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        2025 (7) TMI 474 - HC - Indian Laws

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        Statutory notice under cheque dishonour law must reach the drawer; service on a relative is insufficient without proof of knowledge. Service of the statutory demand notice under Section 138(b) of the Negotiable Instruments Act is mandatory before liability for cheque dishonour can 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.
                          Provisions expressly mentioned in the judgment/order text.

                            Statutory notice under cheque dishonour law must reach the drawer; service on a relative is insufficient without proof of knowledge.

                            Service of the statutory demand notice under Section 138(b) of the Negotiable Instruments Act is mandatory before liability for cheque dishonour can be sustained. Where notice is received only by the accused's relative and there is no proof that the drawer knew of that receipt, constructive service cannot be presumed and the notice requirement remains unfulfilled. In that situation, prosecution under the cheque dishonour provision fails for want of valid statutory notice, and the conviction cannot stand.




                            Issues: Whether service of the statutory notice under Section 138(b) of the Negotiable Instruments Act, 1881 on the accused's relative, without proof that the accused had knowledge of such service, amounts to valid service on the drawer of the cheque.

                            Analysis: Clause (b) of the proviso to Section 138 makes service of a written demand notice on the drawer mandatory before the offence can be sustained. On the evidence, the notice was received by a relative of the accused, but there was no material to show that the accused had knowledge of that receipt. In the absence of proof of such knowledge, constructive service could not be presumed, and the requirement of statutory notice was not satisfied. The conviction could not therefore stand.

                            Conclusion: Service of notice on the accused's relative, by itself, was not valid service on the accused and the requirement of Section 138(b) was not complied with.

                            Final Conclusion: The prosecution under the cheque dishonour provision failed for want of valid statutory notice, and the conviction and sentence were set aside with acquittal of the petitioner.

                            Ratio Decidendi: For an offence under Section 138 of the Negotiable Instruments Act, 1881, notice must be served on the drawer, and service on a relative is insufficient unless the drawer's knowledge of such service is shown.


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                            ActsIncome Tax
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