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Issues: Whether a complaint under Section 138 of the Negotiable Instruments Act, 1881 could be quashed on the ground that the cheque was issued towards a debt said to have become time-barred under the promissory note, and whether the debt remained legally enforceable on the facts of the case.
Analysis: The cheque was issued within the limitation period calculated from the fixed time for repayment stipulated in the promissory note, which required repayment by December 2016. Under Article 34 of the Limitation Act, 1963, limitation for a promissory note payable at a fixed time begins when the fixed time expires. On that basis, the period would extend beyond the date of the cheque and the complaint. The Court held that the debt could not be treated as time-barred on the face of the record and that the issue did not justify interference under Section 482 of the Code of Criminal Procedure, 1973. The presumption under Sections 118 and 139 of the Negotiable Instruments Act, 1881 and the applicability of Section 25(3) of the Indian Contract Act, 1872 supported the view that the complaint disclosed a legally enforceable liability, leaving no basis for quashing at the threshold.
Conclusion: The cheque was issued in respect of a legally recoverable debt, and quashing of the complaint was unjustified.
Final Conclusion: The order quashing the criminal proceedings was set aside and the complaints were restored for trial on merits.
Ratio Decidendi: Where a cheque is issued within the subsisting limitation period arising from a promissory note payable at a fixed time, the complaint under Section 138 of the Negotiable Instruments Act, 1881 cannot be quashed at the threshold on the premise of a time-barred debt if the record discloses a legally enforceable liability.
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