The document discusses key provisions and amendments to the Negotiable Instruments Act of 1881 relating to dishonour of cheques, including definitions of offenses, requirements for initiating prosecution, and important judgements from the Supreme Court of India that have clarified ambiguities in the law. It examines topics such as post-dated cheques, jurisdiction, successive cheque presentations, legally enforceable debts, notice requirements, and the liability of company directors. The conclusion notes that while the law aims for expedited trials, cases in lower courts often move slowly.
This document discusses Section 138 of the Negotiable Instruments Act 1881, which deals with dishonoring of cheques. It defines key terms related to cheques like bearer cheque, order cheque, etc. It outlines the 5 ingredients required to constitute an offence under Section 138, which are drawing of cheque, presentation, returning unpaid, notice demanding payment, and failure to pay within 15 days of notice.
It describes the procedure for filing a complaint under this section, which involves a judicial magistrate conducting a summary trial. Guidelines from previous court cases on the summary trial procedure are also mentioned. The document discusses issues like jurisdiction, settlement during trial, and key cases related to Section 138 offenses. It provides details on the trial process
This document summarizes important case laws related to Section 138 of the Negotiable Instruments Act. It discusses recent interpretations of Section 138 by courts, the objectives of amendments to this Section, and key rulings on issues such as what constitutes a valid notice, who can file complaints, the liability of directors and partners, and when proceedings can be quashed. Over 30 specific case laws are summarized dealing with issues such as absconding accused, stop payment notices, definition of a holder in due course, and the burden of proof for defendants.
The document provides an overview of key amendments made to Section 138 of the Negotiable Instruments Act 1881 regarding dishonored checks. Key points include:
- Section 138 defines the dishonoring of a check as a criminal offense, with punishment of up to 2 years imprisonment or a fine up to twice the check amount.
- Later amendments increased the notice period for payment from 15 to 30 days and the maximum imprisonment from 1 to 2 years.
- Inserted sections aim to expedite trials for dishonored check cases within 6 months.
Section 138 of the negotiable instruments actAltacit Global
Section 138 of the Negotiable Instruments Act defines the dishonor of a cheque as a criminal offense. The 1988 amendment to this section clarified that dishonor for any reason, including insufficient funds, constitutes a criminal offense. The purpose of this amendment was to encourage the use of cheques and protect honest individuals dealing with cheques. Dishonor of a cheque is considered a criminal offense with punishment of up to 2 years imprisonment, a fine of twice the cheque amount, or both.
This presentation talks about the various aspects of Dishonour of cheque under Negotiable Instrumenmts Act 1881.
The presentation has been prepared as a project work and from basic research and understanding of law.
It must not be taken as any guidance, advise or any advertising on any part.
A Quick Guide to Action on Bouncing of ChequeAnil Chawla
Bouncing of a cheque invites criminal prosecution under section 138 of The Negotiable Instruments Act, 1881 in India. This Guide is meant to help entrepreneurs and small businesses cope with the problems that they often face when a cheque bounces. It gives the legal provisions in common man's language.
The document discusses the territorial jurisdiction of Section 138 of the Negotiable Instruments Act regarding dishonored checks. It summarizes key cases that have established that complaints can only be filed: 1) where the drawee bank is located, and 2) within 30 days of a check being returned to the complainant. This clarifies that only one court has jurisdiction, preventing harassment from multiple complaints. However, the applicability of this interpretation to "At Par" checks is still being debated.
This document summarizes a presentation on negotiable instruments and related laws. It discusses key concepts like absolute title, freely transferable title, and essential elements of negotiable instruments. It defines promissory notes, bills of exchange, and cheques. It also covers concepts like hundis, reasons for dishonor or non-acceptance of cheques and bills of exchange, and measures to avoid fraud related to negotiable instruments. The document includes case studies and questions from attendees, and responses providing legal advice regarding cheque bouncing cases.
This document discusses Section 138 of the Negotiable Instruments Act 1881, which deals with dishonoring of cheques. It defines key terms related to cheques like bearer cheque, order cheque, etc. It outlines the 5 ingredients required to constitute an offence under Section 138, which are drawing of cheque, presentation, returning unpaid, notice demanding payment, and failure to pay within 15 days of notice.
It describes the procedure for filing a complaint under this section, which involves a judicial magistrate conducting a summary trial. Guidelines from previous court cases on the summary trial procedure are also mentioned. The document discusses issues like jurisdiction, settlement during trial, and key cases related to Section 138 offenses. It provides details on the trial process
This document summarizes important case laws related to Section 138 of the Negotiable Instruments Act. It discusses recent interpretations of Section 138 by courts, the objectives of amendments to this Section, and key rulings on issues such as what constitutes a valid notice, who can file complaints, the liability of directors and partners, and when proceedings can be quashed. Over 30 specific case laws are summarized dealing with issues such as absconding accused, stop payment notices, definition of a holder in due course, and the burden of proof for defendants.
The document provides an overview of key amendments made to Section 138 of the Negotiable Instruments Act 1881 regarding dishonored checks. Key points include:
- Section 138 defines the dishonoring of a check as a criminal offense, with punishment of up to 2 years imprisonment or a fine up to twice the check amount.
- Later amendments increased the notice period for payment from 15 to 30 days and the maximum imprisonment from 1 to 2 years.
- Inserted sections aim to expedite trials for dishonored check cases within 6 months.
Section 138 of the negotiable instruments actAltacit Global
Section 138 of the Negotiable Instruments Act defines the dishonor of a cheque as a criminal offense. The 1988 amendment to this section clarified that dishonor for any reason, including insufficient funds, constitutes a criminal offense. The purpose of this amendment was to encourage the use of cheques and protect honest individuals dealing with cheques. Dishonor of a cheque is considered a criminal offense with punishment of up to 2 years imprisonment, a fine of twice the cheque amount, or both.
This presentation talks about the various aspects of Dishonour of cheque under Negotiable Instrumenmts Act 1881.
The presentation has been prepared as a project work and from basic research and understanding of law.
It must not be taken as any guidance, advise or any advertising on any part.
A Quick Guide to Action on Bouncing of ChequeAnil Chawla
Bouncing of a cheque invites criminal prosecution under section 138 of The Negotiable Instruments Act, 1881 in India. This Guide is meant to help entrepreneurs and small businesses cope with the problems that they often face when a cheque bounces. It gives the legal provisions in common man's language.
The document discusses the territorial jurisdiction of Section 138 of the Negotiable Instruments Act regarding dishonored checks. It summarizes key cases that have established that complaints can only be filed: 1) where the drawee bank is located, and 2) within 30 days of a check being returned to the complainant. This clarifies that only one court has jurisdiction, preventing harassment from multiple complaints. However, the applicability of this interpretation to "At Par" checks is still being debated.
