138 Ni Act Indian Law
3. Where a court imposes a penalty that does not include a fine, the court may, in rendering the judgment, order the accused to pay as compensation the amount specified in the decision to the person who has suffered loss or damage as a result of the act for which the accused person was convicted – A cheque is an instrument: which is regularly used for commercial transactions and to make payments. True, cheques are demystified for various reasons such as expired cheques, insufficient funds, alterations, irregular signatures, etc., and this non-cashing of cheques is dealt with under section 138 of the Negotiable Instruments Act, 1881. In MSR Leathers v.S. Palaniappan” has been determined that the beneficiary can present a redemption cheque before the expiration of 3 months from the date it was drawn or in its validity, whichever comes first. 2. Dayawati v. Yogesh Kumar Gosain 2017 CSC online Del 11032. (b) in the payment of compensation for loss or injury caused by the crime to a person, if the Court considers that compensation can be recovered from that person in a civil court; In this case, the status of an early complaint was called into question. It is therefore inferred from the above section that the withdrawal of cheques due to insufficient funds from the account or for any other reason constitutes a criminal offence. 3. Settlement of disputes outside the tribunal: (1) If the tribunal considers that there are elements of a settlement that may be acceptable to the parties, the tribunal shall formulate the terms of the settlement and give them to the parties for comment, and upon receipt of the parties` opinion, the tribunal may reformulate the terms of any settlement and apply them to the tribunal, in whose territorial jurisdiction the beneficiary`s bank branch is located, where the beneficiary deposits the cheque for payment into his account, except in the case of bearer cheques presented at the branch of the bank used, and in that case the local court of that branch would have jurisdiction.
Section 319 of the CrPC, 1973 provides that the court may take action against that person on the basis of evidence that a person who is not charged has committed a crime. There is no exception to the applicability of section 319 Crpc to the offence under section 138 of the NI Act. In N. Harihara Krishnan v. J. Thomas, the Supreme Court stated that the offence under section 138 is person-specific, so knowledge of the person who has not already been charged must be made in the same manner as knowledge was first obtained against the former defendant. The burden of complying with the conditions set out in the reservation in Section 138 of the NI Act for the newly added defendant would lie with the plaintiff. The essential aspects that constitute a crime under section 138 of the Ni Act cannot be circumvented in order to prosecute. Cheque bounce procedures are summary in nature, which means that the courts would not conduct normal criminal proceedings, which are very long and complex.
To challenge the case, the accused must be released on bail by the court. In cases of cheque bounce, the parties also have the option to settle the case amicably outside of court, as this is a composite offense. Recently, in the case of Kumaran v. In the state of Kerala, 2017 [7 SCC 471], the court ruled that, although the convicted person has always been sentenced in absentia, compensation may be recovered in the manner provided for in Article 421(1). However, this would be without the need to identify specific reasons. 2. Where the fine is imposed in an appeal case, such payment shall not be made before the expiry of the time limit for appeal or, in the case of an appeal, before the decision on the complaint is taken. Yes, failure to cash the cheque is a criminal offence and is punishable by imprisonment for up to two years or a fine of up to twice the amount of the cheque. or both.
6. Order for payment of compensation: (1) Where a court imposes a fine or penalty (including a death sentence) to which the fine belongs, the Court of Justice may, when delivering the judgment, order the application of the fine collected in whole or in part. After reviewing the procedural records, in particular the defendant`s cross-examination, the court found that the defendant had different versions regarding the context in which the cheque was issued. Although the defendant stated that the cheque was not issued by him to repay a debt, there was no evidence on the record that could prove that this was indeed the case. Section 138 of the Ni Act protects the beneficiary from the illegal portion of the drawer. It criminalizes the dishonor of cheques in cases where the amount of the cheque is greater than the amount of money in the account or exceeds the amount agreed with the bank. (d) where a person is convicted of a criminal offence involving theft, embezzlement, embezzlement or fraud, or for receiving or retaining unfairly stolen property or wilfully participating in the disposition of stolen property, having knowledge or having reason to believe that it has been stolen in order to compensate a bona fide purchaser of such property for the loss of such property; if the asset is returned to the possession of the beneficiary within the legal period, despite receipt of the notification of the cashing of the cheque, the presumption of illegibility on the part of the issuer and the suspicion of credibility of the negotiable instrument arise. To avoid this and maintain confidence in banking and business operations, section 139 has been incorporated into the Act. This provision creates a compelling presumption that a cheque that is the subject of section 138 of the Act was received by the cheque holder in whole or in part to satisfy a legally enforceable debt or liability.
