TaxTMI 
TaxTMI 
2023 (11) TMI 1460
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....d 03.08.2022; ii. Setting aside of order dated 06.12.2022 vide which notice under Section 138 Negotiable Instruments Act, 1881 ('NI Act') has been framed against the petitioner. iii. Quashing of criminal proceedings in criminal complaint bearing no. 4763/2022 titled as 'Smt. Sita Devi v. Sh. Premananda Prusty' filed under Section 138 of NI Act, pending before learned Metropolitan Magistrate-01 (NI Act)/Digital Court, Central, Tis Hazari Courts, Delhi ('Trial Court'). 2. Brief facts of the case, as per the complaint filed under Section 138 of NI Act, are that the complainant had been was approached by the accused i.e. petitioner herein and his wife namely Smt. Damayanti Prusty, through complainant's son namely Manish Bha....
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....s per provisions of Section 138 of NI Act. It is stated that Syndicate Bank, where the cheque in question was drawn, had merged with Canara Bank on 01.04.2020, and therefore, cheques issued by Syndicate Bank had become invalid with effect from 01.07.2021 as per the notice issued by Canara Bank. Hence, the cheque in question which is alleged to have been issued on 28.02.2022 was not a valid cheque at the time of its presentation, and thus, its non-encashment cannot fall within the purview of Section 138 of NI Act. It is also stated by the learned counsel that petitioner has no liability towards the complainant, and that no specific amount of loan is mentioned in the complaint. It is further stated that some financial transaction had taken pl....
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....138. Dishonour of cheque for insufficiency, etc., of funds in the account - Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may be extended to two ....
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.... (ii) The cheque is drawn for the discharge of the "whole or part' of any debt or other liability" Debt or other liability' means legally enforceable debt or other liability; and (iii) The cheque is returned by the bank unpaid because of insufficient funds. However, unless the stipulations in the proviso are fulfilled the offence is not deemed to be committed. The conditions in the proviso are as follows: (i) The cheque must be presented in the bank within six months from the date on which it was drawn or within the period of its validity; (ii) The holder of the cheque must make a demand for the payment of the "said amount of money" by giving a notice in writing to the drawer of the cheque ....
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....0. This Court has also gone through the statement of the petitioner recorded under Section 294 of Cr.P.C., wherein the petitioner has admitted his signatures on all the relevant documents i.e. the promissory notes, the undertakings, and the cheque in question, though he denies the contents of these documents. 11. Now, it is the case of petitioner that Syndicate Bank had merged with Canara Bank on 01.04.2020 and therefore, cheques issued by Syndicate Bank had become invalid with effect from 01.07.2021 as per the notice issued by Canara Bank and hence, on the alleged date of issuance of cheque in question, i.e. on 28.02.2022, the cheque was not a valid cheque and its non-encashment could not fall under Section 138 of NI Act. 12. However....
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....k was not accepting the MICR Code, the petitioner after receipt of legal notice could have made the payment to the complainant or could have issued a fresh cheque towards the discharge of his liability. The fact remains that the cheque in question, which has been undisputedly signed by the petitioner, was presented for encashment with the Bank by the complainant towards discharge of debt, which the complainant claims is reflected from the promissory notes and undertakings signed by the petitioner, and upon its presentation, the cheque had been returned unpaid by the Bank to the complainant. Thereafter, the petitioner had also failed to make payment of the amount in question to the complainant after service of legal notice and therefore, the....