The notice of demand is a mandatory requirement for filing a complaint under Section 138 of the Negotiable Instruments Act. The notice serves to give the drawer of the cheque a chance to rectify the omission and protect an honest drawer. The burden is on the complainant to show the service of notice and the accused's attempt to evade service.

Judgment:

Subhash Kakade, J.

1. This petition under Section 378(4) of Cr.PC for grant of leave to appeal has been filed by the applicant/complainant against the impugned judgment dated 23-4-2010, passed in Private Complaint Case No. 517/2006, by the learned Judicial Magistrate First Class, Jabalpur acquitting the respondent No. 2, hereinafter referred as "the accused" for the offence punishable under Section 138 of Negotiable Instruments Act, 1881; hereinafter referred to as "NI Act". Short facts of the case are that on 14-9-2005, the accused issued a cheque amounting to Rs. 48,000/- in favour of the complainant. The complainant presented the cheque through his Banker Dena Bank and the same has been returned with an endorsement "Funds insufficient". In spite of duly served legal notice of demand the accused did not return the amount of cheque.

2. The learned Trial Court on the basis of affidavit of the complainant and documentary evidence passed the order for registration of complaint. Accused abjured his guilt. His further plea was that he has been falsely roped in this complaint. The complainant, to substantiate the charge against the accused examined himself as P.W. 1 and witness Aashish Namdeo (P.W. 2) and exhibited impugned cheque with endorsement memo, unserved notice with AD and postal receipt as Exh. P-1 to Exh. P-4 respectively. Civil Jorge (D.W. 1) examined as defence witness.

3. On consideration of oral as well as documentary evidence learned Trial Court acquitted the accused as mentioned above.

4. Learned Counsel for the applicant mainly based his arguments on two counts that the learned Trial Court firstly, wrongly held that the complainant did not make serious effort to serve the notice on the accused and secondly, also wrongly held that there was no seal of bank found on endorsement memo. He further submitted that as per provisions of Section 146 of NI Act, the Court has to presume that memo issued by the Bank is proper and valid, unless rebuttal, by the accused. Finally, it is submitted by the learned Counsel for the applicant that the learned Trial Court has failed to appreciate the evidence in proper prospect and committed grave error and arrived at wrong conclusion resulting acquitting the accused, hence the impugned judgment is illegal and contrary to the provision of law.

5. Having heard the learned Counsel for the appellant and after perusing the entire record this Court is of the view that the learned Trial Court has not committed any error in acquitting the accused.

6. The object of promulgate the Negotiable Instruments Act, containing Sections 138 to 142 by the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 was to promoting and inculcating faith in the efficacy of banking system and its operations and giving credibility to negotiable instruments in business transaction. In developing countries like ours importance of the banking system is need not to be required ornamental words. The introduction of these provisions was intended to create an atmosphere of faith and reliance on banking system by discouraging people from not honouring their commitments by way of payment through cheques. Section 138 of the NI Act was enacted to punish those unscrupulous persons, who purported to discharge their liability by issuing cheques without really intending to do so. Apart from civil liability, criminal liability is sought to be imposed by the said provision on such unscrupulous drawers of cheques. Therefore, while construing the provision, the object of the legislation has to be borne in mind.

7. In other words, these provisions have been introduced to give the better credibility to our trade, business, commerce and industry, which is absolutely imperative in view of the growing international trade and business. The constitutional validity of these provisions have been upheld by the Apex Court.

Protective Umbrella for honest drawer:

8. However, with a view to avert unnecessary p