N.I. Act offence cases, generally the Courts can apply the ratio in Indian Bank Associations case(2 supra) and treat the affidavits and documents filed by the complainant at pre-summoning stage as evidence also at post-summoning stage. The trial Court on appearance of accused examine him under Sec.251 Cr.P.C and post the case for defence evidence unless he files an application for recalling the complainant and his witnesses for cross-examination. However, when the trial Court is determining the stage of the case for the purpose of returning the file to complainant for presentation in proper Court in the light of Dashrath Rupsingh Rathods case(1 supra), it shall not treat the oral/written sworn statements along with documents submitted by the complainant at pre-summoning stage as evidence under Sec.145(2) of N.I.Act. So in the instant case, the trial Court ought to have held that recording of evidence has not commenced and consequently returned the file for presentation before appropriate Court. Therefore, the finding of the trial Court on the first ground cannot be countenanced. However, that is not the end of the matter. As per the impugned order, it appears, Honble Apex Court directed that all the cases between the parties for convenience sake shall be tried in a Court at Hyderabad. In view of the said specific order, the case on hand shall be continued before the trial Court irrespective of the decision in Dashrath Rupsingh Rathods case (1 supra).

THE HONBLE SRI JUSTICE U. DURGA PRASAD RAO          

Criminal Petition No.204 of 2015

03-06-2015

Sri Lakshmi Agencies, Vijayawada Rep. by its Partner B.Sudhakar and
another..... Petitioners

The State of Andhra Pradesh Rep. by its Public Prosecutor, High Court of
Judicature at Hyderabad For the State of Telangana and the State of Andhra
Pradesh, Hyderabadand another.. Respondents  

Counsel for Petitioners  : Sri P. Prabhakar Rao

Counsel for Respondent No.1 : Public Prosecutor

^Counsel for Respondent No.2 : Sri N. Naveen Kumar

<Gist:

>Head Note:

? Cases referred:
1)      2014 (2) ALD Crl.190 (SC) = (2014) 9 SCC 129
2)      AIR 2014 SC 2528 = (2014) 5 SCC 590  
3)      (1999) 7 SCC 510
4)      MANU/SC/0508/2015  
5)      MANU/AP/0129/2015  

