AI Overview...
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Blank Cheque as Security - Issuance of a blank cheque, especially when signed and handed over as security or collateral, can attract liability under Section 138 of the Negotiable Instruments Act (N.I. Act). Courts have held that such cheques, even if blank, issued towards security or security for a loan, can lead to prosecution if dishonoured Elder ICIC Health Pvt. Ltd. vs Glide Chem Pvt. Ltd. - Himachal Pradesh, Ramakrishna Urban Co-operative Credit Society Ltd. VS Rajendra Bhagchand Warma - Dishonour Of Cheque.
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Cheque Reported Lost - The return of a cheque marked reported lost by the bank does not automatically attract Section 138 of the N.I. Act. Courts have clarified that unless the cheque is dishonoured due to insufficient funds or other specific reasons, merely reporting it lost or stolen does not invoke penal provisions under Section 138 RAJ KUMAR KHURANA VS STATE OF (NCT OF DELHI) - Uttarakhand, Raj Kumar Khurana VS State of NCT of Delhi - Madhya Pradesh, Raj Kumar Khurana VS State of (NCT of Delhi) - Rajasthan, Raj Kumar Khurana VS State of (NCT of Delhi) - Supreme Court.
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Limitation and Acknowledgment - Under Section 18 of the Limitation Act, acknowledgment of debt or security, including through issuance of a cheque, can extend the limitation period for filing a suit. An acknowledgment or act recognizing the debt can be a crucial factor in establishing liability, even if the cheque is issued as security or is blank, provided there is an existing debt Shreeyansh Rayappa Nandeshwar, S/O Rayappa Laxmana Rao Nandeshwar VS Prakash Ponde, S/o. Subrao Phonde - Karnataka.
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Legal Fiction and Presumption - The law presumes the existence of debt when a cheque is issued, and dishonour triggers the application of Section 138. The courts have emphasized that the mere issuance of a cheque, even a signed blank cheque, can invoke Section 138 if there is a debt or liability acknowledged or implied Elder ICIC Health Pvt. Ltd. vs Glide Chem Pvt. Ltd. - Himachal Pradesh, Ravi Kumar VS State of Himachal Pradesh - Himachal Pradesh.
Analysis and Conclusion:
A blank cheque issued as security or towards a debt can attract liability under Section 138 of the N.I. Act, especially if dishonoured due to insufficient funds or other reasons. However, the mere reporting of a cheque as lost or stolen does not automatically invoke penal provisions. Acknowledgment under Section 18 of the Limitation Act can extend the period for legal action, and courts generally presume debt existence upon issuance of a cheque. Therefore, the Blank Cheque Attract Section 18 of the Limitation Act primarily hinges on whether the cheque was issued towards a debt or security, and whether dishonour occurs within the prescribed limitation period, considering acknowledgments and other facts Elder ICIC Health Pvt. Ltd. vs Glide Chem Pvt. Ltd. - Himachal Pradesh, Shreeyansh Rayappa Nandeshwar, S/O Rayappa Laxmana Rao Nandeshwar VS Prakash Ponde, S/o. Subrao Phonde - Karnataka.
Search Results for "Blank Cheque Attract Section 18 of the Limitation Act"
2025 Supreme(Online)(HP) 4601 • India - IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Rakesh Kainthla, J
2016(10) SCC 458 that issuing a cheque toward securoity will also attract the liability for the commission of aCn offence punishable under Section 138 of N.I. Act. It was observed: - “10. ... As per Section 138 of the Negotiable Instruments Act 1881, if any cheque is issued on account of other liability, then the provisions of Section 138 of the Negotiable Instruments Act 1881 would be attracted. The court has perused the origina....
2009 0 Supreme(UK) 239 • India - Uttarakhand
MUKUNDAKAM SHARMA, S.B.SINHA
Act — Blank signed cheque said to be stolen from office — Information regarding missing of the cheques given to the bank concerned ... (A) Negotiable Instruments Act, 1881, Sec. 138 — Dishonour of cheques — Cheques reported lost by the drawer — Not constituted an ... " — Penal provision u/Sec. 138, enacted in terms of legal fiction drawn would be attracted when a cheque is returned by the bank ... Whether return of a cheque by the bank on the ground ....
