2009 (4) TMI 1048 - SC - Indian Laws

Summary

Issues involved: Acquittal under Section 138 of the Negotiable Instruments Act, 1881 challenged on grounds of lack of proper notice before filing complaint.

The Supreme Court heard the appeal where the Trial Court had acquitted the appellant of the charge under Section 138 of the Negotiable Instruments Act, but the High Court set aside the acquittal and convicted the appellant. The High Court directed the appellant to pay a sum of rupees one lakh twenty thousand to the complainant and face imprisonment if the amount was not paid. The appellant challenged this decision on the grounds that proper notice as required by Clause (b) of the proviso to Section 138 of the Act was not served before filing the complaint. The notice was served on the appellant's wife, which the appellant argued did not fulfill the legal requirement. The respondent, however, argued that serving the notice on the appellant's wife was sufficient compliance.

The key legal provision in question was Section 138 of the Negotiable Instruments Act, which deals with the dishonour of cheques due to insufficient funds. The section specifies that the drawer of a dishonored cheque can be punished with imprisonment or fine. The proviso to Section 138 outlines conditions that must be met before a person can be convicted under this section. Clause (b) of the proviso mandates that the payee or holder must make a demand for payment by giving written notice to the drawer of the cheque within thirty days of being informed of the dishonour. In this case, the notice was served on the appellant's wife instead of the appellant himself. The Court concluded that this did not fulfill the legal requirement, and the complainant had not complied with the notice provision of Clause (b) of the proviso to Section 138. The Court noted that the High Court had overlooked this crucial aspect, leading to the appellant's conviction being unsustainable.

In the final decision, the Supreme Court allowed the appeal, setting aside the High Court's order and restoring the Trial Court's acquittal of the appellant.