This document summarizes a presentation on negotiable instruments and related laws. It discusses key concepts like absolute title, freely transferable title, and essential elements of negotiable instruments. It defines promissory notes, bills of exchange, and cheques. It also covers concepts like hundis, reasons for dishonor or non-acceptance of cheques and bills of exchange, and measures to avoid fraud related to negotiable instruments. The document includes case studies and questions from attendees, and responses providing legal advice regarding cheque bouncing cases.
The document provides an overview of dishonored cheques in India, including:
- Key parties in a cheque transaction and legal definitions. Dishonor can occur due to insufficient funds or exceeding arranged limits.
- Remedies for dishonor under civil law through lawsuits and criminal law by proving fraudulent intent, but these have limitations.
- The Negotiable Instruments Act of 1881 created a new offense for dishonor with a stricter liability standard to address weaknesses in prior remedies. Specific criteria like notice and non-payment timelines must be met for this offense.
Critical study of dishonour of cheques under negotiable instruments act,1881merenjithr
The document discusses key provisions and amendments to the Negotiable Instruments Act of 1881 regarding dishonour of cheques, including definitions of offenses, requirements for prosecution, and important case law interpretations from the Supreme Court of India that have clarified ambiguities in the Act. It examines issues such as jurisdiction, successive cheque presentations, legally enforceable debts, notice requirements, and the liability of company directors. The overall objective of the Act and amendments is to encourage the use of cheques and enhance their credibility by penalizing dishonored cheques.
Useful article on Negotiable instrument act 138 Arjun Randhir
very useful compilation on negotiable instrument act case 138. not for commercial purpose only for educational purpose.. help to lawyer, judge, or legal student
This document summarizes key aspects of dishonored cheques under Indian law. It defines what constitutes a bill of exchange and cheque, discusses postdated cheques, the process of depositing and endorsing cheques, and key details like the payee, date, and amount. It also outlines when dishonor of a cheque becomes a criminal offense, the complaint process and associated timelines, penalties for drawers, and jurisdiction rules.
There are three types of negotiable instruments: promissory notes, bills of exchange, and cheques. A cheque is an unconditional order in writing to a banker to pay a certain sum of money. A cheque can be dishonored for reasons like insufficient funds or a frozen account. Under Section 138 of the Negotiable Instruments Act, a person whose cheque is dishonored can be punished with up to 2 years imprisonment, a fine of twice the cheque amount, or both. The legal process for recovering money from a dishonored cheque involves issuing a notice, filing a criminal case if payment is not made, presenting evidence, and the court issuing a judgment.
This document discusses dishonored cheques under Section 138 of the Negotiable Instruments Act 1881 in India. It defines what a cheque is and different types of cheques. It explains that a cheque is dishonored if the bank does not credit it for reasons like insufficient funds or signature mismatch. The document outlines the 5 ingredients required for an offense under Section 138 and the legal procedure for filing a complaint, including sending a demand notice within 30 days, allowing 15 days for payment, and filing a complaint within 30 days of the cause of action. It notes the punishment for dishonoring a cheque is up to 2 years imprisonment and a fine up to twice the cheque amount. Some possible defenses in such cases are also listed.
NEGOTIABLE INSTRUMENTS ACT, 1881 – CRIMINAL LIABILITY OF COMPANIES FOR OFFENC...IAEME Publication
This paper attempts to delineate the criminal liability of companies for offence committed by corporate bodies under section 138 – 141 of the Negotiable Instrument Act. The company and all the people responsible for the affairs of the company will be liable to be prosecuted against and punished. As the company is having a separate legal entity, it is not immune to the punishment and fine for offence committed under section 138 of the N.I. Act. The vicarious liability would cast on three category of persons viz: the company itself, every person who was in charge of the affairs of the company, and other persons like director, or a manager, or a secretary, or other officer of the company. To get clarity on the point of law, relevant territorial jurisdiction for filing a complaint, various decisions of the courts is discussed in this study.
The document discusses the laws around dishonour of negotiable instruments like bills of exchange, promissory notes, and cheques in India. It defines dishonour as non-acceptance or non-payment of obligations. A negotiable instrument can be dishonoured by non-acceptance or non-payment, with different implications for each type of instrument. The holder must give notice of dishonour and may have to get the instrument noted and protested by a notary public to establish liability of prior parties.
The document discusses bankers, customers, and dishonour of cheques under Indian law. It provides definitions of collecting bankers and paying bankers. It explains cheque clearance processes and protections provided to collecting bankers under Section 131 of the Negotiable Instruments Act. The duties and liabilities of paying bankers are greater, including verifying signatures and endorsements. A cheque holder can proceed against the bank if the drawer is discharged or the bank pays out of due course. Dishonour of cheques is governed by the Act, with conditions for presumption of dishonour and penalties for failure to pay within 15 days of notice. Offences can also apply to companies and directors.
The document discusses dishonor of cheques under the Negotiable Instruments Act of 1881 in India. It defines a cheque and dishonor of a cheque. The key points covered include that dishonor of a cheque for insufficient funds is a criminal offense under Section 138 of the Act. Some common reasons for dishonor discussed are mistakes, requests by the drawer, insolvency, and court orders. Dishonor of cheques is regulated to protect people from fake or insufficient fund cheques. In summary, the document outlines India's laws around dishonor of cheques and reasons cheques may be dishonored.
The document discusses various aspects of bouncing of cheques such as grounds for dishonour, requirements for filing a case under Section 138 of the Negotiable Instruments Act, penalties, jurisdiction of courts, process of filing a case, stages of trial and appeal process. It provides details on who can be prosecuted for cheque bouncing, defenses available, changes made by amendments and steps involved in legal recourse for cheque dishonour.
David purchased a wedding package from Syarikat Cinta Sejati that included clothes and photographs. However, he was dissatisfied with the quality of the photographs and clothes provided. The most appropriate method for David to seek compensation other than litigation is through the Tribunal for Consumer Claims. The procedures for bringing a claim to the tribunal include filing a claim form, serving notice to the respondent, attending a negotiation session, a tribunal hearing if needed, and the tribunal issuing a final binding decision with possible compensation for David.
case law on Burden of proof in Negotiable Instrument Act 1881MehulMayank2
The appellate court upheld the acquittal of the respondent in the case of Ranjit Singh Sethi v. Abdul Jalil Shaikh Abdulla for the following reasons:
1. The respondent was able to provide evidence of periodic payments made to the complainant prior to the alleged date of loan, contradicting the complainant's claims.
2. The complainant failed to explain these prior transactions or provide proof of the alleged loan amount.
3. Based on the evidence and contradictions in the complainant's case, the appellate court determined the trial court was justified in finding reasonable doubt over the existence of a legally enforceable debt.
