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RAJNESH OSWAL
Ajay Gupta, S/o. Sudesh Kumar Gupta – Appellant
Versus
Ajay Trading Co. , through its Partner, Ajay Gupta, S/o. Ram Lal Gupta – Respondent
JUDGMENT :
CRM(M) No. 487/2022
1. The respondent filed a complaint under section 138 Negotiable Instruments Act (hereinafter to be referred as “the NI Act”) against the petitioner by asserting that it is a partnership firm dealing with finance, loan, auction group and committee business etc. It is averred in the complaint that the petitioner was having a business relationship with the respondent, as such, he approached the respondent for financial support and the respondent gave him some amount. In order to discharge his part liability, the petitioner issued a cheque bearing No. 073991 dated 29.01.2022 for an amount of Rs. 20.00 lacs in favour of respondent but the same was dishonored vide memo dated 31.01.2022 for “Funds Insufficient”.
2. The respondent through its counsel served a legal notice on 18.02.2022 through registered post calling upon the petitioner to pay the amount of dishonored cheque within a period of 15 days from the date of receipt of notice. The said notice was received by the petitioner on 24.02.2022 but he did not pay the amount of the dishonored cheque within the period of 15 days. Thereafter, the respondent filed a complaint under Section 138 NI Act, before th
A person who is not a signatory to the cheque cannot be prosecuted under Section 138 of the Negotiable Instruments Act, 1881, for the offence of dishonour of cheque for insufficiency of funds.
The court affirmed that partners can be held vicariously liable for a cheque issued by the firm if sufficient averments are made in the complaint, regardless of claims of being sleeping partners.
A partner of an unregistered partnership cannot file a complaint under Section 138 of the Negotiable Instruments Act without express authority, as per Section 69(2) of the Partnership Act.
The main legal point established in the judgment is the requirement for the complaint to be in the name of the payee and the authorization of the person representing the company in proceedings under ....
The court upheld the validity of a dishonored cheque under Section 138 of the N.I. Act, allowing simultaneous proceedings under the N.I. Act and SARFAESI Act, emphasizing the distinct purposes of eac....
(1) Dishonour of cheque – In cases where payee/complainant is company, all that is necessary to be demonstrated before Magistrate is that complaint is filed in name of payee.(2) Dishonour of cheque ....
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