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negotiable instrument act

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“Whether payee or holder of cheque can initiate proceeding of prosecution under Section 138 of Negotiable Instrument Act, 1881 for the second time if he has not initiated any action on earlier cause of action?” =After all, neither the courts nor the parties stand to gain by institution of proceedings which may become unnecessary if cheque amount is paid by the drawer. The magistracy in this country is over-burdened by an avalanche of cases under Section 138 of Negotiable Instruments Act. If the first default itself must in terms of the decision in Sadanandan Bhadran’s case (supra) result in filing of prosecution, avoidable litigation would become an inevitable bane of the legislation that was intended only to bring solemnity to cheques without forcing parties to resort to proceedings in the courts of law. While there is no empirical data to suggest that the problems of overburdened magistracy and judicial system at the district level is entirely because of the compulsions arising out of the decisions in Sadanandan Bhadran’s case (supra), it is difficult to say that the law declared in that decision has not added to court congestion. 33. In the result, we overrule the decision in Sadanandan Bhadran’s case (supra) and hold that prosecution based upon second or successive dishonour of the cheque is also permissible so long as the same satisfies the requirements stipulated in the proviso to Section 138 of the Negotiable Instruments Act. The reference is answered accordingly. The appeals shall now be listed before the regular Bench for hearing and disposal in light of the observations made above.

REPORTABLE IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NOS.261-264 OF 2002 MSR Leathers …Appellant Versus S. Palaniappan & Anr. …Respondents     J U D G M E N T   T.S. THAKUR, J.   1. In Sadanandan Bhadran v. Madhavan Sunil Kumar (1998) 6 SCC 514, this Court was dealing … Continue reading

civil case and criminal case both maintainable basing on the set of facts of the case=in offences of the nature contemplated under the summoning order, there can be civil liability coupled with criminal culpability. What a party has been deprived of by an act of cheating, can be claimed through a civil action. The same deprivation based on denial by way of deception, emerging from an act of cheating, would also attract criminal liability. In the course of criminal prosecution, a complainant cannot seek a reciprocal relief, for the actions of the accused. As in the instant case, the monetary consideration under the bill of exchange dated 1.2.2001, cannot be claimed in the criminal proceedings, for that relief the remedy would be only through a civil suit. It is therefore not possible for us to accept, that since a civil claim has been raised by the complainant-JCE Consultancy, based on the alleged breach of the agreement dated

1   “REPORTABLE” IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NO. 304 OF 2012 (Arising out of SLP (Criminal) No.9168 of 2009) Lee Kun Hee & Ors. …. Appellants Versus State of U.P. & Ors. …. Respondents   J U D G M E N T JAGDISH SINGH KHEHAR, J. 1. … Continue reading

when the cheques were not issued in discharge of any „debt‟ or „liability‟ but were issued as interest free security deposits and so the provisions of section 138 of the Act were not applicable.?=“With regard to the point in relation to security, I am of the view that whether the cheque was given as security or towards discharge of liability is a question to be decided by the Trial Court during the course Crl.M.C. 1136/2011 Page 8 of 8 of trial. Therefore, the point regarding issuance of cheque as security cannot be urged at this stage before this Court.” 12. From all these prima facie it is established that the dishonoured cheques were issued towards the discharge of a liability notwithstanding the fact that the money was by way of security deposit for the due performance of the terms of the agreement and was refundable at the time of vacation of the premises

Crl.M.C. 1136/2011 Page 1 of 8 * THE HIGH COURT OF DELHI AT NEW DELHI + CRL.M.C. 1136/2011 Reserved on: 14.12.2011 Pronounced on: 11.01.2012 DEEPAK VIG ….. Petitioner Through: Mr. Harish Malhotra, Senior Advocate with Mr. V.L. Madan and Mr. K.K. Madan, Advocates versus AVDESH MITTAL ….. Respondent Through: Mr. Ashish Middha and Mr.Y.R. Yadav, … Continue reading

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