COMPLAINT UNDER SECTIONS 138 AND 142 OF THE
NEGOTIABLE INSTRUMENTS ACT [CD1]
IN THE COURT OF
CHIEF METROPOLITAN MAGISTRATE....................
Shri....................
s/o.................... R/o....................
...................................................................
Complainant
versus
..........................................................................
Accused
Complaint u/ss.
138 & 142 of the Negotiable Instrument Act, 1881 as amended by Act 66 of
1988.
The complainant
respectfully submits as under: —
1. That the accused is Proprietor
of.............................................................
dealing....................
2. That the accused took loan of Rs..................... from the
complainant and executed a pronote on.................... for
Rs..................... (A photocopy of the pronote is
Annexure.................... ).
3. That the accused issued Cheque No.....................
dated.................... for the sum of Rs.....................
(Rupees.................... only) drawn on.................... and gave it to
the complainant to discharge his liability with respect to the said loan
amount/pronote. (Photocopy of cheque is
Annexure....................
).
While issuing
the said cheque the accused assured the complainant that the cheque will be
honoured on its presentation.
4. That the complainant states that the cheque was presented for
collection through the complainant’s bank....................
on........................................ and the said cheque was returned
on.................... as unpaid due to insufficiency of funds in the account
of the accused in the bank with a memorandum ‘refer to drawer’. (Photocopy of
the memorandum of the bank is
Annexure:....................
).
The accused had
thus dishonest and guilty intention right from the beginning at the time he
issued the aforesaid cheque.
5. That the complainant immediately thereafter contacted the accused
and apprised him about the dishonouring of the cheque but the accused did not
pay any heed.
6. That the complainant states that within fifteen days of the receipt
of his information from the bank regarding dishonour/the return of the cheque
as unpaid, he send a registered AD and U. P.
C. notice
dated................... through his lawyer .................... to the accused
on.................... vide postal receipt No..................... dated
.................... (Post Office.................... ) calling upon the
accused for payment of the said amount alongwith interest due on the
dishonoured cheque within fifteen days from the date of the receipt of the
notice. The accused acknowledged the receipt of the said notice vide
acknowledgement due. (The photostat copies of the postal receipt of the
Registered A. D. Letter/U. P. C. and the A. D. Card are
Annexures..................... The photostat copy of the legal notice is
Annexure.................... ). The accused having received the notice
on..................... has failed to make payment within fifteen days of the
receipt of the legal notice.
That the accused
is deemed to have received the Notice on.................... as the Notice was
sent under Registered A/D and as well U. P. C. on.................... The
accused having received the notice on.................... has failed to make
payment within fifteen days of the receipt of the legal notice.
7.
That the complainant submits
that accused had issued the cheque without sufficient funds in his bank
account. Therefore the accused committed the offence u/s. 138 of the Negotiable
Instrument Act, 1881 as amended by the Act 66 of 1988 and is liable to be
punished.
8.
That the complainant further
submits that the Accused intentionally induced the complainant to render loan
assistance/to him with preintention not to pay and thereby has cheated the
complainant & committed offences u/ss. 415 and 420 of I. P. C.
9.
The cause of action for the
present prosecution arose on the 16th day i. e. .................... after the
expiry of 15 days of receipt of the aforesaid legal notice, and due to
non-payment of the amount by the accused.
10.
That the complainant further
submits that he has filed the complaint within one month from the date of
expiry of the fifteen days time given under the law for the payment of the said
money. The said cheque was issued at..................... presented at
the.................... where the cheque was returned as unpaid by complaints
Bank and so this Hon’ble Court has jurisdiction to take cognizance of the
offence.
11.
The accused has thus committed
the offences punishable under Sections 415 & 420 I. P. C. and Section 138
of the Negotiable Instruments Act, 1881, as amended in 1988. The complainant,
however, chooses to prosecute the accused only for the offence under Section
138 of the Negotiable Instruments Act an amended because of the said remedy
being more efficacious and
speedier.
It is,
therefore, prayed that the accused may be summoned to face the trial under
Section 138 of the Negotiable Instruments Act, 1881, as amended in 1988, tried
and punished thereunder in accordance with law.
It is also
further prayed that this Hon’ble Court may be pleased to order for the payment
of the compensation out of the fine amount u/s. 357 of Cr. P. C. read with S.
