Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 141, 142 – Complaint by Director of Company – Authorisation of Company – Requirement of -- Company is a legal entity and any prosecution before a Court shall be by a person duly authorized by the said company – 2nd respondent has described himself as the Director of Private Limited company, no authorization of company filed -- Though no authorization was initially filed, still a company can at any stage rectify the defect -- Grounds raised by the petitioner/ accused are not tenable. M.M.T.C’s case, (2002) 1 SCC 234 relied.

(Para 4-8)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Cheque bounce complaint – Presumption that the cheque had been issued for a debt or liability – Rebuttal of presumption -- Section 138 deals with a cheque drawn by a person "for the discharge, in whole or in part, of any debt or other liability." -- The section does not say that the cheque should have been drawn for the discharge of any debt or other liability of the drawer towards the payee -- Thus in complaint u/s 138 of N.I. Act, the Court has to presume that the cheque had been issued for a debt or liability -- This presumption is rebuttable.

(Para 10)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Cheque bounce complaint – Presumption that the cheque had been issued for a debt or liability – Rebuttal of presumption -- Applicant being holder of cheque and the signature appended on the cheque having not been denied by the Bank, presumption shall be drawn that cheque was issued for the discharge of any debt or other liability -- Presumption u/s 139 is a rebuttable presumption.

(Para 10)

C. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Cheque bounce complaint – Service of notice -- It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice -- Unless and until the contrary is proved by the addressee, the service of notice is deemed to have been effected at the time, at which the letter would have been delivered in the ordinary course of business.

(Para 11)

D. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Cheque bounce complaint – Service of notice -- Complaint cannot be thrown at the threshold even if it does not make a specific averment with regard to service of notice on the drawer on a given date -- Factum of disputed service of notice requires adjudication on the basis of evidence and the same can only be done and appreciated by the trial court.

(Para 16)

E. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Cheque bounce complaint – Quashing of -- Stolen cheque – Ground of -- Submission that the cheque was stolen -- If the cheque was stolen, the applicant should have given information for the same to the Bank and also lodged an FIR regarding loss of the check -- However, there is nothing on record to show that the cheque was stolen and the information regarding missing of cheque was also not given to the bank -- However, after nearly one year, when opposite party no.2 came to know about the said complaint u/s 138 of N.I. Act, he sent a letter to the bank regarding missing of check book, but neither the details of check has been mentioned nor any complaint has been made regarding the same earlier -- All the submissions made is disputed questions of fact - Therefore, when the facts have to be established by way of evidence, High Court while exercising the powers u/s 482 of Cr.P.C., cannot interfere with such proceedings -- Hence, no grounds are made out for quashing of the proceedings u/s 138 of the NI Act -- Application dismissed.

(Para 17-19)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 406 -- Transfer of complaint u/s 138 of NI Act – Delhi to Madhya Pradesh -- Alleged transactions took place in the district of Raisen in the State of Madhya Pradesh -- Cheques were also drawn in Madhya Pradesh – Ends of justice would be served if the complaints pending before the Court of the Metropolitan Magistrate, Central District, Tis Hazari, Delhi transferred to the Competent Court in District Raisen, Madhya Pradash.

(Para 2, 3)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 142 – Cause of action – Time barred complaint -- Delay of 7 days in complaint – Cognizance by Magistrate -- No petition filed for condoning the delay -- It is settled law that the Magistrate is forbidden from taking cognizance of the offence if the complaint was not filed within one month of the date of which the cause of action arose -- Hence, summoning order and revisional order confirming the cognizance taken by Magistrate are erroneous and  contrary to law, set aside.

(Para 2, 7, 8)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 406 -- Transfer of complaint u/s 138 of NI Act – Tamil Nadu to Haryana -- Sole-respondent is shown to be a resident of Delhi and his office address is indicated as being situated in Haryana -- Keeping in view the fact that the transfer of the petitions would be to the convenience of both the parties, the prayer of the petitioner is accordingly accepted – Complaint transferred.

