IMPORTANT POINT
Dishonour of cheque for the reason “account closed” is an offence if account is closed with guilty mind.

R. Basant, J.—Does a cheque issued after the date of closure of the account fall within the , sweep of Section 138 of the Negotiable Instruments Act? This is the question of law thrown up for consideration in this appeal against an appellate Judgment of acquittal.

2. Fundamental facts are not in dispute. The cheque in question is Ext. P1. It is dated 23.12.1991. It was dishonoured on 21.1.1992. The account on which the cheque was drawn was closed by the accused long earlier on 30.1.1990. The cheque was dishonoured on the ground that the account was closed. Signature in the cheque is admitted. The accused con- tended that the cheque was not issued for the due discharge of any legally enforceable debt/liability to the complainant. It was issued to another person one Vijayan by name. The obvious suggestion was that the undated cheque handed over to the said Vijayan as security was being misused by the complainant.

3. P.Ws. 1 to 3 were examined and Exts. P1 to P6 were marked. On the side of the accused D.Ws. 1 to 3 were examined and Exts.D1 to D4 were marked.

4. The trial Court held that all ingredients of the offence punishable under Section 138 of the Negotiable Instruments Act have been established. The appellate Court took the view that Section 138 of the Negotiable Instruments Act does not apply to a cheque issued after the date of closure of the account. It was further held that the cheque is not proved to be one issued for the due discharge of any legally enforceable debt/liability.

5. Arguments have been heard. It will be apposite to extract Section 138 of the Negotiable Instruments Act. Proviso is omitted as it is not of relevance here.

“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 account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of the cheque, or with both.” (emphasis supplied)

6. The short argument of the learned Counsel for the accused is that to attract Section 138 of the N.I. Act the cheque must be one drawn “on an account maintained by him”. It is not enough if it is a cheque drawn “on an account (which was) maintained by him”. Inasmuch as there was no live account on the date of issue of the cheque. Section 138 of the N.I. Act can have no application at all.

7. On the contrary, the learned Counsel for the appellant/complainant contends that the expression “on an account maintained by him” cannot have any artificial or unrealistic connotation. The cheque must be drawn on an account which the accused maintained with the bank. The status of the account whether it was live or dead on the date of the cheque, is irrelevant. It must be an account which the accused maintains or had maintained with the bank. Present continuous tense is not used by the Legislature. The expression used is not “is maintained by him”. The cheque must have reference to an account of the accused. Its status as on the date of the cheque is irrelevant. It would be artificial and unrealistic to exclude persons who fraudulently issue cheques on accounts maintained by them merely because prior to the issue of the cheque they had closed the account. The learned Counsel for the complainant/appellant hence contends that the sweep of Section 138 of the Negotiable Instruments Act would and should take within it, an accused like the one in this case who has