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MADRAS HIGH COURT
Janarthanam, J.
R.M. Sundaram- Petitioner
versus
C.M. Ramraj - Respondent
Cri. M.P. No. 6447 of 1990
Decided on 18.12.1992
Counsel for the parties:
For the Petitioner - P.L. Narayanan, Advocate. For the Respondent - K.V. Sridharan, Advocate.

IMPORTANT POINT
Section 138(c) of Negotiable Instruments Act does not contemplate constructive notice hence written demand notice returned with postal endorsement "not found" cannot be said to have complied with provisions of section 138(c) of the Act.

Headnote:Negotiable Instruments Act - Section 138 Cheque returned unpaid due to insufficiency of funds - Written demand notice returned with postal endorsement "not found" - Section 138 does' not contemplate constructive notice Provision of sub section (c) of section 138 of the Act cannot be said to have been complied with. Complaint is liable to be dismissed.

       (Paras 9 to 10)

        Result: Petition allowed.

       

ORDER

Janarthanam, J. - One R.M. Sundaram drew a cheque dated 12.7.1989 for a sum of Rs. 15,000/- in favour of one C.M. Ramraj towards discharge of the dues by him in connection with the business transaction he had. The cheque so drawn had been presented by C.M. Ramraj through his Bank for collection on 26.12.1989 and the cheque so presented was stated to have been returned on 2.1.1990, as unpaid due to insufficiency of funds to the credit of R.M. Sundaram.

2. C.M. Ramraj in turn caused a lawyer's notice to be sent to him on 9.1.1990, giving him time for 15 days requiring the amount to be paid to him. The notice so issued was returned with the postal endorsement as 'not found'. No further notice had been issued.

3. However, a complaint had been launched by C.M. Ramraj as against R.M. Sundaram for alleged offences under section 138 of the Negotiable Instruments Act (for shori 'the act'), which was taken on file as C.C. No. 120/1990 on the file of the Judicial Magistrate No. VII, Coimbatore.

4. On receipt of process, accused R.M. Sundaram entered appearance through a counsel of his choice and before over the trial commenced, he came forward with the present action invoking the inherent jurisdiction of this court under section 482 of the Code of Crl. Procedure; 1973 to quash the criminal proceedings initiated against him.

5. Learned Counsel appearing for the petitioner/accused would submit that since the petitioner-accused had not received the notice, as contemplated by sub-section (c) of Sec. 138 of the Act, the prosecution, as launched, has to be thrown back, stock and barrel.

6. Learned counsel appearing for the Respondent complainant would however repel such a submission and what he would contend is that what is contemplated by the provision, as referred to by learned counsel appearing for the other side, in not the actual receipt of the notice, but even if there is any deliberate evasion of the receipt of the notice, then such an evasion must have to be construed as sufficient 'compliance' of the said provision.

7. Sub-section (b) of Section 138 of the Act requires the payee or the holder-in-due course of the cheque to issue a notice to the drawer of the cheque within 15 days of the receipt of the information by him from the bank regarding the return of the cheque as unpaid.

8. Sub-section. (c) there of further provides that the drawer has to comply with the demand within 15 days of the receipt of the said notice. Only if the demand is not complied with within the time so specified, the cause of action accrues for lodging of a complaint within a period of one month, as contemplated by sub-section (b) of the Section 142 of the Act. For determining the period of one month, the actual receipt of the notice, as contemplated under sub-section (c) of Section 138

is necessary and without such information, limitation, provided for the launching of prosecution under sub-section (b) of Section 142 cannot at all

be determined.

9. Sub-section (c) of (Section 138 does not at all contemplate any constructive notice. If constructive notice has been contemplated under the said sub-section by the Legislature, sufficient phraseology would have been utilised for such a purpose. The language used there in, namely, 'receipt of the said notice' unambiguously points

out actual receipt of notice.

10. In the case on hand notice issued had not been actually served, but it had been returned with a postal endorsement as 'not found'. Such being the case, it cannot at all be stated that the provisions of Sub-secti0n (c) of the said section had been duly complied with and the non-compliance of the said provision is sufficient enough for the prosecution to the thrown back, stock and barrel, as contended by learned counsel for the petitioner accused.

11. Assuming for arguments that the provisions of sub-section (c) of the said section contemplates constructive notice, even then it cannot, be stated that in the case on hand, there is a plausibility to come to the conclu





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