(Para 1-4)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 141 (2)(a) – Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Cheque bounce case -- Complaint u/s 138 of N.I.Act against Proprietor -- Proprietorship Firm not made party – Quashing of complaint/ summoning order – Statutory signification assigned to a 'Company', does visibly cover not only any corporate body, but also covers a firm, or other association of individuals -- Held, Sole proprietary entity though is obviously solitarily owned, yet, the said juristic person, or, legal entity rather becomes 'a person' committing an offence u/s 138, and, besides the said juristic person, is also a 'Company' – Therefore, not only the juristic entity concerned, was amenable for being arrayed as an accused in the petition complaint, but also all those persons responsible to the sole proprietary concern , for the conduct of its business -- Complaint reveals that the sole proprietary concern has not been arrayed as an accused, but only its sole proprietor has been arrayed as an accused – Petition allowed complaint u/s 138 of the N.I. Act as well as, the summoning order both are quashed and set aside.

(Para 12-17)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 406 -- Transfer of complaint u/s 138 of NI Act – Gujarat to Mumbai -- Trial at fag end – Complaint in 2016, thereafter, the respondent has filed a suit for recovery of the amount subject matter of the cheque in the High Court of Judicature at Bombay and one more suit for injunction in a Court in Mumbai – Trial in the complaint has substantially progressed and even a statement of the petitioner u/s 313 of the Cr.PC has been recorded – At this stage, the prayer for transfer of the complaint cannot be entertained.

(Para 2-4)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 82 – Indian Penal Code, 1860 (45 of 1860), Section 174-A – Cheque bounce case – Incorrect address -- Proclaimed person – FIR u/s 174-A IPC -- Despite of providing repeated opportunities to complainant to file the correct address, needful was not done -- An application was filed that there is no other address except the one mentioned in the complaint -- Without therebeing any basis, to conclude that petitioner was avoiding service the court proceeded to issue warrant of arrest and thereafter passed the impugned order for registration of FIR – Petition allowed, impugned order set aside.

(Para 6, 7)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 139 -- Indian Evidence Act, 1872 (1 of 1872), Section 45 -- Cheque signed by drawer – Presumption u/s 139 of N.I.Act/ Cheque towards payment of a debt or in discharge of a liability – Rebuttal of -- Handwriting expert to examine writing on cheque – Permissibility of – High Court permitted to engage a hand-writing expert to seek an opinion on whether “the authorship on the questioned writings” (the disputed cheque) can be attributed to the respondents -- Evidence of a hand-writing expert on whether the respondent had filled in the details in the cheque would be immaterial to determining the purpose for which the cheque was handed over --  Presumption which arises on the signing of the cheque cannot be rebutted merely by the report of a hand-writing expert -- No purpose served by allowing the application for adducing the evidence of the hand-writing expert – Order of High Court set aside, appeal allowed.

(Para 4, 17)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 139 -- Cheque bounce case – Presumption u/s 139 of N.I. Act -- Nature of transaction -- Source of fund – Requirement of -- Conviction by trial court affirmed by Appellate court -- High Court acquitted the accused on the ground that, in the complaint, the Complainant has not specifically stated the nature of transactions and the source of fund. Held,

-- High Court has failed to note the presumption u/s 139 of the N.I. Act – Once the initial burden is discharged by the Complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability

– High Court has also failed to appreciate that the High Court was exercising the revisional jurisdiction and there were concurrent findings of fact recorded by the courts below.

Impugned judgment and order passed by the High Court acquitting the accused quashed and set aside -- Accused granted two months’ time to pay the fine, as ordered by the learned first Appellate Court.

(Para 7-11)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 142 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 200 -- Cause of action – Pre-mature complaint – Second complaint -- Demand notice period of 15 days not expired -- Complaint filed before fifteen days -- In view of the legal bar created by Section 142 of the NI Act, taking of cognizance by the Court was contrary to the law and the complaint was not maintainable -- Respondent would be at liberty to institute a fresh complaint and to seek the benefit of the proviso by satisfying the trial court of sufficient cause for the delay in instituting the complaint.

