1
Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO(S). 000868 OF 2019
(@SLP(Crl) No(s). 10811 of 2018)
Birendra Prasad Sah �Appellant(s)
VERSUS
The State of Bihar & Anr. �Respondent(s)
J U D G M E N T
Dr Dhananjaya Y Chandrachud, J
1 Delay condoned.
2 Leave granted.
3 This appeal arises from a judgment of a learned Single Judge of the High Court
of Judicature at Patna dated 10 May 2018 by which an order taking cognizance of an
offence under Section 138 of the Negotiable Instruments Act, 1888 1
has been quashed.
1 �Act�
2
4 The facts, briefly stated, are thus:
5 The dispute arises over two cheques drawn on the State Bank of India in the
amount of Rs 36,00,000 and Rs 13,00,000 which were returned unpaid under a memo
issued by the UCO Bank, Begusarai on 20 November 2015. The appellant received the
memo on 4 December 2015. Following this, a legal notice was issued on 31 December
2015 intimating the dishonour of the cheque. According to the appellant, between 14
February 2016 and 23 February 2016, he made queries with the postal department but
no proof of service was provided. Accordingly, on 26 February 2016, a second legal
notice was issued. This was replied to by the second respondent on 2 March 2016.
Eventually, a complaint under Section 138 was instituted on 11 May 2016.
6 The Chief Judicial Magistrate, Begusarai by an order dated 14 July 2016,
condoned the delay in filing the complaint. While taking cognizance, the CJM issued
summons to the second respondent. The second respondent instituted revisional
proceedings before the Sessions Judge which were rejected on 8 March 2017. In a
further recourse to the High Court under Section 482 CrPC, the learned Single Judge
held that the complaint under Section 138 was not filed within the statutory period of
thirty days prescribed under Section 138 as a result of which the proceedings were
quashed.
7 Assailing the judgment of the High Court, Mr Nagendra Rai, learned Senior
Counsel submitted that in MSR Leathers v. S Palaniappan 2
a three judge Bench of this
Court has taken the view that the issuance of successive notices is permissible under
the provisions of Section 138 having regard to the object of the legislation. Moreover,
2 (2013) 1 SCC 177
3
the learned Senior Counsel submitted that the delay in the institution of the complaint
was condoned by the CJM under Section 142. Hence, there was an error on the part of
the High Court in quashing the proceedings.
8 On the other hand, Mr Jay Savla, learned Senior Counsel appearing on behalf of
the second respondent submitted that:
(i) The second legal notice dated 26 February 2016 was sent beyond a period of
thirty days of the receipt of the memo of dishonour on 4 December 2015 and
hence cannot be the basis of a valid institution of a criminal complaint;
(ii) If at all, the complaint could have only been instituted on the basis of the first
legal notice dated 31 December 2015 which was within thirty days of the receipt
of the memo of dishonour;
(iii) The complaint which was lodged on 11 May 2016 was beyond the stipulated
period from the date of issuance of the first notice;
(iv) The CJM had condoned the delay which had occurred in the institution of the
complaint only for the period after 6 April 2016 after the issuance of the second
notice; and
(v) In the decision of the three judge Bench in MSR Leathers (supra) , there was a
re-presentation of the cheque as a result of which, a fresh notice was held to be
within the ambit of the law.
9 Section 138 provides thus:
�138. Dishonour of cheque for insufficiency, etc., of funds
in the account. �
Where any cheque drawn by a person on an account
maintained by him with a banker for payment of any amount
of money to another person from out of that account for the
4
discharge, in whole or in part, of any debt or other liability, is
returned by the bank unpaid, either because of the amount of
money standing to the credit of that 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 that
bank, such person shall be deemed to have committed an
offence and shall, without prejudice to any other provision of
this Act, be punished with imprisonment for 3
[a term which
may be extended to two years], or with fine which may extend
to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply
unless�
(a) the cheque has been presented to the bank within a
period of six months 4
from the date on which it is drawn or
within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as
the case may be, makes a demand for the payment of the
said amount of money by giving a notice in writing, to the
drawer of the cheque, 5
[within thirty days] of the receipt of
information by him from the bank regarding the return of the
cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of
the said amount of money to the payee or, as the case may
be, to the holder in due course of the cheque, within fifteen
days of the receipt of the said notice.�
10 In the present case, the facts narrated above indicate that the appellant issued a
legal notice on 31 December 2015. This was within a period of thirty days of the receipt
of the memo of dishonour on 4 December 2015. Consequently, the requirement
stipulated in proviso (b) to Section 138 was fulfilled. Proviso (c) spells out a requirement
that the drawer of the cheque has failed to make payment to the holder in due course or
payee within fifteen days of the receipt of the notice. The second respondent does not
as a matter of fact, admit that the legal notice dated 31 December 2015 was served on
him. The appellant has in the complaint specifically narrated the circumstance that
despite repeated requests to the postal department, no acknowledgment of the notice
3 Sub. by Act 55 of 2002, sec. 7, for a �term which may be extended to one year� (w.e.f. 6-2-2003).
4 The period has been reduced from six months to three months vide R.B.I Notification No. RBI/2011-12/251, DBOD.AML
BC. No. 47/14.01.001/2011-2012, dated 4 th
November, 2011 (w.e.f. 1-4-2012).
