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        Case ID :

        2021 (6) TMI 475 - HC - Indian Laws

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        Presumed service of demand notice under Section 138 protects complaints, and a later reminder notice does not defeat maintainability. In a prosecution under Section 138 of the Negotiable Instruments Act, service of a demand notice sent by registered post to the correct address may be ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.

                          Presumed service of demand notice under Section 138 protects complaints, and a later reminder notice does not defeat maintainability.

                          In a prosecution under Section 138 of the Negotiable Instruments Act, service of a demand notice sent by registered post to the correct address may be presumed under Section 27 of the General Clauses Act and Section 114 of the Evidence Act, so the complaint need not plead the exact date of service as a condition for summoning. Disputed service and rebuttal of the presumption are matters for trial, not quashing. A later reminder notice does not displace the cause of action arising from the first statutory notice and does not make the complaint non-maintainable. The quashing challenge was rejected and the complaint was permitted to proceed.




                          Issues: (i) Whether proceedings under Section 138 of the Negotiable Instruments Act, 1881 could be quashed for want of a specific averment of the date of service of demand notice when the notice was sent by registered post to the correct address. (ii) Whether a second notice dated 02.11.2012 could defeat the complaint or render it not maintainable.

                          Issue (i): Whether proceedings under Section 138 of the Negotiable Instruments Act, 1881 could be quashed for want of a specific averment of the date of service of demand notice when the notice was sent by registered post to the correct address.

                          Analysis: Clause (b) of the proviso to Section 138 requires issuance of notice within the prescribed time, and service may be presumed where the notice is properly addressed and sent by registered post. The statutory presumption under Section 27 of the General Clauses Act, 1897 and the corresponding presumption under Section 114 of the Indian Evidence Act, 1872 mean that the complaint need not plead the exact date of service as a condition precedent for summoning. At the stage of process, the court only examines whether basic facts disclose a prima facie case, while disputed service and rebuttal of presumption are matters for trial.

                          Conclusion: The challenge on this ground failed, and the proceedings could not be quashed for absence of a specific date of service.

                          Issue (ii): Whether a second notice dated 02.11.2012 could defeat the complaint or render it not maintainable.

                          Analysis: The cause of action for prosecution arose from the first notice dated 19.09.2012 and the failure to pay within the statutory period. A later notice does not nullify the earlier notice and is treated only as a reminder of the drawer's obligation. The second notice does not amount to an admission that the first notice was not served, and it does not affect the maintainability of the complaint filed within time.

                          Conclusion: The second notice did not invalidate the complaint or the proceedings.

                          Final Conclusion: The application for quashing was found to be without merit, and the complaint proceedings were allowed to continue with a direction for expeditious disposal by the trial court.

                          Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, service of notice sent by registered post to the correct address may be presumed, the absence of an exact pleaded date of service does not by itself justify quashing, and a subsequent reminder notice does not displace the cause of action arising from the first statutory notice.


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                          ActsIncome Tax
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