Section 138 notice service presumption governs maintainability; complaint is not bad for lack of proof of actual service at filing

In proceedings under Section 138 of the Negotiable Instruments Act, issuance of notice to the correct address by registered post attracts a presumption of service under Section 27 of the General Clauses Act and Section 114 of the Evidence Act unless rebutted. The complaint is not premature merely because it was filed within one month of dispatch of notice; the complainant need not mechanically wait for service to be affirmatively proved at filing stage. Specific averments of actual service or deliberate evasion are also not mandatory for maintainability, because service is a matter of evidence and the drawer may rebut the presumption during trial. The appellate acquittal was set aside and the matter remanded for fresh consideration.

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Issues: (i) whether a complaint under Section 138 of the Negotiable Instruments Act instituted within one month from the date of issuance of notice is premature when service of notice is not affirmatively proved; (ii) whether the complaint must contain averments regarding actual service of notice or deliberate evasion by the accused.

Issue (i): whether a complaint under Section 138 of the Negotiable Instruments Act instituted within one month from the date of issuance of notice is premature when service of notice is not affirmatively proved.

Analysis: The statutory scheme requires issuance of notice within the stipulated period, service of notice, failure to pay within fifteen days of receipt, and then institution of the complaint within one month from the date the cause of action arises. The Court noted that when notice is sent to the correct address by registered post, a presumption of service arises under Section 27 of the General Clauses Act, 1897 and Section 114 of the Indian Evidence Act, 1872, unless rebutted. The Court held that the complainant is not required to wait mechanically for thirty days and then add another fifteen days in every case; such an approach would unduly favour a defaulting drawer and defeat the object of the provision. The appellate court's view that the complaint was premature merely because it was filed within one month of dispatch of notice was found to be legally unsustainable.

Conclusion: The complaint was not liable to be treated as premature on the facts found by the Court.

Issue (ii): whether the complaint must contain averments regarding actual service of notice or deliberate evasion by the accused.

Analysis: The Court relied on the settled position that service of notice is a matter of evidence and that the complainant need only plead the basic facts showing issuance of notice in the manner required by law. Once notice is sent to the correct address, service is presumed unless the drawer rebuts that presumption. The Court held that the absence of a specific averment of actual service or of evasion does not by itself invalidate the complaint. The accused may rebut the presumption during the proceedings, including by showing lack of knowledge or incorrect address, but a mere denial is insufficient.

Conclusion: Specific averments of actual service or deliberate evasion were not mandatory for maintainability of the complaint.

Final Conclusion: The order of acquittal passed by the appellate court was set aside, and the matter was sent back for fresh consideration by the appellate court after hearing both sides.

Ratio Decidendi: In proceedings under Section 138 of the Negotiable Instruments Act, timely issuance of notice to the correct address coupled with the statutory presumption of service is sufficient at the threshold, and the complaint is not rendered bad merely because actual service is not proved at filing stage or because the complaint is presented within one month of dispatch of notice.

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