HONBLE SRI JUSTICE U.DURGA PRASAD RAO        

CRIMINAL PETITION No.204 of 2015  

ORDER:
        In this petition filed under Section 482 Cr.P.C., the petitioners/A.1
and A.2 seek to quash the order dated 17.10.2014 in Crl.M.P.No.1725 of
2014 in C.C.No.84 of 2013 passed by learned III Special Magistrate,
Hyderabad, whereunder the learned Judge declined to return the complaint
to the complainant to present the case before an appropriate Court having
territorial jurisdiction in Vijayawada City.
2)      The factual matrix of the case is thus:
a)      The complainant originally filed C.C.No.110 of 2005 on 18.05.2005
under Sec.138 of N.I.Act against accused before Judicial Magistrate of First
Class, Gurgaon.  The case was transferred from Gurgaon to the Court at
Hyderabad and renumbered as C.C.No.135/2008 before XIV Additional
Chief Metropolitan Magistrate, Hyderabad.  The petitioners/A.1 and A.2
appeared before XIV Additional Chief Metropolitan Magistrate on
21.02.2008. Then A.3 appeared on 13.03.2008.  When the case was pending  
for the appearance of A.4 to A.7, it was transferred to XIII Special
Magistrate Court, Hyderabad.  A.3 to A.5 died on 08.08.2013. A.2, A.6 and
A.7 were present.  At this stage, the case was transferred from XIII Special
Magistrate Court, Hyderabad to III Special Magistrate, Hyderabad and
renumbered as C.C.No.84 of 2013.  A.1, A.2 and A.6 were examined under
Sec.251 Cr.P.C on 09.07.2014 for the offence under Sec.138 of N.I. Act and
the accused pleaded not guilty and claimed to be tried.
b)      When the case was posted for trial, petitioners/A.1 and A.2 filed
Crl.M.P.No.1725 of 2014 seeking for return of complaint to the
complainant for presentation before proper Court at Vijayawada City in
view of the ruling given by Apex Court in the case of Dashrath Rupsingh
Rathod vs. State of Maharashtra and another . Their case was that the
cheques involved in this case were drawn on Union Bank of India,
Vijayawada and issued by the accused to complainant and they were
presented at Gurgaon for collection of the cheques and subsequently the
cheques were bounced for the reason payment stopped by the drawer and
in view of the decision in Dashrath Rupsingh Rathods case(1 supra), the
Court in whose jurisdiction the cheque was bounced alone will have the
power to try the case and hence the case is to be returned to the
complainant.  The trial Court dismissed the application on two grounds:
i)      Firstly on the ground that though in Dashrath Rupsingh Rathods
case(1 supra) the Apex Court held that the Court within whose jurisdiction
the cheque was bounced will alone have jurisdiction to try the offence under
Sec.138 of N.I. Act, still depending upon the stage of the case Apex Court
exempted certain pending cases from being returned to the complainant.
According to the said ruling, if post the summoning and appearance of the
accused, the recording of evidence as envisaged in Sec.145(2) of N.I.Act
has commenced, the proceedings will continue in that Court and the case
need not be returned to the complainant.  Then the trial Court further
observed that in the instant case recording of evidence shall be deemed to
be commenced in view of another judgment of Apex Court rendered in
Indian Bank Association and others vs. Union of India (UOI) and
another . As per Para 16 coupled with direction No.4 of the said judgment,
the complainant is not required to examine himself twice i.e, once after
filing the complaint and once after summoning of the accused and the
affidavit and documents filed by him along with complaint for taking
cognizance of the offence are good enough to be read in evidence at both
the stages i.e, pre-summoning stage and post-summoning stage.
Subsequently when the accused appeared, the Court can examine him under  
Sec.251 Cr.P.C and post the case for defence evidence unless he files an
application under Sec.145(2) N.I.Act for recalling of complainant and his
witnesses for cross-examination.  The trial Court observed that in view of
this judgment, by the time accused appeared and examined under Sec.251
Cr.P.C, the evidence of complainant side shall be deemed commenced and
completed.
a)      By conjunctively applying these two Apex Court judgments to the
facts of the instant case, the trial Court observed that by the date of
examination of accused under Sec.251 Cr.P.C on 09.07.2014 the evidence
of complainant was already deemed to be commenced and further, the
accused did not file any application under Sec.145(2) N.I Act to recall the
complainant for cross-examination and hence, the complaint need not be
returned for presentation before proper Court.
ii)     Secondly, on the ground that Honble Apex Court in Transfer
Petition (Criminal) Nos.161-171 of 2005 dated 03.03.2006 directed that all
the cases pending between complainant and accused shall be tried by a
Court at Hyderabad and for this reason also the case cannot be returned.
3)      Heard learned Counsel for petitioners.  Notice to R.2 was unserved.
4)      Learned counsel for petitioners has argued that the trial Court has not
properly applied the ratio in Dashrath Rupsingh Rathods case
(1 supra) and prayed to allow the petition.
5)      The point for determination is:
     Whether there are merits in this petition to allow?
6)      POINT: On perusal of the record and the two Apex Court decisions,
