Himachal Pradesh High Court
Reserved On: 17.6.2025 vs Rajender Prasad Sonkar on 11 July, 2025
2025:HHC:22352
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Cr. Appeal No. 646 of 2024
.
Reserved on: 17.6.2025
Date of Decision: 11.07.2025.
Het Ram Chauhan ...Appellant
Versus
Rajender Prasad Sonkar ...Respondent
Coram
Hon'ble Mr Justice Rakesh Kainthla, Judge.
Whether approved for reporting?1 Yes.
For the Appellant : Mr. Kishore Pundeer, Advocate.
For the Respondent : Mr. Ajay Sipahiya, Advocate.
Rakesh Kainthla, Judge
The present appeal is directed against the judgment
dated 29.3.2003, passed by learned Sessions Judge, Solan,
District Solan, H.P. (learned Appellate Court), vide which the
judgment of conviction dated 30.7.2022 and order of sentence
dated 6.8.2022, passed by learned Additional Chief Judicial
Magistrate, Kasauli, District Solan, H.P. (learned Trial Court)
were set-aside and the appeal filed by the respondent (accused
before the learned Trial Court) was allowed. (Parties shall
1
Whether reporters of Local Papers may be allowed to see the judgment? Yes.
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hereinafter be referred to in the same manner as they were arrayed
before the learned Trial Court for convenience.)
.
2. Briefly stated, the facts giving rise to the present
appeal are that the complainant filed a complaint before the
learned Trial Court against the accused for the commission of an
offence punishable under Section 138 of the Negotiable
Instruments Act (NI Act). It was asserted that Het Ram Chauhan
and Sons is a sole proprietorship of Het Ram Chauhan. It is
engaged in the business of purchasing fruits and vegetables. The
accused purchased apples worth ₹38,12,846/- from the
complainant on a credit basis. He paid ₹22,65,457/- leaving the
balance of ₹15,53,389/-. He issued a cheque of ₹5.00 lacs, drawn
on HDFC Bank. The complainant presented the cheque to his
Bank, but it was returned with an endorsement 'Instrument out
of date/stale'. The complainant issued a notice to the accused
asking him to pay the money within 15 days of the receipt of the
notice. The notice was duly served upon the accused, but the
accused failed to pay the amount, hence, the complaint was filed
before the learned Trial Court to take action as per the law.
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3. The learned Trial Court found sufficient reasons to
summon the accused. When the accused appeared, notice of
.
accusation was put to him for the commission of an offence
punishable under Section 138 of the NI Act, to which he pleaded
not guilty and claimed to be tried.
4. The complainant examined himself (CW1) to prove
his case.
5. The accused, in his statement recorded under Section
313 of Cr.P.C., denied the complainant's case in its entirety. He
stated that he and the complainant never had any business
transactions with each other. Initially, he stated that he wanted
to lead defence evidence; however, no evidence was produced
despite many opportunities; hence, the evidence was closed by
the order of the Court.
6. Learned Trial Court held that the issuance of the
cheque was not disputed in the cross-examination; therefore, a
presumption under Section 139 of the NI Act would arise that the
cheque was issued in discharge of the legal liability, and the
burden would shift upon the accused to rebut the presumption.
The accused failed to rebut the presumption; yherefore, the
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accused was convicted of the commission of an offence
punishable under Section 138 of the NI Act and was sentenced to
.
undergo simple imprisonment for 10 months and pay
compensation of ₹5,60,000/-.
7. Being aggrieved by the judgment and order passed by
the learned Trial Court, the accused filed an appeal which was
decided by the learned Sessions Judge, Solan (learned Appellate
Court). Learned Appellate Court held that the cheque was
dishonoured on the ground of 'Instrument out dated/stale',
which does not attract the provisions of Section 138 of the NI
Act. Learned Trial Court erred in convicting and sentencing the
accused; therefore, the appeal filed by the accused was allowed,
and the accused was acquitted of the commission of an offence
punishable under Section 138 of the NI Act.
8. Being aggrieved by the judgment passed by the
learned Appellate Court, the complainant filed the present
appeal, asserting that the learned Appellate Court erred in
appreciating the material on record. It was wrongly assumed
that the date of the cheque returning memo was the date of
presentation. The cheque was presented through the payee's
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bank. The finding recorded by the learned Appellate Court that
the cheque was presented after the expiry of the validity period
.
is wrong and illegal. The cheque was issued on 21.10.2017, and its
validity expired on 21.1.2018. Therefore, it was prayed that the
present appeal be allowed and the judgment passed by the
learned Appellate Court be set aside.
9. I have heard Mr. Kishore Pundeer, learned counsel
for the appellant/complainant and Mr. Ajay Sipahiya, learned
counsel for the respondent/accused.
10. Mr. Kishore Pundeer, learned counsel for the
appellant/complainant, submitted that the cheque was issued
on 21.10.2017 and could have been presented till 21.1.2018, which
was a holiday; therefore, its presentation on 22.1.2018 was valid.
Learned Appellate Court erred in holding that the dishonour was
on the ground that the cheque was 'Instrument out dated/stale'.
The notice was served upon the accused, and he failed to pay the
amount despite the receipt of the valid notice of demand. All the
ingredients of the commission of an offence punishable under
Section 138 of the NI Act were satisfied. The notice was sent
through courier and is deemed to be served in the ordinary
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course of business. Therefore, he prayed that the present appeal
be allowed and the judgment passed by the learned Appellate
.
Court be set aside. He relied upon the following judgments in
support of his submission: -
(i) M/s Gimpex Private Ltd. Vs. Manoj Goel (2022) 11 SCC
705;
(ii) N. Paraesewaran Unni Vs. G. Kannan (2017) 5 SCC 737;
(iii) C.C. Alavi Haji Vs. Palapetty Muhammad and another
(2007) 6 SCC 555;
(iv) M/s Ajeet Seeds Ltd. Vs. K. Gopala Krishnaih: (2014) 12
SCC 685;
(v) Rohit Bhai Jivanlal Patel Vs. State of Gujarat and
another (2019) 18 SCC 106;
(vi) Rajesh Jain Vs. Ajay Singh (2023) 10 SCC 148;
(vii) Budh Dev Vs. Parveen Sharma, 2024:HHC:1480-DB;
(viii) T. Vasant Kumar Vs. Vijay Kumari AIR 2015 SC 2240;
(ix) Sri Dattaraya Vs. Sharanappa, 2024 0 INSC 586;
(x) Chuni Lal Vs. Indira Seth (2017) 1 DCR 195;
(xi) Muddasani Venkata Narasaiah Vs. Muddasani Saojana
(2016) 12 SCC 288;
(xii) V. Velu v. Chennakrishnan, 2019 SCC OnLine Mad 39152;
(xiii) Gunnet Bhasin Vs. State of NCT Delhi (2023) 1 BC 263;
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(xiv) Sunderpal Singh Chawla Vs. State of Gujarat (2010) 1
RCR (Criminal) 10;
.
