same, the question with regard to the fact that there is no legally enforceable debt or liability is concerned the same is not required to be gone at this stage in view of the fact that there is no convincible documents available on record as the same is also a mixed question of facts and law which needs to be thrashed out when the trial commences. The next objection that the original cheque was not before the court below is concerned, the court is not required to go into, in view of the summoning order where reference has been made of cheque and further, it is open for the applicants to raise all legal questions at the stage when the trial commences. As regards the issue that the cheuqe was with the opposite party no. 2 as security, thus, no offence under Section 138 of the NI Act is made out and summoning order is bad is concerned suffice it to say that the same is a matter of trial in M/s Womb Laboratories Pvt. Ltd. vs Vijay Ahuja 2022 (18) SCC 631 and in Sunil Todi vs. the State of Gujarat 2022 (16) SCC 762.

10. Accordingly, interference is declined, the application stands disposed of directing the applicants to submit a recall application by 08.08.2025. On the said recall application, the court below shall proceed to passed an appropriate order strictly in accordance with law subject to the compliance which the applicants is to make under the statute.

11. Till the disposal of the recall application seeking recall of the non-bailable warrants, no coercive action shall be taken against the applicant in the Complaint Case No. 3068 of 2023 pending before Chief Judicial Magistrate, Pilibhit (Venus Suppliers vs. M/s Laxman Prasad Contractor and another), U/S 138 of N.I. Act against the applicants as well as summoning order dated 20.04.2023 passed by Chief Judicial Magistrate, Pilibhit in the said proceeding and the order dated 07.04.2025 passed by Additional District & Session Judge, Court No. 4 (Special Judge E.C. Act), Pilibhit in Revision No. 96 of 2024.

12. The protection accorded to the applicant is only available subject to compliance of the terms and conditions and timeline as provided herein and in case of default, the order shall stand vacated without reference to the Bench.

13. It is is open for the applicant to contest the said proceedings taking all legal and factual grounds and this Court has no reasons to disbelieve that the same shall be decided in accordance with law. Order Date :- 28.7.2025 Rajesh RAJESH KUMAR High Court of Judicature at Allahabad