(Para 7-10)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Indian Penal Code, 1860 (45 of 1860), Section 406, 420 – Code of Criminal Procedure, 1973 (2 of 1974), Section 300 – Constitution of India, Article 20(2) – Cheque bounce case – Double jeopardy -- Two complaints on same allegations – One complaint for offence under NI Act and other under IPC on same set of allegation – Maintainability of -- Matter referred to larger bench to answer the following questions:

(1) Whether the ratio of the judgment, in the case of G. Sagar Suri, (2000) 2 SCC 636 and Kolla Veera Raghav Rao (2011) 2 SCC 703 lay down the correct law? or The view taken in the case of Sangeetaben Mahendrabhai Patel (2012) 7 SCC 621 as followed in M/s V.S. Reddy and Sons Crl Appeal No. 1285 of 2015, decided on 28.09.2015 which is subsequent and conflicting, lay down the correct proposition of law?

(2) Whether on similar set of allegations of fact the accused can be tried for an offence under NI Act which is special enactment and also for offences under IPC unaffected by the prior conviction or acquittal and, the bar of Section 300(1) Cr.P.C. would attract for such trial?

(Para 12)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Dishonour of cheque – Non-impleadment of co-borrower -- Once cheque was issued by accused, who was a co-borrower, non-impleadment of his wife/ co-borrower is of no consequence – Conviction upheld.

(Para 5, 9, 11)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 313 -- Dishonour of cheque – Cheque by co-borrower -- Accused in his statement recorded u/s 313 CrPC, though claimed that he did not take any loan, but he himself put a suggestion to bank official that the loan account was joint in his name and his wife -- If it so, he being co-borrower was under liability to discharge liability for which he issued cheque and same was dishonoured -- Conviction upheld.

(Para 9, 11)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 118, 138, 139 – Cheque bounce case – Presumption as to issuance of cheque in discharge of debt or other liability -- Admission of issuance of cheque and signature -- Presumption envisaged u/s 118 read with Section 139 of NI Act would operate in favour of the complainant – Presumption is one of law and there under the court shall presume that the instrument was endorsed for consideration -- In absence of contrary evidence on behalf of the petitioner/ accused, the presumption under section 118 and 139 of the NI Act, goes in favour of the complainant.

(Para 10)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 139 – Cheque bounce case – Presumption as to issuance of cheque in discharge of debt or other liability -- Wrong cheque number in legal notice/ complaint – Effect of -- Original cheque was placed before the trial court and the same was exhibited -- Cheque as well as the signature has been accepted by the petitioner -- Thus, the presumption u/s 139 would operate and the wrong number of the cheque in the complaint and/or in the legal notice would not make any difference and has to be taken as typographical error.

(Para 11, 12)

C. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 401 – Conviction in cheque bounce case – Long pendency of case – Sentence of compensation -- Ld. Appellate Court has sustained the compensation amount of Rs.9 lakhs and sentenced of S.I. for a period of 1 year -- Having regard to the facts of the case and looking to the continuity of litigation, since the case is of the year 2009 and 13 years have elapsed; interest of justice would be sufficed if the sentence part is modified in lieu of compensation itself -- Sentence of one year modified to an amount of Rs.1 lakh over and above 9 lakhs compensation – Petitioner directed to pay the amount within a period of 10 weeks’, failing which the trial court shall proceed in accordance with law.

(Para 13)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Constitution of India, Article 136 -- Conviction u/s 138 of NI Act --  Upheld by Supreme Court – Compromise/ Settlement between parties – Recalling of order -- In view of the statement made and as full payment has been made along with compensation, order recalled and the special leave petition restored to its original number – Leave granted, impugned order upholding the conviction of the appellant would be treated as settled and compounded -- Appeal allowed.