117 of Negotiable Instruments Act to the complainant as follows:
(1) Cheque Amount Rs. .......................
(2) Bank Service Charge Rs. .......................
(3) Notice Charge Rs. .......................
(4) Advocate’s Fees Rs. .......................
(5) Interest Amount (upto........) Rs. .......................
Total Rs......................... (plus interest
@......... till
payment
Dated at .................. this
............... day of....................
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CASE LAW
S. 138 Negotiable Instruments Act
QUASHING OF COMPLAINT ON GROUND THAT COMPLAINT DID NOT
DISCLOSE DATE ON WHICH NOTICE SERVED.
Mere fact that date of delivery of notice
under Section 138 Clause (c) of proviso of Negotiable
Instruments Act
is not mentioned in the complaint does not affect maintainability of
complaint.1
DISHONOUR OF CHEQUE (SECTION
138 OF N. I. ACT)
The offence under
section 138 of the Negotiable Instruments Act, can be completed only with the
concatenation of a number of acts. Following are the acts which are components
of the said offence: -
(1) Drawing of cheque.
(2) Presentation of cheque to the Bank.
(3) Returning the cheque unpaid by the drawer bank.
(4) Giving notice in writing to the drawee of the cheque demanding
payment of the cheque amount.
(5) Failure of the drawer to make payment within fifteen days of the
receipt of notice..
It is not
necessary that all the five acts should have been perpetrated at the same
locality. It is possible that each of those five acts could be done at five
different localities. But concatenation of all the above five is a sine qua non for the completion of the
offence under section 138 of the Act.2
NOTICE — SERVICE OF
Service of notice of demand in clause (b)
of the proviso to section 138 of Negotiable Instruments
Act, 1881 is a
condition precedent for filing a complaint under section 138 of the Act.3
NOTICE OF DEMAND (SECTION 138
PROVISO (B))
A notice cannot
be faulted if in addition to "cheque amount" any other sum by way of
interest, cost etc. is separately indicated.4
1. S. K. Trading & Co. v. Beerbal Dass Jindal, 1996 (3) Crimes 8
(All).
2. K. Bhaskaran v. Sankaran Vaidhyan Balan, AIR 1999 SC 3762.
3. Central Bank of India v. M/s. Saxons Farms, AIR 1999 SC 3607.
4. Suman Sethi v. Ajay K. Churiwal, AIR 2000 SC 828.
DISHONOUR OF CHEQUE — COMPLAINT
OF
Mere
presentation of the complaint in the court cannot be held to mean that its
cognizance had been taken by the Magistrate.5
DISHONOUR OF CHEQUE — PROSECUTION OF COMPANY
The winding up
proceedings of a company do not render debt unenforceable.6
DISHONOUR OF CHEQUE — COMPANY
DECLARED SICK
The fact that
the company has been declared sick before expiry of period for payment of
cheque amount does not save it or its directors from criminal prosecution.7
Complaint under
section 138, Negotiable instruments Act can be filed by power of attorney
holder of payee.
It is obligatory
on court under Section 139 of Negotiable Instruments Act to raise presumption
in every case where factual presumption has been established.8
Proceedings
under Section 138 Negotiable Instruments Act cannot be quashed in a petition
under Section 482, Cr. P. C. on a plea that petitioner director of the accused
company had resigned much prior to cause of action had arisen for the case.9
To prosecute a director of company for
offence under Section 138 of Negotiable Instruments Act a bald allegation by
merely repeating those words mentioned in Section 141 of the Act would not be
enough and there must be something more clearly stated in complaint.10
In a prosecution
under Section 138/141 of Negotiable Instruments Act where cheque has been
issued by a partnership firm, all the partners are not liable for prosecution
on a contention that their liability was joint but only those partners could be
prosecuted who were in charge of and were responsible for conduct of business
of firm.11
Cause of action
for filing complaint under Section 138 of Negotiable Instruments Act arises
only once and time for filing complaint would start running from the date of
service of notice issued under Section 138(b) of the Act.12
5. Narsingh Das Tapadia v. Goverdhan Das Partani, AIR 2000 SC 2946.
6. Pankaj Mehra v. State of Maharashtra, AIR 2000 SC 1953.
7. Kusum Ingots and Alloys Ltd. v. Pennar Peterson Securities Ltd., AIR
2000 SC 954.
8. Y. Sreelatha @ Roja v. Mukanchand Bothra, 2002 (2) Crimes 19.
9.
