2026 (1) TMI 260 - SC - Indian Laws

Late-filed cheque bounce complaint u/s138-delay condonation u/s142(b) must come before cognizance; proceedings set aside.

Under the proviso to s. 142(b) of the NI Act, a court may take cognizance of a complaint under s. 138 only after the complainant establishes 'sufficient ... Dishonour of cheque - cognizance of offence by learned Magistrate without first condoning the delay in the filing of the complaint - sufficient cause for delay or not - HELD THAT:- The power conferred upon the Court to take cognisance of a belated complaint is subject to the complainant first satisfying the Court that he had sufficient cause for not making the complaint within time. The satisfaction in that regard, resulting in condonation of the delay, must therefore precede the act of taking cognizance. Ordinarily, a proceeding instituted with limitation-linked delay before a Court of law does not actually figure as a regular matter on its file until that delay is condoned. For example, Order XLI Rules 3A and 5(3) of the Code of Civil Procedure, 1908, make this position amply clear in the context of belated presentation of civil appeals. Therefore, the approach of the High Court in treating this crucial aspect as a mere interchangeable exercise, i.e., either to first condone the delay or to first take cognisance, is not in keeping with the mandate of the aforestated proviso. We may note that the respondent was herself responsible for this imbroglio as she had made a categorical statement in her complaint that it was filed within time, when it was not. There are no hesitation in holding that the learned Magistrate erred in taking cognisance of the respondent’s complaint under Section 138 of the NI Act, even before the delay of two days in its presentation was condoned. The order passed by the High Court refusing to quash the same is, thus, set aside. Appeal allowed. 1. ISSUES PRESENTED AND CONSIDERED (i) Whether, under the proviso to Section 142(1)(b) of the Negotiable Instruments Act, a Court can validly take cognisance of a complaint presented beyond the prescribed period before recording satisfaction of 'sufficient cause' and condoning the delay. (ii) Whether subsequent condonation of delay cures the prior act of taking cognisance on a time-barred complaint so as to sustain the proceedings. 2. ISSUE-WISE DETAILED ANALYSIS Issue (i): Requirement that condonation of delay must precede taking cognisance Legal framework: The Court examined the proviso to Section 142(1)(b), which permits cognisance after the prescribed period only if the complainant satisfies the Court that there was 'sufficient cause' for not filing within time. The Court treated this proviso as controlling the Court's power to take cognisance of a belated complaint. Interpretation and reasoning: The Court held that the proviso's language makes the power to take cognisance of a belated complaint conditional upon the complainant first satisfying the Court regarding 'sufficient cause.' This satisfaction, resulting in condonation, must precede the act of taking cognisance. The Court rejected the view that condonation and cognisance are interchangeable steps. It reasoned that limitation-linked delay prevents a proceeding from being treated as a regular matter on the file until delay is condoned, and therefore taking cognisance first is contrary to the proviso's mandate. Conclusion: Taking cognisance of a belated complaint without first condoning delay is impermissible; the Magistrate erred in taking cognisance before condoning the two-day delay. Issue (ii): Whether later condonation cures earlier improper cognisance Legal framework: The Court applied the same proviso to Section 142(1)(b) to assess whether subsequent condonation could validate cognisance taken earlier. Interpretation and reasoning: The Court disagreed with the approach that the defect is merely curable by later condonation. It held that, because the statutory condition requires prior satisfaction and condonation, subsequent condonation cannot retrospectively legitimise cognisance already taken in breach of that condition. The Court also held that earlier non-challenge to intermediate orders did not matter, since condonation occurred much later and the core illegality concerned cognisance having been taken before delay was condoned. Conclusion: Subsequent condonation does not cure the illegality of cognisance taken prior to condonation; the High Court's refusal to quash was incorrect, and the complaint was quashed as a consequence.