Allahabad High Court: When Offence under 138 NI Act Completes?

When Offence under 138 NI Act Completes-

In the Latest Judgment of Allahabad High Court, Hon’ble Justice Dr Kaushal Jayendra Thakher passed an order

with respect to a summon order issued in a Cheque Bounce Case.

Brief facts of the case Ravi Dixit vs State Of Uttar Pradesh & Anr, filed under Section 482 of Cr.P.C are as follows:-

The petitioner had issued two cheques of Rs.5,00,000/- and Rs.5,98,000/- on 01.03.2019 and 2.03.2019, respectively.

The bank dishonoured both the cheques on 28.05.2019.  A legal notice was sent on 12.06.2019 as he had not received

any money and subsequently he filed a complaint under section 138 against the accused.

The Judge after hearing the facts of the case was convinced that based on the evidence a case can be made out and passed

a summoning order on 03.09.2019 Aggrieved by the summoning order issued by the Hon’ble Judge, the petitioner moved to Allahabad High Court.

Arguments Before the High Court

The counsel argued that his client could not be summoned as he had already filed a reply to the

notice issued on 12.06.2019, and a complaint can only be filed after 15 days of his reply.

The counsel also submitted to the Court that

the date of service was not mentioned in the complaint and in such cases as per the

General Clause Act “30 days time time would have been presumed for service of notice and 15 days thereafter for waiting period of payment and, then only the complaint should have been filed”

The petitioner stated that he was falsely implicated in this case, as he had a financial dispute with the complainant. The petitioner admitted the fact that the cheques were dishonoured because he had directed the bank to stop the payment.

Issue Before the Court

The main issue before the Court was if a party has made it clear that they don’t want to make a payment

then in such a case should a complainant wait 15 days to file a complaint.

When Offence under 138 NI Act Completes

The Allahabad High Court observed that section 138 of the Negotiable Instruments Act

cannot be interpreted to mean that even if the accused refuses to make payment, the complainant cannot file a complaint.

Proviso (c) of the said Act is to see the bona fide of the drawer of the cheque and is with a view to grant him a chance to make the payment”. 

Further the Court noted the fact that the accused drew the cheques on an account that he maintained in a bank but stopped the payment.

His intention was clear that he did not want to make the payment and subsequently did not appear before the trial court for one year.

He moved the High Court only in August 2020.

The Court also mentioned that as per provisions of Section 138, an offence is complete the moment a cheque is dishonoured,

so the complainant had all the rights to file a complaint against the accused.

In his order, the Hon’ble Judge referred to Supreme Court’s Judgement in N. Parameswaram Unni Vs G. Kannan, (2017) 5 SCC 737

where it was held that proviso (c) to Section 138 of the Act, 1881 is to avoid unnecessary hardship if the drawer wants to make payment.

In the present case, it was clear that the accused did not wish to make the payment.

The Allahabad High Court found that the reason given by the learned Magistrate is very clear.

It is a well reasoned order which was passed on 30.11.2019.

For a period of one year, the petitioner has chosen not to appear before the learned Magistrate and has moved to the High Court now.

In view of the above the petition has been dismissed, and a cost of Rs 15000 has been imposed on the petitioner. 

Case Details

Title: Ravi Dixit vs State Of Uttar Pradesh & Anr

Case No. APPLICATION U/S 482 No. – 14068 of 2020

Date of Order- 23.09.2020

Quorum: Hon’ble Mr. Justice Dr. Kaushal Jayendra Thakher

Counsel for the petitioner: Mr Ajay Dubey

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