(Para 2-7)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 190 -- Cheque bounce case -- Amendment in complaint – Wrong mentioning the name of Bank in complaint as Punjab National Bank instead of HDFC Bank – Held, mistake is a simple infirmity which is curable by means of formal amendment, and by allowing such amendment, no prejudice would be caused to the applicant as there is no dispute about the issuance of cheque of HDFC bank by the petitioner/accused and same was annexed at the time of filing of complaint – Infirmity can be cured through amendment at any stage before pronouncement of the judgment.

(Para 10-13)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 141 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Constitution of India, Article 136 – Cheque bounce case – Security deposit cheque – Quashing of Complaint u/s 138 of NI Act – High Court quashed the complaint -- Dispute between the parties regarding the quality of the material supplied – Respondent/ accused made a complaint in writing of the defective material and then stopped the payment – Respondent has already filed a Civil Suit for damages – Held, the issues between the parties can be effectively resolved through Civil Suit only – Petitioner shall be at liberty either to file counter claim or a separate suit in accordance with law – Observations made by the High Court in its impugned order shall have no bearing on the outcome of the Civil Suit.

(Para 1-7)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 401 -- Conviction in cheque bounce case – Revision -- Allegation of forgery against complainant -- Had that been the case, the accused would have certainly filed a criminal complaint in that regard -- No effort has been made to examine any expert either -- Further, there is no denial by the petitioner to the signatures upon the cheque -- Except bald assertion, the accused has not been able to raise a probable defence even while referring to the cross-examination of the complainant and his witnesses – No infirmity in the judgment of conviction passed by the Trial Court affirmed by the ld. Appellate Court – No merit, revision dismissed.

(Para 16)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 401 -- Conviction in cheque bounce case -- Revision -- Reduction of sentence -- Cheque amounting Rs.4,58,000/- -- Sentenced to R.I. for one year, fine of Rs.5,000/- and in case default sentence of one month -- Conduct of the petitioner is extremely disturbing, firstly, did not appear at the time the Appeal was pending before the ASJ and was declared a proclaimed offender and was released on interim bail -- Petitioner continued as such for a period of approximately three years -- When the matter came up for hearing before High Court, an assurance was given that he would surrender and file a revision petition, however the petitioner was untraceable -- No mitigating circumstances for reducing his sentence.

(Para 8, 17, 18)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Cheque bounce case -- Opportunity to cross-examine witness -- Petitioner adopting delaying tactics and wants to prolong the adjudication -- Be that as it may, in the interest of justice, one and last opportunity grated to the petitioner to cross examine subject to payment of cost of Rs.1 lakh to be paid to complainant.

(Para 6-10)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 142 – Cheque bounce case -- Non-appearance of accused after grant of bail – Cancellation of bail – Rule of natural justice -- Address mentioned in the Court notice, being an incorrect description thereof, petitioner/accused did not come to be validly served on his correct address, hence the learned trial Magistrate concerned, could not conclude that any valid service, became caused upon him, nor could he conclude, that there was any willful, and, deliberate omission on the part of the petitioner, to cause his personal appearance -- Contrarily, it became incumbent upon the learned Magistrate, to after discovering the correct address, cause there his valid service however,  did not recourse, the above measure -- Impugned order quashed, and, set aside -- Petitioner directed to cause his personal appearance before the learned Magistrate.

(Para 2, 5, 6)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 147 – Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Compromise post-conviction -- Nature of dispute is predominantly private -- Statement made in the joint petition preferred by the informant and the accused as well as the affidavit filed discloses that the compromised has been entered into voluntarily -- Nature of the offences is also not heinous – Conviction and sentence set aside and quashed.

(Para 7-9)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 147 -- Constitution of India, Article 136 -- Cheque bounce case – Compromise after conviction -- Compounding of offence -- In conformity with the settlement requisite payment accepted -- It does appear appropriate to accept the terms of settlement between the parties and allow the compounding of offence – Orders passed by the Appellate Court and the Trial Court are set aside.