Source of income of complainant has to be proved in 138 ni act casesanjsur28
The Supreme Court of India heard an appeal regarding a case under Section 138 of the Negotiable Instruments Act. The complainant had alleged that the appellant borrowed Rs. 14 lakhs in cash in 1997 and issued post-dated cheques that were dishonored. The trial court acquitted the appellant, finding that the complainant did not prove the source of the loan amount. The High Court set aside the acquittal and remanded the case. The Supreme Court allowed the appeal, setting aside the High Court judgment. It found that the trial court's conclusion that the complainant did not prove a legally recoverable debt was based on proper appreciation of evidence.
The document summarizes the Negotiable Instruments Act of 1881 in India. It discusses the history of the Act, which was originally drafted in 1886 and introduced in 1867, undergoing several revisions. It describes the main types of negotiable instruments covered by the Act: promissory notes, bills of exchange, and cheques. For each type, it outlines the key definitions, parties involved, and requirements. It also covers features of negotiable instruments like transferability and presumptions made. Finally, it discusses Section 138 related to dishonor of cheques and the rights and remedies available in such cases.
Maria bought a pair of sunglasses from Syarikat Nice 2C that left marks on her cheeks, making her uncomfortable. She asked for a replacement pair but was refused. Maria wants to file a claim against Syarikat Nice 2C at the Tribunal for Consumer Claims. The Tribunal may order Syarikat Nice 2C to replace or repair the sunglasses, refund Maria's money, or award her compensation for damages suffered from the marks. Maria must follow procedures like filing a statement of claim and attending a hearing to pursue her claim.
This presentation is on Negotiable instrument and it covers following points :-
Introduction
Negotiable instrument
Characteristics of negotiable instrument
Presumption as to negotiable instrument
Types of negotiable instruments
Maturity or days of grace
Negotiation & Assignment
Endorsement
Holder in due course
Dishonor of negotiable instrument
Discharge of negotiable instrument
This document outlines the respondent's written submission in response to an appeal filed by the appellants against a High Court decision in favor of the respondent's winding up petition against the 1st appellant company. The respondent argues that the appeal is not valid for two reasons: 1) The company is already wound up so the 2nd appellant does not have authority to file the appeal on the company's behalf. 2) The appellants' affidavit in opposition to the winding up petition was filed late in contravention of mandatory timelines in the Companies Winding Up Rules, so it should be considered inadmissible. The respondent cites several court cases to support the argument that late filing of affidavits cannot be allowed as it violates mandatory requirements.
This document summarizes the background of a civil case between Madasama Goodway Sdn Bhd and Lim Eng Huat regarding the sale of a property. Key points:
- Lim Eng Huat had rented a property from Madasama and wanted to purchase it after a fire damaged the building. They signed an agreement on July 19, 2002 for RM270,000.
- Lim paid a deposit and took steps to obtain financing, but Madasama refused to complete the sale. Lim filed a lawsuit seeking specific performance of the agreement.
- The High Court ruled in Lim's favor, but Madasama appealed. The document outlines the claims and evidence presented by both sides regarding whether the agreement was
The document discusses the arbitration process between EPS and GI regarding a death insurance claim.
1) EPS must first appoint an arbitrator and notify GI within 30 days. If they fail to do so, either party can request the court to appoint an arbitrator.
2) Once appointed, the arbitrator will hold preliminary meetings to discuss procedures, dates, and evidence. They will then conduct hearings where both sides can present their case.
3) The arbitrator will make a final decision on whether the death was accidental or suicide based on the evidence provided. This decision will settle the insurance claim dispute between EPS and GI.
Dokumen tersebut membahas tentang teh dan kandungan zat aktif dalam teh seperti polifenol, vitamin, mineral, dan kafein. Secara khusus, dibahas tentang manfaat polifenol sebagai antioksidan, kandungan vitamin dan mineral dalam teh yang bermanfaat untuk kesehatan, serta efek kafein yang dapat menimbulkan efek samping apabila dikonsumsi berlebihan.
The document provides an overview of dishonored cheques in India, including:
- Key parties in a cheque transaction and legal definitions. Dishonor can occur due to insufficient funds or exceeding arranged limits.
- Remedies for dishonor under civil law through lawsuits and criminal law by proving fraudulent intent, but these have limitations.
- The Negotiable Instruments Act of 1881 created a new offense for dishonor with a stricter liability standard to address weaknesses in prior remedies. Specific criteria like notice and non-payment timelines must be met for this offense.
Critical study of dishonour of cheques under negotiable instruments act,1881merenjithr
The document discusses key provisions and amendments to the Negotiable Instruments Act of 1881 regarding dishonour of cheques, including definitions of offenses, requirements for prosecution, and important case law interpretations from the Supreme Court of India that have clarified ambiguities in the Act. It examines issues such as jurisdiction, successive cheque presentations, legally enforceable debts, notice requirements, and the liability of company directors. The overall objective of the Act and amendments is to encourage the use of cheques and enhance their credibility by penalizing dishonored cheques.
Useful article on Negotiable instrument act 138 Arjun Randhir
very useful compilation on negotiable instrument act case 138. not for commercial purpose only for educational purpose.. help to lawyer, judge, or legal student
This document summarizes key aspects of dishonored cheques under Indian law. It defines what constitutes a bill of exchange and cheque, discusses postdated cheques, the process of depositing and endorsing cheques, and key details like the payee, date, and amount. It also outlines when dishonor of a cheque becomes a criminal offense, the complaint process and associated timelines, penalties for drawers, and jurisdiction rules.
There are three types of negotiable instruments: promissory notes, bills of exchange, and cheques. A cheque is an unconditional order in writing to a banker to pay a certain sum of money. A cheque can be dishonored for reasons like insufficient funds or a frozen account. Under Section 138 of the Negotiable Instruments Act, a person whose cheque is dishonored can be punished with up to 2 years imprisonment, a fine of twice the cheque amount, or both. The legal process for recovering money from a dishonored cheque involves issuing a notice, filing a criminal case if payment is not made, presenting evidence, and the court issuing a judgment.
This document discusses dishonored cheques under Section 138 of the Negotiable Instruments Act 1881 in India. It defines what a cheque is and different types of cheques. It explains that a cheque is dishonored if the bank does not credit it for reasons like insufficient funds or signature mismatch. The document outlines the 5 ingredients required for an offense under Section 138 and the legal procedure for filing a complaint, including sending a demand notice within 30 days, allowing 15 days for payment, and filing a complaint within 30 days of the cause of action. It notes the punishment for dishonoring a cheque is up to 2 years imprisonment and a fine up to twice the cheque amount. Some possible defenses in such cases are also listed.
NEGOTIABLE INSTRUMENTS ACT, 1881 – CRIMINAL LIABILITY OF COMPANIES FOR OFFENC...IAEME Publication
This paper attempts to delineate the criminal liability of companies for offence committed by corporate bodies under section 138 – 141 of the Negotiable Instrument Act. The company and all the people responsible for the affairs of the company will be liable to be prosecuted against and punished. As the company is having a separate legal entity, it is not immune to the punishment and fine for offence committed under section 138 of the N.I. Act. The vicarious liability would cast on three category of persons viz: the company itself, every person who was in charge of the affairs of the company, and other persons like director, or a manager, or a secretary, or other officer of the company. To get clarity on the point of law, relevant territorial jurisdiction for filing a complaint, various decisions of the courts is discussed in this study.
