Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram

TMI Blog

Home

2016 (7) TMI 1627

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... amount payable in instalments was ₹ 57,000/-. CW1 admitted in his cross-examination that respondent no. 2 had already paid about ₹ 40,000/- to petitioner. Statement of account Ex. CW1/1 indicated that as on 16th February, 2009 ₹ 17,100/- was outstanding balance. Over and above this, overdue charges of ₹ 12,451.48 were added. Even the aggregate of this amount comes to ₹ 29,551.48; whereas cheque amount was much more than this. Thus, the cheque being of higher amount could not be taken towards discharge of the existing legal liability. Reliance has been placed on the judgments, that is, ALLIANCE INFRASTRUCTURE PROJECT PVT. LTD. AND ORS. VERSUS VINAY MITTAL [ 2010 (1) TMI 1288 - DELHI HIGH COURT ] to conclude t .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... Delhi to discharge his part liability. However, on presentation the cheque was returned unpaid vide banker's memo dated 19th February, 2009 for the reason Funds Insufficient . Since cheque amount was not paid within the prescribed period despite service of legal notice dated 13th March, 2009, hence, the complaint. 3. The complaint case was contested by respondent no. 2. Issuance of cheque was not disputed. However, it was alleged that cheque was as security cheque. Subsequently, it was accepted that it was not a security cheque. On the basis of evidence adduced by the parties, it was concluded that cheque amount was much more than the actual amount due, therefore, cheque was not in discharge of a legal liability. Trial court has .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... f cheque in question. No doubt, the expression amount of money would mean the amount of the cheque alone in case the amount payable by the drawer, on the date of presentation of the cheque, is more than the amount of the cheque. But, can it be said the expression amount of money would always mean the amount of the cheque, even if the actual liability of the drawer of the cheque has got reduced on account of some payment made by him towards discharge of the debt or liability in consideration of which cheque in question was issued. If it is held that the expression amount of money would necessarily mean the amount of cheque in every case, the drawer of the cheque would be required to make arrangement for more than the admitted amount pa .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... cheque drawn should be towards the discharge of either the whole debt or part of the debt. If the cheque is more than the amount of the debt due, I am afraid, Section 138 cannot be attracted. This is a case where the cheque amount was more than the amount due on the date when the cheque was presented. The presentation of the cheque and subsequent dishonour alone raises a cause of action. When the cheque cannot be said to be drawn towards the discharge of either the whole or part of any debt or liability, Section 138 is not attracted. On this sole ground, the complaint is liable to be quashed and is accordingly quashed. (emphasis laid) 6. For the foregoing reasons, I do not find any perversity in the view taken by the trial co .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

 

 

 

 

Quick Updates:Latest Updates