Vicarious Liability

Girdhari Lal Gupta v. D.H. Mehta, (1971) 3 SCC 189; State of Karnataka v. Pratap Chand, (1981) 2 SCC 335; Municipal Corporation of Delhi v. Ram Kishan Rohtagi, (1983) 1 SCC 1; Municipal Corporation of Delhi v. Purshotam Dass Jhunjunwala, (1983) 1 SCC 9; National Small Industries Corporation Limited v. Harmeet Singh Paintal, (2010) 3 […]

Read more "Vicarious Liability"

Settlement Deed Cheque

This is a case of cheques, issued pursuant to a deed of compromise, being dishonoured. The dishonour of cheques, issued subsequent to a settlement agreement, would give rise to a fresh cause of action attracting liability under Section 138 and other remedies under civil law and criminal law. A contrary interpretation would lead to contradictory […]

Read more "Settlement Deed Cheque"

Section 141, The NI Act II

In light of S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla, (2005) 8 SCC 89 in addition to asserting Directors are in-charge and responsible for conduct of business, if statutory compliance of Section 141 has been made – it is not open for High Courts to interfere under Section 482, CrPC unless it comes across some unimpeachable, incontrovertible […]

Read more "Section 141, The NI Act II"

Same Transaction

Courts continue to struggle with the humongous pendency under Section 138 of The Negotiable Instruments Act, 1881. Offences that are committed as part of the same transaction can be tried jointly as per Section 220 of The Code of Criminal Procedure, 1973. What is meant by ‘same transaction’ is not defined. Indeed, it would always […]

Read more "Same Transaction"

Civil Sheep & Criminal Wolf

A reading [State of Assam v. Ranga Mahammad, (1967) 1 SCR 454; Jagdish Chander Gupta v. Kajaria Traders (India) Ltd., (1964) 8 SCR 50; Rajasthan State Electricity Board v. Mohan Lal, (1967) 3 SCR 377; CBI v. Braj Bhushan Prasad, (2001) 9 SCC 432; Godfrey Phillips India Ltd. v. State of U.P., (2005) 2 SCC […]

Read more "Civil Sheep & Criminal Wolf"

Rebuttable Presumption III

Trial Court completely overlooked and failed to appreciate the statutory presumption drawn under Section 118 and Section 139. The point of law has been crystalized in Rohitbhai Jivanlal Patel v. State of Gujarat, (2019) 18 SCC 106. Trial Court ought to have presumed, the cheque was issued as consideration for a legally enforceable debt, once […]

Read more "Rebuttable Presumption III"

Section 141, The NI Act I

“S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla, (2005) 8 SCC 89 had occasion to consider the requirements of Section 141. “What is required is that the persons who are sought to be made criminally liable under Section 141 should be at the time the offence was committed, in charge of and responsible to the company for […]

Read more "Section 141, The NI Act I"

Rebuttable Presumption II

“We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Section 139 about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove his financial capacity and […]

Read more "Rebuttable Presumption II"

Cheque Bounce Acquittal

The legal heirs of someone deceased, convicted under Section 138, are neither liable to pay the fine or undergo imprisonment. However, they have a right to challenge the conviction of their predecessor. Trial Court had acquitted the (now) deceased on basis of an opinion of a handwriting expert. High Court considered, the opinion was inconclusive. […]

Read more "Cheque Bounce Acquittal"

Section 143A, The NI Act

“With effect from 01.09.2018, Section 143A was inserted in The Negotiable Instruments Act, 1881 by Amendment Act No. 20/2018. We are concerned in the present case only with the issue regarding applicability of said Section 143A to offences under Section 138, committed before the insertion of said Section 143A. Section 143A not only creates a […]

Read more "Section 143A, The NI Act"

Section 148, The NI Act

Considering, Statement of Objects and Reasons of Amendment, Amended Section 148 of The N.I. Act is applicable w.r.t. Appeals against Orders of Conviction and Sentence for the Offence under Section 138, even where Criminal Complaints for the Offence are filed prior to Amendment Act No. 20/2018 [01.09.2018]. “If such a purposive interpretation is not adopted, […]

Read more "Section 148, The NI Act"

Rebuttable Presumption I

The presumption under Section 139 is a rebuttable presumption; Section 139 is an example of a reverse onus and the test of proportionality should guide the construction and interpretation of reverse onus clauses on the accused and the accused cannot be expected to discharge an unduly high standard of proof; the standard of proof for […]

Read more "Rebuttable Presumption I"

Notice to Directors II

Appellant-Director [Himanshu] cannot not be prosecuted for a Company-Issued, Director-Signed Cheque Bounce without Company [M/s. Lakshmi Cement and Industries Ltd.] being named/arraigned as an Accused. Three-Judge Bench in Aneeta Hada, (2012) 5 SCC 661 governs the area of dispute. Three-Judge Bench has since been followed by a Two-Judge Bench in Charanjit Pal Jindal vs. L.N. […]

Read more "Notice to Directors II"

Successive Presentations of Cheque

“The correctness of the decision in Sadanandan’s case was doubted. Three-Judge Bench of this Court in MSR Leathers v. S. Palaniappan held that there is nothing in the provisions of Section 138 of The Act that forbids the holder of the cheque to make successive presentation of the cheque and institute the criminal complaint based […]

Read more "Successive Presentations of Cheque"

A Legally Enforceable Debt III

Advocate represented its Client before a Motor Accident Claims Tribunal and charged a fee of Rs. 10,00,000 [Rupees Ten Lakhs]. Tribunal awarded compensation. Client was compelled to sign a further cheque, in favour of Advocate, towards payment of a certain percentage of decretal amount. That cheque stood dishonoured and Advocate in due time initiated proceedings […]

Read more "A Legally Enforceable Debt III"

Video Conferencing in Matrimonial (Cheque) Disputes II (I)

Recently in M/s. Meters and Instruments Private Ltd. v. Kanchan Mehta, [Criminal Appeal No. 1731 of 2017] Goel and Lalit JJ observed: “There appears to be need to consider categories of cases which can be partly or entirely concluded ‘online’ without physical presence of the parties by simplifying procedures where seriously disputed questions are not required […]

Read more "Video Conferencing in Matrimonial (Cheque) Disputes II (I)"

A Legally Enforceable Debt II

To commit an offence, within the meaning of Section 138 of The Negotiable Instruments Act, 1881 there must be a legally enforceable debt or other liability subsisting on the date of drawal of the cheque. This is important to point out for sometimes cheques are post-dated. Notably, in Indus Airways Pvt. Ltd. v. Magnum Aviation […]

Read more "A Legally Enforceable Debt II"

Negotiable Instruments (Amendment) Second Ordinance, 2015

It is widely known that Dashrath Rupsingh Rathod v. State of Maharashtra, (2014) 9 SCC 129 gave rise to further ‘territorial jurisdiction conundrum’. In Bridgestone India, 2015 (13) SCALE 155 decided on 24.11.2015, “in order to overcome the legal position declared by the Court in Dashrath,” attention was drawn to The Negotiable Instruments (Amendment) Second […]

Read more "Negotiable Instruments (Amendment) Second Ordinance, 2015"

Section 138 Notice

You do not need the help of an Advocate to draft a Section 138(b), NI Act Notice. A hand written note mentioning – i) the amount under subject, ii) cheque nos., iii) dates of issue, iv) bank particulars, v) details of dishonor – with a demand for repayment, is valid for the purposes of calculating […]

Read more "Section 138 Notice"