https://www.taxtmi.com/highlights?id=82769 Dishonor of cheque due to account freeze falls within the purview of Section 138 of the Negotiable Instruments Act. The test is whether the account had insufficient funds or exceeded the arranged limit, regardless of the drawer's knowledge about the account freeze. If a cheque is issued from a frozen account with the intention to cheat, it attracts Section 138. In this case, on the cheque date, the account lacked sufficient funds, satisfying the first contingency u/s 138. Despite the statutory notice, the petitioner company disputed the liability and did not pay the cheque amount. The court dismissed the petition, ruling that a bank freezing the account can initiate a complaint for cheque dishonor due to account freeze, subject to considering the circumstances surrounding the issuance of the cheque to the complainant bank. en-us Tue, 05 Nov 2024 13:02:22 +0530 Tue, 05 Nov 2024 13:02:22 +0530 TaxTMI RSS Generator https://www.taxtmi.com/highlights?id=82769 Dishonor of cheque due to account freeze falls within the purview of Section 138 of the Negotiable Instruments Act. The test is whether the account had insufficient funds or exceeded the arranged limit, regardless of the drawer's knowledge about the account freeze. If a cheque is issued from a frozen account with the intention to cheat, it attracts Section 138. In this case, on the cheque date, the account lacked sufficient funds, satisfying the first contingency u/s 138. Despite the statutory notice, the petitioner company disputed the liability and did not pay the cheque amount. The court dismissed the petition, ruling that a bank freezing the account can initiate a complaint for cheque dishonor due to account freeze, subject to considering the circumstances surrounding the issuance of the cheque to the complainant bank. Highlights Indian Laws Tue, 05 Nov 2024 13:02:22 +0530 https://www.taxtmi.com/highlights?id=82769