it must be said that the trial Court has not properly applied the ratio of the
two decisions to the case on hand.  The impugned order would show that on
09.07.2014, A.1, A.2 and A.6 were examined by the trial Court under
Sec.251 Cr.P.C and they pleaded not guilty and claimed to be tried and
hence the matter was posted for trial.  This was the stage when the accused
filed Crl.M.P.No.1725 of 2014 relying upon the judgment in Dashrath
Rupsingh Rathods case (1 supra).  The dates of judgments of Apex Court
in Indian Bank Associations case (2 supra) and Dashrath Rupsingh
Rathods case (1 supra) are important for the purpose of this case.  The
former judgment was on 21.04.2014 and latter was on 01.08.2014.  In the
judgment of Indian Bank Associations case (2 supra), the Apex Court
gave certain directions for expeditious disposal of N.I. Act offences.   As
rightly observed by the trial Court, Para 16 and Direction No.4
(MANU/SC/0387/2014) are relevant. Para 16 would show that a
complainant need not be examined twice i.e, once at pre-cognizance stage
and latter at post-cognizance stage.  Affidavits and documents filed by him
along with complaint can be treated as his evidence at both stages.  In other
words, there is no necessity to recall and reexamine the complainant after
summoning the accused unless the Magistrate passes a specific order as to
why the complainant was to be recalled. Then as per direction No.4, after
appearance of the accused the Court should direct him to furnish bail-bond
to ensure his appearance during trial and examine him under Sec.251
Cr.P.C to enable him to enter his plea of defence and post the case for
defence evidence unless an application is made by the accused under
Sec.145(2) N.I.Act for recalling of complainants witnesses for cross-
examination. When the ratio in the above decision is applied to the instant
case, it is no doubt true that by 09.07.2014 when A.1, A.2 and A.6 were
examined under Sec.251 Cr.P.C, the trial was already deemingly
commenced.  
7)      Then coming to Dashrath Rupsingh Rathods case (1 supra), it was
delivered on 01.08.2014.  The principal ratio in that decision is that
prosecution in offences under Sec.138 of N.I.Act has to be launched against
the drawer of the cheque only before the Court within whose jurisdiction
the dishonor took place. In this process, the earlier judgment in
K.Bhaskaran vs. Sankaran Vaidhyan Balan  which permitted prosecution
of N.I.Act offences at any one of the five different places indicated in that
judgment was overruled.  However, considering the impact of this decision
on the pending cases, Honble Apex Court has carved out an exception to
the pending cases depending upon the stage of the case as follows:
     Para 20: xx xx
Consequent on considerable consideration we think it expedient to
direct that only those cases where, post the summoning and
appearance of the alleged Accused, the recording of evidence has
commenced as envisaged in Section 145(2) of the Negotiable
Instruments Act, 1881, will proceeding continue at that place. To
clarify, regardless of whether evidence has been led before the
Magistrate at the pre-summoning stage, either by affidavit or by oral
statement, the Complaint will be maintainable only at the place
where the cheque stands dishonoured..
        So in a pending case if  by 01.8.2014, the recording of evidence has
been commenced as envisaged under Sec.145(2) of N.I.Act, then that case
need not be returned to be presented to the Court which has territorial
jurisdiction as laid down in Dashrath Rupsingh Rathods case (1 supra).  If
that stage is not reached, the case shall be returned to the complainant for
fling in a proper Court.  Apex Court has given the clarification as to what
amounts to the commencement of recording of evidence as envisaged under
Sec.145(2) N.I Act.  If at the pre-summoning stage i.e, pre-cognizance stage
if the complainant gave his sworn statement either by affidavit or by oral
statement, that cannot be treated as commencement of recording of
evidence under Sec.145(2) of N.I. Act.  This aspect has been emphasized in
the subsequent judgment of Apex Court and by this High Court.
a)      In the case of Ultra Tech Cement Ltd. vs. Rakesh Kumar Singh and
others , the Apex Court further clarified the ratio of Dashrath Rupsingh
Rathods case (1 supra) as follows:
        Para 5: On a perusal of the conclusions drawn in paragraph 22,
extracted hereinabove, we feel that the proceedings initiated prior to
the rendering of the judgment in Dashrath Rupsingh Rathod's case
(supra) on 01.08.2014, will be preserved at the place they were filed,
only when "post the summoning and appearance of the alleged
accused, the recording of evidence has commenced as envisaged in
Section 145(2) of the Negotiable Instruments Act, 1881". In order to
further explain its intent, the judgment clarifies, that merely leading
of evidence at the pre-summoning stage, either by way of affidavit or
by oral statement will not exclude applicability of the judgment in
Dashrath Rupsingh Rathod's case (supra). The above judgment,
thereby seeks to confirm the position, that only when recording of
evidence at the post-summoning stage had commenced, before  
01.08.2014 (the date on which the judgment in Dashrath Rupsingh
Rathod's case was pronounced), such proceedings would not be
dislodged.

