IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.1101 OF 2008 (Arising out of SLP (Crl.) No.3650 of 2006)

M/s. Indo Automobiles           ...Appellant(s)  

Versus

M/s. Jai Durga Enterprises & Ors.  …Respondent(s)

O R D E R

1. Leave granted.

2. This appeal is directed against an order dated

17th of  May,  2006  passed  by  the  High  Court  of

Judicature  at  Allahabad  in  Criminal  Misc.

Application No.11313 of 2005.

3. In spite of due service,  no one has appeared

before us to contest this appeal.

4. We  have  heard  the  learned  counsel  for  the

appellant and perused the materials on record.

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NON-REPORTABLE

5. A  proceeding  under  Section  138  of  the

Negotiable  Instruments  Act  was  initiated  against

the  respondents.  In  the  said  proceeding,  the

Judicial Magistrate, First Class, Saharanpur passed

an  order  summoning  the  respondents  for  trial.

Challenging  the  aforesaid  order,  an  application

under  Section  482  of  the  Code  of  Criminal

Procedure  was  moved  by  the  respondents  for

quashing  the  summons.  The  High  Court  by  the

impugned order  had quashed the said proceeding

on  the  ground  that  no  notice  was  served  on  the

respondents.  

6. Feeling  aggrieved,  this  Special  Leave  Petition

was filed which, on grant of leave, was heard in the

presence of the learned counsel for the appellant.   

7. Having considered the materials on record and

after hearing learned counsel for the appellant, we

are of the view that the impugned Judgment of the

High  Court  cannot  be  sustained  for  the  reasons

stated hereinafter.  

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8. Admittedly, notice under Section 138B of the

Negotiable  Instruments  Act  was  sent  to  the

respondents  through registered  post  and under  a

certificate of posting on their correct address of the

respondents.  The  High  Court  had  quashed

proceeding  on  the  ground  that  although  notice

through registered post and also under certificate of

posting were sent by the appellant/ complainant to

the respondents but because of the endorsement of

the  postal  peon,  the  service  could  not  be  said  to

have been effected. In our view, the High Court was

not justified in holding that service of notice could

not  be  found  to  be  valid.   In  K.Bhaskaran  vs.

Sankaran  Vaidhyan  Balan  &  Anr.  [1999  (7)  SCC

510], it  has been held that the context  of section

138B  of  the  Negotiable  Instruments  Act  invites  a

liberal interpretation favouring the person who has

the statutory obligation to give notice under the Act

because he must be presumed to be the loser in the

transaction and provision itself  has been made in

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his interest and if a strict interpretation is asked for

that  would  give  a  handle  to  the  trickster  cheque

drawer. It is also well settled that once notice has

been sent by registered post with acknowledgment

due in a correct address, it must be presumed that

the service has been made effective. We do not find

from the endorsement of the postal peon that the

postal peon was at all examined.  In V. Raja Kumari

vs. P. Subbarama Naidu & Anr. [2004 (8) SCC 774],

again this Court reiterated the same principle and

held that the statutory notice  under Sections 138

and 142  of  the  Negotiable  Instruments  Act,  1881

sent  to  the  correct  address  of  the  drawer  but

returning with the endorsement must be presumed

to be served to the drawer and the burden to show

that  the  accused  drawee  had  managed  to  get  an

incorrect  postal  endorsement  letter  on  the

complainant  and  affixed  thereof  have  to  be

considered during trial on the background facts of

the case.  

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9. That  being  the  position,  we  are  unable  to

sustain  the  order  of  the  High  Court  and  the

impugned  order  is  set  aside  and  the  proceeding

started  under  Section  138  of  the  Negotiable

Instruments Act is restored to its original file. The

appeal is, therefore, allowed to the extent indicated

above. We, however, make it clear that at the trial

stage  on  the  question  of  interpretation,  postal

endorsement affixed thereof shall be considered on

the background facts of the present case.  

    ………………………….J.     [TARUN CHATTERJEE]

New Delhi;          ….………………………..J. July 15, 2008.                  [AFTAB ALAM]

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