(xv) J. Veeraraghavan Vs. Lalith Kumar 1995 3 Crimes (HC)
205;
(xvi) Satyaveer Singh Vs. Suraj Cr. A. No. 556/2016, decided
on 12.01.2024.
(xvii) Harendra Rai Vs. State of Bihar and Anr. AIR 2023 SC
4331;
(xviii) Bhupender Kumar Sharma Vs. Rattan Singh (2013) 2
SimLC 780; and
(xix) P. Narasimha Vs. State of A.P. & Anr. (2019) ACD 587;
(xx) Thomas Varghese Vs. P. Jerome (1992) 2 Bank CLR 126;
(xxi) Syed Rasool and Sons and others Vs. Alidas and
Company and another (1993) 2 AICLR 159;
(xxii) NEPC Micon Limited and others Vs. Magma Leasing
Limited (1999) 38 ACrC 876; and
(xxiii) Goa Plast (P) Ltd. Vs. Chico Ursula D'Souza (2004) 48
ACrC 212.
11. Mr. Ajay Sipahiya, learned counsel for the
respondent/accused, submitted that the dishonour of the
cheque on the ground of 'Instrument out dated/stale' does not
attract the provisions of Section 138 of the NI Act. The
presentation has to be made before the bank of the accused, and
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the presentation before the bank of the complainant is not
sufficient. The memo of dishonour is a computer-generated
.
document which cannot be proved in the absence of the
certificate required under Section 65(B)(4) of the Indian
Evidence Act, and such a certificate is lacking in the present
case; hence, no reliance can be placed on the memo of
dishonour. The notice was sent through courier, and there is no
proof of its delivery. Learned Appellate Court had taken a
reasonable view while deciding the appeal, and this Court should
not interfere with the reasonable view of the learned Appellate
Court while deciding an appeal against the acquittal. Therefore,
he prayed that the present appeal be dismissed. He relied upon
the following judgments in support of his submission: -
(i) Ishar Alloy Steels Vs. Jayaswals Neco Ltd. (2001) 3 SCC
609;
(ii) Nitin Mahajan Vs. Vinod Kumar Cr. M-M 14696 of 2021,
decided on 11.5.2023;
(iii) Boddu Jhansi Rani Vs. State of Telangana (2023) 3 ALT
(Crl.) 288;
(iv) M. Meeran Mohideen Vs. B. Vijayakumar (2019) 4 CivCC
642;
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(v) Arjun Panditrao Khotkar Vs. Kailash Kushanrao
Gorantyal and others (2020) AIR (SC) 4908;
.
(vi) Anvar P.V. Vs. P.K. Basheer (2014) 10 SCC 473;
(vii) Vandana Vs. Abhilasha (2018) 4 BomCR (Cri) 774;
(viii) Krishnapal Vs. Hari Singh, Cr. Appeal No. 13704 of 2023,
decided on 25.4.2024;
(ix) Satyendra Tiwari Vs. State of M.P. (2014) 3 MPLJ 574;
(x) Rajinder Singh Verma Vs. Haji B.K. Hanchnamani, Cr.
Appeal No. 582 of 2017, decided on 30.4.2019; and
(xi) Rameshchandra Ambalal Joshi Vs. State of Gujarat and
another (2014) ACD 554.
12. I have given considerable thought to the submissions
made at the bar and have gone through the records carefully.
13. It is admitted case of the complainant that the
cheque was dishonoured with an endorsement 'Instrument out
dated/stale'.
14. Delhi High Court held in H.D. Gumber v. Ashok
Sachdeva, 2012 SCC OnLine Del 2037, that a cheque presented
after its validity will not make the accused liable for the
commission of an offence punishable under Section 138 of the
NI Act. It was observed: -
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"8. Admittedly, the cheque was drawn on 23rd November,
2002, and the period of six months within which it could
be presented to the bank on which it was drawn, expired
.
on 22.5.2003. However, the cheque was presented by the
complainant on 23.5.2003, i.e. one day after the expiry of
the statutory period of six months. Consequently, the
cheque became invalid and thus the petitioner could not
be made criminally liable for its dishonour under the
provisions of Section 138 of the Act."
15. The cheque was dishonoured with an endorsement
'Instrument outdated/stale'. It was laid down by the Madras
High Court in M. Meeran Mohideen vs. B. Vijayakumar 2019 (4)
Civil Court Cases 642 that when the cheque was returned with
the reason Instrument outdated/stale, the cheque became
invalid and no proceedings could have been initiated for the
commission of an offence punishable under Section 138 of the
NI Act. It was observed:
"7. In view of the same, the instrument, viz., the Cheque,
is valid only for a period of 6 months from the date of
issuance of the same. In the case at hand, admittedly, the
cheque was presented only after the period of 6 months,
viz., 26.09.2017. Therefore, the cheque dated 10.03.2017
became invalid and hence, the entire proceedings have
been vitiated, and the learned Judicial Magistrate,
without even considering the said fact, mechanically took
cognisance and issued a summons to the petitioner.
Therefore, this Court is of the view that the proceedings
under Section 138 of the Negotiable Instruments Act are
liable to be quashed."
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16. Gujarat High Court held in Anil Vasudev Rajgor v.
State of Gujarat, 2017 SCC OnLine Guj 2799 that when the
.
cheque was presented beyond the period of validity and was
dishonoured with the endorsement 'Instrument outdated',
the proceedings under Section 138 of the NI Act do not lie. It
was observed:
"11. From the above proviso, it is clear that the provisions
of Section 138 of the Negotiable Instruments Act are
enacted taking into consideration the currency of cheques
for a period of six months from the date of issue or the
reduced period of validity, whichever is earlier. Therefore,
this provision of the Negotiable Instruments
Act contemplates a cheque with a lesser period of validity
than six months, which is the general Banking practice
and' stipulates that the cheque should be presented for
encashment1 either within the period of six months or
within the period of validity of the cheque, whichever is
earlier. Hence, a cheque, which is issued with a reduced
validity period, has to be presented for encashment
within the expiry of that period so as to attract the
provisions of Section 138 of the Negotiable Instruments
Act. Indisputably, in the case on hand, the cheque was
presented by the complainant for encashment after the
expiry of currency of three months and in such
circumstances, the provisions of Section 138 of
the Negotiable Instruments Act are not attracted in this
case in view of Clause (a) of the proviso to Section 138 of
the. Negotiable Instruments Act. The Supreme Court, in
the case of Shri Ishar Alloys Steels Ltd. v. Jayaswals NECO
Ltd. [(2001) 3 SCC 609: AIR 2001 SC 1161, observed in para 9
as under: --
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"It, however, does not mean that the cheque is
always to be presented to the drawer's Bank on
which the cheque is issued. The payee of the cheque
has the option to present the cheque in any Bank
.