Smt. Sunaina R. Mathani v. National
Capital Territory of Delhi, 2002 (2) Crimes
61.
10. Neeta Bhalla (A-4) v. S. M. S. Pharmaceutical Ltd. Hyderabad, 2002
(2) Crimes
89.
11. Punjab State Coop. Supply & Marketing Federation Ltd. v. M/s.
Malerkotla Rice Mills, 2002 (2) Crimes 178.
12. Mohammed Jakeer v. Ch. Koli Reddy, 2002 (2) Crimes 188.
Bouncing of
cheque with remarks drawer’s signature incomplete would also attract offence
under Section 138 of Negotiable Instruments Act.13
Once notice
under Section 138 of Negotiable Instruments Act has been sent by regd. post on
the correct address and is returned with an endorsement that "party was
not available" it shall be deemed to have been served.14
The complaint
filed under Section 200, Cr. P. C. or under Section 142 of the Negotiable
Instruments Act would not ipso facto terminate
or abate upon the death of the complainant and his LRs., their agents or power
of attorney holder could be permitted to prosecute the complaint under Section
302(2), Cr. P. C. or under Section 142 of the N. I. Act.15
Cheque drawn for
a loan four years prior to the issuance of cheque does not cease to be legally
enforceable for a complaint under Section 138 of the Negotiable Instruments
Act, 1881.16
Cheque given by
accused in favour of bank for issuance of Demand Draft in favour of complainant
for amount payable to complainant will make complainant payee of cheque and on
dishonour of cheque, complainant was competent to maintain complaint under
Section 138 of Negotiable Instruments Act.17
A cheque which
has become invalid because of the expiry of the stipulated period could be made
valid by alteration of dates.18
A state cheque
can be revalidated by drawer. Change in date with consent is not material
alteration. Whether change in date was voluntary or involuntary is a question
of fact which has to be established by evidence. High Court was thus wrong in
quashing complaint on alleged change in dates of earlier dishonoured cheques.19
13. Vinod Tanna v. Zaheer Siddiqui, 2002 (1) Crimes 104.
14. M/s. VIF Airways Ltd. v. M/s. Aishu Finance Ltd., 2002 (2) Crimes
205.
15. Jimmy Jahangir Madan v. Mrs. Bolly Cariyappa Hindley, 2002 (1)
Crimes 291.
16. A. V. Murthy v. B. S. Nagabasavanna, 2002 (1) Crimes 306 (SC).
17. Ram Kasyyap Chits Pvt. Ltd. Visakhapatnam v. Chinnam Krishna Murthy,
2002
(1) Crimes 673.
18. Veera Exports v. T. Kalavathy, AIR 2002 SC 38.
19. Veera Exports v. T. Kalavathy, 2002 (1) Crimes 123 (SC).
IN THE COURT
OF.........................................
Complaint
No......................... of 200
In the Matter of: -
AB.............................................................
Complainant
versus
CD....................................................................
Accused
APPLICATION FOR RECALLING
THE SUMMONING ORDER DATED ........................ ON BEHALF OF
ACCUSED/APPLICANT
Most Respectfully Showeth: -
1.
That vide order
dated........................ this Hon’ble Court was pleased to issue process
to the applicant for an alleged offence under section 138 N. I. Act, 1881.
2.
That the said order of
summoning the applicant as an accused is bad in law on the following amongst
other grounds and is liable to be recalled: -
GROUNDS
a.
Because the complaint is barred
by limitation as per record produced by the Complainant, the bank’s
intimation/advise regarding return of cheque is dated........................
and the notice under section 138 N. I. Act was to be given within 15 days from
................................................ but the alleged notice is
purported to be dated................................................ and was
sent on........................ which on the face of it is beyond the
prescribed period of limitation provided under section 138 N. I. Act and as
such the Complaint is incompetent and liable to be dismissed on this ground
alone.
b.