5 Subs. by Act 55 of 2002, sec. 7, for �within fifteen days� (w.e.f. 6-2-2003).
5
was furnished. It was in these circumstances that the appellant issued a second notice
dated 26 February 2016. Cognizant as we are of the requirement specified in proviso
(b) to Section 138, that the notice must be issued within thirty days of the receipt of the
memo of dishonour, we have proceeded on the basis that it is the first notice dated 31
December 2015 which constitutes the cause of action for the complaint under Section
138.
11 The complaint was instituted on 11 May 2016. Under Section 142(1), a
complaint has to be instituted within one month of the date on which the cause of action
has arisen under clause (c) of the proviso to Section 138 6
. The proviso however
stipulates that cognizance of the complaint may be taken by the court after the
prescribed period, if the complainant satisfies the Court that he had sufficient cause for
not making a complaint within such period. Both in paragraphs 7 and 8 of the
complaint, the appellant indicated adequate and sufficient reasons for not being able to
institute the complaint within the stipulated period. These have been adverted to above.
The CJM condoned the delay on the cause which was shown by the appellant for the
period commencing from 6 April 2018. However, if paragraphs 7 and 8 of the complaint
are read together, it is evident that the appellant had indicated sufficient cause for
seeking condonation of the delay in the institution of the complaint. The High Court has
merely adverted to the presumption that the first notice would be deemed to have been
served if it was dispatched in the ordinary course. Even if that presumption applies, we
6 142 (1) 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, the holder in due course of the cheque;
(b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the
proviso to section 138:
[Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant
satisfies the Court that he had sufficient cause for not making a complaint within such period];
(c) no court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence
punishable under section 138..
6
are of the view that sufficient cause was shown by the appellant for condoning the delay
in instituting the complaint taking the basis of the complaint as the issuance of the first
legal notice dated 31 December 2015.
12 In the view which we have taken, we have come to the conclusion that the
impugned judgment of the High Court is unsustainable. The appeal is accordingly
allowed and the order passed by the learned Single Judge is set aside. The complaint
shall accordingly stand restored to the file of the trial court.
13 We have not expressed any opinion on the merits of the rival contentions which
will be adjudicated upon during the trial.
...........��������.....................J.
[Dr Dhananjaya Y Chandrachud]
��������................................J.
[Hemant Gupta]
NEW DELHI;
May 8, 2019.
7
ITEM NO.43 COURT NO.11 SECTION II-A
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Petition(s) for Special Leave to Appeal (Crl.) No(s). 10811/2018
(Arising out of impugned final judgment and order dated 10-05-2018
in CRLM No. 27495/2017 passed by the High Court Of Judicature at
Patna)
BIRENDRA PRASAD SAH Petitioner(s)
VERSUS
THE STATE OF BIHAR & ANR. Respondent(s)
Date : 08-05-2019 This petition was called on for hearing today.
CORAM : HON'BLE DR. JUSTICE D.Y. CHANDRACHUD
HON'BLE MR. JUSTICE HEMANT GUPTA
For Petitioner(s) Mr. Nagendra Rai, Sr. Adv.
Ms. Prerna Singh, Adv.
Mr. Shantanu Sagar, AOR
Mr. Aakash, Adv.
Ms. Priya Ranjan, Adv.
For Respondent(s) Mr. Keshav Mohan, Adv.
Mr. Rishi K. Awasthi, Adv.
Mr. Santosh Kumar - I, AOR
Mr. Jay Saula, Sr. Adv.
Mr. Arvind Gupta, AOR
Mr. Sanjeev Kumar Verma, Adv.
UPON hearing the counsel the Court made the following
O R D E R
Delay condoned.
Leave granted.
The appeal is allowed in terms of the signed reportable
judgment.
Pending application(s), if any, shall stand disposed of.
