Cheque dishonour notice demanding wrong amount under s 138(b) NI Act led to complaint quashed under s 482 CrPC

A prosecution under s 138 NI Act was challenged on the ground that the statutory demand notice under s 138(b) did not demand the "said amount of money" (the cheque amount). The HC held that a valid cause of action requires a written demand for payment of the exact cheque amount; given the penal nature of s 138, compliance must be strict and a purported typographical error in the notice cannot cure a mismatch between the notice and the complaint. Since the complaint proceeded on a cheque/loan of a higher amount while the notice demanded a lower amount, the notice was not for the cheque amount and no prima facie offence was disclosed; proceedings were quashed by allowing the s 482 CrPC application.

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ISSUES PRESENTED AND CONSIDERED

1. Whether the statutory notice issued under Section 138(b) of the Negotiable Instruments Act made a demand for the "said amount of money" (i.e., the cheque amount forming the basis of the prosecution), and if not, whether the complaint for the offence under Section 138 was liable to be quashed for non-compliance with the mandatory precondition.

ISSUE-WISE DETAILED ANALYSIS

Issue 1: Validity of the Section 138(b) notice vis-à-vis demand for the "said amount of money" and maintainability of the Section 138 prosecution

Legal framework (as discussed by the Court): The Court examined the statutory requirement under Section 138(b) that the payee/holder in due course must make a demand for payment of the "said amount of money" by issuing a written notice to the drawer. The Court treated service of a legally compliant demand notice as a condition precedent to prosecution, and emphasised that Section 138 is penal and must be construed strictly. The Court applied the principle that the notice must specifically demand the cheque amount; absence of such a demand defeats the statutory ingredient necessary for the offence to arise.

Interpretation and reasoning: The Court compared (i) the allegations in the complaint (loan and cheque amount of Rs.4,30,000/-) with (ii) the contents of the statutory notice (loan and cheque amount of Rs.43,000/-). The notice, on its own terms, asserted a different transaction amount and demanded payment of Rs.43,000/-, not the cheque amount alleged in the complaint. The Court rejected the submission that the discrepancy could be treated as a mere typographical error curable by evidence at trial, holding that the complainant cannot "get rid of" the notice issued by him by later characterising the stated amount as mistaken. Since the statutory notice is the foundational step giving the drawer an opportunity to pay and avoid penal consequences, strict compliance with the requirement of demanding the "said amount of money" is mandatory.

Conclusions: The Court held that the notice was not issued for the "said amount of money" corresponding to the cheque amount on which the complaint was founded. Consequently, the complaint did not prima facie disclose the offence under Section 138 due to non-fulfilment of the mandatory technical requirement, and the proceedings for the offence under Section 138 were quashed in exercise of inherent jurisdiction.

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