including the collecting Bank 'where he has his
account but to attract the criminal liability of the
drawer of the cheque such collecting Bank is
obliged to present the cheque in the drawee or
payee Bank on which the cheque is drawn within
the period of six months from the date on which it
is shown to have been issued. In other words, a
cheque issued by (A) in favour of (B) drawn in a
Bank named (C) where the drawer has an account
can be presented by the payee to the Bank upon
which it is drawn, i.e. (C) Bank, within a period of
six months or present. It is to any other Bank for
the collection of the cheque amount, provided such
other Bank, including the collecting Bank, presents
the cheque for collection to the (C) Bank. The non-
presentation of the cheque to the drawee-bank
within the period specified in the Section would
absolve the person issuing the cheque of his
criminal liability under Section 138 of the Act, who
shall, otherwise, may be liable to pay the cheque
amount to the payee in a civil action initiated
_under the law. A combined reading of Sections 2,
72 and 138 of the Act "would" leave no doubt in our
mind that the law mandates the cheque to be
presented at the Bank on which it is drawn if the
drawer is to be held criminally liable. Such
presentation is necessarily to be made within six
months at the Bank on which the cheque is drawn,
whether presented personally or through another
Bank, namely, the collecting Bank of the payee."
12. A learned Single Judge of this Court in the case
of Arunbhai Nilkantharai v. Jayaben Prahladbhai [2000 Cri
LJ 1152] had an occasion to consider almost an identical
issue. In the said case, it was contended on behalf of the
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complainant that what should the payee of the cheque
should do if the cheque is returned, holding that the
validity period had expired. In the said case, an argument
was canvassed that there may be a delay on the part of the
.
collecting' Bank in sending the cheque to the paying Bank
though it had been within the period of validity, or
because of the delay on the part of the postal Authority,
the cheque might reach the paying Bank after the expiry
of the period of validity or six months, as the case may be,
the holder of the cheque, in such circumstances, would be
helpless. The learned Single Judge rejected the
contention, observing as under: --
"10...The contention must fail. In that case,
initiation of criminal action is viewed as non-
fulfilment of the requirements of Sec. 138 of the Act
would certainly be barred, but it will be open to the
payee to initiate the civil action by filing the suit for
the recovery of the cheque amount, subject to the
law of limitation. The civil Court will certainly pass
the decree if the case alleged in the plaint is proved.
The payee qua the recovery of the sum will not be
helpless. It may however be stated that when the
cheque is required to be presented at the paying
Bank before it becomes a stale cheque, the holder of
the cheque or the payee has to present the cheque
well in advance, considering the exigencies or
contingencies or delay that is likely to occur on the
part of the collecting Bank or the postal Authorities.
He cannot wait till the last day of the period of
validity for presentment of the cheque, because
proviso (a) to Sec. 138 makes it abundantly clear
that if presentment of a cheque is not made within
6 months from the date on which the cheque is
drawn or within the period of its validity whichever
is earlier, the cause to lodge the complaint does not
subsist or live on, for in that case the offence
cannot be said to have been constituted and payee
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or holder of a cheque loses his right if there be any
to initiate criminal action.
11. In this case, presentment of the cheque to the
.
paying Bank is, in view of the above-stated dates,
not made within 6 months of the date of the
cheque. The presentment is late by four days. The
cheque, therefore, became a stale cheque and the
same was bounced without honouring the same. As
the presentment is not in consonance with Sec. 138
of the Act, and is late by 4 days, one of the essential
requirements of Sec. 138 of the Act for initiating
penal action is not satisfied. When that is so, the
complaint lodged cannot be entertained, the same
has to be quashed, and the petitioner, who is the
accused, in that case, is required to be discharged."
13. In taking the aforesaid view, I am supported by a
decision of the Kerala High Court in the case of Kesavan
Thankappan v. State of Kerala [1999 Cri LJ 714], I may quote
the relevant observations as under: --
"5. The counsel for the appellant vehemently
argued that the dishonour of the cheque on the
ground that the cheque was out of time since the
cheque drawn on Treasury Saving Bank Is Current
only for three months from the date of issue as
against the Banking practice of the currency of
cheques for six months from the date of issue, and
the provisions of the Negotiable Instruments Act,
are illegal and unsustainable. The Treasury Code is
framed by the Government of Kerala as empowered
under Article. 283(2) of the Constitution and
promulgated by the Governor of Kerala by
notification No. 54282 dated 6-4-1983.
6. As per List 1, which is styled as Union List in 7th
Schedule of the Constitution, all the items
mentioned therein fall within the exclusive
jurisdiction of the Union of India, and item 45 in
the list I of Schedule 7 is Banking and entry 46
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therein is Bill of Exchange, Cheques etc. Therefore,
the counsel for the appellant argued that Banking
comes within the exclusive jurisdiction of the
Government of India and the same can be regulated
.
only by the Government of India and the Reserve
Bank of India.
7. The counsel for the appellant further argued that
the Treasury Code is intended for transactions in
Government money only and not for Banking
business for the public and if the Treasuries
conduct Banking business the entire rules and
regulations regarding Bank including those rules
applicable to cheques etc. contained in
the Negotiable Instruments Act and the Banking
Practice should be followed by the Treasuries.
According to him, though the Treasury can regulate
the period of validity of cheques, it will bind only
the Treasuries and persons who are transacting
with the Treasury by opening accounts with them,
and it cannot bind a person who has no dealings
with the Treasury and in whose favour a Treasury
cheque is issued.
8. The learned counsel for the appellant also argued
that Appendix 3 to Treasury Code Vol. II relates to
rules regulating transactions in the Treasury
Savings Bank. Rule 1 in Appendix 1 states that the
object of the Government in establishing the
Treasury Savings Bank Scheme is to provide a ready
means for the deposit of savings and so to
encourage thrift. Treasury Code Vol. I, Part I, Rule
2(c) defines 'cheque' and Rule 61(1) deals with non-
Banking Treasuries and Rule 61(2) deals with
Banking Treasuries. Chapter III of the Kerala
Treasury Code Vol. II deals with the rules relating to
the Treasury Savings Bank. The counsel for the
appellant argued that transaction in the Banking
Treasury is similar to the transaction in ordinary
Banks and the Treasury cheque drawn has to be
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treated as a cheque drawn on a Bank for all
purposes under S. 138 of the Negotiable
Instruments Act and there cannot be any
distinction between ordinary Bank and the
.
