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SUPREME COURT OF INDIA
B.R. GAVAI, CJI., N.V. ANJARIA, JJ.
Kaveri Plastics – Appellant
Versus
Mahdoom Bawa Bahrudeen Noorul – Respondent
Criminal Appeal Nos. 4142-4143 of 2025 (@ Special Leave Petition (Crl.) Nos. 11184-11185 of 2024)
Decided On : 19-09-2025
Negotiable Instruments Act, 1881 – Section 138, Proviso (b) – Dishonour of cheque – Notice – Notice to be issued under Proviso (b) to Section 138 of Act, must mention same amount for which cheque was issued – It is mandatory that demand in statutory notice has to be the very amount of cheque – After mentioning exact cheque amount, sender of service may claim in notice amounts such as legal charges, notice charges, interest and such other additional amounts, provided cheque amount is specified to be demanded for payment – Even if cheque details are mentioned in notice but corresponding amount of cheque is not correctly mentioned, it would not bring in law validity for such notice – Here, principle of reading of notice as a whole is inapplicable and irrelevant – Any elasticity cannot be adopted in interpretation – It has to be given technical interpretation – Condition of notice under Proviso (b) is required to be complied with meticulously – Even typographical error can be no defence – Notice demanding payment of amount covered by dishonoured cheque is one of main ingredients of offence under Section 138 of NI Act – In the event of main ingredient not being satisfied on account of discrepancy in amount of cheque and one mentioned in notice, all proceedings under Section 138 of NI Act would fall flat as bad in law. (Paras 8, 8.1 and 8.2)
Facts of the case:
When amount mentioned and demanded in notice sent under Proviso (b) to Section 138 of Negotiable Instruments Act, 1881, to payee or holder in due course of cheque, is different from amount for which cheque was issued, whether notice would stand valid in eye of law; whether a defence that such was a typographical error could be a ground which could be countenanced in law - are the questions falling for consideration in the present appeals.
Findings of Court:
Even if the cheque number was mentioned in the notice, since the amount was different, it created an ambiguity and differentiation about the ‘said amount’. The notice stood invalid and bad in law. The order of quashment of notice was eminently proper and legal. No case is made out for interfering with impugned order of High Court.
Result : Appeals dismissed.
Based on the provided legal document, the key legal principles and findings are as follows:
The validity of a legal notice under Proviso (b) to Section 138 of the Negotiable Instruments Act, 1881, hinges on its strict compliance with the requirement that the notice must specify the exact amount for which the cheque was issued. Any discrepancy between the amount mentioned in the notice and the cheque amount renders the notice invalid and lawfully defective (!) (!) (!) .
The phrase ‘said amount of money’ in Proviso (b) refers specifically to the amount of the dishonoured cheque. The notice must demand payment of this precise amount; demanding a different amount, even if it appears to be a typographical error, is considered a fatal defect and invalidates the notice (!) (!) (!) (!) (!) .
The requirement for meticulous and strict compliance with the conditions laid out in Section 138 is emphasized, especially because the offence is of a penal nature. Any technical deviation, including incorrect mention of the cheque amount, can lead to the quashing of proceedings initiated under Section 138 (!) (!) .
The courts have consistently maintained that the demand in the statutory notice must be for the exact amount of the dishonoured cheque. Any deviation, even if unintentional or due to typographical error, is unacceptable and results in the invalidity of the notice (!) (!) (!) (!) .
When there is a discrepancy in the amount demanded in the notice versus the cheque amount, the proceedings under Section 138 of the Act are rendered legally void. The technical requirement of the notice's correctness cannot be relaxed or overlooked (!) (!) .
Overall, the legal framework mandates a strict, technical interpretation of the statutory provisions related to the issuance of demand notices under Section 138, emphasizing that the exact cheque amount must be explicitly mentioned in the notice for it to be valid (!) (!) (!) .
In conclusion, for a notice to be valid under Proviso (b) to Section 138, it must explicitly mention the same amount as the dishonoured cheque. Any inconsistency, including typographical errors, invalidates the notice and consequently affects the validity of subsequent proceedings under Section 138.
JUDGMENT
N.V. ANJARIA, J.
Leave granted.
2. When the amount mentioned and demanded in the notice sent under Proviso (b) to Section 138 of the Negotiable Instruments Act, 1881, to the payee or the holder in due course of the cheque, is different from the amount for which the cheque was issued, whether the notice would stand valid in eye of law; whether a defence that such was a typographical error could be a ground which could be countenanced in law - are the questions falling for consideration in the present appeals.
