High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE M. JEYAPAUL
K. Prashanth
Versus
Bharti Telenet Limited, rep. By its Executive V. Narayanan
Crl.O.P.No.20190 of 2005
Decided On : 09-10-2007
Negotiable Instruments Act - Quashing of Criminal Proceedings - Section 138 - 138 proviso (b) - Act 55 of 2002 - Summary
Fact of the Case:
The accused issued a cheque that was returned unpaid, leading to criminal proceedings under section 138 of the Negotiable Instruments Act. The accused sought quashment on the grounds of defective statutory notice timing.
Finding of the Court:
The court found that the complainant failed to issue notice within the statutory period, and the amended provision providing an extended period did not apply retroactively to revive the barred prosecution.
Issues: The timing of the statutory notice issuance and the applicability of the amended provision to the barred prosecution.
Ratio Decidendi: The court held that the complainant cannot take advantage of the amended provision to revive a statutorily barred prosecution.
Final Decision: The criminal proceedings were quashed as the prosecution was not sustainable due to the complainant's failure to comply with the statutory mandate.
The petition is filed seeking to quash the criminal proceedings in C.C.No.3505 of 2003 on the file of the XIV Metropolitan Magistrate, Egmore, Chennai.
2. In the criminal proceedings initiated by the respondent/complainant for offence punishable under section 138 of the Negotiable Instruments Act as against the petitioner/accused, the latter, having contended that the statutory notice was slapped on the petitioner/accused only after the expiry of 15 days from the date of intimation of the return of the cheque, seeks for quashment.
.3. The complainant is Bharti Telenet Limited. The accused K.Prashanth subscribed for the telephone services provided by the Telephone Company by sending a subscription form accepting the terms and conditions therein. The accused was highly irregular in making payment under the said agreement. The accused was liable to pay a balance sum of Rs.9,00,000/= towards the aforesaid services provided to the accused. The accused issued a cheque bearing No.653575 dated 11. 2003 for a sum of Rs.9,00,000/= drawn on Hong Kong and Shanghai Banking Corporation Limited, Mylapore, Chennai. The complainant presented the cheque for payment, but the cheque was returned unpaid by the banker with the endorsement "payment stopped by the drawer". The complainant issued lawyers notice dated 2. 2003 calling upon the accused to pay the amount, but, the notice was returned on 12. 2003. The complainant, having thus alleged, prosecuted the accused for the offences punishable under section 138 of the Negotiable Instruments Act before the learned XIV Metropolitan Magistrate, Egmore, Chennai.
4. The grievance of the accused is that the dishonour of the cheque was admittedly intimated to the complainant by the Banker on 11. 2003, but, the statutory notice was issued only on 2. 2003 after the expiry of statutory period of 15 days. Therefore, the accused would contend that the criminal proceedings under section 138 of the Negotiable Instruments Act initiated as against him is liable to be quashed.
5. The court heard the submissions made on either side.
6. Learned counsel appearing for the accused would submit that the prosecution case launched with the defective statutory notice is not sustainable before the court of law.
7. Learned counsel appearing for the complainant would submit that after the amendment made by Act 55 of 2002 to section 138 proviso (b) of the Negotiable Instruments Act, the payee or the holder in due course of the cheque has a statutory period of 30 days to issue the notice from the date of receipt of information regarding the return of cheque.
8. It is the admitted case that the intimation regarding the dishonour of the cheque was given by the banker to the complainant on 11. 2003 before the amendment by Act 55 of 2002 came into effect from 2. 2003. Only 15 days statutory period was originally given to issue notice to the accused from the date of receipt of information. But, by the Amendment Act 55 of 2002, such a statutory period has been enlarged to 30 days.
.9. It is found that only 15 days statutory period was available for the complainant to issue notice on receipt of information from the banker regarding the return of the cheque prior to 2. 2003, the date on which the amended provision came into force. The 15 days statutory period from 11. 2003, the date on which intimation of dishonour of cheque was served on the complainant, has expired on 2. 2003 about five days prior to coming into force of the amended provision under section 138 proviso (b) of the Negotiable Instruments Act by Act 55 of 2002.
10. Learned counsel appearing for the accused refers to an authority reported in CONTROLLER OF ESTATE DUTY, AHMEDABAD v. M.A.MERCHANT (AIR 1989 SC 1710) wherein it has been held as follows:-
"The new S.59 came into force from 1 July, 1960. Much earlier, on 26 February, 1960 the assessment on the accountable person had already been completed. There is a well settled principle against inter
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