ni-act-order-undergo-imprisonment-default-pay-compensation-appealable-calcutta-hc/

http://www.livelaw.in/ni-act-order-undergo-imprisonment-default-pay-compensation-appealable-calcutta-hc/

Cheque Bounce: Reminder Notice Can’t Be Construed As Admission Of Non-Service Of First Notice: SC

Cheque Bounce: Reminder Notice Can’t Be Construed As Admission Of Non-Service Of First Notice: SC [Read Judgment]

Read more at: http://www.livelaw.in/cheque-bounce-reminder-notice-cant-construed-admission-non-service-first-notice-sc/

NI Act S.138 - When notice has been duly served on the Company,

Important Judgments (10/03/2017)

NI Act S.138 - When notice has been duly served on the Company, merely because notice has not been duly served on Director of Company respectively, will not by itself a vitiating ground to dismiss the complaint at the S.203 CrPC stage - 2017 (1) KHC 923

Contempt of Courts – Intervention by third party – Not permissible - 2017 (1) KHC 940 (DB)

A foreign judgment passed ex parte is not executable in India - 2017 (1) KHC 959 (DB)

Environment Law – Quarrying activities – Objector has a limited right of being heard - 2017 (1) KHC 952

Custody of child – Presumption is in favour of maternal custody - 2017 (1) KHC 47 (SC) (SN)

A person who is issued with a learner’s driving licence, can drive a vehicle in public place, but subject to the specific provisions under MV Act & Rules - 2017 (1) KHC 942 (DB)

For filing a suit against Panchayat or its officers to prevent any unlawful act, like trespass, forceful encroachment, etc., having no sanction under the Panchayat Raj Act, statutory notice under Section 249(1) of the Panchayat Raj Act is not required - 2017 (1) KHC 928

Prosecution under S.57(a) of Abkari Act on the ground that the toddy offered for sale by the licensee is not one conforming to the specifications prescribed under the Abkari Act; would lie even after the promulgation of the FSS Act - 2017 (1) KHC 931

Vehicle driven by holder of learners licence without complying with statutory prescription – Amounts to violation of statutory provision - 2017 (1) KHC 942 (DB)

LLMC alone has the power to correct entry in the data bank - 2017 (1) KHC 967

S. 138 NI Act- no date of demand & advancement of loan mentioned in complaint nor in affidavit -

S. 138 NI Act- no date of demand & advancement of loan mentioned in complaint nor in affidavit - No receipt was taken  No security document executed  rightly held by Court below that presumption u/s 139 NI Act duly rebutted by accused. Sanjeev v. Sumit, Crl. Misc. A-1639/15, 12.1.17 P&Hwww.ilfsu.in

Supreme Court Changes ground rule under Section 138 of Negotiable Instruments Act to prosecute a person who had presented the cheque which bounced for insufficiency of funds.