(Para 7, 8)

Negotiable Instruments Act, 1881 (26 of 1881), Section 148 – Code of Criminal Procedure, 1973 (2 of 1974), Section 374, 397, 401, 482 -- Deposit of 20% compensation – Interlocutory order – Maintainability of revision – Inherent power u/s 482 Cr.P.C -- Order passed in exercise of power u/s 148 of the NI Act, is neither a final order nor an intermediate order -- Such powers are in the interlocutory in nature and Revision is not maintainable -- Petitioner would be at liberty to approach High Court in exercise of inherent power u/s 482 of the Code of Criminal Procedure.

(Para 15-18)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 200 -- Cheque bounce complaint – Quashing of proceedings -- Partial payment of cheque amount – Effect of -- Cheque when presented for realization was returned for technical reason -- On the very same date, the accused transferred a sum of Rs.10,00,000/- to the account of the complainant through RTGS – No material placed that the cheque was re-presented towards recovery of balance amount – Ld. Magistrate has committed an error in taking cognizance of the offence punishable u/s 138 of the Negotiable Instruments Act – Petition allowed, impugned proceedings quashed.

(Para 6, 7)

Code of Criminal Procedure, 1973 (2 of 1974), Section 401 – Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 148 -- Cheque bounce case – 20% pre-deposit of compensation – Extension of time-- Addl. Session Judge directed the petitioner to deposit 20% amount of compensation by 04.06.2022 vide order dated 26.04.2022 – High Court extended time upto 30.06.2022 by taking sympathetic consideration.

(Para 3-6)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Indian Penal Code, 1860 (45 of 1860), Section 174-A -- Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Cheque bounce case -- Proclaimed person – Quashing of FIR u/s 174-A of IPC -- Complaint u/s 138 of N.I. Act withdrawn by complainant as compromised – Case of the petitioner that he was not aware of the proceedings u/s 138 of the Act of 1881 and was subsequently arrested and released on bail -- Order declaring the petitioner as proclaimed person would prove to be insignificant inasmuch as the main complaint u/s 138 of the Act itself has been withdrawn -- Petition allowed -- FIR u/s 174-A of the IPC and all the subsequent proceedings arising therefrom quashed/set aside.

(Para 9-13)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 401 -- Summary trial – Conviction in cheque bounce complaint -- Ld. trial court recorded the statement of the complainant and convicted the petitioner and imposed one year’s sentence and fine of Rs.14 lakhs – Additional evidence application for calling witness pending before appellate Court – Held, decision arrived at by the learned trial court held to be justified -- Trial u/s 138 of NI Act has to be a summary trial and if sufficient evidence  to convict and the preponderance of probability is met, then there is no reason for creating an elaborate trial -- No interference in the revision called for, dismissed.

(Para 3, 8, 9)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 273, 299 – Cheque bounce complaint -- Absence of accused – Recording of evidence -- If the personal attendance of the accused is dispensed with, evidence may be recorded in the presence of the pleader of the accused -- Except u/s 299, evidence cannot be recorded for any other reason in the absence of the accused.

(Para 11)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 273, 299 – Absence of accused – Ex-parte proceedings -- There is no provision in Cr.P.c. for keeping an accused ex parte similar to one found in CPC -- Held, trial cannot be held in the absence of an accused unless personal appearance is dispensed with for valid reasons.

(Para 12, 15)

C. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 313 – Absence of accused – Statement u/s 313 Cr.P.C. – Dispense with – Permissibility of -- There cannot be dispensation of examination of an accused u/s 313 Cr.P.C if incriminating evidence appears in the evidence of the witness -- Speedy trial does not take the meaning of jumping the stages in criminal trial.

