The cause of action under Section 138/142 of the NI Act arises only once with the issuance of notice after dishonour of cheques and failure to pay the amount within fifteen days of receipt of the demand notice.

Mukta Gupta, J.

1. By the present petition, the Petitioner seeks quashing of proceedings emanating from the summoning order dated 25th April, 2005 in complaint No. 336/A/11 filed against the Petitioner for offences punishable under Section 138/142 of the Negotiable Instruments Act, 1881 (in short the 'NI Act').

2. Learned counsel for the Petitioner states that the cognizance taken by the learned Trial Court is bad in law and is liable to be set aside. The complainant has admitted that the demand notice was sent on 20th March, 2003 and thereafter again a demand notice was sent on 22nd May, 2003. Thus, the cause of action accrued only when the first demand notice sent on 20th March, 2003. It is not permissible for the payee to create another cause of action in respect of the same cheque by issuing another legal notice. Cause of action for a complaint under Section 138 N.I. Act arises only once with the issuance of notice after dishonour of cheques and received thereof by the drawer. Reliance in this regard is placed on Prem Chand Vijay Kumar v. Yash Pal Singh & Anr., (2005) 4 SCC 417, Puri International(P) Ltd & Anr. v. Ram Lal Bansiwal & Sons, 135(2006) Delhi Law Times 103 and Umesh Tandon & Ors. v. Indian Technological Products, 2007(3) LRC 64(Del).

3. Per contra, learned counsel for the Respondent states that the present petition has no merit and the order summoning the Petitioner suffers from no illegality. The Respondent in order to maintain cordial relations in business with the Petitioner agreed not to proceed with the matter after issuing the first demand notice and once again presented the cheque for encashment. This cheque was again returned back for insufficiency of funds. The Petitioner was apprised of the said fact but the Petitioner did not respond to the same and thus the Respondent once again issued legal demand notice to the Petitioner. However, the Petitioner failed to pay the amount even on the second notice and thus the Complainant/Respondent within 15 days of the subsequent notice filed the complaint. Hence the present petition has no merit and is liable to be dismissed.

4. Briefly, the facts of the case are that the Respondent Company M/s Amit Enterprises is dealing in sale and purchase of hardboard articles. The Petitioner/accused had been purchasing material from the Complainant from time to time on credit basis. Under the agreement, it is provided that interest at the rate of 24% per annum will be paid, if the said bills are not paid within the stipulate period of two weeks from the date of the bill. It is alleged that in lieu of the payment of fifteen bills, the Petitioner issued cheque bearing No. 726267 dated 14th March, 2003 for a sum of Rs. 42,949/- in favour of Complainant firm drawn on Punjab National Bank, Maharani Bagh, New Delhi. The said cheque was presented for encashment but the same was returned dishonoured vide memo dated 17th March, 2003 for „insufficiency of funds?. Thereafter, the Respondent issued a legal notice dated 20th March, 2003 to the Petitioner after which the Petitioner contacted the Respondent and requested to represent the cheque for encashment with an assurance that cheque will be honoured. On the assurance the complainant presented the cheque and the same was again dishonoured vide memo dated 17th May, 2003 for insufficiency of funds. The Respondent/Complainant immediately contacted the Petitioner but the Petitioner did not give any satisfactory response and thus the Respondent issued another legal demand notice dated 21st May, 2003 to the Petitioner. The Petitioner paid no heed to the said notice hence aggrieved by the inaction and non-payment of the bills, the Respondent filed the complaint under Section 138/142 N.I. Act before the learned Metropolitan Magistrate against the Petitioner. Learned Metropolitan Magistrate vide order dated 25th April, 2005 issued summons against the Petitioner. Accordingly, notice under Section 251 Cr.P.C. was served on the Petitioner.