IMPORTANT POINTS
1. Cognizance of the offence under Section 138, NIA cannot be taken on the basis of presumption.
2. An actual service of the notice upon the drawer must be proved.

Crl. M.A. No. 5937/2009

Dr. S. Murlidhar, J.— This petition is directed against the order dated 21st March, 2009 passed by the learned Metropolitan Magistrate (‘MM’) dismissing CC No. 4167 of 2009 titled HDFC Bank Limited v. Amit Kumar Singh, under Section 138 of the Negotiable Instruments Act 1881 (‘NI Act’).

2. The short question that arises for consideration is whether the learned MM while entertaining a complaint under Section 138 NI Act, at the presummoning stage, can insist upon the complainant producing some proof of despatch of the notice in terms of NI Act sent to the drawer of the dishonoured cheque.

3. The aforementioned complaint was filed in respect of dishonour of a cheque No.763884 drawn on Punjab & Sind Bank, Jangpura Extension, New Delhi dated 5.12.2008 for Rs.19,083 drawn by the Respondent in favour of the petitioner HDFC Bank Limited (‘Bank’). The cheque when presented for payment was dishonoured with the remarks “Funds insufficient”. It was stated in the complaint filed by the Bank under Section 138 NI Act that upon receipt of intimation from the Bank to which the cheque was presented that it was dishonoured, a legal notice “was sent to the drawer at the address available in the records that the said notice was sent/posted to the accused on 14.1.2009, by registered A/D post at his abovestated address as the same was duly provided time and again”. The cover was not received back. It was claimed that “thus the said notice has been duly served upon the accused. But in spite of the service of the said notice on the accused as aforesaid, the accused intentionally failed to show the positive response and also failed to make the payment of the aforesaid dishonoured cheques to the complainant within the stipulated time”.

4. The question that arose before the learned MM was whether it could be said that the legal notice issued to be drawer of the dishonoured cheque, was in fact served on the drawer. The question arose in the clauses of the precise wording of Section 138(c) NI Act where one of the conditions for the offence to be attracted is that the drawer the cheque should fail to make the payment to the payee “within fifteen days of the receipt of the said notice”. Therefore, the receipt of the notice by the payee is an essential condition which must be fulfilled followed by the failure of the drawee to make payment within 15 days thereafter. Although Section 138 (b) NI Act states that the payee has to only give a notice in writing to the drawer”. Can it be said that by merely giving of such notice, the subsequent stage of receipt of such notice by the drawer is automatically to be presumed?

5. It was urged before the learned MM by the petitioner that since the notice was sent by registered post, Section 27 of the General Clauses Act, 1897 (G.C Act) can be invoked and a presumption drawn that service has been effected. Reliance was placed inter alia on the judgments of the Supreme Court in K. Bhaskaran v. Sankaran Vaidhyan Balan1 and C.C. Alavi Haji v. Palapetty Muhammed.2 Reliance was also placed in Section 94 NI Act to contend that once the notice of dishonour has been given by post then it would satisfy the requirement even of Section 138 (b) read with Section 138(c) NI Act. Importantly, the learned MM noted at the outset that the Counsel for the complainant had argued that there was no need to file any delivery report or the acknowledgement due card or proof of delivery of the demand notice sent by Speed Post/Registered Post.

6. The learned MM discussed the provisions of Section 27 GC Act with Section 114 Indian Evidence Act (EA). It is held that the presumption of service of notice cannot be automatically drawn unless the petitioner was able to show to the Court a delivery report, or a signed acknowledgement due card or the internet generated report or any such proof of delivery.

7. After discussing the case law, the learned MM concluded that the provision of deemed service would be attracted only whe