2001 Supreme(Cal) 51
HIGH COURT OF CALCUTTA
Debiprasad Sengupta, J.
Indian Seamless Financial Services Ltd.
Versus
Shyam Sundar Kejriwal
C.R.R. No.1233 of 1998
Decided On : February 5, 2001
Advocate Appeared:
Sekhar Basu, Tirthankar Ghosh, Sandip Kr. Dutta for the petitioner;
Sumit Talukdar, Joymalya Bagchi, Rajashree Kajaria for the opposite party.
A demand notice under section 138 of the Negotiable Instruments Act, 1881 is not invalid merely because it mentions a wrong cheque number, provided the drawer is aware of the dishonour of the cheque issued by him.
Headnote:
NEGOTIABLE INSTRUMENTS ACT, 1881 - SECTION 138 - DEMAND NOTICE - VALIDITY - MENTIONING OF WRONG CHEQUE NUMBER - EFFECT - SECTION 138 OF THE N.I. ACT DOES NOT REQUIRE MENTIONING OF CHEQUE NUMBER IN DEMAND NOTICE - DEMAND NOTICE IS VALID DESPITE WRONG CHEQUE NUMBER IF DRAWER IS AWARE OF DISHONOUR OF CHEQUE ISSUED BY HIM.
Fact of the Case:
The accused petitioner issued a cheque for Rs. 30 lakhs to the complainant in discharge of a liability. The cheque was dishonoured by the bank. The complainant served a demand notice on the accused petitioner demanding payment of the cheque amount within 15 days. The demand notice mentioned a wrong cheque number. The accused petitioner filed a revision application in the High Court challenging the validity of the demand notice and the consequent criminal proceeding initiated against him.
Finding of the Court:
The High Court held that the demand notice was valid despite the wrong cheque number being mentioned therein. The court noted that the accused petitioner was aware of the dishonour of the cheque issued by him, and that he was not prejudiced in any way by the mentioning of the wrong cheque number in the demand notice.
Issues: Whether a demand notice under section 138 of the Negotiable Instruments Act, 1881 is invalid if it mentions a wrong cheque number.
Ratio Decidendi: Section 138 of the Negotiable Instruments Act, 1881 does not require the mention of the cheque number in the demand notice. The purpose of the demand notice is to give the drawer of the cheque an opportunity to rectify his omission and to protect the interest of an honest drawer of the cheque. The drawer is not prejudiced in any way if a wrong cheque number is mentioned in the demand notice, provided he is aware of the dishonour of the cheque issued by him.
Final Decision: The High Court dismissed the revision application and directed the trial court to proceed with the trial and conclude the same with utmost expedition.
Debiprasad Sengupta, J.
This is an application for quashing of a proceeding being complaint case No. C/1629 of 1996 pending in the court of learned Metropolitan Magistrate 12th Court, Calcutta under section 138/141 of the Negotiable Instruments Act, 1881.
2. The aforesaid proceeding was initiated on the basis of a petition of complaint filed by the complainant/opposite party. The allegations made in the petition of complaint is that the accused petitioner approached the complainant/ opposite party's company for corporate loan and promised to repay the same within a stipulated period and in that perspective issued a cheque bearing No.594544 dated 16.7.96 for Rs. 30 lakhs drawn on Bank of India, Jawaharlal Nehru Road Branch, Calcutta. Before the said cheque was due to be presented for encashment the accused petitioner gave a letter containing some false and frivolous story with the fraudulent intention to cheat the complainant. The complainant thereafter presented the said cheque for encashment within its validity period to their Banker, but the said cheque was dishonoured on 15.7.96 with the remark "payment stopped by the drawer". The complainant served a demand notice upon the accused petitioner on 22.7.96 demanding the payment of the cheque amount being Rs. 30 lakhs within a period of 15 days from the date of receipt of the said notice. Such demand notice was received by the accused petitioner on 23.7.96. But the accused failed to make the payment of the cheque amount within the stipulated period of 15 days. It was further alleged in the petition of complaint that the accused petitioner issued the cheque in discharge of their existing liabilities and the said cheque being presented for encashment was dishonoured by the Bank. So the accused persons have committed an offence under section 138 read with section 141 of the N.I. Act.
3. Mr. Sekhar Bose, learned Advocate appearing for the petitioner submits that the accused petitioner was carrying on transactions with the complainant/opposite party and as such certain cheques were issued to them and the same is the subject matter of a suit pending before this court.
4. Mr. Bose submits that the cheque No. was mentioned in the demand notice as 594544 dated 16.7.96 amounting to Rs. 30 lakhs. But no such cheque, bearing the number as mentioned by the complainant in the demand notice, was issued by the petitioner at any point of time. Mr. Bose further submits that in order to attract the provision of section 138 of the N.I. Act the cheque must be issued by the drawer in discharge of any debt or liability. Further one of the prerequisites of the section is that the payee or holder in due course of the cheque must make a demand for payment of the amount of money by giving a notice in writing to the drawer of the cheque within15 days of the receipt of information from the Bank regarding dishonour of the cheque. On failure to make the payment within 15 days from the date of receipt of the notice the cause of action arises. But, it is submitted by Mr. Bose, the provisions of the section are not attracted when a demand notice in respect of a cheque, which has not been issued by the drawer, is issued demanding the payment of the amount. Since the cheque bearing No. 594544 dated 16.7.96, as mentioned in the demand notice issued by the complainant/O.P. was not issued by the accused petitioner, the same cannot give rise to any cause of action leading to the initiation of the present proceeding. According to Mr. Bose since the cheque, which is the subject matter of the case, is unknown to the petitioner the present proceeding should not be allowed to continue and the same should be quashed.
5. Mr. Sumit Talukdar, learned Advocate appearing for the complainant/opposite party admits at the very out set that the cheque No. was wrongly mentioned as cheque No.594544 in the demand notice. But, according to Mr. Talukdar, only for such a mistake the demand notice should not be treated as defective a