Cheque dishonour notice must go to the drawer company before liability can attach to its Managing Director.

For a cheque dishonour prosecution under section 138 of the Negotiable Instruments Act, statutory notice must be issued to the actual drawer of the cheque. Where the cheque is drawn on a company's account and signed by its Managing Director, the drawer is the company, not the officer in an individual capacity. Notice addressed only to the Managing Director does not satisfy the mandatory proviso to section 138, and liability under section 141 cannot be fastened on the officer unless the company's offence is first made out. On that basis, the complaints were held not to disclose an offence.

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Issues: Whether complaints under section 138 of the Negotiable Instruments Act disclosed an offence where the statutory notice was not issued to the company which was the drawer of the cheques, and whether the Managing Director could be prosecuted without making out a case of offence by the company.

Analysis: The complaints and accompanying cheque copies showed that the cheques were drawn on the account of Shakti Spinners Ltd. and were signed by the petitioner as Managing Director. In such circumstances, the drawer for purposes of section 138 was the company, not the petitioner in his individual capacity. The statutory notice was addressed to the petitioner and not to the company, and notice to the petitioner could not be treated as notice to the drawer company. The requirement of notice under the proviso to section 138 is mandatory, and criminal liability must be strictly construed. The reasoning under section 141 also required that where the offence is by a company, the company's liability must first be made out before fastening liability on its officer.

Conclusion: The complaints did not disclose a legal and proper notice to the drawer company and therefore did not disclose an offence under section 138. The proceedings were liable to be quashed in favour of the petitioner.

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