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TMI Blog1990 (4) TMI 306X X X X Extracts X X X X X X X X Extracts X X X X ..... 21,00,000. On May 2, 1986, an agreement was entered into between the parties in pursuance of which the first accused-firm issued in favour of the respondent 57 post-dated cheques bearing different dates from May 2, 1986, to January 1, 1991, for a total sum of ₹ 21,00,000. The petitioner had signed the cheques on behalf of the partnership firm. The cheques were presented on the dates shown on them and the cheques up to June 1, 1987, were honoured, whereby the respondent realised a sum of ₹ 4,30,000. Cheques presented subsequent to June 1, 1987, were returned by the bank unpaid with endorsements refer to drawer . By notices dated April 22, 1989, and April 8, 1989, respectively, in respect of the cheques in each case, the respondent called upon the petitioner and his firm to pay the amounts covered by the cheques. Though the notices were received, the amounts were not paid; not was any reply sent. An offence under section 138 of the Negotiable Instruments Act (hereinafter referred to as the Act ), as amended by the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988, had been committed. Hence the two complaints. C.C. No. 6515 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in the complaints taken as they are and without adding or subtracting do not make out an offence and, in such a contingency, this court ought to quash the proceedings, since allowing it to continue would amount to abuse of the process of the criminal court. The legal contention raised in this case, therefore, has to be decided on the basis of the averments made in the two complaints. 6. According to the complaints, the five cheques, as also the other 52 cheques, were written up by the petitioner on May 2, 1986, in pursuance of an agreement entered into between the parties, settling the liability of the partnership and, in pursuance of that agreement, the cheques were post-dated to various dates commencing from May 2, 1986, to January 1, 1991. The complaints also show that all the cheques were handed over to the respondent on the same day, i.e. May 2, 1986. The five cheques which are the subject-matter of the criminal complaints are dated December 1, 1988, January 1, 1989, February 1, 1989, March 1, 1989, and April 1, 1989. Each cheque had been presented in the bank on the dates shown in it. Under these circumstances, the question is whether, as contended by learned counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ante-dated or post-dated , we do not find any such parallel provision in the Negotiable Instruments Act, 1881, though substantially the two Acts correspond, being based upon the law developed by the English courts. Indian courts, however, have recognised the validity of such cheques. 9. Even in the Negotiable Instruments Act, legal sanction for the recognition of ante-dated cheques, a provision slightly analogous to the one and post-dated cheques is found in section 118 of the Act. Section 118(b) raised a presumption regarding the date on which a negotiable instrument could be taken to have been drawn or made. Section 118(b) is as follows : Until the contrary is proved, the following presumptions shall be made : .... as to date. (b) that every negotiable instrument bearing a date was made or drawn on such date; 10. This would show that a cheque is taken to be drawn not always on the date that the cheque bears. There is only an initial presumption that the cheque is drawn on the date it bears. However, it is open to parties to prove the contrary and, in the event of any party succeeding in proving that a cheque was drawn earlier to the date it bears or later to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , taking care to provide adequate safeguards to prevent harassment to honest drawers, which safeguards are inbuilt in Chapter XVII itself. When proviso (a) to section 138 limits the applicability of the provision to cheques presented within six months of the date of drawal of the cheques, it has to be taken that it was the intention of Parliament to exclude cheques post-dated or ante-dated beyond a period of six months from the ambit of the penal provision. The use of the words in proviso (a) ..... within a period of six months from the date on which it is drawn rather than within a period of six months from the date the cheque bears and the use of words or within the period of its validity, whichever is earlier rather than the words or within the period of its validity, whichever is later would make this intention explicit. 15. Post-dated cheques, though legal, are real anomalies in the commercial world. They are payable on demand and negotiable even between the dates of issue and the dates shown on them. The holder of such a cheque, duly negotiated to him, even before the date the cheque bears, is indeed a holder in due course under the Act. Yet, when presented to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intiff of February 4, 1954, and had been encashed on a date subsequent to February 25, 1954, and, under those circumstances, the date of payment for the purpose of saving limitation was not February 4, 1954, viz., the date when the cheque was drawn but was February 25, 1954, the date the cheque bore. This decision would not in any way help us to determine the question as to when a post-dated cheque is said to have been drawn, since what was decided in that case was that, when payment is conditional, mere delivery of a cheque would not mean that the payment was made on that date and the date of payment for the purpose of limitation was the date on which the cheque would be actually payable at the earliest, assuming that it would be honoured. 19. It follows from the above discussion that a cheque is drawn on the date when the drawer signs the cheque, complete in its form. On such an interpretation, cheques post-dated or ante-dated beyond the period of six months from the date the cheques bear would be out of the purview of section 138 of the Act. 20. Though Thiru Dolia, learned counsel for the respondent, made submissions by referring to several books and decisions that a chequ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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