b)      This High Court in Kalakoti Niranjan Reddy vs. State of Andhra
Pradesh  has observed thus:
Para 9: xx xx
It must be noted that the Apex Court has given the clarification
also regarding what amounts to the commencement of recording of
evidence as envisaged under Sec.145(2) of N.I. Act. If at the pre-
summoning stage i.e., pre-cognizance stage the complainant led
evidence either by affidavit or by oral statement, that cannot be
treated as commencement of the recording of the evidence as
envisaged under Sec.145(2) of N.I. Act. Such sworn statement in the
form of oral submission or written affidavit given by the complainant
for taking cognizance of the case cannot be treated as evidence in
the main case for deciding whether or not to transfer the case. From
this clarification of Hon'ble Apex Court, it is manifest that when only
sworn statement in the form of written affidavit or oral statement
which was reduced to writing was available but no evidence in trial
was commenced in terms of Sec.145(2) of N.I. Act, the case is liable
to be returned to the complainant for filing in the proper court. This
is the obvious intendment of the Apex Court.
8)      So when the judgments in Indian Bank Associations case (2 supra)
and Dashrath Rupsingh Rathods case (1 supra) are studied, there appears
to be a dichotomy in the matter of treating the oral/written sworn statements
along with documents submitted by the complainant for taking cognizance
as evidence at post-cognizance stage. As per Indian Bank Associations
case (2 supra), the complainant need not be examined twice and the affidavit
and other documents filed by him along with complaint for taking
cognizance are good enough to be read in evidence at both stages i.e, pre-
summoning stage and post-summoning stage.  However, as per Dashrath  
Rupsingh Rathods case(1 supra), leading of evidence at the pre-summoning
stage either by way of affidavit or by oral statement cannot be treated as
commencement of recording of evidence under Sec.145(2) of N.I. Act.
9)      In view of above dichotomy, the harmonious interpretation is
necessary for applying the ratio in both the judgments. So in N.I. Act offence
cases, generally the Courts can apply the ratio in Indian Bank Associations
case(2 supra) and treat the affidavits and documents filed by the complainant
at pre-summoning stage as evidence also at post-summoning stage.  The trial
Court on appearance of accused examine him under Sec.251 Cr.P.C and post  
the case for defence evidence unless he files an application for recalling the
complainant and his witnesses for cross-examination. However, when the
trial Court is determining the stage of the case for the purpose of returning
the file to complainant for presentation in proper Court in the light of
Dashrath Rupsingh Rathods case(1 supra), it shall not treat the oral/written
sworn statements along with documents submitted by the complainant at
pre-summoning stage as evidence under Sec.145(2) of N.I.Act.  So in the
instant case, the trial Court ought to have held that recording of evidence has
not commenced and consequently returned the file for presentation before
appropriate Court.  Therefore, the finding of the trial Court on the first
ground cannot be countenanced.  However, that is not the end of the matter.
As per the impugned order, it appears, Honble Apex Court directed that all
the cases between the parties for convenience sake shall be tried in a Court at
Hyderabad.  In view of the said specific order, the case on hand shall be
continued before the trial Court irrespective of the decision in Dashrath
Rupsingh Rathods case (1 supra).

10)     In the result, with the above observation, this Criminal Petition is
dismissed.
        As a sequel, miscellaneous applications pending, if any, shall stand
closed.
_________________________  
U. DURGA PRASAD RAO, J    
Date: 03.06.2015