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One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=761211 https://www.taxtmi.com/caselaws?id=761211 Dishonour of Cheque - insufficient funds - challenge to summoning order - scope of interference of this Court under Section 482 of the Code - non-application of mind - whether the learned MM and learned ASJ erred in passing the summoning order and impugned revision order, respectively, against the petitioner? - HELD THAT:- It is observed that after a cheque is returned for insufficient funds in the account, a notice demanding the repayment of the due amount should be issued by the payee to the drawer within a time period of thirty (30) days from the date on which the cheque was returned. Moreover, the provision also provides the drawer with a statutory period of fifteen (15) days to repay the due amount from the date of receipt of the demand notice. However, if the drawer fails to pay the due amount within the said statutory period, then an offence under Section 138 of the NI Act is deemed to have been committed. Moreover, once the offence is made out under Section 138 of the Act, the concerned Magistrate shall take cognizance of the offence as per Section 142 of the NI Act, only if the complaint is made in writing, by payee or holder in due course of time and within one month from the date on which the cause of action arises. It is pertinent to unfold the series of events that took place between the respondent no. 2 and the petitioner, wherein the cheque presented by the respondent no. 2 was returned for insufficient funds vide the return memo dated 25th May, 2019. Thereafter, the respondent no. 2, adhering to the statutory requirement of 30 days mentioned under clause (b) of proviso to Section 138 of the NI Act, issued a legal demand notice to the petitioner for the payment of due amount on 21st June, 2019 and the same was received by the petitioner on 24th June, 2019 as per the postal tracking report on record. It is pertinent to note that the Hon ble Supreme Court in the case of M/S. SAKETH INDIA LIMITED AND OTHERS VERSUS M/S. INDIA SECURITIES LIMITED [ 1999 (3) TMI 591 - SUPREME COURT] observed that the day on which the cause of action arises must be excluded in computing the limitation period for filing of the complaint as per Section 142 (1) (b) of the NI Act. In the matter at hand, the period of fifteen (15) days for repayment of the due amount expires on 9th July, 2019. Therefore, the cause of action under clause (c) of proviso to Section 138 of the NI Act arises on 10th July, 2019, which is to be excluded while calculating the limitation period of one month as envisaged under Section 142 (1) (b) of the NI Act. Therefore, according to the said provision, the complaint is to be filed on or before 10th August, 2019. However, the respondent no. 2 filed the complaint on 13th August, 2019 - It is the case of the respondent no. 2 that the limitation period of one month for filing the complaint expires on 10th August, 2019, on which the Court was not functioning and therefore, the respondent no. 2 was only able to file the complaint on the next working day i.e., 13th August, 2019. The NI Act, which categorically lays down extensive substance regarding the dishonor of the cheque, is silent with respect to the expiration of the limitation period on the day the Courts are closed. However, since the same is explicitly dealt by Section 4 of the Limitation Act, 1963, the same would be applicable in the instant case as well - given that the limitation period of one month for filing the complaint expires on 10th August, 2019, which is a holiday for the Court concerned, the same may be filed on the day when the Court concerned reopened i.e., 13th August, 2019. Coming to the issue of non-providence of sufficient reasons for summoning of the petitioner, it is observed that the respondent no. 2 filed pre-summoning evidence by way of an affidavit. It is pertinent to note that as per Section 145 of the Act, the complainant may give its evidence via an affidavit and upon satisfaction of the Court concerned, the same may be treated as an evidence for summoning the accused for any enquiry, trial or proceedings - Upon perusal of the summoning order, it is observed that the learned MM was satisfied with the sufficient causes being shown and accordingly, summons against the petitioner were issued. Therefore, the learned MM was correct in passing the summoning order against the petitioner and the learned ASJ was also right in upholding the said summoning order. This Court is of the view that the learned MM and the learned ASJ have not committed any error or illegality while passing the respective orders and therefore, this Court does not find any reasons to exercise its powers under Section 482 of the Code as the instant petition is bereft of any merits - Petition dismissed. Case-Laws Indian Laws Mon, 28 Oct 2024 00:00:00 +0530