A court acts on the basis of that presumption and it is for the issuer to rebut the presumption and establish the contrary on the basis of evidence. Since section 138 of the Act creates a criminal offence and the Criminal Provisions Act must be interpreted strictly so that no one can be prosecuted in an ingenious, insidious or strategic manner. 5. I.R Vijay Kumar v M/S IFCI Factors Limited & Ors. [Crl. M.C. 2358/2021 of 20 December 2021 – Delhi High Court] The word “negotiable” means transferable from one person to another, and the term “instrument” means a document of the title of the currency (as described by Professor Goode). In order to achieve the objective of the law, the legislator, in its wisdom, has considered it appropriate to create special procedures in the event that the obligation arising from the instrument is not fulfilled. Article 138 of the Act provides for the criminal liability of the issuer of a cheque for dishonesty, resulting in a prison sentence of up to two years or a fine of up to twice the amount, or both. Non-payment a) The cheque has been presented to the Bank within six months from the date of its use or within the period of validity, whichever comes first. Section 142 of the Act states that the complaint must be filed by the recipient or holder of the cheque in a timely manner. If a beneficiary is a natural person, he may lodge a complaint and, if the beneficiary is a company or a legal person, he must be represented by a natural person.
[Sankar Finance and Investment v. State of the P.A. The tribunal concluded that it was clear from the documents on file that specific allegations had been made against the Director. In addition to the principled assertion that the claimant was responsible for the day-to-day operations of the accused company, it was also alleged that the claimant, as managing director, was responsible for the financial decision-making of the accused company and agreed to guarantee the reimbursement of all amounts to be paid by the accused company to the complainant. The quasi-criminal nature of section 138 of the Ni Act can be better understood in two ways. On the one hand, the penalty for prison sentences of up to two years and a fine, which can be up to twice the amount of the cheque, and, on the other hand, the adoption of the Code of Criminal Procedure in the handling of these cases. The Court dismissed the appeal and challenge as to the nature of the cheque and held that marking the cheque as security for a debt would not remove its intrinsic character as a tool for settling a legally enforceable debt or liability. Civil liability: Article 138 provides for civil liability by imposing a fine twice as high as uncollected checks. The Negotiable Instruments Act, 1881 does not adequately define a negotiable instrument. Nevertheless, section 13 of the Ni Act defines a negotiable instrument as “a promissory note, bill of exchange or cheque payable either by order or to the holder”.
[a term that can be extended to two years] or with a fine, which can be up to twice the amount of the cheque, or both: 18.3. The investigation procedure under Chapter XVII of the Act should normally be summarized. The discretion of the judge, subject to the second reservation in article 143, to find that it was not desirable to hear the case summarily, since a sentence of more than one year is to be imposed, must be exercised after taking into account the additional fact that, in addition to the custodial sentence provided for in article 357, paragraph 357 of the Court, the judge must be allowed to rule on the matter. 3 Cr.P.C.6 for the award of appropriate compensation with a penalty for default under § 64 IPC and with other recovery powers under § 431 Cr.P.C.7 With this approach, a custodial sentence of more than one year may not be required in all cases. If an act of a person makes him responsible both civilly and criminally, no one can escape, he should suffer both.