1998 (7) TMI 721 - HC - Indian Laws

Summary

Issues:
1. Failure to issue notice within 15 days of intimation of insufficient funds.
2. Inclusion of the firm as an accused under Section 141 of the Negotiable Instruments Act.

Issue 1: Failure to issue notice within 15 days of intimation of insufficient funds.

In Crl.R.C. No.418 of 1997, the accused issued a cheque that was dishonored, leading to a complaint under Section 138 of the Negotiable Instruments Act. The contention was that the notice was not sent within 15 days of intimation. However, the lower appellate court found that the notice sent on 11.1.93 was within the period of limitation as the return memo was issued on 26.12.92. Similarly, in Crl.R.C. No.431 of 1997, the notice was sent on 11.1.93 after the return memo was received on 1.1.93, well within the statutory period. The courts below upheld the validity of the notices based on these timelines, dismissing the argument of failure to issue timely notice.

Issue 2: Inclusion of the firm as an accused under Section 141 of the Negotiable Instruments Act.

The petitioner contended that the firm should have been made an accused under Section 141 of the Act. However, both courts found that the accused issued the cheques towards the discharge of his liability, and unless it was established that the firm was liable to pay the amount, adding the firm as an accused was not necessary. The petitioner's argument that signing as a partner implied issuance on behalf of the firm was dismissed as there was no evidence the firm purchased on credit. Additionally, the lower court noted that the firm was not registered, and unless firm liability was proven, adding it as an accused was not mandatory. The petitioner cited precedents for mandatory inclusion of the firm, but the court found no need to delve into those debates as the facts of these cases did not warrant interference with the lower courts' findings.

In conclusion, the High Court of Madras dismissed both revisions as they lacked merit. The court upheld the validity of the notices sent within the statutory period and found no requirement to include the firm as an accused based on the specific circumstances of the cases. The judgment emphasized the importance of establishing firm liability before compelling its inclusion as an accused, thereby maintaining consistency with the factual findings of the lower courts.