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Issues: (i) Whether a cheque issued towards a time-barred debt falls within the ambit of Section 138 of the Negotiable Instruments Act, 1881. (ii) Whether the sentence, including the default sentence, required interference.
Issue (i): Whether a cheque issued towards a time-barred debt falls within the ambit of Section 138 of the Negotiable Instruments Act, 1881.
Analysis: The decision under challenge was held not to depend on Section 18 of the Limitation Act, 1963. A cheque is complete only upon writing, signing and delivery, and before delivery there is a promise in writing to discharge the liability. Such a promise is supported by Section 25(3) of the Indian Contract Act, 1872, and a cheque so delivered is treated as issued for discharge of a legally enforceable liability within the meaning of Section 138 of the Negotiable Instruments Act, 1881.
Conclusion: The cheque issued for a time-barred liability still attracts Section 138 of the Negotiable Instruments Act, 1881; the conviction was sustained.
Issue (ii): Whether the sentence, including the default sentence, required interference.
Analysis: The substantive imprisonment was found unnecessary, while the compensation awarded was upheld as just and proper in the circumstances. However, the default sentence did not conform to Section 30 of the Code of Criminal Procedure, 1973, and warranted modification.
Conclusion: The sentence was modified by substituting imprisonment till rising of court and reducing the default sentence, while maintaining the compensation.
Final Conclusion: The revision succeeded only to the extent of sentence modification, while the conviction under Section 138 of the Negotiable Instruments Act, 1881 was affirmed.
Ratio Decidendi: A cheque issued and delivered towards a time-barred liability constitutes a valid promise in writing supported by consideration under Section 25(3) of the Indian Contract Act, 1872, and therefore falls within Section 138 of the Negotiable Instruments Act, 1881.
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