(Para 16)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 401 – Conviction u/s 138 of NI Act – Reduction of sentence to fine, default sentence intact -- Cheque of Rs.3 Lacs – Conviction by Trial Court for one year with fine of Rs.5,000/-, in default whereof the appellant was directed to undergo S.I. for six months -- Out of Rs.5000/-, Rs.2500/- was to be paid to the complainant – High Court reduced the sentence from one year to three months – Considering the fact that the appellant is an old lady of 69 years, the substantive sentence substituted by fine in the sum of Rs.50,000/- in addition to the fine already deposited by the appellant; Rs.55,000/- shall be the sentence for the offences committed by the appellant -- Default sentence awarded by the trial court as affirmed by the first appellate court and the High Court kept intact.

(Para 3-8)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Cheque bounce case – Signatures on cheque not disputed – Effect of -- Undisputed signatures of the respondent/accused on the cheque in itself is not sufficient for conviction u/s 138 of the Act -- One of the ingredient for succeeding u/s 138 of the Act is that the cheque was issued for discharge of debt or other liability.

(Para 10)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 143A -- Bihar and Orissa Public Demands Recovery Act, 1914 (4 of 1914), Schedule I, Clause 3 – Code of Criminal Procedure, 1973 (2 of 1974), Section 421 -- Cheque bounce complaint -- Interim compensation – Recovery as public demand -- Whether an order for payment of interim compensation under the Negotiable Instrument Act can be enforceable under the Bihar & Orissa Public Demands Recovery Act, 1914 as a public demand? -- Interim compensation so ordered u/s 143A of the NI Act is recoverable as a fine u/s 421 of Cr.P.C. which then, clearly falls under the definition of ‘public demand’ – Held, interim compensation ordered under the NI Act falls within the ambit of Schedule I of the Recovery Act, realization thereunder cannot be stopped.

(Para 17-20)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 438 -- Cheque bounce case -- Non-bailable warrants – Bailable case – Need of anticipatory bail – Held, petitioner has been summoned for an offence u/s 138 of the N.I. Act which is a bailable offence -- Hence, there is no occasion for apprehension of arrest and detention in a bailable offence provided the petitioner is ready and willing to comply with the conditions set forth by the concerned Illaqa Magistrate for granting him the concession of bail – Petition withdrawn with liberty to move an application/petition for bail before the concerned Illaqa Magistrate.

(Para 2)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 389, 421, 446 – Conviction in 4 cheque bounce cases – Suspension of sentence in appeals – Brother/Appellant stood surety for Rs. 1 lac – Convict/Appellant in appeals absented and bail bond/ surety bond forfeited – Appellate court directed the surety/appellant to deposit Rs. 1 lac each in four cases – Recovery warrants issued – Convict/ Appellant has already appeared before the lower Appellate Court -- Absence of convict/ appellant was beyond the control of the Surety/appellant – Penalty reduced to Rs.10,000/-.

(Para 11)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 82, 482 – Indian Penal Code, 1860 (45 of 1860), Section 174-A -- Proclaimed person – Quashing of FIR u/s Section 174-A – Compromise in cheque bounce case – Complaint has been dismissed as withdrawn -- Petition allowed, FIR and consequential proceedings quashed.

(Para 1-5)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 143(A) – Cheque bounce case – Interim compensation – Opportunity of hearing –Trial Court granted interim compensation u/s 143(A) just in a routine manner and there is no application of mind as to why the said compensation has to be awarded – No opportunity was given to the petitioner to file his response, before passing of the impugned order – Trial Court misread Section 143(A) and treated the said provision as mandatory in nature, whereas the legal position is otherwise – Matter remanded back to learned Trial Court to dispose of the matter regarding grant of interim compensation to the complainant in accordance with law.

(Para 7-10)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 148 – Code of Criminal Procedure, 1973 (2 of 1974), Section 374 -- Conviction in cheque bounce complaint – Appeal -- Compensation of 20% or less -- Discretion of Court -- Minimum sum of 20% is a statutory mandate, no discretion is left with the Court to order to deposit less than 20% of the compensation amount -- Appellate Court has rightly ordered to deposit 20% of the compensation amount.

