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DELHI HIGH COURT
DALVEER BHANDARI AND R.S.SODHI. JJ.
Cri. Writ No. 828 of 1998.
Date of Judgment 3-12-1999.
M/S RAJINDER STEELS LTD. AND OTHERS
versus
UNION OF INDIA AND ANR.

Advocates:
Counsels
S.N. Gupta— For Petitioners.
Neeraj Kishan Kaul—For Respondent 1. S.K. Manaktala, —For respondent 3
S.S. Gandhi—For Stale.

Headnote:Result : Petition dismissed.

       

JUDGMENT

Dalveer Bhandari, J. - The petitioners have filed this writ petition under Article 226 of the Constitution of India for issuance of an order/directions thereby holding that Chapter XVII of the Negotiable Instrument Act as incorporated by Section 4 of the Banking Public Financial Institution and Negotiable Instruments Laws (Amendment Act) 1988 (66 of 1988) is ultra vires the Constitution and rule making powers of the legislature and/or in the alternative to issue an appropriate writ or order for direction holding that Section 138 of the Negotiable Instruments Act 1881 (hereinafter called as Act) is ultra vires of objects of the amending Act and/or issue a declaration that Section 138 of the Negotiable Instruments Act 1881 (hereinafter called as Act) is not applicable to the post-dated cheques which are issued beyond the period of six months from the date when they are drawn.

2. The petitioners have approached this Court because a complaint under Section 138 of Negotiable Instruments Act against them have been filed by respondent No. 3 before the Metropolitan Magistrate, Patiala House, New Delhi. In this petition the Court has been called upon to decide only the constitutional validity of these provisions, therefore, it is not necessary to recapitulate the detailed facts of this case. According to the petitioners this petition raised the following questions of law :

(i) Whether the provisions of Section 138, 139, 140, 141 and 142 of the Negotiable Instruments Act, 1881, are ultra vires and Violative of Article 21 of the Constitution of India.

(ii) Whether the provisions of Sections 138 to 142 of the Negotiable Instruments Act, 1881, are ultra vires the powers of the Central Government to enact laws in this direction on account of the fact that this subject of legislation can only be made by the State Governments in view of Article 246(3) read with Entry 30 List II of the VII Schedule to the Constitution of India ?

(iii) Whether mens rea is an essential ingredient for an offence committed under Section 138 of the Negotiable Instruments Act ?

(iv) Whether a person can be imprisoned and/or can be forced to face the rigour of criminal trial on account of his failure to comply with financial contractual liability which is purely of civil nature for reasons beyond his control and whether such imprisonment will be violative of the objects of Negotiable Instrument Act, 1881?

(v) Whether a person can be tried for an offence under Section 138 of the Negotiable Instruments Act for dishonour of the cheques which are issued beyond the period of six months from the date when those were drawn?

3. It may be pertinent to mention that by the Banking Public Financial Institutions & Negotiable Instruments Laws (Amendment Act) 1988 (66 of 1988) a new Chapter being Chapter XVII was added in the Negotiable Instruments Act, 1881 containing Sections 138 to Section 142. For convenience, these sections are reproduced as under :

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 persons 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 :

Provided that nothing contained in this section shall apply unless-

(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its v






















































































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