The document discusses the laws around dishonour of negotiable instruments like bills of exchange, promissory notes, and cheques in India. It defines dishonour as non-acceptance or non-payment of obligations. A negotiable instrument can be dishonoured by non-acceptance or non-payment, with different implications for each type of instrument. The holder must give notice of dishonour and may have to get the instrument noted and protested by a notary public to establish liability of prior parties.
The document discusses bankers, customers, and dishonour of cheques under Indian law. It provides definitions of collecting bankers and paying bankers. It explains cheque clearance processes and protections provided to collecting bankers under Section 131 of the Negotiable Instruments Act. The duties and liabilities of paying bankers are greater, including verifying signatures and endorsements. A cheque holder can proceed against the bank if the drawer is discharged or the bank pays out of due course. Dishonour of cheques is governed by the Act, with conditions for presumption of dishonour and penalties for failure to pay within 15 days of notice. Offences can also apply to companies and directors.
The document discusses dishonor of cheques under the Negotiable Instruments Act of 1881 in India. It defines a cheque and dishonor of a cheque. The key points covered include that dishonor of a cheque for insufficient funds is a criminal offense under Section 138 of the Act. Some common reasons for dishonor discussed are mistakes, requests by the drawer, insolvency, and court orders. Dishonor of cheques is regulated to protect people from fake or insufficient fund cheques. In summary, the document outlines India's laws around dishonor of cheques and reasons cheques may be dishonored.
The document discusses various aspects of bouncing of cheques such as grounds for dishonour, requirements for filing a case under Section 138 of the Negotiable Instruments Act, penalties, jurisdiction of courts, process of filing a case, stages of trial and appeal process. It provides details on who can be prosecuted for cheque bouncing, defenses available, changes made by amendments and steps involved in legal recourse for cheque dishonour.
David purchased a wedding package from Syarikat Cinta Sejati that included clothes and photographs. However, he was dissatisfied with the quality of the photographs and clothes provided. The most appropriate method for David to seek compensation other than litigation is through the Tribunal for Consumer Claims. The procedures for bringing a claim to the tribunal include filing a claim form, serving notice to the respondent, attending a negotiation session, a tribunal hearing if needed, and the tribunal issuing a final binding decision with possible compensation for David.
case law on Burden of proof in Negotiable Instrument Act 1881MehulMayank2
The appellate court upheld the acquittal of the respondent in the case of Ranjit Singh Sethi v. Abdul Jalil Shaikh Abdulla for the following reasons:
1. The respondent was able to provide evidence of periodic payments made to the complainant prior to the alleged date of loan, contradicting the complainant's claims.
2. The complainant failed to explain these prior transactions or provide proof of the alleged loan amount.
3. Based on the evidence and contradictions in the complainant's case, the appellate court determined the trial court was justified in finding reasonable doubt over the existence of a legally enforceable debt.
Source of income of complainant has to be proved in 138 ni act casesanjsur28
The Supreme Court of India heard an appeal regarding a case under Section 138 of the Negotiable Instruments Act. The complainant had alleged that the appellant borrowed Rs. 14 lakhs in cash in 1997 and issued post-dated cheques that were dishonored. The trial court acquitted the appellant, finding that the complainant did not prove the source of the loan amount. The High Court set aside the acquittal and remanded the case. The Supreme Court allowed the appeal, setting aside the High Court judgment. It found that the trial court's conclusion that the complainant did not prove a legally recoverable debt was based on proper appreciation of evidence.
The document summarizes the Negotiable Instruments Act of 1881 in India. It discusses the history of the Act, which was originally drafted in 1886 and introduced in 1867, undergoing several revisions. It describes the main types of negotiable instruments covered by the Act: promissory notes, bills of exchange, and cheques. For each type, it outlines the key definitions, parties involved, and requirements. It also covers features of negotiable instruments like transferability and presumptions made. Finally, it discusses Section 138 related to dishonor of cheques and the rights and remedies available in such cases.
Maria bought a pair of sunglasses from Syarikat Nice 2C that left marks on her cheeks, making her uncomfortable. She asked for a replacement pair but was refused. Maria wants to file a claim against Syarikat Nice 2C at the Tribunal for Consumer Claims. The Tribunal may order Syarikat Nice 2C to replace or repair the sunglasses, refund Maria's money, or award her compensation for damages suffered from the marks. Maria must follow procedures like filing a statement of claim and attending a hearing to pursue her claim.
This presentation is on Negotiable instrument and it covers following points :-
Introduction
Negotiable instrument
Characteristics of negotiable instrument
Presumption as to negotiable instrument
Types of negotiable instruments
Maturity or days of grace
Negotiation & Assignment
Endorsement
Holder in due course
Dishonor of negotiable instrument
Discharge of negotiable instrument
This document outlines the respondent's written submission in response to an appeal filed by the appellants against a High Court decision in favor of the respondent's winding up petition against the 1st appellant company. The respondent argues that the appeal is not valid for two reasons: 1) The company is already wound up so the 2nd appellant does not have authority to file the appeal on the company's behalf. 2) The appellants' affidavit in opposition to the winding up petition was filed late in contravention of mandatory timelines in the Companies Winding Up Rules, so it should be considered inadmissible. The respondent cites several court cases to support the argument that late filing of affidavits cannot be allowed as it violates mandatory requirements.
This document summarizes the background of a civil case between Madasama Goodway Sdn Bhd and Lim Eng Huat regarding the sale of a property. Key points:
- Lim Eng Huat had rented a property from Madasama and wanted to purchase it after a fire damaged the building. They signed an agreement on July 19, 2002 for RM270,000.
- Lim paid a deposit and took steps to obtain financing, but Madasama refused to complete the sale. Lim filed a lawsuit seeking specific performance of the agreement.
- The High Court ruled in Lim's favor, but Madasama appealed. The document outlines the claims and evidence presented by both sides regarding whether the agreement was
The document discusses the arbitration process between EPS and GI regarding a death insurance claim.
1) EPS must first appoint an arbitrator and notify GI within 30 days. If they fail to do so, either party can request the court to appoint an arbitrator.
2) Once appointed, the arbitrator will hold preliminary meetings to discuss procedures, dates, and evidence. They will then conduct hearings where both sides can present their case.
3) The arbitrator will make a final decision on whether the death was accidental or suicide based on the evidence provided. This decision will settle the insurance claim dispute between EPS and GI.
