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TMI Blog1993 (10) TMI 347X X X X Extracts X X X X X X X X Extracts X X X X ..... visions of Section 138(a) would squarely be attracted. In the present case the post-dated cheques were drawn in March 1990 but they became "cheques" in the year 1991 on the dates shown therein. The period of six months, therefore, has to be reckoned from the dates mentioned on the face of the cheques. Even otherwise we agree with the reasoning adopted by the Division Bench of the Kerala High Court. Section 138 has to be construed with reference to the context. If the object of bringing Section 133 of the Act on the statute has to be fulfilled then the only interpretation which can be given to Clause (a) of proviso to Section 138 of the Act is that a post-dated cheque shall be deemed to have been drawn on the date it bears. Appeals allowed. - CRL.A. 640 OF 1993 - - - Dated:- 11-10-1993 - KULDIP SINGH AND YOGESHWAR DAYAL, JJ. JUDGMENT 1. Leave granted. 2. Anil Kumar Sawhney filed three complaints before the Chief Judicial Magistrate, Karnal alleging that Gulshan Rai, the accused therein, had committed an offence under Section 138 of the Negotiable Instruments (Amendment) Act, 1988 (for short the Act). The learned magistrate issued summons in each of the three compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement of liabilities by making the drawer liable for penalties in case of bouncing of cheques due to insufficiency of funds in the accounts or for the reason that it exceeds the arrangements made by the drawer, with adequate safeguards to prevent harassment of honest drawers. 5. Sections 5, 6, 19, 138, 139 and 140 of the Act, to the relevant extent, are reproduced hereunder: 'Bill of Exchange' is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument. xxx xxx xxx 6. Cheque - A 'cheque' is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand. 19. Instruments payable on demand - A promissory note or bill or exchange, in which no time for payment is specified, and a cheque, are payable on demand. 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 disch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to have been drawn. In other words, what is the date from which the period of six months as contemplated under Section 138(a) of the Act is to be reckoned. 7. The main contention raised by the respondent before the High Court was that the cheques in dispute were drawn in March, 1990 when those cheques were written and made. The dates written on those cheques, which were post-dated cheques, are not the dates when the cheques were drawn. According to the respondent, since the cheques were drawn in March, 1990 and those were presented before the bankers in the year 1991, the cheques had been presented to the bank beyond the period of six months from the date on which those were drawn and as such no offence was made out under Section 138(a) of the Act. Following the judgment of a learned single Judge of the Madras High Court in Babu Xavier v. Lalchand Munoth 1990 TLNJ (Crl.) 121 the High Court quashed the criminal complaints against the respondent. 8. The Madras High Court in Babu's case (supra) interpreted Section 138 of the Act in the following terms: When proviso (a) to Section 138 limits the applicability of the provision to cheques presented within six months of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in Babu's case and interpreted Section 138 of the Act in the following terms: Interpretation of Section 138 of the Act to discover the liability arising from dishonouring of a post-dated cheque has to be with due regard to the said character of post-dated cheque and the scope of Clause (a) of the proviso to Section 138 cannot be considered in isolation. The Statute has to be construed with reference to the context and other clauses of Act to make it consistent with it. The very object of the provision is to enhance the acceptability of cheques by making the drawer liable for penalty in case the cheque bounces for the reasons mentioned in the said section. If a postdated cheque is considered to be drawn on the date of its delivery, the drawer of such a cheque can defeat Section 138 of the Act by showing a date beyond six months of its delivery. In the circumstance an interpretation which will bring about such a result cannot be adopted. The object of the section is to make drawer of the cheque subject to penalty when the cheque bounces on the ground mentioned in the Section. The rigour of the Section itself reveals the intention of the legislature. Enough safeguards are pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l of Exchange is a negotiable instrument in writing containing an instruction to a third party to pay a stated sum of money at a designated future date or on demand. A cheque on the other hand is a bill of exchange drawn on a bank by the holder of an account payable on demand. Thus a cheque under Section 6 of the Act is also a bill of exchange but it is drawn on a banker and is payable on demand. It is thus obvious that a bill of exchange even through drawn on a banker, if it is not payable on demand, it is not a cheque. A post-dated cheque is only a bill of exchange when it is written or drawn, it becomes a cheque when it is payable on demand. The post-dated cheque is not payable till the date which is shown on the face of the said document. It will only become cheque on the date shown on it and prior to that it remains a bill of exchange under Section 5 of the Act. As a bill of exchange a post-dated cheque remains negotiable but it will not become a cheque till the date when it becomes payable on demand . 13. It is clear from Section 19 that a cheque is an instrument which is payable on demand. A post-dated cheque, which is not payable on demand till a particular ..... X X X X Extracts X X X X X X X X Extracts X X X X
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