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1991 Supreme(Ker) 177

Judges : L.MANOHARAN,M.M.PAREED PILLAY
Manoj K.Seth - Appellant
Versus
R.J.Fernandez - Respondent
Case No : Crl.M.C. No. 97 of 1991
Decided On : 06/20/1991
Advocates Appeared :
For the Petitioner: Johnson Manayani and P.V. Lonachan, Advocates. For the Respondent: A. Antony and A. Antony (Jr.).

The main legal point established in the judgment is that a post-dated cheque should be considered to have been drawn on the date it bears, and the liability of the drawer for penalties in case of dishonour is determined based on the presentation of the cheque within six months of the date of the cheque.

Headnote:

Section 138 of the Negotiable Instruments Act, 1881 - Quashing of proceedings - Post-dated cheque - Section 138 of the Act - Sections 138 to 142 - The court discussed the interpretation of Section 138 of the Act in relation to post-dated cheques and the liability of the drawer for penalties in case of dishonour. The court held that a post-dated cheque should be considered to have been drawn on the date it bears, and since the cheque was presented within six months of the date of the cheque, the condition in the proviso to Section 138 was satisfied.

Fact of the Case:

The petitioner sought to quash the proceedings in a case pending before the Chief Judicial Magistrate's Court, Ernakulam, alleging that the cheque in question was post-dated and not presented within six months from the date it was drawn, thus no offence under Section 138 of the Act was committed.

Finding of the Court:

The court held that the post-dated cheque should be considered to have been drawn on the date it bears, and since the cheque was presented within six months of the date of the cheque, the condition in the proviso to Section 138 was satisfied. The court dismissed the petitioner's plea to quash the proceedings.

Issues: The issues involved the interpretation of Section 138 of the Act in relation to post-dated cheques, the liability of the drawer for penalties in case of dishonour, and the timing of when a post-dated cheque can be considered to have been drawn for the purpose of the Act.

Ratio Decidendi: The court's decision was based on the interpretation of Section 138 of the Act, which held that a post-dated cheque should be considered to have been drawn on the date it bears, and the condition in the proviso to Section 138 was satisfied by the presentation of the cheque within six months of the date of the cheque.

Final Decision: The Criminal M.C. was dismissed, and the court held that the post-dated cheque should be considered to have been drawn on the date it bears, and the condition in the proviso to Section 138 was satisfied. The petitioner's plea to quash the proceedings was dismissed.

Judgment :-

MANOHARAN, J.

Petitioner seeks to quash the proceedings in C.C. No. 479 of 1990 pending before the Chief Judicial Magistrate's Court, Ernakulam by invoking Section 482 of the Cr.P.C. Respondent filed a complaint against petitioner alleging that a cheque issued by the petitioner on 6-3-1990 for an amount of Rs. 15,192.65 drawn on the Syndicate Bank, Ernakulam was presented for encashment on 2-8-1990 was dishonoured on 3-8-1990, and that though notice as required under Clause (b) of proviso to Section 138 of the Negotiable Instruments Act, 1881, (for short 'the Act') was issued, the petitioner failed to make the payment within 15 days of the receipt of the notice, and therefore the petitioner has committed offence under Section 139 of the Act.

2. According to the petitioner, the cheque post-dated 6-3-1990 was drawn on 1-3-1986; and since the cheque was not presented within six months from the said date as required under Clause (a) of Proviso to Section 138 of the Act, no offence under the said section is disclosed and therefore it is necessary that the proceeding is quashed.

3. The learned single Judge before whom the matter came up for consideration felt that the matter has to be considered by a Division Bench since the view taken in Paramjith Singh v. Job, (1989) 2 Ker LT 740, was not endorsed by another single Judge and the same was referred to a Division Bench for consideration.

4. The Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 (Act 66 of 1988) amended the Act also and inserted Chapter XVII containing Sections 138 to 142 in the Act. Section 138 makes the drawer of a cheque liable for penalties in case the cheque is dishonoured and payment is not made after notice. As has noted, whereas the respondent alleged that the petitioner has committed offence punishable under Section 138 of the Act, the petitioner maintains that though the cheque was dishonoured, since the conditions required under Section 138 of the Act are not satisfied, no offence under the said section is made out. For properly appreciating the argument, it would be necessary to read Section 138 of the Act. Section 138 reads :

"138. Dishonour of the 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 :

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 validity, whichever is earlier;

b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque, within fifteen days, of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and

c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

Explanation. - For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability".

5. According to the petitioner the cheque dated 6-3-1990 is a post-dated











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