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IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
Sankar - Appellant
Versus
Shiek Ansar - Respondent
Crl.O.P.No. 13259 of 2022 & Crl.M.P.Nos. 7118 & 7116 of 2022
Decided On : 13-06-2022
Time Barred Debt - Negotiable Instruments Act - The court dismissed the petition to quash the proceedings initiated under Section 138 of the Negotiable Instruments Act, stating that the issue of whether the cheque was issued for a time-barred debt is a matter for evidence and cannot be adjudicated before the court.
Fact of the Case:
The petition was filed to quash the proceedings initiated under Section 138 of the Negotiable Instruments Act, arguing that the cheque was dated in the year 2018 for a debt issued in the year 2013, making it a time-barred claim.
Finding of the Court:
The court dismissed the petition, stating that the issue of whether the cheque was issued for a time-barred debt is a matter for evidence and cannot be adjudicated before the court. The trial judge was directed to dispose of the matter at the earliest.
Issues: The main issue was whether the cheque was issued for a time-barred debt and if it could be legally enforced.
Ratio Decidendi: The court held that the issue of whether the cheque was issued for a time-barred debt is a matter for evidence and cannot be adjudicated before the court. It also emphasized that once the cheque is issued and dishonored, it is for the accused to dislodge the legal presumption available under Section 118 and 139 of the Negotiable Instruments Act.
Final Decision: The Criminal Original Petition was dismissed, and the trial judge was directed to dispose of the matter at the earliest.
JUDGMENT
(Prayer: Criminal Original Petition filed under Section 482 of the Code of Criminal Procedure, to call for records and quash the CC No.132 of 2019 on the file of the Judicial Magistrate Kallakuruchi.)
This petition has been filed to call for the records in C.C. No.132 of 2019 on the file of the Judicial Magistrate Kallakuruchi and quash the proceedings initiated under Section 138 of Negotiable Instruments Act.
2. The only ground raised by the learned counsel for the petitioner is that the cheque was dated in the year 2018 for the debt issued in the year 2013. Therefore, it is the contention of the petitioner that the time barred claim is not a legally enforceable debt. In support of his contention, the learned counsel relied upon the judgment of this Court in 2019 STPL 9359 Madras in Crl.O.P.No.17803 of 2014 dated 07.03.2019 in Insulation House., Rep. by Meenakshi Davey and others v. Pramod Kumar Daga.
3. The learned single Judge who has passed the above jugement reling upon the other judgment of this Court in Sama Dharman and Another vs. S. Natarajan in Crl.O.P.(MD) No.3824 of 2012 dated 25.07.2012. It is also relevant to note that challenging the above order an appeal was filed before the Honourable Apex Court. The Honourable Apex Court in S. Natarajan vs. Sama Dharman and another [(2021) 6 SCC 413] allowed the appeal and set aside the Judgment. Therefore, the judgment in Crl.O.P.No.17803 of 2014 (supra) is no longer good law.
4. In such view of the matter, I do not find any merit in this petition. Once the cheque is issued and got dishonoured and statutory notice is issued, it is for the accused to dislodge the legal presumption available u/s.118 and 139 of Negotiable Instruments Act. Whether the cheque in question has issued for the time barred debt or not itself is the matter for evidence and that cannot be adjudicated before this Court.
5. Subject to the above observation, this Criminal Original Petition stands dismissed. The learned trial Judge is directed to dispose of the matter at the earliest. Consequently, the connected miscellaneous petitions are closed.
The issue of whether a cheque was issued for a time-barred debt is a matter for evidence and cannot be adjudicated before the court.
The nature of the debt must be proven during trial, and there is a presumption in favor of the holder of the cheque.
Point of Law : Hon’ble Supreme Court observed that, Section 139 of N.I. Act, includes a presumption that there exists a legally enforceable debt or liability, which is a rebuttal one.
A debtor's issuance of a cheque acknowledges a debt; questions of enforceability or time-bar must be determined through evidence, not prior to trial.
A cheque issued for a time-barred debt is not legally enforceable under Section 138 of the Negotiable Instruments Act.
The court ruled that a cheque issued to discharge a time-barred debt is not legally enforceable under the Indian Contract Act. A written promise is required to validate such debts.
The legal enforceability of a debt, including whether it is time-barred, is a question of fact requiring trial evidence, and cannot be quashed under Section 482 of Cr.P.C.
The legal point established is that the existence of a time-barred debt should be determined based on evidence during the trial, and the burden of proof lies with the accused to establish the non-exi....
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