1999 (3) TMI 591 - SC - Companies Law

Whether the complaint filed by the respondent under Section 138 of the Negotiatiable Instruments Act is within or beyond time as it is contended that it is not filed within one month from the date on which the cause of action arose under clause (c) of the proviso to Section 138 of the Negotiable Instruments Act? Held that - Appeal dismissed. The period of one month for filing the complaint will be reckoned from the day immediately following the day on which the period of 15 days from the date of the receipt of the notice by the drawer, expires. Period of 15 days, in the present case, expired on 14th October, 1995. So cause of action for filing complaint would arise from 15th October, 1995. That day(15th October) is to be excluded for counting the period of one month. Complaint is filed on 15th November, 1995. The result would be that the complaint filed on 15th November is within time.

Summary

Issues:
- Whether the complaint filed under Section 138 of the Negotiable Instruments Act is within the prescribed time limit.

Analysis:
The case involved appeals questioning the timeliness of complaints filed under Section 138 of the Negotiable Instruments Act. The complainant's cheques bounced, leading to notices being served on the accused. The accused failed to make payment within the stipulated 15 days, causing the complainant to file complaints beyond the alleged time limit. The accused petitioned the High Court for quashing the process, which was rejected, leading to the appeals. The issue revolved around the interpretation of Sections 138 and 142 of the Act.

The court examined Section 138, which deems the dishonoring of a cheque as an offense under certain conditions. Section 142 mandates that the court can only take cognizance of such offenses upon a written complaint made within one month of the cause of action. The court deliberated on whether the period of one month should exclude the day on which the cause of action arose, citing a precedent where the first day was excluded in similar calculations. The court referred to the Limitation Act and the General Clauses Act, which support the exclusion of the initial day in computing time periods.

Applying the established rule of excluding the first day and including the last, the court calculated the period for filing the complaint. In this case, the 15-day period expired on 14th October, 1995, making the cause of action arise on 15th October, 1995. By excluding this day, the complaint filed on 15th November, 1995, was deemed to be within the prescribed time limit. Consequently, the appeals challenging the timeliness of the complaints were dismissed, upholding the validity of the complaints filed under Section 138 of the Negotiable Instruments Act.