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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether a cheque under Section 138 of the Negotiable Instruments Act, 1881 can be presented more than once within its validity period so as to give rise to a fresh cause of action on the second dishonour, and whether the complaint was barred by limitation on that basis.
Analysis: The statutory scheme permits presentation of a cheque within six months from the date of drawing or within its period of validity, whichever is earlier, and does not prescribe any limit on the number of presentations within that period. The limitation for complaint under Section 142 runs from the cause of action arising after notice and failure to pay. Reading a restriction against repeated presentation into Section 138 would amount to adding words to the statute and would be inconsistent with the expressed legislative intent. The apprehension of repeated prosecutions is answered by the requirement that the cheque must accompany the complaint and by the bar against multiple prosecutions on the same cheque after institution of proceedings.
Conclusion: A second presentation of the cheque within its validity period can give rise to a fresh cause of action if the statutory conditions are satisfied, and the complaint is not barred on that ground. The challenge to the proceedings on limitation failed.
Ratio Decidendi: Where Section 138 does not restrict the number of presentations of a cheque within its validity period, each valid dishonour after statutory notice and non-payment may furnish a fresh cause of action for prosecution.
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