Treasury dealing with Banking transactions.
9. The counsel for the appellant further argued that
Banking being a Union subject in the first list of
Schedule 7 of the Constitution, the Treasury Code,
which is a subordinate legislation promulgated by
the Governor of Kerala applicable to the territory in
Kerala under Art. Section 283(2) of the Constitution
cannot have an overriding effect on the provisions
of the Negotiable Instruments Act enacted by the
Parliament and the Banking Rules and Regulations,
and the Banking Practice approved and enforced by
the Central Government. Therefore, according to
him, the provisions regarding the currency of
cheques drawn on a Banking Treasury reducing, the
period of currency to three months as provided
under Rule 245(b) of Vol. I of the Treasury Code
cannot be pressed into service in this case as
against the prevailing Banking practice of currency
of cheques for six months as provided under
the Negotiable Instruments Act.
10. Though the above arguments advanced by the
counsel for the appellant are very attractive, they
cannot be accepted on the face of clause (a) of the
proviso to S. 138 of the Negotiable Instruments Act,
which reads as follows: --
"Provided that nothing contained in this
Section shall apply unless- (a) the cheque has
been presented to the Bank within the period
of six months from the date on which it is
drawn or within the period of its validity,
whichever is earlier."
From the above proviso, it is clear that the
provisions of S. 138 of the Negotiable Instruments
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Act are enacted taking into consideration of the
currency of cheques for a period of six months from
the date of issue or the reduced period of validity,
whichever is earlier. Therefore, this provision of
.
the Negotiable Instruments Act contemplates a
cheque with a lesser period of validity than six
months, which is the general Banking practice and
stipulates that the cheque should be presented for
encashment either within the period of six months
or within the period of validity of the cheque,
whichever is earlier. Hence, a cheque which is
issued with a reduced validity period has to be
presented for encashment within the expiry of that
period so as to attract the provisions of S. 138 of
the Negotiable Instruments Act. Therefore, the
r argument advanced by the counsel for the appellant
that the Treasury Code promulgated by the
Governor of Kerala should be subject to the
provisions of the Negotiable Instruments Act, the
Banking Rules and Regulations issued by the
Government of India, the Banking Practice and the
Rules promulgated by the Reserve Bank of India
and the provisions of the Treasury Code cannot
have overriding effect against the provisions of
the Negotiable Instruments Act and the Banking
Practice, need not be considered in this case.
11. In view of the fact that the cheque was presented
by the appellant for encashment after the expiry of
currency of three months, the provisions of
S. 138 of the Negotiable Instruments Act are not
attracted in this case in view of clause (a) of the
proviso to S. 138 of the Act."
17. A Similar view was taken by the Delhi High Court in
Ansh Chugh vs. Pradeep Gupta, 2020 STPL 8425 Delhi, wherein
it was held that:
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"7. Admittedly, the cheque was presented to the drawee
bank after the period of expiry of its validity of three
months, which is to be calculated from the date
mentioned on the cheque. Clause (a) of the Proviso to
.
Section 138 of N.I. Act stipulates that Section 138 shall not
be applicable unless the cheque is presented to the bank
within a period of six months (the period has been
reduced from 6 months to 3 months vide the
aforementioned RBI notification dated 04.11.2011) from
the date on which it is drawn or within the period of its
validity, whichever is earlier.
8. In Shri Ishar Alloys Steel Ltd. v. Jayaswals NECO Ltd.,
(2001) 3 SCC 609, the Supreme Court held that non-
presentation of the cheque to the drawee bank within the
period specified in the section would absolve the person
issuing the cheque of his criminal liability under Section
138 N.I. Act.
9. The Supreme Court in MSR Leathers v. S.Palaniappan &
Anr.,2012 SCCOnLineSC 791, it was held as under:-
"14. Presentation of the cheque and dishonour
thereof within the period of its validity or a period
of six months is just one of the three requirements
that constitutes cause of action' within the
meaning of Sections 138 and 142(b) of the Act, an
expression that is more commonly used in civil law
than in penal statutes...."
xxx
19. ....A careful reading of Sections 138 and 142, as
noticed above, makes it abundantly clear that the
cause of action to institute a complaint comprises
the three different factual prerequisites for the
institution of a complaint to which we have already
referred in the earlier part of this order. None of
these prerequisites is in itself sufficient to
constitute a complete cause of action for an offence
under Section 138. For instance if a cheque is not
presented within a period of six months from the
date on which it is drawn or within the period of its
validity, whichever is earlier, no cause of action
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would accrue to the holder of the cheque even when
the remaining two requirements, namely service of
a notice and failure of the drawer to make the
payment of the cheque amount are established on
.
facts...."
10. Learned counsel for the respondent has fairly not
disputed the aforesaid legal position, though he urged
that all such issues could be considered at the stage of
framing of notice.
11. Reliance placed by the learned counsel for the
respondent in Rajeev Ranjan Sinha(supra), Jitender
Singh(supra), Thomas Varghese(supra) and A.V.
Murthy(supra) is misplaced as the issue involved in the
present case was not raised in the aforesaid judgments.
The validity of a cheque goes to the root of the initiation
of proceedings under the Negotiable Instruments Act.
There is no cause of action if the cheque presented was
not valid."
18. This Court also took a similar view in Dolma Devi v.
Roshan Lal, 2023 STPL 4524 HP, wherein it was held that
"8. The reasons, on account of which the complaint of the
present appellant has been dismissed, already stand spelt
out by me in the above part of the judgment. It is not in
dispute that the cheque in issue is dated 14.09.2004. The
same was drawn upon H.P. State Cooperative Bank,
branch Beri, District Bilaspur, H.P. This cheque though
was presented by the appellant with her bank on
07.03.2005, yet the same was received by the payee bank,
i.e. H.P. State Cooperative Bank, branch Beri, District
Bilaspur, H.P. on 15.03.2005, i.e. after six months from the
date of issuance of the cheque which lapsed on
13.03.2004.
