High Court · 2025

1. Heard Sri Virendra Singh along with Sri Hari Om Gupta, learned counsel for the applicants as well as Sri Vikas Sharma, learned State Law Officer for the State.

2. This is an application under Section 528 of BNSS preferred by the applicant for quashing the summoning order dated 21.11.2023 passed by of Judicial Magistrate/Addl. Civil Judge, Junior Division, Court No.4, Agra in complaint case 4508/2022 no. (Flonexs Oil N.I.Act, India Pvt. Ltd. Vs. Khushi Traders and another) u/s 138 Hari P.S. Parwati, Agra and entire proceeding of complaint case, pending in the court of Judicial Magistrate/Addl. Civil Judge, Junior Division, Court No.4, Agra.

3. The case of the applicants is that O.P. No.2 had lodged a complaint under Section 138 of N.I. Act against the applicants, who are two in number, with an allegation that with respect to discharge of a liability with regard to sale of mobile oil, the applicants had drawn a cheque bearing number "000003" of an amount Rs.8,60,645/- dated 04.03.2022, which on presentation in the bank on 04.03.2022 came to be dishonoured on 05.03.2022 with the remarks 'funds insufficient' followed by a statutory demand notice issued dated 17.03.2022, which is stated to have been delivered on 18.03.2022 followed by the complaint on 22.04.2022 and the applicants came to be summoned under Section 138 of N.I. Act on 21.11.2023.

4. Questioning the summoning order, the present application has been preferred.

5. Learned counsel for the applicants has submitted that the summoning order cannot be sustained for the simple reason, that though in the complaint, particularly in para-6, it has been asserted that the statutory demand notice came to be issued and has been served, but actually the said notice has not been served upon the applicants, as he seeks to rely upon para-11 and 18 of the application so as to contend that the address of the applicants is Belthara Road, Ballia and not Maunath Bhanjan. He further submits that once the statutory demand notice was not served as it was on a wrong and incorrect address, then it was clear cut case of infraction of provisions of Section 138 read with Section 142 of the N.I. Act, thus the offences under Section 138 of the N.I. Act cannot be made out. Further submission is that though mobil oil was purchased by the applicants from the O.P. No.2 but the same was sub-standard and certain amount was also paid and nothing remains to be due and the mobil oil was also returned to the O.P. No.2, thus it is submitted that there is no legal enforceable debt or liability.

6. Learned A.G.A. on the other hand submits that once a cheque stood drawn by the applicant, then presumption under Section 139 of the N.I. Act would be there.

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

8. Apparently, as per the allegations contained in the complaint, it is alleged that a cheque bearing number "000003" of an amount of Rs.8,60,645/- dated 04.03.2022 in favour of O.P. No.2, which came to be dishonoured with the remarks 'funds insufficient' on 05.03.2022. So far as the objection so sought to be raised by the learned counsel for the applicants that the statutory demand notice though came to be issued as alleged by the O.P, but it could not be served as address was incorrect, this Court at this stage is not required to go into the said aspect of the matter, particularly whether the applicant is resident of said place, which stands mentioned in the complaint, is a question of fact, which needs leading of evidence at the stage when the trial commences. For the ready reference, para-6 of the complaint is quoted herein:- "6. That complainant send demand notice to Accused/s on 17-03-2022 through Rahul Rathore Advocate via registered post said notices also delivered at (Maryadpur S.O.) on 18.03.2022. Computer generated internet delivery Report is annexed with complaint."

9. A perusal of para-6 of the complaint would reveal that the statutory demand notice came to be issued on 17.03.2022 and it is alleged that it came to be delivered Belthara Road on 18.03.2022. The question whether there was an actually delivery or not which as per page-34 of the paper book being a tracking report is a question of fact, consideration whereof would be required when raised at the stage, when the trial commences. Suffice would be a clear recital about the issuance of statutory demand notice. The question whether it was served or not is a question of trial. The Hon'ble Apex Court in the case of Ajeet Seeds Ltd. Vs. K. Gopala Krishnaiah, (2014) 12 SCC 685, in paragraph-10 and 11 has held 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 Court?s 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."

10. Apart from this, the objection of the applicants that there was no legal enforceable debt or liability fastened upon the applicant, particularly when the consignment of mobil oil stood returned and the certain payments were made and there is nothing due is a question, which is a subject matter of defence, consideration whereof would be at the stage, when the trial commences. Moreover, presumption under Section 139 of the N.I. Act would be there.

11. Accordingly, interference is declined. The application is disposed of leaving it open to the applicants to contest the trial before the court below while taking all the legal and factual grounds and this Court has no reason to disbelieve that the court below shall consider the same in correct perspective. Order Date :- 22.8.2025 N.S.Rathour (Vikas Budhwar, J) NIPENDRA SINGH RATHOUR High Court of Judicature at Allahabad

1. Heard Sri Virendra Singh along with Sri Hari Om Gupta, learned counsel for the applicants as well as Sri Vikas Sharma, learned State Law Officer for the State.