(Para 13)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Probation of Offenders Act, 1958 (20 of 1958), Section 4 – Code of Criminal Procedure, 1973 (2 of 1974), Section 374 -- Probation – Conviction in cheque bounce complaint -- Matter pertains to an incident that occurred in the year 2000 and the present appeal has been pending since 2012 – No material on record that the accused-petitioner has any criminal antecedents – Held, the accused-petitioner are entitled to the benefit under the Probation of Offenders Act, 1958 -- Petitioner ordered to be released on probation, u/s 4 of the Act.

(Para 12-14)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 148 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 389 -- Conviction in cheque bounce case – Suspension of sentence in appeal with pre-condition to deposit 20% of compensation – Held, pre-condition as imposed by the Additional Sessions judge, cannot be found fault with, being legal and in consonance with the provisions of Section 148 of the N.I. Act, 1881.

(Para 1, 9)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 320, 401, 482  -- Cheque bounce case – Compromise after conviction – Compounding of offence -- Exemption from 15% of Cheque amount -- Petitioner is stated to be a poor farmer, who had taken the said loan for treatment of his son, who was suffering from cancer and stated to be 67 years of age – Petitioner exempted from paying 15% of the cheque amount -- Application u/s 320 Cr.P.C. read with Section 482 of Cr.P.C. for compounding of offence allowed -- Judgment and order of sentence set aside.

(Para 17-19)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 147 -- Compromise after conviction – Compounding of offence -- Cheque amount paid -- No one appeared to oppose the application on behalf of the private respondent, in spite of service of notice -- Since amount of both the dishonoured cheques (each of Rs.1,00,000/-) has been paid and the disputes have been compromised, the offence may be compounded -- Sentence of imprisonment of the petitioner set aside.

(Para 1, 2)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 142 – Cheque bounce case -- Quashing of non-bailable warrants – Petitioner ready to surrender and apply for regular bail -- Further submitted that since the petitioner is resident of Delhi, he has no local surety and he can furnish security bonds as per valuation certificate regarding his residential house, therefore, the trial Court may be directed to accept the bail/security bonds in this regard – Considering the limited prayer direction given that in case the petitioner appears before the trial Court within a period of 15 days, the trial Court will not insist upon furnishing a local surety and will accept any other surety/security bonds, on the basis of property offered by the petitioner.

(Para 1-4)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 143A – Cheque bounce case -- Death of accused – Interim compensation – Final compensation – Recovery from Estate – Permissibility of -- In case of death of an accused the compensation awarded u/s 138 of the Negotiable Instruments Act, 1881 can be recovered from the estate of a deceased accused, but an interim compensation awarded u/s 143A of the said Act cannot be recovered from the estate of a deceased accused, who died before the conclusion of the trial.

(Para 38)

Indian Penal Code, 1860 (45 of 1860), Section 174-A – Negotiable Instruments Act, 1881 (26 of 1881) , Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Cheque bounce case – Proclaimed person – FIR u/s 174-A IPC – Compromise in cheque bounce case – Complaint u/s 138 NI Act withdrawn --  Held, since the main complaint stands withdrawn the matter being compromised between the parties, therefore, continuation of the proceedings under Section 174-A IPC would be nothing but an abuse of the process of law – FIR and all other subsequent proceedings arising thereof quashed qua the petitioner subject to payment of cost of Rs.7000/- to the Legal Services Authority.

(Para 5-7)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 82 – Indian Penal Code, 1860 (45 of 1860), Section 174-A -- Cheque bounce case – Proclaimed person -- FIR u/s 174-A IPC – Compromise in complaint u/s 138 NI Act case – Complaint was dismissed as withdrawn – FIR u/s 174-A of IPC and all consequential proceedings arising therefrom quashed.

(Para 2-6)

Negotiable Instruments Act, 1881 (26 of 1881) Section 138, 148 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 357(3), 389 – Conviction in cheque bounce case -- Suspension of sentence in appeal – Pre-condition to deposit 20% of compensation -- Petitioner was directed to deposit 20% of the compensation amount, as a pre-condition for his suspension of sentence during the pendency of the appeal – Petition seeking quashing/setting aside of the order dismissed.