9. Hon'ble Supreme Court in Shri Ishwar Alloy Steels Ltd.
Versus Jayaswals Neco LTD., (2003) 3 Supreme Court Cases
609, has been pleased to hold that the law mandates a
cheque to be presented at the bank on which it is drawn if
the drawer is to be held criminally liable necessarily
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within six months as from the date of its issuance (this
judgment relates to the period when the validity of
cheque used to be for a period of six months). In Para 10
of said judgment, the Hon'ble Supreme Court has been
.
pleased to hold as under:
"It, however, does not mean that the cheque is
always to be presented to the drawer's bank on
which the cheque is issued. The payee of the cheque
has the option to present the cheque in any bank
including the collecting bank where he has his
account but to attract the criminal liability of the
drawer of the cheque such collecting bank is obliged
to present the cheque in the drawee or payee bank
on which the cheque is drawn within the period of
six months from the date on which it is shown to
have been issued. In other words a cheque issued by
(A) in favour of (B) drawn in a bank named (C)
where the drawer has an account can be presented
by the payee to the bank upon which it is drawn i.e.
(C) bank within a period of six months or present it
to any other bank for collection of the cheque
amount provided such other bank including the
collecting bank presents the cheque for collection
to the (C) bank. The non-presentation of the
cheque to the drawee bank within the period
specified in the Section would absolve the person
issuing the cheque of his criminal liability under
Section 138 of the Act, who shall otherwise be liable
to pay the cheque amount to the payee in a civil
action initiated under the law. A combined reading
of Sections 2, 72 and 138 of the Act would leave no
doubt in our mind that the law mandates the
cheque to be presented at the bank on which it is
drawn if the drawer is to be held criminally liable.
Such presentation is necessarily to be made within
six months at the bank on which the cheque is
drawn, whether presented personally or through
another bank, namely, the collecting bank of the
payee."
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19. Punjab and Haryana High Court also took a similar
view in Nitin Mahajan vs. Vinod Kumar (11.05.2023 - PHHC):
.
MANU/PH/3563/202326.) and held:
"5. From a perusal of proviso (a) to Section 138, it is
apparent that one of the essential conditions to bring into
effect the substantive provision i.e. Section 138 of NI Act
is that cheque be presented to the bank within a period of
six months from the date on which it is drawn or within
the period of its validity, whichever is earlier. In the
present case, the cheque in question was issued on
18.05.2018; therefore, as per the RBI circular/notification
dated 04.11.2011, which is in vogue, the same was valid till
17.08.2019 only and it was ultimately dishonoured on
8.11.2018, clearly showing that it was presented in the
bank much beyond its validity. Reliance has rightly been
placed on Ansh Chugh's case (supra), wherein it was held
that the validity of a cheque goes to the root of initiation
of proceedings under the Negotiable Instruments Act, and
there is no cause of action if the cheque presented was not
valid. Even learned Counsel for the respondent has not
been able to produce any judgment to counter the same."
20. Telangana High Court has also held similarly in
Boddu Jhansi Rani vs. The State of Telangana (12.04.2023 -
TLHC): MANU/TL/0599/2023 27 as under: -
7. It is not in dispute that the subject cheque was
presented beyond the three-month period from the date
of the cheque. The Reserve Bank of India had issued a
notification on 04.11.2011, signed by the Chief General
Manager in charge. The said notification was issued in
exercise of the powers conferred by Section 35A of the
Banking Regulation Act, 1949 and accordingly directed
the Banks not to make payment of the cheques/drafts/pay
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order/bankers cheque if the cheques are presented
beyond the period of three months from the date of such
instruments.
.
Section 35A in the BANKING REGULATION ACT,1949
reads as follows:
35A Power of the Reserve Bank to give directions. -
Where the Reserve Bank is satisfied that- in the 178
[public interest]; or 179 [ in the interest of banking
policy; or] to prevent the affairs of any banking
company being conducted in a manner detrimental
to the interests of the depositors or a manner
prejudicial to the interests of the banking company;
or to secure the proper management of any banking
company generally, it is necessary to issue
directions to banking companies generally or to any
banking company in particular, it may, from time
to time, issue such directions as it deems fit, and
the banking companies or the banking company, as
the case may be, shall be bound to comply with
such directions. The Reserve Bank may, on
representation made to it or on its own motion,
modify or cancel any direction issued under sub-
section (1), and in so modifying or cancelling any
direction may impose such conditions as it thinks
fit, subject to which the modification or
cancellation shall have effect.]
8. Under Section 138-A of N I Act, it is mentioned that the
cheque should have been presented to the Bank within a
period of six months from the date on which it is drawn or
within the period of validity. Section 35-A of the Banking
Regulation Act, 1949, confers powers to the Reserve Bank
for giving directions in the interest of public or banking
policy. Accordingly, directions were issued that the Banks
should not make payment of the cheques which are
presented beyond the period of three months from the
date of such instrument.
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9. Section 138-A of the Negotiable Instruments Act deals
with two contingencies, firstly, the cheque being
presented within a period of six months and secondly,
within the period of its validity, whichever is earlier. By
.
virtue of the notification of the Reserve Bank of India, the
period of validity would be three months, and the cheque
should have been presented within a period of three
months. The Bank has committed an error in entertaining
the cheque and giving a memo stating that the cheque
was returned for the reason of 'insufficient funds'. It is
the specific direction of the Reserve Bank of India that the
Banks should not entertain the cheque beyond the period
of three months, which had to be scrupulously followed
by the Bank and should have returned the cheque on the
ground of being stale or invalid.
10. The basis for prosecution is the return of the cheque,
which was presented beyond the period of its validity.
Applying the judgment reported in Shri Ishar Alloy Steels
Ltd., v. Jayaswals Neco Limited's case (supra), the Criminal
Court does not have jurisdiction to proceed with the trial
of the petitioner."
21. Therefore, the dishonour of the cheque on the
ground of 'Instrument out dated/stale' does not attract the
provisions of Section 138 of the NI Act.
22. It was submitted that the memo issued by the bank is
not important, and it is open to the complainant to show that
the reason for dishonour was something else. There is no
dispute with the proposition of law. It was laid down by Thomas
Varghese (supra) that the offence punishable under Section 138
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of the NI Act does not depend upon the endorsement made by
the Bank while returning the cheque. It was observed: -
.
"8. Section 138 was enacted by the legislature to enhance
the acceptability of cheques. The drawer of the cheque
was sought to be made liable in case of bouncing of
cheques due to insufficiency of funds in the accounts or
for the reason that it exceeds the arrangements made by
the drawer with the bank. If the cheque is bounced on
account of insufficiency of funds in the accounts of the
drawer or for the reason that it exceeds the arrangements
made by the drawer, then the drawer must be liable. It
cannot solely depend on the endorsement made by the
banker. An endorsement by the banker that a cheque is
returned due to insufficiency of funds standing in the
name of the drawer will tell upon the financial soundness
of the drawer. Such an endorsement may adversely affect
the reputation of the drawer. Sometimes a banker may be
slow to use the words such as "no sufficient fund in the
account" etc. because it may have adverse implication on
the financial soundness of the drawer of the cheque and
consequently affect his reputation also, so if the banker
refrains from making such a derogatory endorsement,
should be object of the legislation be defeated?
