JUDGMENT :

The question referred to the Division Bench for being answered reads as under :-

“Whether in case the transaction, is not reflected in the Books of account and/or the Income Tax Returns of the holder of the cheque in due course and thus is in violation to the provisions of Section 269-SS of the Income Tax Act, 1961 whether such a transaction, can be held to be “a legally enforceable debt” and can be permitted to be enforced, by institution of proceedings under Section 138 of the Negotiable Instruments Act ?”

2. The reference arises in the light of the proceedings initiated by the appellant-complainant under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the Act of 1881’). The complainant had advanced a handloan of Rupees One Lakh Fifty Thousand to the respondent-accused. In lieu of that the accused issued a cheque for the aforesaid amount dated 19.05.2016 drawn in favour of the complainant. The said cheque was dishonoured for want of sufficient funds as per the Bank Advice dated 11.07.2016. On 13.07.2016 a statutory notice was issued under Section 138 of the Act of 1881. The trial Court dismissed the said complaint principally on the ground that the amount