Supreme Court Changes ground rule under Section 138 of Negotiable Instruments Act to prosecute a person who had presented the cheque which bounced for insufficiency of funds. Through this judgment, SC provides relief to the holders of bounced cheques under the provisions of the Negotiable Instruments Act What is a Negotiable Instrument? The word negotiable means ‘transferable by delivery’ and the word instrument means ‘a written document by which a right is created in favour of some person’. The transfer should be unrestricted and in good faith. Therefore, a negotiable instrument is a document guaranteeing the payment of a specific amount of money, either on demand, or at a set time, with the payer named on the document. It is an indebtedness to pay an amount and the negotiable instrument is an unconditional guarantee for the same. Some Examples of Negotiable instruments are Promissory notes, Cheques, Bills of Exchange, bearer bonds, bank notes etc. The Indian law on Negotiable instruments is governed by the Negotiable Instruments Act of 1881. About the Act The Negotiable Instruments Act 1881 was passed in 1882 and was amended in 1989 and 2002, Before 1988 there was no provision to restrain the person issuing the Cheque without having sufficient funds in his account. The only remedy against a Dishonoured cheque was a civil liability accrued. In order to ensure promptitude and remedy against the defaulters of the Negotiable Instrument a criminal remedy of penalty was inserted in Negotiable Instruments Act, 1881 by amending it with Negotiable Instruments Act, 1988. The second noteworthy amendment was when the parliament enacted the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002 which is intended to plug the loopholes. This amendment Act inserts five new sections from 143 to 147 touching various limbs of the parent Act. This act is applicable to the whole of India including the state of Jammu and Kashmir, which was brought under the purview of the act in 1956. Objective The objective of the act is to define the various negotiable instruments such a, promissory notes, bills of exchange, cheque etc. Also to prescribe the liability in case of a failure of the instrument to fulfill its debt due to the default on the part of the payer or to curb scrupulous practices adopted to escape liability in respect of negotiable instruments. However, Section 138 in regard to dishonor of cheque attracts criminal liability. Law on Negotiable Instrument, Section 138 It is manifest that to constitute an offense under Section 138 of the Act; the following ingredients are required to be fulfilled a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account the cheque should have been issued for the discharge, in whole or in part, of any debt or other liability; that cheque has been presented to bank within a period of three months from the date on which it is drawn or within the period of its validity whichever is earlier; that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank; the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 30 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice; READ MORE : PROCEDURE FOR A CHEQUE BOUNCE CASE To put it in simpler terms the law stated that the person must owe some amount of money to another and draws a cheque in that regard to fulfil that liability, the cheque be drawn on an account in a bank by him. The cheque was then presented to the bank within 3 months of the date on which it is drawn. However due to insufficiency of funds the cheque is returned by the bank unpaid. The payee (the bank) makes a demand for payment of said amount which the person owed within 30 days of the information received by him (the person who owed the money) that the cheque was returned unpaid; and thereafter the person fails to pay the amount within 15 days of the notice by the bank. Latest Law By a landmark judgment, Dashrath Roopsingh Rathod Vs. Stae of Maharashtra & Anr. In this case, the Supreme Court has changed the basic criteria under Section 138 of Negotiable Instruments Act which is to prosecute a person who had presented the cheque which had been returned due to insufficiency of funds or if the amount exceeds the amount in the bank of the payer. Earlier, a case under Section 138 could be initiated by the holder of the cheque at his place of business or residence. But, a bench of justices TS Thakur, Vikramjit Sen and C Nagappan ruled that the case has to be initiated at the place where the branch of the bank on which the cheque was drawn is located. And the judgment would apply retrospectively. This means, lakhs of cases pending in various courts across the country would witness a interstate transfer of cheque bouncing cases. The bench said: “In this analysis, we hold that the place, situs or venue of judicial inquiry and trial of the offence must logically be restricted to where the drawee bank is located.” Looking for more clients? Register - free Example: Mr. X who resides in Chennai owes Rs. 1 Lakh to Mr. B who resides in Chandigarh, Mr. X issues a cheque in delhi in favour of Mr. B. The cheque bounces in Ludhiana (place of bank where the cheque is given by Mr. B) for insufficiency of funds. According to the earlier law Mr. X could have chosen any of the four places. But by the recent judgment the only place for institution of case would be Ludhiana, i.e. where the cheque has dishonored at the payee bank which is located in Ludhiana in this example. Reasons for passing the new law The rationale behind this change is that the payers majority being businessmen and traders were using extending credit recklessly and due to the leniency in the provision of Section 138, it was being misused in regards to the place of institution, as sometime the payer had no concern with the place where the cheque was issued and to unnecessarily harass the payee cause hardship of place of institution of case according to their convenience. To curb this practice this judgment aims to get to the root of the issue and resolve it by a strict approach so as to discourage the payer from misusing or carelessly issuing cheques. The hardship of traveling to the location of drawee bank is now on the payer. The change in the existing law shifts the inconvenience and hardship on the payer because now he would have to travel to the place of the drawee bank where the cheque gets dishonored due to insufficiency of funds. Hence, guaranteeing more precaution by the payer at the time of issuing the cheque. http://www.vakilno1.com/legalviews/landmark-supreme-court-judgment-sec-138-negotiable-instruments-act.html Note:- We try our level best to avoid any kind of abusive content posted by users. Kindly report to us if you notice any. This report may be copied from a news/channel/magazine/blog/site for knowledge sharing, where PathLegal DISCLAIM any ownership of the content posted and offer NO

Dishonour-of-post-dated-cheques-is-not-an-offence-under-NI-

http://www.lawyersclubindia.com/judiciary/SC-Dishonour-of-post-dated-cheques-is-not-an-offence-under-NI-Act-3984.asp

Amendment To Negotiable Instruments Act, 1881

Hon'ble Supreme Court in its judgment dated August 1, 2014 in the case of Dashrath Rupsingh Rathod vs. State of Maharashtra and another (Criminal Appeal No. 2287 of 2009) inter alia held that the territorial jurisdiction for dishonor of cheques is restricted to the Court within whose local jurisdiction the offense was committed i.e. where the cheque is dishonoured by the Bank on which it is drawn.