2009 0 Supreme(MP) 545 • India - Madhya Pradesh
S.B.SINHA, MUKUNDAKAM SHARMA
Negotiable Instruments Act, 1881 -- S. 138 -- return of cheque with endorsement "reported lost" -- does not attract provision under ... Bank as envisaged in section itself. ... -provision is attracted when there is insufficient amount in account and amount of cheque is more than the arrangement with the ... Whether return of a cheque by the bank on the ground that it was reported lost by the drawer would attract the penal provisions contained in section#HL_E....
2009 0 Supreme(SC) 926 • India - Supreme Court
MUKUNDAKAM SHARMA, S.B.SINHA
by the bank on the ground that it was reported lost by the drawer would attract the penal provisions contained in Section , 1881 – Section 138 r/w section 209, Code of Criminal ... Whether return of a cheque by the bank on the ground that it was reported lost by the drawer would attract the penal provisions contained in Section 138 of the Negotiable Instruments Act, 1881 (for short "the Act") is the question involved in this appeal.....
2009 0 Supreme(Raj) 662 • India - Rajasthan
S.B.SINHA, MUKUNDAKAM SHARMA
Negotiable Instruments Act, 1881, Sec. 138 — applicability — Dishonour of cheque — Cheque returned by the Bank with the remark "said ... cheque reported lost by the drawer" — First information report lodged — Held — Refusal on the part of the Bank to honour the cheque ... would not bring the matter within the scope of Sec. 138 of the Act — Penal provisions of Sec. 138 would not be attracted in such ... Whether return of a cheque by the bank on the ground that it was r....
2019 0 Supreme(Mad) 137 • India - Madras
M.V.MURALIDARAN
for discharge or security, would attract Section 138 of the N.I. ... security, would attract Section 138. ... Negotiable Instruments Act - Dishonour of Cheque - Section 138 - 138 - Summary: The court discussed the applicability of Section ... So long as there is a debt existing, in respect whereof the cheque in question is issued, in my view, the same would attract Section 138 of....
2021 0 Supreme(Kar) 37 • India - Karnataka
H.P.SANDESH
acknowledgement under Section 18 of the Limitation Act - Whether the self cheque issued by the petitioner attracts Section 138 of ... 139 - Limitation act - Section 18 - Contract Act - Section 25(3) - Dishonour of Cheque - Whether issuance of cheque amount to an ... the repayment of the said amount, the petitioner herein has i....
2023 0 Supreme(HP) 233 • India - Himachal Pradesh
VIVEK SINGH THAKUR
Negotiable Instruments Act, 1881 - Sections 138, 20, 87 and 139 - Code of Criminal Procedure, 1973 - Section ... Section 138 of NI Act are in existence, then presumption is there, as provided under law, and to rebut same, definitely, evidence ... are required to be adjudicated by Trial Court - There is a difference between an ‘ordinary criminal case’ and a ‘complaint under Section ... Even a blank cheque leaf, voluntarily signed and handed over by th....
• India - Dishonour Of Cheque
P.R.BORKAR
Negotiable Instruments Act, 1881—Section 138—Dishonour of cheque—Blank ... that on the date of cheque amount of cheque was outstanding—Acquittal was not liable to be interfered. ... towards repayment of loan—Blank cheques were issued prior to disbursement of loan as a collateral security for loan—It has not proved ... In this case, we cannot say that debt was time barred on the date appearing on cheque i.e. 24.1.2008 in view of vari....
2008 1 Supreme 123 • India - Supreme Court
S.B.SINHA, HARJIT SINGH BEDI
(Para 20) ... (e)Indian Penal ode, 1860 – Section 420 – Blank cheques ... (Para 18) ... (c)Negotiable Instruments ... bearing No. 444840 dated 31.7.2006 of Rs. 6.28 crores, Cheque No. 444841 dated 31.7.2006 of a sum of Rs. 3,80,77,646/- and Cheque ... In a given situation, even it may become barred by limitation. It must also be borne in mind that commercial expediencies may lead a person to issue blank cheques. ......
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