(MANISH SETHI) (SAROJ KUMARI GAUR)
COURT MASTER (SH) BRANCH OFFICER
(Signed reportable judgment is placed on the file)
Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO(S). 000868 OF 2019
(@SLP(Crl) No(s). 10811 of 2018)
Birendra Prasad Sah �Appellant(s)
VERSUS
The State of Bihar & Anr. �Respondent(s)
J U D G M E N T
Dr Dhananjaya Y Chandrachud, J
1 Delay condoned.
2 Leave granted.
3 This appeal arises from a judgment of a learned Single Judge of the High Court
of Judicature at Patna dated 10 May 2018 by which an order taking cognizance of an
offence under Section 138 of the Negotiable Instruments Act, 1888 1
has been quashed.
1 �Act�
2
4 The facts, briefly stated, are thus:
5 The dispute arises over two cheques drawn on the State Bank of India in the
amount of Rs 36,00,000 and Rs 13,00,000 which were returned unpaid under a memo
issued by the UCO Bank, Begusarai on 20 November 2015. The appellant received the
memo on 4 December 2015. Following this, a legal notice was issued on 31 December
2015 intimating the dishonour of the cheque. According to the appellant, between 14
February 2016 and 23 February 2016, he made queries with the postal department but
no proof of service was provided. Accordingly, on 26 February 2016, a second legal
notice was issued. This was replied to by the second respondent on 2 March 2016.
Eventually, a complaint under Section 138 was instituted on 11 May 2016.
6 The Chief Judicial Magistrate, Begusarai by an order dated 14 July 2016,
condoned the delay in filing the complaint. While taking cognizance, the CJM issued
summons to the second respondent. The second respondent instituted revisional
proceedings before the Sessions Judge which were rejected on 8 March 2017. In a
further recourse to the High Court under Section 482 CrPC, the learned Single Judge
held that the complaint under Section 138 was not filed within the statutory period of
thirty days prescribed under Section 138 as a result of which the proceedings were
quashed.
7 Assailing the judgment of the High Court, Mr Nagendra Rai, learned Senior
Counsel submitted that in MSR Leathers v. S Palaniappan 2
a three judge Bench of this
Court has taken the view that the issuance of successive notices is permissible under
the provisions of Section 138 having regard to the object of the legislation. Moreover,
2 (2013) 1 SCC 177
3
the learned Senior Counsel submitted that the delay in the institution of the complaint
was condoned by the CJM under Section 142. Hence, there was an error on the part of
the High Court in quashing the proceedings.
8 On the other hand, Mr Jay Savla, learned Senior Counsel appearing on behalf of
the second respondent submitted that:
(i) The second legal notice dated 26 February 2016 was sent beyond a period of
thirty days of the receipt of the memo of dishonour on 4 December 2015 and
hence cannot be the basis of a valid institution of a criminal complaint;
(ii) If at all, the complaint could have only been instituted on the basis of the first
legal notice dated 31 December 2015 which was within thirty days of the receipt
of the memo of dishonour;
(iii) The complaint which was lodged on 11 May 2016 was beyond the stipulated
period from the date of issuance of the first notice;
(iv) The CJM had condoned the delay which had occurred in the institution of the
complaint only for the period after 6 April 2016 after the issuance of the second
notice; and
(v) In the decision of the three judge Bench in MSR Leathers (supra) , there was a
re-presentation of the cheque as a result of which, a fresh notice was held to be
within the ambit of the law.
9 Section 138 provides thus:
�138. Dishonour of cheque for insufficiency, etc., of funds
in the account. �
Where any cheque drawn by a person on an account
maintained by him with a banker for payment of any amount
of money to another person from out of that account for the
4
discharge, in whole or in part, of any debt or other liability, is
returned by the bank unpaid, either because of the amount of
money standing to the credit of that 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 that
bank, such person shall be deemed to have committed an
offence and shall, without prejudice to any other provision of
this Act, be punished with imprisonment for 3
[a term which
may be extended to two years], or with fine which may extend
to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply
unless�
(a) the cheque has been presented to the bank within a
period of six months 4
from the date on which it is drawn or
within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as
the case may be, makes a demand for the payment of the
said amount of money by giving a notice in writing, to the
drawer of the cheque, 5
[within thirty days] of the receipt of
information by him from the bank regarding the return of the
cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of
the said amount of money to the payee or, as the case may
be, to the holder in due course of the cheque, within fifteen
days of the receipt of the said notice.�
10 In the present case, the facts narrated above indicate that the appellant issued a
legal notice on 31 December 2015. This was within a period of thirty days of the receipt
of the memo of dishonour on 4 December 2015. Consequently, the requirement
stipulated in proviso (b) to Section 138 was fulfilled. Proviso (c) spells out a requirement
that the drawer of the cheque has failed to make payment to the holder in due course or
payee within fifteen days of the receipt of the notice. The second respondent does not
as a matter of fact, admit that the legal notice dated 31 December 2015 was served on
him. The appellant has in the complaint specifically narrated the circumstance that
despite repeated requests to the postal department, no acknowledgment of the notice
3 Sub. by Act 55 of 2002, sec. 7, for a �term which may be extended to one year� (w.e.f. 6-2-2003).
4 The period has been reduced from six months to three months vide R.B.I Notification No. RBI/2011-12/251, DBOD.AML
BC. No. 47/14.01.001/2011-2012, dated 4 th
November, 2011 (w.e.f. 1-4-2012).
