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TMI Blog2014 (10) TMI 1057X X X X Extracts X X X X X X X X Extracts X X X X ..... earance, the matter was not contested. In that, the complainant was not cross-examined to test his evidence by way of his examination-in-chief, nor did the accused tender any evidence in spite of opportunity. The case of the complainant was therefore accepted by the court and the respondent was convicted and sentenced to pay a fine of Rs.2.45 lakh of which Rs.2.44 lakh was to be paid as compensation to the complainant. The accused had challenged the judgment of the trial court by way of an appeal before the lower appellate court. He was permitted to tender evidence under Section 391 of the Code of Criminal Procedure, 1973, (Hereinafter referred to as 'the Cr.P.C.', for brevity). The accused had then demonstrated that the actual sequence of events were as follows, that in terms of Exhibit P6, the endorsement issued by the banker, of dishonour of the cheque was on 25.4.2007, pursuant to which the complainant is said to have issued a notice of demand, Exhibit-D1, hence the cause of action to file a complaint, when the accused failed to meet the demand, arose on 9.5.2007. However, no complaint was preferred . The complainant chose to present the cheque again on 28.6.2007 for encashme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pre-emptory action in exercise of such right under clause (b) of Section 138 go on presenting the cheque so long as the cheque is valid for payment. But once he gives a notice under clause (b) of Section 138 he forfeits such right for in case of failure of the drawer to pay the money within the stipulated time he would be liable for the offence and the cause of action for prosecution will arise. The correctness of this view was questioned in MSR Leathers v. S. Palaniappan & Anr. (2013) 1 SCC 177 before a bench comprising of Markandey Katju and B. Sudershan Reddy, J.J. who referred the issue to a larger bench. The larger bench in MSR Leathers case (supra) overruled Sadanandan Bhadran (supra) holding that there was no reason why a fresh cause of action within the meaning of Section 142 (b) read with section 138 should not be deemed to have arisen to the complainant every time the cheque was presented but dishonoured and the drawer of cheque failed to pay the amount within the stipulated period in terms of proviso to 138. This Court said: "In the result, we overrule the decision in Sadanandan Bhadran's case (supra) and hold that prosecution based upon second or successive dish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t a cheque can be presented any number of times during the period of its validity. Indeed that is also the consistent view of all the High Courts except that of the Division Bench of the Kerala High Court in Kumaresan1 which struck a discordant note with the observation that for the first dishonour of the cheque, only a prosecution can be launched for there cannot be more than one cause of action for prosecution. 30. MSR Leathers (supra) also looked at Section 138 and held that a complaint could be filed under Section 138 after cause of action to do so had accrued in terms of clause (c) of the proviso to Section 138 which happens no sooner the drawer of the cheque fails to make the payment of the cheque amount to the payee within fifteen days in terms of clause (b) to proviso to Section 138. MSR Leathers was not so much concerned with the question whether the proviso stipulated ingredients of the offence or conditions precedent for filing a complaint. It was primarily concerned with the question whether the second or successive dishonour followed by statutory notices and failure of the drawer to make payment could be made a basis for launching prosecution against the drawer. Tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision, any dishonour falling within the four corners of the enacting provision would be punishable without much ado. The proviso, however, draws an exception to the generality of the enacting part of the provision, by stipulating two steps that ought to be taken by the complainant holder of the cheque before the failure of the drawer gives to the former the cause of action to file a complaint and the competent Court to take cognizance of the offence. These steps are distinct from the ingredients of the offence which the enacting provision creates and makes punishable. It follows that an offence within the contemplation of Section 138 is complete with the dishonour of the cheque but taking cognizance of the same by any Court is forbidden so long as the complainant does not have the cause of action to file a complaint in terms of clause (c) of the proviso read with Section 142 which runs as under: "Section 142: Cognizance of offences. Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974) (a) no court shall take cognizance of any offence punishable under section 138 except upon a complaint, in writing, made by the payee or, as the case may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment stand absolved by the penal consequences of dishonour. This scheme may be unique to Section 138 NI Act, but there is hardly any doubt that the Parliament is competent to legislate so to provide for situations where a cheque is dishonoured even without any criminal intention on the part of the drawer. 13. The scheme of Section 138 thus not only saves the honest drawer but gives a chance to even the dishonest ones to make amends and escape prosecution. Compliance with the provision is, in that view, a mandatory requirement. (See C.C. Alavi Haji v. Palapetty Muhammed and Another (2007) 6 SCC 555). 14. Harman in that view correctly held that what would constitute an offence is stated in the main provision. The proviso appended thereto however imposes certain further conditions which are required to be fulfilled before cognizance of the offence can be taken. If the Parliament intended to make the conditions stipulated in the proviso, also as ingredients of the offence, the provision would have read differently. It would then have specifically added the words and the drawer has despite receipt of a notice demanding the payment of the amount, failed to pay the same within a p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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