Dokumen tersebut membahas tentang teh dan kandungan zat aktif dalam teh seperti polifenol, vitamin, mineral, dan kafein. Secara khusus, dibahas tentang manfaat polifenol sebagai antioksidan, kandungan vitamin dan mineral dalam teh yang bermanfaat untuk kesehatan, serta efek kafein yang dapat menimbulkan efek samping apabila dikonsumsi berlebihan.
4th Annual Life Changing Lives Gala with special honoree Muhammad Ali. Performance by Grammy winner Robin Thicke and menu by celebrity chef Cat Cora. Gala takes place on September 11 every year and raises millions for amazing charities while remember our countries heroes. Sponsorship opportunities and table sales available. World renowned Chef Cat Cora just came on to design our menu. Also Yankee/Angels play across the street from our venue in Anaheim that day. Great outdoor signage opportunities!
Disruptive innovation refers to new products or services that disrupt existing markets and businesses. Clayton Christensen defined disruptive innovation in 1997 as innovations that enter markets in a simple and convenient way but eventually meet customer needs in new ways. Examples include iTunes disrupting the music industry, Amazon and eBay disrupting brick-and-mortar retail, and Skype disrupting traditional telecommunications. Technological growth, especially on the internet, has accelerated innovation and lowered barriers to entry, allowing new entrants to disrupt incumbent businesses through new distribution channels and business models. Exponential increases in computing power and emerging technologies will likely continue fueling disruptive innovation.
The document discusses building a server-side JavaScript framework called ASPJS that brings modern JavaScript tricks like modules, namespacing, and MVC patterns to older server-side JavaScript implementations. It provides an overview of features like routing, object-relational mapping, templating, and an ActiveRecord-inspired model layer. Code examples demonstrate using libraries, application structure, validation, relationships, and a jQuery-like DOM implementation on the server. Future goals include improved testing and debugging and support for additional platforms.
The document describes the Modified Cornell Note Taking System for organizing lecture notes. It consists of a record column on the right for writing main ideas and details, and a question column on the left for writing questions about the notes. After class, questions are written in the question column corresponding to the notes. Later, the questions can be answered without looking at the notes to help with memory retention. The system promotes relating ideas, leaving space for additions, and reviewing notes weekly.
Discurs sobre igualtat de l'eurodiputada sueca Cecilia Wikström al II fem.tal...fem talent
Discurs sobre igualtat d'oportunitats de l'eurodiputada sueca Cecilia Wikström al II fem.talent fòrum, celebrat el 22 de febrer de 2013, Equal Pay Day, el Dia contra la Desigualtat Salarial per raó de gènere.
The document discusses how applying basic technology like word processing, spreadsheets, and databases in the classroom can improve productivity, organization, and the appearance of student work and presentations while helping them meet deadlines. It also mentions software tools like the "Basic Three" of word processing, spreadsheets, and databases, and discusses other types of software tools and their purposes as well as online resources for teachers.
React Walk-Thru - Santa Cruz JS, May 2015Simon Sturmer
The document provides an overview of React including:
- An introduction to ES6 features like template strings and arrow functions useful for React.
- React uses a declarative paradigm where views are pure functions of state.
- JSX is just syntax sugar that compiles to regular JavaScript and is optional.
- Components can be composed to extend functionality and add defaults rather than wrapping elements.
- Major companies that use React like Netflix, AirBnB, and Facebook are listed.
This document presents three unusual inventions: a salt shaker attached to a finger skate for easily passing to others, a cup with an attached glove for a handle to avoid burns, and a vibrating backpack that provides massages while walking. The inventions are presented as solutions to common problems and inconveniences with claims that they make everyday tasks easier.
This document provides guidelines for a group presentation project on one of the five senses. It instructs students to create a visual aide, define key vocabulary and anatomy, include a demonstration or activity, and produce a handout. Students must cite all sources, including images and ideas used. Fair use policies allow limited use of copyrighted material without permission. The document provides links to search tools to find images with usage rights labeled for reuse under creative commons licenses.
React Fundamentals - Jakarta JS, Apr 2016Simon Sturmer
This document discusses React fundamentals and why React is a good choice for building user interfaces. It explains that React uses a component-based approach where each component is a pure function of state. This makes the UI easy to reason about and improves testability, performance, and code reuse. It also notes that React uses immutable data structures and re-renders the entire UI when state changes, similar to how server-side rendering works. This avoids issues with directly manipulating the DOM and helps developers build more reliable software faster.
This document discusses negotiable instruments under Indian law. It begins with an introduction to the Negotiable Instruments Act enacted in 1881 in India, which was based on English common law relating to promissory notes, bills of exchange, and cheques. It then defines negotiable instruments and their key characteristics, such as being in writing, unconditional promises to pay certain amounts, and being freely transferable. The document discusses the essential elements and parties involved in promissory notes, bills of exchange, and cheques. It also distinguishes between these different types of negotiable instruments and discusses dishonoring of cheques and the legal procedures and recent judgments related to dishonored cheques.
The document provides details from the weekly progress report of an internship at Amity University in Uttar Pradesh from May 28th to June 1st.
Over the course of the week, the intern researched the Negotiable Instruments Act and wrote about bills of exchange and cheques. They learned about parties to negotiable instruments, endorsement, dishonor of cheques, and the Trade Unions Act of 1926. The intern observed court cases, assisted their guide with case files, and researched assigned legal topics including the definition and registration of trade unions.
Legal Notice presentation ABHIJITH.pptx for llmlathamraj23
This document summarizes key aspects of Section 138 of the Negotiable Instruments Act 1882 in India regarding dishonored checks. It defines relevant terms like checks, dishonor, truncation. Section 138 makes the drawer of a check criminally liable if the check bounces due to insufficient funds. A legal notice must be served to the drawer within 30 days of the check bouncing, demanding payment within 15 days, or criminal prosecution can be initiated. The document outlines essential information that must be included in a legal notice served under Section 138, such as names and addresses of claimant and recipient, check details, reason for dishonor, and warning of legal action.
1. The document discusses the provisions relating to dishonor of negotiable instruments such as cheque under Section 138 of the Negotiable Instruments Act. It summarizes the applicability of Section 138, the duties of the payee/holder, reasons for dishonor, punishment for drawer, and procedures for filing complaints.
2. It also summarizes offenses by companies/firms, cognizance of offenses, power of courts for summary trials, provisions for interim compensation and deposits for appeal in cases of dishonor of cheque.
3. Key aspects covered include duties of payee/holder, reasons for attracting Section 138 penalties, punishments for drawer, jurisdiction of courts, and special provisions for speedy trials,
1. The document discusses the provisions relating to dishonor of cheques under Section 138 of the Negotiable Instruments Act. It provides details about applicability of Section 138, reasons for dishonor, duties of the payee/holder, punishment for drawer, offences by companies/firms, and cognizance of offences.
2. It also summarizes the provisions regarding speedy trial procedures, interim compensation, deposit for appeal and repayment in case of acquittal in appeal.
