IMPORTANT POINTS
Limitation of six months under N.I.Act would expire one day prior to the date in the corresponding month and in case no such day falls, the last day of the immediate previous month.

Headnote:(a) Negotiable Instruments Act, 1881 – Section 138 – Limitation of six months – Month – Defined in section 3(35) of General Clauses Act – Means a month reckoned according to the British calendar – Period of six months cannot be calculated on 30 days in a month basis. (Para 14)
       1998 CRL.L.J. 4330; (2009) 13 SCC 623 – Distinguished
       (b) Negotiable Instruments Act, 1881 – Section 138 – Limitation of six months – Date of commencement – In case of ambiguity Section 9 of General Clauses Act should be resorted to – Six months to be determined on the day in corresponding sixth month – When no such day falls in the corresponding month and therefore the last day would be last date of the immediate previous month – Date on which cheque is drawn to be excluded – Cheque drawn on 31.12 2005 – Presented on 30.6.2006 – Six months would expire one day prior to the date in the corresponding month and in case no such day falls, the last day of the immediate previous month – Date on which the cheque was drawn, i.e., 31.12.2005 will be excluded and the period of six months will be reckoned from the next day i.e. from 1.1.2006 – Thus period of six months would expire at the end of the 30th day of June, 2006 – Cheque presented on 30.6.2006, i.e., within the period prescribed. (Para 18, 20, 25)
       (1972) 1 SCC 639; (1999) 3 SCC 1; AIR 2013 SC 3283 – Relied upon
       (2009) 13 SCC 623; (2009) 13 SCC 623 – Distinguished
       Facts of the case:
       The appellant had taken loan of 1,00,000 from his friend (Respondent) and in that connection he issued a cheque which was dishonoured.
       Respondent filed a complaint and cognizance was taken.
       Appellant’s application for discharge was rejected.
       His application for revision and one under section 482 CrPC was also rejected.
       Interpretation of the limitation for presenting cheque to Bank has come up before the Court.
       Finding of the Court:
       Cheque was presented within limitation period.

Judgement Key Points

Key Points: - The period of six months under Section 138 of the Negotiable Instruments Act is calculated using the British calendar, where the word "month" means a month as per that calendar (!) . - The date on which the cheque is drawn must be excluded, and the six-month period runs from the next day (!) (!) . - If no corresponding day exists in the sixth month, the period expires on the last day of that month; here, the cheque drawn on 31 December 2005 became payable within the six-month period as it was presented on 30 June 2006 (!) (!) .

How is the six-month limitation period under Section 138 of the Negotiable Instruments Act calculated when the cheque is drawn on the last day of a month?

JUDGMENT :

CHANDRAMAULI KR. PRASAD, J. –

According to the complainant-respondent No. 2, the accused-petitioner, Rameshchandra Ambalal Joshi was his friend, who had taken a loan of Rs.1,00,000/- (Rupees one lac only) from the complainant. The petitioner issued a cheque dated 31st of December, 2005 towards repayment of the loan. The cheque presented for payment by the complainant on 30thof June, 2006 was dishonoured on the ground of insufficiency of funds on the same day. A registered notice dated 25th of July, 2006 was then sent by the complainant to which the petitioner replied. The complainant then filed Criminal Case No. 2146 of 2006 on 5th of September, 2006 alleging commission of offence under Section 138 of the Negotiable Instruments Act,1881 (hereinafter referred to as 'the Act') in the Court of Judicial Magistrate, First Class, Borsad, who took cognizance of the offence and issued summons to the petitioner.

An application for discharge was filed by the petitioner before the trial court inter alia contending that as a period of six months had lapsed between the date of drawl of the cheque on 31st of December, 2005 and its presentation by the complainant on 30th of June, 2006 for payment, the petitioner cannot be prosecuted. The prayer of the petitioner was rejected by the trial court on its finding that the provisions of discharge were not applicable to the present proceeding, they being in the nature of summons trial. A criminal revision application against the aforesaid order, filed by the petitioner before the Court of Sessions, Anand was rejected by an order dated 5th of May, 2009, which the petitioner assailed in a petition filed under Section 482 of the Code of Criminal Procedure before the High Court.

The High Court by its order dated 20th of August, 2010 rejected the application of the petitioner, observing as under: "7. Though the submission has been made by the learned counsel, Mr. Hakim raising the contention with regard to the limitation, bare perusal of the provisions of Section 138 of the Negotiable Instrument Act, would make it clear that what law provides is presentation within a period of six months, meaning thereby, the Legislature has provided the period of six months by way of limitation. It is also clear that each month may not have same number of days and, therefore, wisely what has been provided in terms of months and not exact date or days, meaning thereby, 180 days.

Therefore, cheque drawn on the last date of month of December would remain valid for a period of six months and the period of six months would expire after the last date of June i.e. 30th June, 2006. Therefore, in the facts and circumstances of the case, as the cheque has already been presented on 30th June, 2006, it cannot be said that it is barred by limitation. Therefore, the submission made by the learned counsel, Hakim cannot be readily accepted." It is against this order that the petitioner has preferred this special leave petition. Leave granted. Mr. Huzefa Ahmadi, learned senior counsel draws our attention to proviso (a) of Section 138 of the Negotiable Instruments Act and contends that to attract its mischief the cheque is required to be presented in the Bank within six months from the date of its drawl.

Otherwise, Section 138of the Act would not apply. Section 138 of the Act, which is relevant for our purpose reads as follows: "138. Dishonour of cheque for insufficiency, etc., of funds in the account.- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, 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 a

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2014 Supreme(SC) 113

SUPREME COURT OF INDIACHANDRAMAULI KR. PRASAD, JAGDISH SINGH KHEHAR, JJ.RAMESHCHANDRA AMBALAL JOSHI – APPELLANTVERSUSTHE STATE OF GUJARAT AND ANR. – RESPONDENTSCRIMINAL APPEAL No. 434 OF 2014(@ SPECIAL LEAVE PETITION(CRL.)No. 7595 of 2011)Decided On : 18-02-2014

IMPORTANT POINTSLimitation of six months under N.I.Act would expire one day prior to the date in the corresponding month and in case no such day falls, the last day of the immediate previous month.

How is the six-month limitation period under Section 138 of the Negotiable Instruments Act calculated when the cheque is drawn on the last day of a month?

Cases Referred (4)

SUPREME COURT OF INDIA
CHANDRAMAULI KR. PRASAD, JAGDISH SINGH KHEHAR, JJ.
RAMESHCHANDRA AMBALAL JOSHI – APPELLANT
VERSUS
THE STATE OF GUJARAT AND ANR. – RESPONDENTS
CRIMINAL APPEAL No. 434 OF 2014(@ SPECIAL LEAVE PETITION(CRL.)No. 7595 of 2011)
Decided On : 18-02-2014

IMPORTANT POINTS
Limitation of six months under N.I.Act would expire one day prior to the date in the corresponding month and in case no such day falls, the last day of the immediate previous month.