Deemed service of cheque dishonour notice may arise from correct address and evasive postal endorsements, leaving disputed facts for trial.

In a prosecution under Section 138 of the Negotiable Instruments Act, notice sent to the correct address may attract a rebuttable presumption of service even if returned with endorsements such as non-availability of the addressee, absence, locked premises, or similar refusal-type situations. The Court applied Section 27 of the General Clauses Act to hold that deliberate evasion, unclaimed delivery, or refusal can support deemed service, while the genuineness of the postal endorsement is ordinarily a matter for evidence at trial. A petition under Section 482 of the Code of Criminal Procedure is therefore not the proper stage to decide disputed questions on fraudulent avoidance of service, and quashing at the threshold is not warranted.

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Issues: Whether, in a prosecution under Section 138 of the Negotiable Instruments Act, 1881, notice returned unserved with an endorsement showing non-availability of the addressee can still give rise to deemed service so as to sustain the complaint and refuse quashing under Section 482 of the Code of Criminal Procedure, 1973.

Analysis: The statutory scheme of Section 138 requires issuance of notice and failure to pay within the prescribed period after receipt of notice. The Court held that receipt of notice is ordinarily required, but the principle of presumption of service under Section 27 of the General Clauses Act, 1897 applies where notice is sent to the correct address. Refusal, unclaimed delivery, or deliberate evasion may justify a presumption of service. Where the envelope is returned with an endorsement such as absence of the addressee or locked premises, the matter depends on facts and evidence, including whether the endorsement is genuine or manipulated. The Court applied purposive construction to avoid defeating the object of Section 138 by allowing dishonest drawers to evade service, and held that the question whether service was fraudulently avoided cannot ordinarily be decided at the stage of process issuance or by a petition under Section 482 of the Code of Criminal Procedure, 1973.

Conclusion: The notice could be treated as capable of deemed service for the purpose of proceeding under Section 138, and quashing of the complaint proceedings was not warranted at the threshold.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, a notice sent to the correct address may attract a rebuttable presumption of service even when returned with endorsements indicating non-availability of the addressee, and the genuineness of such endorsement is ordinarily a matter for trial rather than for quashing at the threshold.

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