9. The rule of strict interpretation of penal statutes in
favour of an accused is not of rigid or universal
application. It must be considered along with other well-
established rules of interpretation. When it is seen that
the scheme and object of the statute are likely to be
defeated by the strict interpretation, courts must
endeavour to resort to that interpretation which furthers
the object of the legislation. It is well recognised that a
statutory provision must be construed, if possible, to
avoid absurdity and mischief. In K.P. Vaghese v. Income
Tax Officer, Emakulam, (1981)4 SCC 173. Their Lordships
observed: -
"It is not a well-settled rule of construction that
where the plain literal interpretation of a statutory
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provision produces a manifestly absurd and unjust
result which could never have been intended by the
legislature, the court may modify the language used
by the legislature or even do some violence' to it, so
.
as to achieve the obvious intention of the
legislature and produce a rational construction
(vide Luke v. Inland Revenue Commissioner). The
court may also, in such a case, read into the
statutory provision a condition which, though not
expressed, is implicit as constituting the basic
assumption underlying the statutory provision."
In this circumstance, we are not in a position to hold that
a complaint under Section 138 of the Act should not be
thrown out at the threshold if the banker's endorsement
while returning the cheque is anything other than that
the amount of money 'standing to the credit of the
account of the drawer 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. If the
circumstances contemplated by Section 138 of the Act are
made out, the court has to examine whether the return of
the cheque was on account of insufficiency of funds
belonging to the drawer. This can be done even without
reference to the endorsement made by the banker.
Endorsements like "refer to drawer", "account closed",
"payment has been stopped", etc., made by the banker at
the time of the return of the cheque are having the effect
of proving that the cheque has been bounced. If the
bouncing of the cheque was on account of insufficiency of
funds belonging to the drawer, then the drawer will be
subjecting himself to proceedings under Section 138 of
the Act.
23. In the present case, the complainant never examined
any official from the bank to prove on record that the reason for
dishonour was not the instrument being outdated/stale but
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something else; therefore, not much advantage can be derived
from the cited judgment.
.
24. It was submitted that if the payment is not made to
the complainant for any reason and the accused fails to pay the
amount despite the receipt of a valid notice of demand, the
offence punishable under Section 138 of the NI Act is made out. It
is true that the Bombay High Court has taken such a view in
Rakesh Nemkumar Porwal v. Narayan Dhondu Joglekar, (1993) 78
Comp Cas 822 and held that the use of the term etc. in Section 138
of the NI Act will mean that whenever the cheque is dishonoured
the provisions of Section 138 of NI Act would be attracted. It was
observed: -
"25. This, to our mind, is too narrow a construction of the
section and fails to take into account the objects and
reasons behind the amendment. The wording and the
endorsement from the bank or the circumstances under
which a cheque is returned are not the guiding criterion,
but the fact that, on presentation of the cheque, the
payment was not made. There could be a host of reasons for
this but the bottom line of the situation is that the payment
could not be made by the Banker and the mechanics of the
reasons apart, the irresistible conclusion that had the funds
been available, the payment would have been made leads
back to the position that dishonour, therefore, implies
insufficiency of funds. We are reinforced in this view by the
definition of a cheque as appears in Section 6 of the
Negotiable Instruments Act, which defines it as a bill of
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exchange drawn on a specified banker. A bill of exchange
is defined in Section 5, which reads as follows:
"A bill of exchange is an instrument in writing
containing an unconditional order signed by the
.
maker directing a certain person to pay a certain
sum of money only to, or to the order of, a certain
person or to the bearer of the instrument."
Reading these provisions with the statement of objects
and reasons of the Banking, Public Financial institutions
and Negotiable Instruments Laws (Amendment) Act,
1988 (66 of 1988), whereby Chapter 17 comprising of
Sections 138 to 142 were inserted with effect from
1.4.1989, there can be little doubt that Section 138 was
intended to be a provision to curb instances of dishonour.
It will have to be presumed that the multifarious grounds on
which a cheque would be dishonoured are common place and
in not having made any exception for such situations, the
legislative intent behind Section 138 was that cases of
dishonour of a cheque would constitute a criminal offence
unless the payment was forthcoming within the prescribed
period. The reference to the term 'insufficiency of funds'
was obviously a qualifying clause which only reiterates
the basic principle that an order to the bank conveyed
through a cheque to make a prescribed payment would
only fail in a situation where the bank could not
implement that directive for want of the requisite funds.
The circumstances that may contribute to the situation
would, therefore, be irrelevant. The presumption in section
139 heavily supports this view.
26. It would be useful in this regard to refer to another
decision of this court, reported in Pawankamar v. Ashish
Enterprises, 1992 Cr. LJ 1619, where the cheque was
returned with the endorsement "suit filed by bank
against account holder". The court held that the reason
apart, that the dishonour had been occasioned because of
insufficiency of funds, and further that the criminal
proceedings under Section 138 were justified regardless of
the plea that civil action for recovery had been initiated.
In our considered view, if the object of introducing
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Section 138 into the statute book is to be achieved, it will
have to be meaningfully enforced, brushing aside
technical and frivolous pleas." (Emphasis supplied)
.
25. Andhra Pradesh High Court held in Syed Rasool and
Sons v. Aildas and Co., (1993) 78 Comp Cas 738 that the cause of
action is given by failure to pay the amount despite the receipt of
a valid notice of demand. Therefore, the failure to pay the
amount despite the receipt of a valid notice of demand will
complete the offence. It was observed:
"23. From the Scheme of the Act, it is clear that following
the dishonour of the cheque a notice has to be issued in
writing to the person who has issued the cheque inviting
his attention that the cheque has been dishonoured and
he is liable for penal consequences under Section 138 read
with Section 142 of the Act. When the reason for return of
the cheque has been mentioned as "refer to drawer" or
"insufficiency of funds" or "account closed", it is the
primary duty of the drawer of the cheque to make the
payment of the said amount of money to the payee within
fifteen days of the receipt of the said notice. So, an
opportunity has been given by the Legislature itself by
providing a notice to the drawer and for payment of the
amount within fifteen days of the receipt of the said
notice and if he fails to comply with clause (c) of Section
138, filing of a complaint within one month from the date
of cause of action is also provided under sub-section (b)
of Section 142 of the Act. Thus, a notice has to be given to
the drawer, and that notice is a condition precedent. That
means the drawer of the cheque has an opportunity to
know in advance, before filing the complaint, that the
cheque was dishonoured for a particular reason. When
that information was already available to him and when
he had not made any attempt to pay the same, it cannot
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be said that the cheque was returned not for insufficiency
of funds or not arranged for. In the normal banking
parlance "refer to drawer" means that no funds are
available and when an opportunity has been given to the
.