2. This is an application under Section 528 of BNSS preferred by the applicant for quashing the summoning order dated 21.11.2023 passed by of Judicial Magistrate/Addl. Civil Judge, Junior Division, Court No.4, Agra in complaint case 4508/2022 no. (Flonexs Oil N.I.Act, India Pvt. Ltd. Vs. Khushi Traders and another) u/s 138 Hari P.S. Parwati, Agra and entire proceeding of complaint case, pending in the court of Judicial Magistrate/Addl. Civil Judge, Junior Division, Court No.4, Agra.

3. The case of the applicants is that O.P. No.2 had lodged a complaint under Section 138 of N.I. Act against the applicants, who are two in number, with an allegation that with respect to discharge of a liability with regard to sale of mobile oil, the applicants had drawn a cheque bearing number "000003" of an amount Rs.8,60,645/- dated 04.03.2022, which on presentation in the bank on 04.03.2022 came to be dishonoured on 05.03.2022 with the remarks 'funds insufficient' followed by a statutory demand notice issued dated 17.03.2022, which is stated to have been delivered on 18.03.2022 followed by the complaint on 22.04.2022 and the applicants came to be summoned under Section 138 of N.I. Act on 21.11.2023.

4. Questioning the summoning order, the present application has been preferred.

5. Learned counsel for the applicants has submitted that the summoning order cannot be sustained for the simple reason, that though in the complaint, particularly in para-6, it has been asserted that the statutory demand notice came to be issued and has been served, but actually the said notice has not been served upon the applicants, as he seeks to rely upon para-11 and 18 of the application so as to contend that the address of the applicants is Belthara Road, Ballia and not Maunath Bhanjan. He further submits that once the statutory demand notice was not served as it was on a wrong and incorrect address, then it was clear cut case of infraction of provisions of Section 138 read with Section 142 of the N.I. Act, thus the offences under Section 138 of the N.I. Act cannot be made out. Further submission is that though mobil oil was purchased by the applicants from the O.P. No.2 but the same was sub-standard and certain amount was also paid and nothing remains to be due and the mobil oil was also returned to the O.P. No.2, thus it is submitted that there is no legal enforceable debt or liability.

6. Learned A.G.A. on the other hand submits that once a cheque stood drawn by the applicant, then presumption under Section 139 of the N.I. Act would be there.

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

8. Apparently, as per the allegations contained in the complaint, it is alleged that a cheque bearing number "000003" of an amount of Rs.8,60,645/- dated 04.03.2022 in favour of O.P. No.2, which came to be dishonoured with the remarks 'funds insufficient' on 05.03.2022. So far as the objection so sought to be raised by the learned counsel for the applicants that the statutory demand notice though came to be issued as alleged by the O.P, but it could not be served as address was incorrect, this Court at this stage is not required to go into the said aspect of the matter, particularly whether the applicant is resident of said place, which stands mentioned in the complaint, is a question of fact, which needs leading of evidence at the stage when the trial commences. For the ready reference, para-6 of the complaint is quoted herein:- "6. That complainant send demand notice to Accused/s on 17-03-2022 through Rahul Rathore Advocate via registered post said notices also delivered at (Maryadpur S.O.) on 18.03.2022. Computer generated internet delivery Report is annexed with complaint."

9. A perusal of para-6 of the complaint would reveal that the statutory demand notice came to be issued on 17.03.2022 and it is alleged that it came to be delivered Belthara Road on 18.03.2022. The question whether there was an actually delivery or not which as per page-34 of the paper book being a tracking report is a question of fact, consideration whereof would be required when raised at the stage, when the trial commences. Suffice would be a clear recital about the issuance of statutory demand notice. The question whether it was served or not is a question of trial. The Hon'ble Apex Court in the case of Ajeet Seeds Ltd. Vs. K. Gopala Krishnaiah, (2014) 12 SCC 685, in paragraph-10 and 11 has held 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 Court?s 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."

10. Apart from this, the objection of the applicants that there was no legal enforceable debt or liability fastened upon the applicant, particularly when the consignment of mobil oil stood returned and the certain payments were made and there is nothing due is a question, which is a subject matter of defence, consideration whereof would be at the stage, when the trial commences. Moreover, presumption under Section 139 of the N.I. Act would be there.

11. Accordingly, interference is declined. The application is disposed of leaving it open to the applicants to contest the trial before the court below while taking all the legal and factual grounds and this Court has no reason to disbelieve that the court below shall consider the same in correct perspective. Order Date :- 22.8.2025 N.S.Rathour (Vikas Budhwar, J) NIPENDRA SINGH RATHOUR High Court of Judicature at Allahabad