IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
HARPREET SINGH BRAR, J.
Khera Trading Co. (M/s) – Appellant
Versus
Guru Nanak Rice Mills (M/s) – Respondents
CRA-S No. 1435-SB of 2024
Decided On : 07-05-2024
Negotiable Instruments - Cheque Dishonour - Section 138, 142 of N.I. Act - The court emphasized the necessity of fulfilling all conditions under Section 138, particularly the 15-day notice period before filing a complaint, which was not adhered to in this case, leading to the dismissal of the appeal.
Fact of the Case:
The respondent issued two cheques to the appellant, which were dishonoured due to insufficient funds. A legal notice was sent, but the respondent refused to accept it. The appellant filed a complaint under Section 138 of the N.I. Act, leading to a conviction that was later overturned on appeal.
Finding of the Court:
The court found that the complaint was filed before the expiry of the 15-day period required by Section 138, thus rendering it invalid. The acquittal was upheld as the necessary legal conditions were not met.
Issues: Whether the complaint under Section 138 of the N.I. Act was valid given that it was filed before the expiry of the 15-day notice period.
Ratio Decidendi: A complaint under Section 138 cannot be filed before the expiry of the 15-day period from the date of receipt of the notice by the drawer; failure to comply with this requirement invalidates the complaint.
Result: The appeal is dismissed as it lacks merit.
JUDGMENT :
Mr. Harpreet Singh Brar, J. (Oral): This instant appeal has been preferred by the appellant complainant against the judgment of acquittal dated 12.07.2001 passed by learned Additional Sessions Judge, Gurdaspur in Criminal Appeal No.37 of 1999, vide which the judgment of conviction and order of sentence dated 17.11.1999 passed by learned Judicial Magistrate Ist Class, Batala in Complaint Case No.215/1 of 05.10.1995 filed under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘N.I. Act’), was set aside.
2. Succinctly, the facts are that the respondent-firm through its sole proprietor Lakhbir Singh, issued two cheques bearing No.2188820 dated 25.05.1995 and 2188821 dated 25.06.1995, respectively, in favour of the appellant-firm for a sum of Rs.75,000/- each drawn on J & K Bank Ltd., Batala in order to discharge a legal liability towards the payment of paddy purchased by the respondent from the appellant-firm. Upon presentation of the said cheques for encashment, the same were dishonoured and returned vide memo dated 11.09.1995 on account of insufficiency of funds. Then, a legal notice was served by the appellant on 16.09.1995 upon the respondent demanding payment of the said cheques amount, but the respondent failed to make such payment. The said notice was received undelivered with remarks ‘addressee has refused to receive the registered letter’. Thereupon, the complaint (supra) was filed by the appellant against the respondent-firm. Consequently, a trial ensued and sole proprietor of the respondent-firm i.e. Lakhbir Singh was convicted and sentenced by learned trial Court to undergo rigorous imprisonment for one year along with a fine of Rs.5,000/- and in case of default of payment of fine, further rigorous imprisonment for three months. Aggrieved, the respondent-accused preferred an appeal against the said judgment of conviction, which was allowed by learned lower Appellate Court and consequently, the conviction and sentence of the respondent was set aside, thereby, acquitting him. Aggrieved by the same, the appellant-complainant has preferred the present appeal.
3. Learned counsel for the appellant, inter alia, contends that the learned lower Appellate Court has ignored the factual as well as the legal position, while acquitting the respondent on the ground that stipulated period of 15 days from the date of receipt of legal notice was not afforded to him before filing the complaint under Section 138 of N.I. Act as the registered notice was issued on 16.09.1995 and returned on 20.09.1995, whereas the complaint was rightly filed on 05.10.1995, i.e., after 15 days. He further submits that the cause of action arose, when the cheques in question were dishonoured and returned and the stipulated period of 15 days is to just give the accused another opportunity to right his wrong and escape punishment. It is further contended that even on merits, there is ample evidence on record to establish the guilt of the respondent, as he has duly admitted his signatures upon the cheques in question.
4. I have heard learned counsel for the appellant and perused the paper-book with his able assistance. It transpires that the legal notice (Ex.P5 & P6) were issued by the appellant-complainant on 16.09.1995 and the same were returned bearing endorsement of the postal authority stating 20.09.1995 as the date of refusal by the accused to receive the said notice, which admittedly, is the date of service of the said notice upon the respondent-accused. Taking that into consideration, 15th day from the date of receipt of demand notice by the respondent fell on 05.10.1995. In the case at hand, the complaint under Section 138 of N.I. Act was instituted by the appellant-complainant on 05.10.1995 and cognizance of the same was taken by learned Magistrate on the same day since he applied his mind and passed an order directing the said complaint to be registered and come up on 27.10.1995 for evidence of the complainant. Now, the contention
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A complaint under Section 138 of the N.I. Act is invalid if filed before the 15-day period from the receipt of the notice has expired.
The court established that in computing time limits under Section 138 of the NI Act, the first day is excluded and the last day is included.
Dishonour of cheque – Complaint is not maintainable before expiry of period of fifteen days from date of receipt of notice by drawer of cheque – Remedy is to file fresh complaint.
The central legal point established in the judgment is that a complaint under Section 138 of the Negotiable Instruments Act is not maintainable if filed before the expiry of the prescribed 15-day per....
The cause of action for filing a complaint case under Section 138 of the Negotiable Instruments Act could not arise prior to expiry of 15 days from the date of service of legal notice on the accused.
It is settled principles of law that court being appellate court will not interfere in judgment of acquittal, unless it is shown that judgment of acquittal is on erroneous ground or it has resulted i....
Dishonour of cheque – Complainant is not required to prove service of notice on accused before institution of case—Requirement of giving notice is a clear departure from rule of criminal law, where t....
The presumption of service of legal notice under Section 27 of the General Clauses Act applies, and a complaint under Section 138 of the Negotiable Instruments Act is premature if filed before the st....
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