Karnataka HC.
Credit: DH File Photo
Bengaluru: A complaint of cheque bounce under Section 138 of the Negotiable Instruments (NI) Act filed before the expiry of 15 days from the date of service of notice cannot be treated as a valid complaint in the eye of law, the Karnataka High Court has held.
The court said that criminal proceedings initiated on such complaints are liable to be quashed.
However, a second complaint over the same transaction is maintainable if the delay in filing the same is deemed to have been condoned, Justice Shivashankar Amarannavar observed, while setting aside the conviction and sentence imposed on Armugam, a resident of Bengaluru.
The petitioner, Armugam, had borrowed a loan of Rs 1 lakh from Anand, the complainant, for business purposes. After the cheque issued by Armugam was dishonoured, the complainant issued a demand notice dated December 30, 2015, which was served on January 1, 2016.
The complaint was filed on January 13, 2016, and on April 3, 2017, the trial court convicted Armugam.
The court imposed a fine of Rs 1,75,000, and in default, simple imprisonment for six months. Armugam moved the High Court after the sentence was affirmed by the Sessions Court.
It was argued on behalf of Armugam that the complaint was filed prior to the accrual of cause of action and was therefore, premature.
Anand admitted that it was a premature complaint and sought permission to file a fresh one.
“Drawer of the cheque cannot be allowed to escape from prosecution merely on a technical count that a premature complaint was filed against him before expiry of the statutory period of 15 days as per the mandate of Section 138(c) of the NI Act. Such a drawer of the cheque is liable to be prosecuted in a second successive complaint filed on the same facts by the holder of the cheque. The drawer of the cheque would not be absolved from penal consequences of dishonouring of cheque issued by him/her,” said Justice Amarannavar.
The court has granted one month’s time to file a fresh complaint and directed the trial court to decide the second complaint, preferably within six months, after affording the opportunity of hearing to the accused