TaxTMI 
TaxTMI 
2010 (12) TMI 1331
X X X X Extracts X X X X
X X X X Extracts X X X X
....t the Petitioner had business transaction with the complainant's wife Madheswari and she invested a sum of Rs. 5,00,000/-to start a cloth store and the Petitioner joined in the shop in order to help the complainant's wife. It is further submitted that the Petitioner took over the business but has not furnished any accounts to the complainant's wife. The said Madheswari preferred a complaint and the Petitioner came forward for a settlement and agreed to pay a sum of Rs. 10,00,000/-and gave a post dated cheque for the same amount on 20.3.2010. However, the cheque was issued in the name of the complainant. The complainant deposited the cheque on 6.4.2010 with the State Bank of India, Mettur and on 13.4.2010, the cheque returned wit....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the alleged amount itself is time barred debt and the proceedings are not maintainable. 5 . The learned senior counsel relied on Giridhari Lal Rathi v. P.T.V Ramanujachari and Anr. 1997 2 Crimes 658, wherein the Single Judge of Andhra Pradesh High Court has held as follows: 7 . The alleged loan was advanced in the year 1985 and the cheque was issued in the year 1990. By the time the cheque was issued, the debt appears to have been barred by limitation because no acknowledgement is alleged to have been obtained by the Appellant from the first Respondent-accused before expiry of three years from the date of loan. Thus it is crystal clear that the debt was not legally enforceable at the time of issuance of the cheque and therefore,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in respect of a debt or liability payable under a wagering contract, it could have been said that that debt or liability is not legally enforceable as it is a claim, which is prohibited under law. This case is not a case of that type. But we are certain that at this stage of the proceedings, to say that the cheque drawn by the Respondent was in respect of a debt or liability, which was not legally enforceable was clearly illegal and erroneous. 8 . In Rajendra Finance rep by Power of Attorney Mr. A.R.G. Laxmi Narayana v. S. Alosius Thairiyanatham 2005 (1) MWN (Cr.) DCC (Mad.)) where a learned single judge of this Court has held as follows: To attract Debt or Liability under Section 138, N.I. Act, the cheque ought to have been dra....
X X X X Extracts X X X X
X X X X Extracts X X X X
....us. 11. On the contrary, Mr. R. Karthikeyan, for Mr. P. Mathivanan submitted that only for a legally enforceable debt, the cheque was issued on 20.3.2010. The learned Counsel pointed out that the Petitioner had admitted the liability and only thereafter the cheque was issued. According to the Respondents, the liability is not time barred and it is legally enforceable. 1 2 . The point for consideration that arises in this petition is whether Heard both sides and perused the materials available on record. there is a legally enforceable debt in a time barred debt. 13. Heard both sides and perused the materials available on record. 1 4 . According to the complainant, the Petitioner was due and payable under a business transaction of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sumption. In Giridhari Lal Rathi v. P.T.V Ramanujachari and Anr. 1997 2 Crimes 658, it is held that by issuance of the cheque, the limitation for realising the loan amount cannot be taken as extended, because at the time of issuance of the cheque, a cheque should be for a legally recoverable debt. In A.V. Murthy v. B.S. Nagabasavanna 2002 (2) SCC 642), cited supra, the Supreme Court held "for example if the cheque was drawn in respect of a debt or liability payable under a wagering contract, it could have been said that the debt or liability is not legally enforceable as it is a claim which is prohibited under law. Likewise, a time barred debt is also not legally enforceable debt. 18. In the present case, the complainant himself admits t....