(Para 1-6)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 401 -- Conviction in cheque bounce case – Compromise at revisional stage – Waiver of cost of 15% of cheque amount -- Petitioner has a poor financial condition is apparent from the fact that the complainant has agreed to finally settle the matter for an amount of Rs.2,50,000/-, although, the cheque was for an amount of Rs.5,00,000/- -- Petitioner is a 51 year old lady who is stated to be having no source of livelihood and with great difficulty, she has repaid the amount of Rs.2,50,000/- to the complainant -- Keeping in view the said special facts and circumstances, this Court deemed it appropriate that no costs should be imposed upon the petitioner -- Revision allowed and judgments of Lower Courts set aside and the petitioner acquitted.

(Para 18-21)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 251, 254, 482 -- Cheque bounce complaint – Discharge application – Dismissal of -- Particulars of offence were stated to the accused/petitioners u/s 251 of CrPC, which was denied by him and it was stated that he had given the blank cheque to the respondent firm, which has been misused -- Complaint case u/s 138 of the NI Act is a summons trial case and the ld. Trial Court has rightly held that prima facie application cannot be decided without going into merits of the case in absence of any evidence -- This finding cannot be interfered with by High Court.

(Para 6-8)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Code of Criminal Procedure, 1973 (2 of 1974), Section 378(4) -- Cheque bounce complaint – Pre-mature complaint -- Leave to appeal -- Trial Court found the complaint pre-mature -- Cheque dishonored and returned with the remark ”Account Closed” -- Notice sent to the accused, who refused to accept notice – Complaint filed on 13^th day of refusal – Complainant-appellant registered the complaint before the statutory period of 15 days -- Leave to appeal dismissed.

(Para 4-6)

Negotiable Instruments Act, 1881 (26 of 1881), Section 138, 139 – Code of Criminal Procedure, 1973 (2 of 1974), Section 401 -- Cheque bounce complaint – Legally enforceable debt – Friendly loan of Rs. 3 lacs -- Basic ingredients which are required for transaction is not disputed -- There was good acquaintance between the petitioner and the accused prior to the transaction took place – No dispute relating to the issuing of demand notice by the petitioner to the accused – Accused/ Respondent No.1 convicted, sentenced to pay fine of Rs.3,00,000/-, in default simple imprisonment for one year.

(Para 2, 29, 30)

A. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Complaint for dishonour of cheque -- Stop payment – Account closed -- Not only the cases of dishonour of cheques on account of insufficiency of funds or on account of exceeding of arrangement but the cases involving dishonour of cheques on account of “stop payment” and “account closed” have also been brought within the ambit of offence under the aforesaid provision.

(Para 10)

B. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Complaint for dishonour of cheque -- Difference in signature -- Contention of the petitioner that in the case offence under Section 138 of the NI Act is not constituted because the cheque was dishonoured on account of difference in signatures and not for the reason of insufficiency of funds or exceeding the arrangement, deserves to be rejected.

(Para 15)

C. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 -- Complaint for dishonour of cheque -- Security cheque -- Even if cheque issued as a security, still then it cannot be stated that no offence is made out, once the cheque issued by him has been dishonoured by the banker.

(Para 19)

D. Negotiable Instruments Act, 1881 (26 of 1881), Section 138 – Code of Criminal Procedure, 1973 (2 of 1974), Section 482 -- Complaint for dishonour of cheque -- Security cheque -- Whether the petitioner had issued the cheque as a security and whether at the time when the cheque was presented for its payment, it was not for discharge of any debt or any other liability cannot be determined either by the trial Magistrate at the time of taking of cognizance or by High Court in these proceedings -- These are defences available to the accused/ petitioner, veracity whereof can be determined during the trial of the case -- Trial Magistrate directed to proceed further in the matter in accordance with law.

(Para 20, 21)