Because a perusal of the
Complaint would show that there is no allegation whatsoever as to on what date
the alleged notice dated ........................ was allegedly delivered to
the applicant and when the cause of action arose to the complainant for filing
the complaint, in the absence of it is settled law that cause of action for
maintaining a Complaint under section 138 N. I. Act, arises on the failure of
the addressee to pay the demanded amount within 15 days from the receipt of the
notice. In this case admittedly no notice was ever served upon the applicant.
c.
Because the Complainant is
alleged to have sent the alleged notice on two addresses: -
(1) .......................
(2) .......................
The Complainant
have however filed one envelope addressed at address No. 1 stated above, and
which contains a remark "Refused" dated......................... It
is pertinent to point out that the said envelope does not contain any Postal
Stamp of any post office which shows that the envelope filed with the complaint
is manipulated one and the envelope sent to post office has been replaced by
the envelope filed in the Complaint and the Complainant is guilty of an offence
of perjury for which the applicant reserves right to file an application under
section 340 Cr. P. C. relating thereto.
d.
Because the alleged notice
dated........................ is purported to have been sent
on........................ at the address
................................................ and is purported to have been
refused en.......................... However the Complainant has not examined anyone
from the Postal Department to prove that it was refused by the addressee. It is
respectfully submitted that the applicant is not residing at the
address................................................ at which address there
are number of shops and it is not the exclusive address of the applicant place
of business.
e.
Because neither in the
Complaint nor in the statement of the complainant it has been averred or stated
as to what was the fate of the alleged notice said to have been sent at the
address
f.
Because there is not an iota of
evidence of the Complainant being partner of applicant which assertion is
falsified from the very fact that the alleged cheque itself shows that the
applicant was sole proprietor of the firm and the cheque in question was without
consideration whatsoever. In this connection it is submitted that the
Complainant who used to visit the applicant frequently. During one such visit,
when the applicant needed money urgently and the closing hour of the bank was
nearby, the applicant hurriedly signed a cheque and gave it to the Complainant
who offered to get the same encashed by going to the bank. The Complainant came
back within 15 minutes and handed over the
cash................................................ to the applicant. It now transpires
that he retained the cheque fraudulently and dishonestly by filling it up of
the sum filed by him and has now filed the present Complaint for dishonest
gain.
3. That this
Hon’ble Court passed the summoning order without taking into the aforesaid
important facts which go into the root of the matter and ning order is bad in
law far it does not give any reasons for coming to the prima facie that an offence under Section 138 N. I. Act had been
made out.
PRAYER
It is therefore
prayed that this Hon’ble Court may be pleased to recall summoning order
dated......................... and drop the proceedings against applicant.
This Hon’ble
Court may be pleased to pass such further order(s) as ma complete justice on
the facts and circumstances of the case.
Applicant/ Accused
Through Advocate
Place:................
Dated:.................
IMPORTANT NOTE
CHANGES MADE BY
THE NEGOTIABLE INSTRUMENTS
(AMENDMENT AND
MISCELLANEOUS PROVISIONS)
ACT, 2002
WITH
EFFECT FROM 17. 12. 2002
(1)
The period of notice by the
payee to the drawer has been increased from fifteen to thirty days. (Section
138)
(2)
Punishment prescribed under the
Act has been increased from one year to two ye (Section 138)
(3)
Person nominated as a director
of a company by virtue of his holding any office employment in the Central
Government or State Government or a financial cor ration owned or controlled by
the Central Government or the State Government, the case may be, shall not be
liable for prosecution under Section 141 of the (Section 141)
(4)
Discretion has been vested in
court to waive period of one month for taking cog zance of the case under the
Act, if complainant satisfies the court that he had su dent cause for not
making a complaint within such period. (Section 142)
By the Amendment Act 2002
Sections 143 to 147 have
been inserted to provide for—
(a) Summary trial of the cases with a view to speed up disposal of cases
and the Mar trying an offence empowered to pass sentence of imprisonment for a ter ing one year and amount of fine
excreding five thousand rupees; (Sec
(b) Procedure for service of summons to the accused or witness by the
post or by such courier services as are approved by a Court of. 144)
(c) Evidence of the complainant on affidavit and on application of
summon and examine any person giving evidence on affidless. tained therein;
(Section 145),
(d) Bank’s slip or memo prima
facie evidence of fact of dishonour of cheque unless and until such fact is
disproved; (Section 146)
(e) Offence under the Act compoundable; (Section 147)
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