5 Subs. by Act 55 of 2002, sec. 7, for �within fifteen days� (w.e.f. 6-2-2003).
5
was furnished. It was in these circumstances that the appellant issued a second notice
dated 26 February 2016. Cognizant as we are of the requirement specified in proviso
(b) to Section 138, that the notice must be issued within thirty days of the receipt of the
memo of dishonour, we have proceeded on the basis that it is the first notice dated 31
December 2015 which constitutes the cause of action for the complaint under Section
138.
11 The complaint was instituted on 11 May 2016. Under Section 142(1), a
complaint has to be instituted within one month of the date on which the cause of action
has arisen under clause (c) of the proviso to Section 138 6
. The proviso however
stipulates that cognizance of the complaint may be taken by the court after the
prescribed period, if the complainant satisfies the Court that he had sufficient cause for
not making a complaint within such period. Both in paragraphs 7 and 8 of the
complaint, the appellant indicated adequate and sufficient reasons for not being able to
institute the complaint within the stipulated period. These have been adverted to above.
The CJM condoned the delay on the cause which was shown by the appellant for the
period commencing from 6 April 2018. However, if paragraphs 7 and 8 of the complaint
are read together, it is evident that the appellant had indicated sufficient cause for
seeking condonation of the delay in the institution of the complaint. The High Court has
merely adverted to the presumption that the first notice would be deemed to have been
served if it was dispatched in the ordinary course. Even if that presumption applies, we
6 142 (1) 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, the holder in due course of the cheque;
(b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the
proviso to section 138:
[Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant
satisfies the Court that he had sufficient cause for not making a complaint within such period];
(c) no court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence
punishable under section 138..
6
are of the view that sufficient cause was shown by the appellant for condoning the delay
in instituting the complaint taking the basis of the complaint as the issuance of the first
legal notice dated 31 December 2015.
12 In the view which we have taken, we have come to the conclusion that the
impugned judgment of the High Court is unsustainable. The appeal is accordingly
allowed and the order passed by the learned Single Judge is set aside. The complaint
shall accordingly stand restored to the file of the trial court.
13 We have not expressed any opinion on the merits of the rival contentions which
will be adjudicated upon during the trial.
...........��������.....................J.
[Dr Dhananjaya Y Chandrachud]
��������................................J.
[Hemant Gupta]
NEW DELHI;
May 8, 2019.
7
ITEM NO.43 COURT NO.11 SECTION II-A
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Petition(s) for Special Leave to Appeal (Crl.) No(s). 10811/2018
(Arising out of impugned final judgment and order dated 10-05-2018
in CRLM No. 27495/2017 passed by the High Court Of Judicature at
Patna)
BIRENDRA PRASAD SAH Petitioner(s)
VERSUS
THE STATE OF BIHAR & ANR. Respondent(s)
Date : 08-05-2019 This petition was called on for hearing today.
CORAM : HON'BLE DR. JUSTICE D.Y. CHANDRACHUD
HON'BLE MR. JUSTICE HEMANT GUPTA
For Petitioner(s) Mr. Nagendra Rai, Sr. Adv.
Ms. Prerna Singh, Adv.
Mr. Shantanu Sagar, AOR
Mr. Aakash, Adv.
Ms. Priya Ranjan, Adv.
For Respondent(s) Mr. Keshav Mohan, Adv.
Mr. Rishi K. Awasthi, Adv.
Mr. Santosh Kumar - I, AOR
Mr. Jay Saula, Sr. Adv.
Mr. Arvind Gupta, AOR
Mr. Sanjeev Kumar Verma, Adv.
UPON hearing the counsel the Court made the following
O R D E R
Delay condoned.
Leave granted.
The appeal is allowed in terms of the signed reportable
judgment.
Pending application(s), if any, shall stand disposed of.
(MANISH SETHI) (SAROJ KUMARI GAUR)
COURT MASTER (SH) BRANCH OFFICER
(Signed reportable judgment is placed on the file)