2.1. The appeals arise out of the judgment and order dated 26.02.2024 in Crl. M.C. No.2164 of 2022 and Crl. M.A. No.9155 of 2022 passed by the High Court of Delhi whereby the High Court quashed the Criminal Complaint No.523804 of 2016 filed by the respondent herein under Sections 138, 141 and 142 of the Negotiable Instruments Act, 1881 (hereinafter referred to as ‘the NI Act’), on the ground that amount mentioned in the notice was not the same as per the cheque, which rendered the notice invalid.
3. Stated in brief, the facts in the background are inter alia that a complaint came to be filed by the appellant herein against the respondent-arraigned as accuse No.3, alleging that accused No.1-M/s. Nafto Gaz India Private Limited entered into Memorandum of Understanding with the appellant-complainant on 30.04.2012 relating to sale of land. A cheque bearing number 876229 dated 12.05.2012 drawn on the Indian Overseas Bank, R.K. Puram, Delhi for Rs.1,00,00,000/- was issued by the accused No.1 in favour of the appellant, which returned dishonoured on the ground ‘funds insufficient’.
3.1 The appellant issued demand notice dated 08.06.2012. The relevant part of said notice is extracted hereunder.
| CHEQUE NO. | DATE | BANK & BRANCH | AMOUNT |
| 876229 | 30.04.2012 | Indian Overseas Bank, B/o R.K. Puram | 1 Crore 1,00,00,000/- |
I, hereby call upon you to make the payments of the aforesaid cheques of 2,00,00,000/- (Rupees Two Crores) within the stipulated period of 15 days from the date of receipt of this legal notice failing which I have definite instructions from my client to initiate legal proceedings, against you which please note shall solely be at your risk and cost. Copy kept.”
3.2 Another notice dated 14.09.2012 was issued to accused No.1- M/s. Nafto Gaz India Private Limited and its Directors through the advocates. Relevant portion thereof is extracted hereinbelow:
Under instructions and on behalf of my client Sh. Deepak Gupta, S/o Sh. Rameshwar Dass, R/o 3862, Gali No.1, Pahari Dheeraj, Sadar Bazar, Delhi - 110006 and on the basis of the documents provided, I serve upon you the following legal notice;
1. That my client is a law abiding citizen residing at the abovementioned address for the past many years.
2. That you the noticee no.1 is a company registered under the Indian Companies Act, 1956 having its office at the abovementioned address while the noticees no. 2-5 are Directors of the noticee no. 1 Company and are responsible for day to day working of the noticee no. 1 company and the noticee no. 6 is the authorised signatory of the noticee no.1 company and noticees No.2-6 are responsible for day to day activities of the noticee no.-1 company.
3. That you the notice no.1 entered into a Memorandum of Understanding with my client on 30.04.2012 pertaining sale of land bearing Khasra No. 75, Khewat No. 61, Khata No. 112 and Khatoni No. 61/14, Village — Humayunpur situated in Abadi of Arjun Nagar, New Delhi and also agreed to take on lease the property till the final sale deed is executed and issued certain cheques towards your liability for rent of leased property.
4. That in pursuance of the MoU, in terms of part liability towards my clients, you the notices issued the following cheque:
| CHEQUE NO. | DATE | BANK & B | |
Dishonour of cheque – When amount mentioned and demanded in notice sent under Proviso (b) to Section 138 of Negotiable Instruments Act, 1881, to payee or holder in due course of cheque, is different ....
A demand notice issued under Section 138 (proviso b) of the Negotiable Instruments Act must specifically state the amount of money demanded; failure to specify the amount renders the notice invalid f....
The legal notice must demand only the cheque amount for the maintainability of a complaint under Section 138 of the NI Act, as per the interpretation of Proviso (b) to Section 138 of the NI Act.
The legal notice under section 138 of the N.I. Act serves the purpose of intimating the drawer about the liability to remit the amount, and a literal interpretation of the law should be avoided to pr....
The main legal principle established is that the sufficiency of a notice of demand for a dishonoured cheque under Section 138 of the N.I. Act does not require explicit language demanding the cheque a....
Point of law : Negotiable instruments - Though in the notice, the demand for compensation, interest, cost, etc. is also made, the drawer will be absolved from his liability under Section 138 of the N....
Dishonour of cheque – By making a higher demand in a notice sent under Section 138(b) of N.I. Act, would not by itself invalidate notice provided, details of claim towards additional amounts are spec....
The demand notice under section 138 of NI Act should specifically ask for the payment of the cheque amount within the stipulated period.
A valid notice under Section 138 of the NI Act must specify the cheque amount, while additional claims can be made if clearly distinguished.
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