ALKA KHANDU AVHAD versus AMAR SYAMPRASAD MISHRA & ANR.

Citation: [2021] 2 S.C.R. 633 · Decided: 08-03-2021 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Appeal(s) allowed

Judgment (excerpt)

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ALKA KHANDU AVHAD
v.
AMAR SYAMPRASAD MISHRA & ANR.
(Criminal Appeal No.258 of 2021)
MARCH 08, 2021
[DR. DHANANJAYA Y. CHANDRACHUD AND
M. R. SHAH, JJ.]
Negotiable Instruments Act, 1881 – s.138 r/w S.141 –
Complaint filed against appellant – High Court refused to quash
the same – On appeal, held: Dishonoured cheque was issued by
original accused no.1-husband of the appellant – It was drawn on
his bank account and was signed by him – Appellant-original
accused no.2 was neither the signatory to the cheque nor the
dishonoured cheque was drawn from her bank account – Account
in question was not a joint account – s.138 does not speak about
the joint liability – Even in case of a joint liability, in case of
individual persons, a person other than a person who has drawn
the cheque on an account maintained by him, cannot be prosecuted
for offence u/s.138 – Appellant cannot be convicted with the aid of
s.141 either – High Court committed grave error in not quashing
the complaint against the appellant – Impugned judgment set aside
– Complaint case filed by respondent no.1-original complainant is
quashed.
Allowing the appeal, the Court
Held: 1.1 The dishonoured cheque was issued by original
accused No. 1 – husband of the appellant. It was drawn from the
bank account of original accused No. 1. The dishonoured cheque
was signed by original accused No. 1. The appellant herein-
original accused No. 2 is neither the signatory to the cheque nor
the dishonoured cheque was drawn from her bank account. That
the account in question was not a joint account. On a fair reading
of Section 138 of the NI Act, before a person can be prosecuted,
the following conditions are required to be satisfied: i) that the
cheque is drawn by a person and on an account maintained by
him with a banker; ii) for the payment of any amount of money to
[2021] 2 S.C.R. 633
633
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SUPREME COURT REPORTS
[2021] 2 S.C.R.
another person from out of that account for the discharge, in whole
or in part, of any debt or other liability; and iii) the said cheque 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. Therefore, a person who is the signatory
to the cheque and the cheque is drawn by that person on an
account maintained by him and the cheque has been issued for
the discharge, in whole or in part, of any debt or other liability
and the said cheque has been returned by the bank unpaid, such
person can be said to have committed an offence. Section 138 of
the NI Act does not speak about the joint liability. Even in case
of a joint liability, in case of individual persons, a person other
than a person who has drawn the cheque on an account maintained
by him, cannot be prosecuted for the offence under Section 138
of the NI Act. A person might have been jointly liable to pay the
debt, but if such a person who might have been liable to pay the
debt jointly, cannot be prosecuted unless the bank account is
jointly maintained and that he was a signatory to the cheque. [Paras
6,7][637-G-H; 638-A-G]
1.2 Section 141 of the NI Act is relating to the offence by
companies and it cannot be made applicable to the individuals.
Two private individuals cannot be said to be “other association
of individuals”. Therefore, there is no question of invoking Section
141 of the NI Act against the appellant, as the liability is the
individual liability (may be a joint liabilities), but cannot be said
to be the offence committed by a company or by it corporate or
firm or other associations of individuals. The appellant herein is
neither a Director nor a partner in any firm who has issued the
cheque. Therefore, even the appellant cannot be convicted with
the aid of Section 141 of the NI Act. Therefore, the High Court
has committed a grave error in not quashing the complaint against
the appellant for the offence punishable under Section 138 r/w
Section 141 of the NI Act. The impugned judgment and order
dated 21.08.2019 passed by the High Court refusing to quash
the criminal complaint against the appellant for the offence
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punishable under Section 138 read with Section 141 of the NI
Act is hereby quashed and set aside. The complaint case pending
in the Court of the learned Metropolitan Magistrate filed by
respondent No.1 – original complainant being C.C. No. 2802/SS/
2016 is hereby quash

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