3. Key highlights include presumption that cheque is issued to discharge legally enforceable debt, duties of payee/holder such as notice of dishonor and filing complaint, punishment including imprisonment and fine for drawer, and jurisdiction of
The Supreme Court of India allowed the appeal challenging the conviction of the appellant in a cheque bouncing case.
The Court held that the lower courts erred in denying the appellant the right to cross-examine the complainant, as the relevant statute did not permit such a denial due to failure to pay interim compensation. The Court set aside the decisions of the lower courts and directed that the case be restored to allow cross-examination of the complainant, and for further proceedings. The Court also directed the appellant to deposit 20% of the cheque amount as interim compensation.
A document or a piece of paper that guarantees payment of a certain amount of money to a specified person (payee) either immediately upon demand or at a predetermined period is known as a negotiable instrument. It is a document made up of a contract that ensures unconditional payment of money that can be paid now or later. In other words, any document that grants ownership over a quantum of money as well as can be transferred by delivery is addressed as a negotiable instrument. To govern the use of negotiable instruments in India, the Negotiable Instrument Act of 1881 was defined. On March 1, 1881, the Act of 1881, came into force and extends to the whole of India. It is “An Act to define and amend the law relating to Promissory Notes, Bills of Exchange and Cheques.” The Negotiable Instrument Act consists of a total of 147 Sections that are spread over 17 chapters. As per the Negotiable Instrument Act of 1881, no phrase appropriately defines ‘negotiable instrument’ whereas Section 13 of the Act states that “A negotiable instrument means a promissory note, bill of exchange or cheque payable either to order or to bearer.”
The Presentation for Security Cheques Judgements FOR and AGAINST the Complai...amanvijayjindal
The Supreme Court ruled in favor of the complainant in a case involving dishonored cheque(s) under Section 138 of the Negotiable Instruments Act.
The Court held that even if a cheque is dishonored due to "stop payment" instructions, an offense under Section 138 can still be made out. Additionally, the Court found that the presumption under Section 139 of the Act applies even in cases where the cheque is dishonored due to stop payment instructions. Under Section 139, the Court must presume that the cheque was received by the holder to discharge a debt or liability, in whole or in part. Therefore, the Court concluded that dishonor due to stop payment does not prevent criminal liability from arising under Section 138
Article 41 payment and pay less notices february 2017 rm03Nick Cheetham
The document discusses several recent court cases regarding payment provisions in construction contracts under the Local Government, Economic Development and Construction Act 2009. The cases have clarified that if a party fails to issue payment or pay less notices, the other party can issue their own notice claiming the amount due. However, more recent cases have found that for a notice to be valid and enforceable, it must meet strict requirements regarding form, substance, and intent, and be issued in accordance with the contract. If these requirements are not met, failure to issue contrary notices does not automatically entitle the claiming party to payment.
Cheque Dishonoured - Legal Tips On Your Cheque BounceLegal Kart
1. Cheque bounce is a criminal offense in India that can result in imprisonment of up to 2 years or a fine, as per Section 138 of the Negotiable Instruments Act.
2. If a cheque is dishonored, the payee can send a notice to the drawer demanding payment within 15 days. If payment is not made, a complaint can be filed in court along with relevant documents.
3. Once a cheque bounce complaint is filed, the drawer will be summoned to court for proceedings. It is advisable to seek legal counsel to prevent imprisonment or fines for cheque bouncing.
The document discusses negotiable instruments and defines key terms like promissory note, bill of exchange, and cheque. It notes that the Negotiable Instruments Act of 1881 governs these instruments and defines a promissory note as an unconditional promise to pay a certain sum, a bill of exchange as an unconditional order to pay, and a cheque as a bill of exchange drawn on a bank. The document also summarizes consequences for dishonored cheques, noting that failure to pay within 30 days of notice can result in imprisonment or fines, and restrictions on appeals without depositing 50% of the dishonored amount.
The document discusses the obligations and precautions of banks when honoring customer cheques under the Negotiable Instruments Act. It explains that banks must honor cheques drawn by customers if there are sufficient funds, and outlines various precautions banks must take regarding genuineness of cheques, customer accounts and balances, and legal restrictions. Precautions include verifying signatures, dates, amounts, endorsements, checking for stops on payments or legal orders, and only making payments that constitute "payment-in-due-course".
This document provides an overview of dishonour of cheques under Indian law. It defines dishonour of a cheque as when it is returned unpaid by the drawee bank for reasons of insufficient funds or signature mismatch. There are two kinds of dishonour: non-acceptance and non-payment. Dishonour can result in legal action against the drawer, loss of negotiability of the cheque, and accrual of a cause of action if a demand notice is issued and unpaid. Dishonour becomes a criminal offense if the payee gives notice demanding payment within 15 days and payment is not made within a further 15 days. Liability on dishonour can be civil, resulting in a fine of twice the
The document discusses key concepts related to negotiable instruments under Indian law, including definitions of holder, holder in due course, and payment in due course. It also covers the different types of cheque crossing - general crossing, special crossing, restrictive crossing, and non-negotiable crossing. Students are assigned questions to differentiate between a holder and holder in due course, and between payment and payment in due course. They are instructed to email their responses with identifying details.
The Full Bench was constituted to determine whether a consignee who is not the owner of goods but is consigned them for sale on commission can maintain a suit for loss caused to the goods in transit. The court held that a consignee in such a situation can maintain a suit, as the railway is primarily liable to the consignor as the bailor, and entering a contract for the benefit of a third party like the consignee is valid. The consignee can enforce payment of cash value for goods that deteriorated, making delivery improper.
Negotiable Instruments Act 1881
Significance of negotiable instruments
Features of negotiable instruments
Cheque Meaning
Types of Cheque
MICR – Meaning
Crossing
Crossing of Cheque
Holder in due course
Payment in due course
Endorsement
Paying Banker
Dishonour of Cheque
Statutory protection to a paying Banker
Material Alteration
Statutory protection in case of a Materially altered Cheque
Collecting Banker
Duties and Liabilities of Collecting Banker
Protection of Collection Banker
Order XXI Rule 1 of the Code of Civil Procedure describes the three modes of paying money under a decree: (1) depositing into the court, (2) depositing out of court to the decree holder, and (3) any other mode directed by the court. It requires accurate details in money orders or bank payments, and states that interest ceases from the date of notice or payment. Rule 2 requires the decree holder to certify out-of-court payments to the court, and allows the judgment debtor to apply to have payments recorded if uncertified. Recorded payments are then recognized by executing courts.
The document discusses negotiable instruments under the Negotiable Instruments Act of 1881. It defines negotiable instruments as those that can be transferred between parties, such as checks, drafts, bills of exchange, and some promissory notes. The key requirements for an instrument to be negotiable are that it must be in writing, signed, an unconditional promise to pay a fixed sum, freely transferable, and payable on demand or at a definite time. The main types of negotiable instruments are promissory notes, bills of exchange, and checks. Dishonor or bouncing of a check is a criminal offense, with punishments including fines and imprisonment.