drawer of the cheque by inviting his attention and when
he has not paid the amount, it has to be construed that
"refer to drawer" or "insufficiency of funds" or "account
closed" etc., ultimately resulted in dishonouring the
cheque and preventing the drawee from getting the
amount which is only on account of the act committed by
the drawer, who has given the cheque. The two situations
contemplated in Section 138 are insufficiency of the
amount standing to the credit of the account, or it
exceeds the amount arranged to be paid by an agreement
made with the bank, such as obtaining the facility of
overdraft, etc. If either of these two contingencies has not
been complied with, the only alternative left to the bank
is to dishonour the cheque or to return the cheque with
the endorsement as is being followed by them from time
to time as per the trade custom, usage and practice. It is
not the phrase or the words used by the Bank in
dishonouring the cheque that has to be taken into
account, but the intention of the bank has to be taken into
consideration. The intention of the Legislature is clearly
to see that in the event of the amount not being paid on
presenting the cheque due to insufficiency of funds or if it
exceeds the arrangement, the person is liable for
prosecution. However, the further safeguard that has
been made to prevent hasty action is that the payee or the
holder in due course of the cheque shall make a demand
for the payment of the amount covered by the said cheque
giving a notice, in writing, to the drawer within fifteen
days of the receipt of information by him from the banker
is well settled that the penal provisions have to be
construed strictly and not liberally. The court will not
extend the law beyond its meaning to take care of a
broader legislative purpose. Here, "strict" means merely
that the court will refrain from exercising its creative
function to apply the rule announced in the statute to
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situations not covered by it, even though such an
extension would help to advance the manifest purport of
the statute. Here, strictness relates not to the meaning of
the statute but to using the statute as a basis for judicial
.
aw making by analogy with it. Even in the Calcutta High
Court case, viz.., Voltas Ltd. Vs. Hiralal Agarwalla's (supra)
averments have been made in the complaint petition,
which show that the complainant had observed the
formality as required by the provisos (a),(b) and (c) of
Section 138 of the Act before initiating the criminal
proceeding against the drawer of the cheque. It was
contended therein on behalf of the petitioners that the
clause "refer to drawer" does not necessarily mean that
the cheque was dishonoured. But, on a clarification from
the Bank, to the effect that the remark "refer to drawer"
necessarily means as per banking custom that the cheque
has been returned for want of funds, the court came to
the conclusion that it is prima facie seen that the cheque
in question was bounced because of inadequacy of funds
in the drawer's account. The endorsements "refer to
drawer" or "insufficiency of funds" or "not arranged" or
"account closed" or some other technical words used by
the bank, ultimately resulted in dishonouring the cheque,
on account of the fault of the person who has issued the
cheque in not providing sufficient funds or not arranging
funds. Having issued the cheque without having sufficient
funds or not arranging the funds or after closing the
account, it is definitely an act on the part of the drawer of
the cheque which ultimately resulted in dishonouring the
cheque. This again is a matter of evidence which has to be
adduced in support of the endorsement. Under these
circumstances, it cannot be said at this stage that taking
cognisance of a private complaint by the court itself is
bad. The words 'refer to drawer in their ordinary meaning
amounted to a statement by the bank, "we are not paying;
go back to the drawer and ask him why "or else" go back
to the drawer and ask him to pay". In view of the above
discussion, we are of the firm view that "refer to drawer"
necessarily means, as per banking parlance, that the
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cheque has been returned for want of funds in the account
of the drawer of the cheque. So we are not in agreement
with the view expressed by the learned single Judge of
this court (Eswara Prasad, J.) in M/s. Union Road Ways (P)
.
Ltd., & Another vs. M/s. Shah Ramanlal Satesh Kumar &
another (supra).
26. A similar view was taken by the Madras High Court in
J. Veeraraghavan v. Lalith Kumar, (1995) 83 Comp Cas 853: 1994
SCC OnLine Mad 567: 1995 Cri LJ 1882: (1995) 1 BC 318: (1994) 2 LW
r to
(Cri) 663 wherein it was observed:
23. Apart from any one of the 21 reasons catalogued above, that
is usually given by a bank in the case of return of a cheque
unpaid, there may be a myriad of reasons, depending upon the
contingency and exigency of the situation. Insufficiency of
funds in the accounts may be a situation, which may be created
either innocently or unknowingly by the drawer or may be a
product of mischievous gimmicks, like "closure of account",
countermanding the payment, etc., or even a situation wherein
the bank dishonours the cheque since it has already instituted
a suit against the drawer to recover the debt against his
account. Further, insufficiency of funds may be indicated by
various direct and indirect endorsements by the dishonouring
bank, such as "insufficiency of funds", "refer to drawer",
"funds expected, present again", "effects not cleared", etc.
There may even be a Situation rather created in a mischievous
or malicious fashion to see that the cheque issued by the
drawer stands returned by the banker unpaid by subscription
of the signature in such a way as not to tally with the specimen
signature, just to purchase time to meet the demands made
knowing fully well that on the date when the cheque had been
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drawn, there was insufficiency of funds in his account. For the
outside world, it may appear that the reason for the return of
the cheque unpaid was the existence of suspicion as regards
.
the genuineness of the cheque issued by the drawer. But the
real reason is altogether different in such a situation. The
drawer, in a fraudulent way, does the mischief of subscribing
his signature totally in a different fashion to create a doubt as
to the genuineness of the cheque so issued by him. He does it
with a purpose, which is rather obvious. Such a trickery device
could be adopted to stall the situation of not being in a position
to meet the demand, in the sense of not having adequacy of
funds in the account of the drawer, and by adoption of such a
device, the payee had really been hoodwinked. Manifold
situations may be created by a fraudulent drawer using all sorts
of ingenuity to make it appear that the reason for the return of
the cheque unpaid, was neither of the two contingencies
contemplated by section 138 of the Act although in the real
state of affairs, the reason for the return of the cheque unpaid
was either of the two contingencies contemplated therein
alone. We are, therefore, of the firm view that the reasons, as
given by the bank for the return of the cheque may not at all
reflect the reality of the situation relatable to the sufficiency or
otherwise of the funds in the accounts of the drawer or
whether it exceeds the amount arranged to be paid by the
drawer by agreement with, the bank.
