Ravinder Kumar vs Sushil Junk Scrap Dealer & Ors

Headnote AI-drafted · Reviewed and approved

The petitioner filed a criminal revision before the Himachal Pradesh High Court challenging the judgment dated 24.11.2023 passed by the Additional Sessions Judge-II, Kangra at Dharamshala, which upheld the conviction and sentence passed by the Judicial Magistrate First Class, Dharamshala under Section 138 of the Negotiable Instruments Act. The complainant had alleged that the accused issued a cheque for Rs. 15,000/- drawn on Kangra Central Cooperative Bank in discharge of his legal liability arising out of a running account maintained in his name, and the cheque was dishonoured first with the remark 'payment stopped by the drawer' and subsequently with 'insufficient funds' upon re-presentation.

The Trial Court convicted the accused and sentenced him to simple imprisonment for six months along with compensation of Rs. 30,000/-, holding that the accused failed to rebut the presumptions under Sections 118(a) and 139 of the NI Act. The Appellate Court concurred with the findings and dismissed the appeal. In the revision, the petitioner contended that the learned Courts below erred in their appreciation of the material on record, particularly regarding which dishonour endorsement triggered the cause of action, and that the complainant had failed to issue notice within 30 days of the first dishonour, thereby extinguishing the cause of action which could not be revived by subsequent presentation of the cheque.

The core legal issue raised in the revision was whether the cause of action under Section 138 of the NI Act once arisen upon the first dishonour could be stopped or revived by the subsequent presentation of the cheque and issuance of a fresh notice, and whether the complainant's failure to issue notice within the prescribed period after the first dishonour was fatal to the complaint.

Catchwords: Negotiable Instruments Act · cheque dishonour · payment stopped by drawer · insufficient funds · cause of action · re-presentation of cheque · notice period · presumption under Section 139 · presumption under Section 118(a) · criminal revision · conviction under Section 138

Cheque dishonour (Section 138 NI Act)