Pursuant to the said judgment of the Supreme Court number of pending proceedings under Section 138 of the NI Act, were transferred to the Courts having jurisdiction as per the said judgment. Further, various representations were made to the Government, inter alia by industry associations and financial institutions expressing their concerns about the wide impact of the said judgment on the business interest since the same would offer undue protection to defaulters at the expense of the Complainants.

Considering various aspects and to address the difficulties faced by the payee of cheques in filing the case under section 138 of the NI Act, the bill No. 151-C of 2015 ("Earlier Bill") was introduced to amend the provisions of NI Act, which was passed by Lok Sabha on May 13, 2015. In said amendment bill it was inter alia proposed to amend the section 142 of NI Act, and following sub-section was proposed to be inserted:

"... The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction, the bank branch of the payee, where the payee presents the cheque for payment, is situated..."

Since the aforesaid bill was pending for consideration before Rajya Sabha and Parliament was not in Session, the Negotiable Instruments (Amendment) Ordinance, 2015 has been promulgated by the President on 15 June, 2015 ("said Ordinance") which, inter alia, provides the following amendment in relation to the territorial jurisdiction of the Court to try and entertain a complaint filed under Section 138 of the NI Act. The said Ordinance is currently in force.

In the principal Act, Section 142 shall be numbered as sub-section (1) thereof and after sub-section (1) as so numbered, the following sub-section shall be inserted, namely:

"(2) The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction-

1. If the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated; or
2. If the cheque is presented for payment by the payee or holder in due course otherwise through an account, the branch of the drawee bank where the drawer maintains the account, situated.

Explanation: For the purposes of clause (a), where a cheque is delivered for collection at any branch of the bank of the payee or holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or holder in due course, as the case may be, maintains the account".

Further, to inter-alia clarify the position regarding the pending/transferred cases, the said Ordinance, provides for insertion of new Section 142A.

"142A. (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 or any judgement, decree, order or directions of any court, all cases arising out of section 138 which were pending in any court, whether filed before it, or transferred to it, before the commencement of the Negotiable Instruments (Amendment) Ordinance, 2015 shall be transferred to the court having jurisdiction under sub-section (2) of section 142 as if that sub-section had been in force at all material times.

(2) Notwithstanding anything contained in sub-section c(2) of section 142 or sub-section (1), where the payee or the holder in due course, as the case may be, has filed a complaint against the drawer of a cheque in the court having jurisdiction under sub-section (2) of section 142 or the case has been transferred to that court under subsection (1), and such complaint is pending in that court, all subsequent complaints arising out of section 138 against the same drawer shall be filed before the same court irrespective of whether those cheques were delivered for collection or presented for payment within the territorial jurisdiction of that court.

(3) If, on the date of the commencement of the Negotiable Instruments (Amendment) Ordinance , 2015, more than one prosecution filed by the same payee or holder in due course, as the case may be, against the same drawer of cheques is pending before different courts, upon the said fact having been brought to the notice of the court, such court shall transfer the case to the court having jurisdiction under sub-section (2) of section 142 before which the first case was filed and is pending, as if that sub-section had been in force at all material times."

The Earlier Bill dated 6th May, 2015 has been withdrawn on 24th July, 2015 and a new Bill No. 186 of 2015 to amend the NI Act, on similar lines of provisions of said Ordinance, was introduced in Lok Sabha on 27th July, 2015 and was passed by Lok Sabha on 6th August, 2015. The said new bill is pending to be introduced in Rajya Sabha.

Conclusion:

Pending the passing of said new bill, the said Ordinance holds the field and is now in force. The jurisdiction for filing and transfer of complaints under Section 138 of NI Act is currently governed by the said Ordinance i.e. jurisdiction depends on the place where the payee maintains the bank account.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.