Critical study of dishonour of cheques under negotiable instruments act,1881
1. Critical Study of Dishonour of Cheques Under
Negotiable Instruments Act,1881
Introduction:
Cheques are very convenient instruments which can be issued to settle payments or obligations in a contract
or even to give gifts. Section 138 to 142 are incorporated in Negotiable Instruments Act,1881 with a view to
encourage the culture of use of cheques and enhancing the credibility of the instrument. The NI Act makes
the drawer of cheque liable for penalties in case of dishonour of cheques due to insufficiency of funds or for
the reason that it exceeds the arrangements made by the drawer. The NI Act also contains sufficient safe
guards to protect the drawer of cheques by giving him an opportunity to make good the payment of
dishonoured Cheque when a demand is made by the payee.
History of the ACT and objective of amendments:
The Negotiable Instruments Act, 1881 was amended by the Banking, Public Financial Institutions and
Negotiable Instruments Laws (Amendment) Act, 1988 to insert a new Chapter XVII with Sections 138 to
142. These new sections came into force w.e.f 1.4.1989.
The Act was further amended in 2002 by inserting Sections 143 to 147 w.e.f 06.02.2003 to deal with certain
deficiencies noticed in the Act. Salient features of amendment are acceptance of Bankers memo of dishonour
as prima facie evidence, evidence of witness or accused on affidavit, serving of summons by post/courier for
speedy trial/prosecution, increase of period for issuance of notice by payee and enhancing of punishment.
Thus the main thrust of the amendment is to provide for a speedy and time bound trial, punishment of 2 years
and double the amount of the cheque as fine. Another notable feature is that it provides for compounding of
the offence.
Offence under the NI Act:
Offence under Section 138 of the N I Act shall be deemed to have been committed, if the following
conditions are satisfied:
a) Cheque must have been drawn by a person(the drawer) in favour of a payee on his bank account for
making payment
2. b) Such payment must be either in whole or partial discharge of a legally enforceable debt
c) Cheque must have been returned by the Banker to the payee or holder in due course due to insufficient
balance in the account of the drawer or it exceeds the arrangement he had with the bank,
Proviso requires fulfillment following additional conditions:
a) Cheque must be presented within a period of 6 months from the date of cheque or its validity period which
ever is earlier.
b) The payee or holder in due course must demand payment of the cheque amount by written notice within
15 days of receipt of notice
c) Such notice must be issued within 30 days from the date of receipt of intimation of dishonour from bank
and
d) The drawer of cheque fails to pay demanded sum within 15 days from the date of receipt of the notice
Punishment for offence
The punishment provided for the offence u/s 138 is imprisonment for a term which may extend to a maximum
period of 2 years or with a fine which may extend to a maximum of twice the amount of the cheque or with
both.
Let us now shift our focus to certain requirements for making out an offence and for initiating prosecution. It is
equally important for us to examine legal issues settled by judgments of Supreme Court. These judgements
paved way for filling up deficiencies in the Act and also in some cases provided for clarifications wherever
ambiguity existed.
1. Post dated cheque and its dishonour
3. Every cheque shall be presumed to be drawn on the date mentioned on the face of the cheque. A post dated
cheque is a bill of exchange when it is written or drawn and it is not payable on demand until the date shown
on the cheque. If post dated cheque is dishonored because of its presentation before it became payable on
demand, no offence u/s 138 can be alleged. The controversy is settled by the decision of the supreme court
in Anil Kumar Sawhney Vs Gulshan Rai(1993) 4 SCC 424. In this case Supreme Court held that a post
dated cheque is a bill of exchange and it becomes a cheque under the NI act only on the date which is written
on the said cheque and period of six months has to be reckoned from the date of the cheque.
2. Jurisdiction:
Most often people are confused about the place where criminal compliant can be filed under the NI Act, as
the Act is silent on this matter. Since the Criminal courts are approached, the issue needs to be examined
from the point of view of the Criminal Procedure Code. Section 177 of CrPC provides that every offence
shall ordinarily be inquired into and tried by a Court within whose local jurisdiction it was committed. Section
178 provides that offence may be tried at by a court having jurisdiction over any of the local areas where
offence is committed. It is possible that an offence may be committed in several local areas or partly in one
area and partly in another area. It is also possible that some times offence may consist of several acts done in
different areas In all the above situations, the court having jurisdiction over any of such local areas may try
the offence.
Judgments on Jurisdiction:
The judgment of supreme court In K Bhaskaran V sankaran Vaidyaa Balan and Anr(1999) 7 SCC 510
dealt with this issue elaborately. The Hon’ble Supreme court opined that offence can be completed only with
concatenation of a number of acts, namely, drawing of cheque, presentation of cheque, returning of the
cheque by the bank, notice by payee and failure of drawer of cheque within 15 days of receipt of notice. Any
one of the courts under whose jurisdiction the above acts have taken place can try the offence. In other
words complainant can file compliant in any one of the courts where the cause of arises or acts have been
committed.
In Harman Electronics(P) Ltd and Anr Vs National Panasonic India Ltd(2009)1 comp LJ 29 (SC)
the Hon’ble supreme court had the occasion to examine the issue of jurisdiction again. In this case the
appellant is a resident of Chandigarh issued a cheque which was dishonored. The cheque was issued at
Chandigarh where the complainant had a branch and was presented at Chandigarh. Notice demanding
payment however was issued by the complainant from its Head office at Delhi to the accsued’s office at
Chandigarh. On failure to respond to the notice, a complaint was filed in Delhi. Both lower court and High
court have placed reliance on K Bhaskaran V sankaran Vaidyaa Balan and Anr case and held that Delhi
court also has jurisdiction. The Appellant/Respondent in appeal contended that Chandigarh court had
jurisdiction to try the offence but his appeal was dismissed. But in appeal, the Supreme court held that a court
4. derives jurisdiction when a cause of action arises. Jurisdiction can not be conferred for any act of omission or
commission on the part of the accused. Issuance of notice would not give rise to cause of action but
communication of the notice would and therefore Delhi High court would not have jurisdiction and it directed
for transfer of the case pending in Delhi to Chandigarh court.
3. Successive presentation of cheque and Cause of action:
Usually when a cheque is dishonored, the drawer is informed and some times he advises to present the
cheque again as in the mean time he must have arranged for funds or some credits have come into his
accounts just after dishonour or made arrangement with his bankers. What is the risk is such cases? In
Sadanandan Bhadrant Vs. Madhavan Sunil Kumar AIR 1998 SC 3043
Supreme court ruled that a cheque can be presented any number of times during its validity period by the
payee. However on each presentation of the cheque and its dishonour, a fresh right accrues in his favour and
not cause of action to file complaint. Once he chooses to give a notice u/s138(b) and the drawer fails to pay
within the stipulated time, the cause of action for filing the complaint will arise immediately on the following
day of expiry of 15 days notice period and remains alive till 30 days. Complaint has to be filed before expiry
of 30 days from the date of expiry of notice period.
