Notice against cheque bounce is a very important stage for the initiation of legal proceedings under Section 138 of the NI Act. The Notice against cheque bounce is to be issued within 30 days of the receipt of information of bouncing of the cheque.
Legally, it is the non-payment of the dishonored cheque within fifteen days from the receipt of the notice that constitutes an offense. Issuing of a cheque and its dishonor is not an offense. The offense is when the drawer receives a notice from the payee and he fails to pay the dishonored cheque amount within the grace period of 15 days that constitute an offense.
Notice against cheque bounce explained:
Any demand made after the dishonor of cheque will constitute a notice. It is not necessary that the notice should be sent by Registered Post alone, it could be sent even by fax or email subject to the provisions of the IT Act. It is not necessary that the notice should be in any particular form or style. What is essential is that there should be a demand to pay the dishonored cheque amount.
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It is held by the Supreme Court that while the cheque could be presented at any number of times however there shall be only one Notice. Once the notice is issued the cause of action for filing of the criminal complaint arises and limitation as prescribed begins. The case Notice against cheque bounce can be referred to as under:
It was h The following case may be noted on the subject: Sadanandan Bhadran v. Madhavan Sunil Kumar[ (1998) 6 SCC 514],
Shiv Kumar Vs. Natrajan(2009)13 SCC 623 – Period of notice has to be calculated including the date as the word used is “within” 30 days “from the date it is drawn” invoking section 9 of the General Clauses Act.
Yogendra Pratap Singh v. Savitri Pandey, (2014) 10 SCC 713: 2014 SCC OnLine SC 744 at page 730
Question (i) Can an offense under Section 138 of the NI Act be said to have been committed when the period provided in clause (c) of the proviso has not expired?
The answer to this Question is in the negative for the following reasons given in the above ruling.
Section 2(d) of the Code defines “complaint”. According to this definition, complaint means any allegation made orally or in writing to a Magistrate with a view to taking his action against a person who has committed an offense. Commission of an offense is a sine qua non for filing a complaint and for taking cognizance of such offense.
Period of filing of complaint after Notice against cheque bounce:
A bare and simple reading of the provision contained in clause (c) of the proviso makes it clear that no complaint can be filed for an offense under Section 138 of the NI Act unless the period of 15 days has elapsed. Any complaint filed before the expiry of 15 days from the date on which the notice against cheque bounce explained has been served on the drawer/accused is no complaint at all in the eye of the law.
It is not the question of prematurity of the complaint where it is filed before the expiry of 15 days from the date on which notice has been served on him, it is no complaint at all under law.
Merely because at the time of taking cognizance by the court, the period of 15 days has expired from the date of issuance of notice against cheque bounce has been served on the drawer/accused, the court is not clothed with the jurisdiction to take cognizance of an offense under Section 138 on a complaint filed before the expiry of 15 days from the date of receipt of notice by the drawer of the cheque.
A complaint filed before the expiry of 15 days from the date on which notice against cheque bounce has been served on drawer/accused cannot be said to disclose the cause of action in terms of clause (c) of the proviso to Section 138 and upon such complaint which does not disclose the cause of action the court is not competent to take cognizance. Therefore, a court is barred in law from taking cognizance of such complaint.
We have no doubt that all the five essential features of Section 138 of the NI Act, as noted in the judgment of this Court in Kusum Ingots & Alloys Ltd. v. Pennar Peterson Securities Ltd., (2000) 2 SCC 745 and which we have approved, must be satisfied for a complaint to be filed under Section 138.
If the period prescribed in clause (c) of the proviso to Section 138 has not expired, there is no commission of an offense nor accrual of the cause of action for filing of a complaint under Section 138 of the NI Act.
The view taken by the Court in Narsingh Das Tapadia [Narsingh Das Tapadia v. Goverdhan Das Partani, (2000) 7 SCC 183 : 2000 SCC (Cri) 1326] and so also the judgments of various High Courts following Narsingh Das Tapadia [Narsingh Das Tapadia v. Goverdhan Das Partani, that if the complaint under Section 138 is filed before the expiry of 15 days from the date on which notice has been served on the drawer/accused the same is premature and if on the date of taking cognizance a period of 15 days from the date of service of notice on the drawer/accused has expired, such complaint was legally maintainable and, hence, the same is overruled.
The view taken by the Court in Sarav Investment & Financial Consultancy [Sarav Investment & Financial Consultancy (P) Ltd. v. Llyods Register of Shipping Indian Office Staff Provident Fund, (2007) 14 SCC 753 : (2009) 1 SCC (Cri) 935] wherein this Court held that service of notice in terms of Section 138 proviso (b) of the NI Act was a part of the cause of action for lodging the complaint and communication to the accused about the fact of dishonoring of the cheque and calling upon to pay the amount within 15 days was imperative in character, commends itself to us.