Legal Question in Banking Law in India

Even one time dishonour is sufficient.But, before he files a case, give him the another cheque and finish the matter or after depositing the money, say him to again present the cheque to the bank.

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The Ingredients of offence under section 138 are as follows:

(1) The cheque should have been issued for discharge, in whole or part, of any debt or other liability

(2) The cheque should have been presented within a period of six months or within its validity period whichever is earlier.

(3) The payee or holder in due course should have issued a notice in writing to the drawer within 30 days of the receipt of information by him from the Bank regarding the return of the cheque as unpaid.

(4) After receipt of the said notice from the holder in due course, the drawer should have failed to pay the cheque within 15 days of receipt of the said notice.

Once the drawer fails to make payment of demanded sum, cause of action for filing complaint under NI Act arises on expiry of the notice period and remains till 30 days. Complaint should be filed within 30 days from the date of cause of action as per Section 142 of NI Act.

In case of delay, this Section gives power to the magistrate to condone the delay, if sufficient cause is shown by the complainant. As per the recent Supreme Court judgment, it was held that a payee or holder of a cheque can issue a statutory notice to the drawer each time the cheque is dishonoured and institute proceedings on the basis of a second or successive statutory notice as well. This was intended to favour the payee as he can overcome 30 days limitation period with each presentation. It is not necessary that the cheque needs to be dishonoured three times before the payee gets the right to issue a notice to the drawer. However, on the expiry of 15 days from the date the notice has been received by the drawer, the right to file a complaint vests with him.

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-Regards

Advocate Pooja

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