Devendra Kishanlal Dagalia vs Dwarkesh Diamonds Pvt Ltd and Ors(2014): Supreme Court on issuance of summons under section 204 of CrPC

Devendra Kishanlal Dagalia vs Dwarkesh Diamonds Pvt Ltd and Ors, (2014) 2 SCC 246

Before the Supreme Court of India

Decided on: 25 November 2013

Bench: Sudhansu Jyoti Mukhopadhaya, V. Gopala Gowda

Author of the judgment: SUDHANSU JYOTI MUKHOPADHAYA, J.

Cases Referred:

  1.  M/s. Escorts Limited vs. Rama Mukherjee(Criminal Appeal No.1457 of 2013), 2013 (11) Scale 487
  2. Bhaskaran vs. Shankaran Vaidhyam Balan & Anr., (1999) 7 SCC 510
  3.  Adalat Prasad vs. Rooplal Jindal and others, (2004) 7 SCC 338

Brief facts and procedural history:

The appellant filed complaints under Section 138 of Negotiable Instruments Act (hereinafter referred to as ‘the N.I. Act’) in the Court of the Special Metropolitan Magistrate at Small Causes Court on 28th July, 2008 and 18th August, 2008. Learned Metropolitan Magistrate after recording of the pre-summoning evidence issued summons on the accused under Section 204 Cr.P.C.

The accused-respondents 1, 2 & 3 then filed application under Section 201 Cr.P.C. for return of complaint for want of jurisdiction. They alleged that the entire transaction took place in New Delhi and only the legal notice was issued from Mumbai and hence the learned Magistrate has no jurisdiction to try and entertain the complaint. Thereafter, the learned Magistrate by order dated 5th January, 2010 allowed the application under Section 201 Cr.P.C. and returned the complaint for want of jurisdiction.

Being aggrieved, the appellant-complainant filed Criminal Revision Applications before the Sessions Court, Greater Bombay. Learned Sessions Judge by the judgment and order dated 2nd November, 2011 allowed the criminal revision applications and set aside the orders of learned Magistrate and the matter was remitted back to the Magistrate. However, at the instance of Respondent Nos.1, 2 & 3 the order passed by the Sessions Judge was set aside by the High Court by the order impugned.

Arguments of the appellants:

  • The Magistrate after finding sufficient ground for proceeding and after issuance of summons under Section 204 Cr.P.C. has no jurisdiction to recall or review the order by exercising power under Section 201 Cr.P.C.
  • It is further contended that the High Court failed to consider the aforesaid fact and has no answer to the issue as was raised and decided by the learned Magistrate.
  • Further, in the matter underSection 138 of the N.I.Act the appellant having been issued legal notice from Mumbai, the Magistrate has jurisdiction to try and entertain the complaint.

Arguments of the respondent:

  • The High Court of Bombay has taken due course and settled all the questions raised in the complaint filed by the appellant.
  • The complaint filed by the appellant is silent with regard to place where
    • the order was given by the respondent;
    • goods were supplied;
    • the payment was agreed to be made;
    • the cheques in question were issued;
    • the cheques in question were dishonoured and
    • the parties to the petition intended to make and receive the same. It is accepted that the notice in question was issued from Mumbai.
  • It is contended that issuance of notice would not by itself give rise to a cause of action for filing the complaint at Mumbai.
  • Further, the appellant has concealed the relevant facts purposefully, particularly the fact that the entire transaction had taken place at Delhi and, therefore, the Magistrate has returned the complaint underSection 201 Cr.P.C.

Issues:

(i) Whether the Magistrate after having found sufficient ground for proceeding in case and issued summons under Section 204 Cr.P.C. has the jurisdiction to recall or review the order by exercising its power under Section 201 Cr.P.C.; and

(ii) Whether the petition under Section 138 of the N.I. Act was maintainable at Mumbai on the ground that goods were supplied from Mumbai to Delhi and cheques were handed over at Mumbai and legal notice was issued from Mumbai.

Ratio:

Chapter XV of Cr.P.C. relates to complaints to the Magistrates whereas Chapter XVI relates to the commencement of proceedings before the Magistrates.

Section 200 of Cr.P.C. relates to examination the of complaint. A Magistrate taking cognizance of an offence on complaint is required to examine the complaint and both the complainant and witness present, if any. On such examination of the complaint and the witness, if the Magistrate is of the opinion that there is no ground for proceeding, he has to dismiss the complaint under Section 203 Cr.P.C.

 Section 201 Cr.P.C. lays down the procedure to be followed by the Magistrate not competent to take cognizance of the offence. If the complaint is made to a Magistrate who is not competent to take cognizance of the complaint he shall return the written complaint for its presentation before a proper court and if the complaint is not in writing, direct the complainant to move before the proper court.

Section 202 contemplates “postponement of issue of process” on receipt of a complaint in the circumstances mentioned therein. If the Magistrate is of the opinion that there is no sufficient ground for proceeding, under Section 203 Cr.P.C. he can dismiss the complaint by briefly recording his reasons.

The commencement of proceedings before the Magistrate under Chapter XVI starts with issue of process under Section 204 Cr.P.C. If in the opinion of a Magistrate taking cognizance of the offence there is sufficient ground for proceeding, and the case appears to be a summons- case, he shall issue his summons for the attendance of the accused, but if it is a warrant-case, he may issue a warrant, or, if he thinks fit, a summons, for causing the accused to be brought or to appear at a certain time before such Magistrate or (if he has no jurisdiction himself) some other Magistrate having jurisdiction. No summons or warrant shall be issued against the accused under sub-section (1) until a list of the prosecution witnesses has been filed. In a proceeding instituted upon a complaint made in writing, every summons or warrant issued under sub-section (1) shall be accompanied by a copy of such complaint.

The aforesaid provisions make it clear that the Magistrate is required to issue summons for attendance of the accused only on examination of the complaint and on satisfaction that there is sufficient ground for taking cognizance of the offence and that it is competent to take such cognizance of offence.

Once the decision is taken and summon is issued, in the absence of a power of review including inherent power to do so, remedy lies before the High Court under Section 482 Cr. P.C or under Article 227 of the Constitution of India and not before the Magistrate.

Section 201 Cr.P.C., as noticed earlier, can be applied immediately on receipt of a complaint, if the Magistrate is not competent to take cognizance of the offense. Once the Magistrate taking cognizance of an offense forms his opinion that there is sufficient ground for proceeding and issues summons under Section 204 Cr.P.C., there is no question of going back following the procedure under Section 201 Cr.P.C. In absence of any power of review or recall the order of issuance of summons, the Magistrate cannot recall the summon in the exercise of power under Section 201 Cr.P.C. The first question is thus answered in negative and in favor of the appellant.

In the case in hand it is admitted that the business dealing was held at Mumbai; the products were supplied from Mumbai to New Delhi, cheques were handed over at Mumbai and the cheques were dishonored by the bankers of respondents at New Delhi, and legal notice was issued from Mumbai. Thus, at least one act out of the five ingredients of Section 138 of the Act having committed at Mumbai, the complaint preferred by the complainant before the Magistrate at Mumbai was maintainable. The second question is thereby, answered in affirmative and in favor of the appellant.

Held:

The order passed by the High Court was set aside and the order of the sessions judge was upheld. The appeal was thus allowed.

 

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