If a complaint is filed before expiry of 15 days notice period, it becomes a premature complaint and it will be
dismissed. If complaint is filed after expiry of 30 days complaint will be dismissed on the ground of limitation.
So one has to be clear about cause of action and filing of complaint before the limitation period runs out
4. Presumption as to Legally enforceable debt.
Section 139 says that it shall be presumed, unless the Contrary is proved, that the holder of a cheque,
received the Cheque for discharge, in whole or in part, or any debt or other liability. Supreme court
reiterated the contents of section 139 in the case of KN Bena V Muniyappan & Another, AIR 2001 SC
2895 that the onus is on the accused to prove by cogent evidence that there was no debt or liability.
5. Instructions in Bank’s memo:
The payee bank while returning the cheque gives reason for dishnour. Most often it mentions reasons such as
“ exceeds the arrangement” or “refer to drawer”. Some times “stop payment “ instruction is also ticked. All
these reasons of dishonour will lead to a presumption of dishonour of cheque. The supreme court in the case
of Modi Cements Ltd Vs M/s V Kuchikumar Nandi AIR SC 1998 1057 ruled that once the cheque is
issued by the drawer, a presumption under S. 139 in favour of holder must follow and merely because the
drawer issues a notice to the drawee or to the Bank for stoppage of the payment, it will not preclude an
5. action under Section 138 by the drawee or the holder of a cheque in due course. This judgment overruled it
previous Judgment in M/s. Electronics Trade and Technology Development Corpn. Ltd.,
Secunderabad Vs M/s. Indian Technologists and Engineers (Electronics) Pvt. Ltd. and another.
Supreme court reiterated the same views in MMTC Ltd & Anr Vs. Ms. Medchal Chemicals &
pharma(P) Ltd. AIR 2002 SC 182.
6. Notice and its requirements:
The NI Act is silent about the manner of service of notice. However, sending by notice by registered post is
desirable as it will be easier to prove service of notice. In SIL Import, M/s. USA v. M/s. Exim Aides Silk
Exporters" AIR 1999 SUPREME COURT 1609, the Supreme court ruled that if notice envisaged in cl.
(b) of the proviso to S. 138 was transmitted by Fax, it would be a compliance with the legal requirement
therefore notice demanding payment can be sent by Fax is also equally acceptable.
If notice is sent by the payee at the correct address of the drawer, it would be deemed to be a proper service
of notice. Some times notice issued is refused or unclaimed by the addressee. In situations such as this, it is
well settled that a notice refused to be accepted by the addresee can be presumed to have been served on
him. The decided cases are Harcharan Singh Vs Shivrani AIR 1981 SC 1284 Jagdish Singh v.
Natthu Singh AIR 1992 SC 1604. Supreme court held that presumption of issuance of notice and receipt
can be inferred in such cases. Courts should not adopt an interpretation which will help the dishonest evader
and thereby defeats the very purpose of the Act. If Acknowledgment card is not received, how the period for
filing complaint will be decided? In cases such as this, on expiry of 45 days period from the date of notice,
action can be taken for filing a complaint.
It must be remembered that the notice issued must demand payment of cheque amount in categorical terms
and demand should not be vague. Notice can not be an omnibus demand. The supreme court in the case of
Suman Sethi Vs Ajay K Churiwala & Anr AIR 2000 SC 828 ruled that the said amount of money
occurring in clause (b) and (c) of section 138 refers to the words ‘payment of any amount of money’ stated in
the main section 138. It implies that the demand has to be made for the amount of the cheque dishonored.
The object of the notice is to give another chance to the drawer of the cheque to make up for his default.
7. Presumption as to consideration:
In the case of AV Murthy V B S Nagabasavanna 2002 Cr LJ 1449 SC held that dismissal of a
complaint at the threshold on the ground that the debt is time barred is erroneous and not proper as
6. consideration is presumed u/s 118 of NI act.
8. Dishonor of cheques by companies under SICA:
Supreme court in the case of Kusum Ingots & alloys Ltd Vs Pennar patterson securities Ltd & ors
AIR 2000 SC 954 held that criminal prosecution for dishonour cheques is neither a proceeding for recovery
of money nor for enforcement of a security. Prosecution against the Directors of Sick companies would not
be suspended merely on the ground that proceedings against sick companies are suspended u/s 22 of SICA.
9. Cheque dishnour and Directors liability:
Many cases have been filed by Directors u/s 482 of Code of Criminal procedure, for quashing of complaints.
If a complaint is filed against a company and its directors, presumption will be drawn as per Section141 of
the NI Act against them unless they rebut this presumption. Normally it is the Managing Director who looks
after the day to day affairs is supposed to be in the knowledge of the affairs of the company on day to day
basis. Once a notice is served on all directors, the burden is on them to show that they are not liable to be
convicted or it will be a good defense, if they can show that at the relevant time they were not in-charge of
the affairs of the company. Same is the case with the partnership firm.
Keeping in view the risk, Nominee Directors of Central or State government or a Financial Corporation
owned or controlled by the Central Government or the State Government, as the case may be, are exempted
from prosecution under NI Act.
10. Compounding of offence:
Section 147 provides that notwithstanding anything contained in the Code of Criminal Procedure, 1973, (2 of
1974.) every offence punishable under NI Act shall be compoundable. Before introduction of section 147
divergent views were expressed by various high courts including Supreme Court. Critical analysis of judgment
of Supreme court in Rajneesh Aggarwal Vs Amit J Bhalla (2001)1SCJ 13leads one to conclude that
once the offence is committed, any payment made subsequent thereto will not absolve the accused of the
liability. However, a joint compromise petition filed may be considered as a mitigating factor while awarding
punishment for offence. Criminal proceedings can not be quashed simply because accused made a deposit of
cheque amount in the court. When offence u/s 307 is compounded u/s 320, why an offence u/s 138 can not
be compounded especially when both the parties file a compromise petition.
In Anil Kumar Haritwal and another Vs Alka Gupta and another, AIR 2004 SC 3978, Supreme court
7. considered the prayer of the parties allowed the appeal and set aside the conviction and sentence imposed on
the appellants in the interest of justice and also in view of the fact that Section 147 of the Negotiable
Instruments Act permits compounding of the offence.
Conclusion:
Although the NI Act provides for expeditious disposal of trial, the cases in the lower courts move at a
snail’s pace. A lot is desired in this direction. May be High courts should monitor and issue directions to
lower courts for speedy disposal of cases to achieve the objective of the Act.
G. S. Rao
Chief Manager(Legal)
OCL India Limited
Source : Negotiable Instruments Act and judgements of Supreme court -