Law on Notices in Cases of Cheque Dishonour under S.138 of Negotiable Instruments Act, 1881

Law on Notices in Cases of Cheque Dishonour under S.138 of Negotiable Instruments Act, 1881

In the case of Chandulal Keshavlal Modi v. Vijaysinh Ratansinh Chavda [2018] GCtR 6616 (Gujarat) the accused facing allegations of offence under Section 138 of Negotiable Instruments Act, 1881 was able to secure acquittal. 

The case was that accused "A" had demanded money from complainant "C". A had executed promissory note. Basically, C had signed on a form and "A" had withdrawn money but "A" did not paid money to "C" after which "A" issued cheque but cheque was dishonoured.

While dealing with the issue of service of notice, it was observed that the postal acknowledgment certificate produced at page 61 of the paper book clearly indicated that three addresses have been shown which are almost the same indicating residential address as well as place of service of the accused, whereas registered acknowledgment i.e. postal receipt at page 63 of the paper book discloses only one address of the accused wherein initial endorsement by the postal authority clearly indicates “not known” and thereafter also second attempt was made; at that time, it was clearly stated on 23rd October by endorsement that the accused is not residing there and he has vacated the house. In view of the aforesaid factual position, indisputably, the notice could not be served upon the accused.

It was held that for want of effective service of statutory notice, the complaint under S.138 of NI Act, 1881 is not maintainable.

While finding the acquittal under S.138 of NI Act to be justified it was laid down that "it is settled legal position that in acquittal appeals, the appellate Court is not required to rewrite the judgment or to give fresh reasonings, when the reasons assigned by the Court below are found to be just and proper."