24. Once a cheque is dishonoured, whatever be the reason
therefor, it behoves upon the payee or the holder in due course
to issue a notice in writing to the drawer of the cheque within
15 days from the date of such return, intimating, as has been
provided under the sanguine provisions adumbrated under
clauses (b) and (c) to the proviso to section 138 of the Act, the
factum of such return and requiring him to comply with the
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demand within 15 days from the date of receipt of the said
notice and the demand so made, if not complied with, gives
rise to a cause of action for the launching of the prosecution
.
against such drawer and the cause of action so enured; lasts for
a period of one month, enabling the aggrieved payee or holder
in due course to file a complaint before the competent criminal
court. The existence of such factors thus prima facie
constitutes an offence under section 138 of the Act, requiring
the case to be taken cognisance of by the competent court,
before which the complaint had been filed. Cognisance of a
complaint is capable of being taken by a competent court,
provided the necessary and requisite averments constituting
the offence complained of are made available in the complaint
and nothing further, excepting the taking of a sworn statement
from the complainant.
25. In the case of prosecution for an offence under section 138
of the Act, a moot question very often raised before courts is,
as to whether averments regarding sufficiency or otherwise of
funds in the account of the drawer were to be made in the
complaint. Divergent views emerge on such a question from
various High Courts, to which we have already adverted. The
rationale or reasoning for the view that there should be a
specific averment in the complaint as to the insufficiency of
funds before ever the case is taken cognisance of, we rather
feel, is not reflecting the real import, purport or the
intendment of section 138 of the Act. We have already adverted
to as to what is necessary and requisite for a complaint to be
taken cognizance of, in respect of an alleged offence under
section 138 of the Act, i.e., the factum of dishonour of the
cheque, whatever be the reason, which was issued in discharge
of a debt or other liability in whole or in part, after its
presentation within its period of validity of six months from
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the date of issue, whichever is earlier, coupled with the non-
compliance with the drawer of the demand made upon him and
the institution of prosecution within one month from such
.
non-compliance. Such being the case, the non-mentioning in
the complaint by way of a specific averment made therein as to
the insufficiency of funds in the account of the drawer, is of no
consequence and the question whether there was sufficiency of
funds or not in the account of the drawer on the date when the
cheque had been drawn, will be relevant only during the stage
of trial and such a question is capable of being decided, with
ease and grace, by the court on the adduction of evidence by
utilising the salient provisions adumbrated under the
provisions of the Bankers' Books Evidence Act, 1891. Once it is
proved in the trial that bouncing of a cheque was due to lack of
balance in the account of the drawer on the date when the
cheque was drawn, then it goes without saying that the act of
giving a cheque resulting in the bouncing of the cheque due to
lack of balance in the account was an "absolute offence" even
if it was done without any "criminal intent", inasmuch as no
mens rea has been prescribed for the commission of such an
offence. The non-prescription of any mens rea therein is
rather obvious. The monetary blood flow in the arteries of
trade and business heart cannot be permitted to be calcified by
the dishonouring of the cheque by debtors. In this view of the
matter, we are of the view that there is no necessity at all to
make any specific averment in the complaint as to the
insufficiency of funds in the account of the drawer on the date
when the cheque was drawn, before ever such a complaint is
taken cognizance of by a competent court.
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27. However, it is difficult to agree to the submission
that the dishonour of the cheque for any reason would give rise
.
to criminal liability. The Legislature has consciously used the
words "returned unpaid because the amount of money standing
to the credit of that account is insufficient to honour the cheque,
or it exceeds the amount" in Section 138 of the NI Act. These
words have been extended to cover the situation where the
payment was not made by the Bank due to the default
committed by the drawer, like payment stopped by the drawer
[Modi Cements Vs. Kuchil Kumar Nandi (1998) 3 SCC 241 and NEPC
Micon Limited and others vs. Magma Leasing Limited (1999) 4 SCC
253], account closed (Goa Plast (P) Ltd. v. Chico Ursula D'Souza,
(2004) 2 SCC 235 and Subhodh S Salaskar Vs Japrakash M Shah,
(2008) 13 SCC 689), signatures mismatch (Laxmi Dyechem v. State
of Gujarat, (2012) 13 SCC 375) account non-existent (Jugesh
Sehgal v. Shamsher Singh Gogi,(2009) 14 SCC 683) etc. The
proceedings are not maintainable when the cheque is
dishonoured due to a circumstance beyond the control of a
person, like account frozen (Best Buildwell (P) Ltd. v. R.D. Sales,
2025 SCC OnLine Del 4267) contact the drawer and present again
(Sathiya Murthi vs Kesava Narayanan Crl.O. P No.10406 of 2019
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decided on 24 July, 2019 and D.S. Shridhar vs. P. John and Ors.
(13.12.2022 - TLHC): MANU/TL/2690/2022), Hence, the offence
.
punishable under Section 138 of the NI Act will not be attracted
to every case of dishonour but to a dishonour which is
attributable to the drawer and not to any other person.
28. In the present case, the memo of dishonour
(Ex.CW1/C) mentions the cheque date 20.1.2018 and return date
22.1.2018. The cheque was issued on 21.10.2017. This memo
shows that the cheque was presented on 20.1.2018 and was
returned on 22.1.2018. It was laid down by Hon'ble Supreme
Court in Rameshchandra Ambalal Joshi v. State of Gujarat, (2014)
11 SCC 759 : (2014) 4 SCC (Civ) 274 : (2014) 3 SCC (Cri) 542: 2014
SCC OnLine SC 134 that the use of the word from in Section 138(a)
requires the exclusion of the first day on which the cheque was
drawn and inclusion of the last day within which such act needs
to be done. It was observed at page 768: -
22. Drawing a conclusion from the abovementioned
authorities, we are of the opinion that the use of the word
"from" in Section 138(a) requires the exclusion of the
first day on which the cheque was drawn and inclusion of
the last day within which such act needs to be done. In
other words, six months would expire one day prior to the
date in the corresponding month, and in case no such day
falls, the last day of the immediate previous month.
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Hence, for all purposes, the date on which the cheque was
drawn i.e. 31-12-2005 will be excluded and the period of
six months will be reckoned from the next day i.e. from 1-
1-2006; meaning thereby that according to the British
.
calendar, the period of six months will expire at the end
of the 30th day of June, 2006. Since the cheque was
presented on 30-6-2006, we are of the view that it was
presented within the period prescribed.
29. In the present case, the cheque was issued on
21.10.2017, which is to be excluded, and the period of three
months expired on 21.1.2018. The cheque was presented on
20.1.2018 as per the memo of dishonour produced by the
complainant. It was Sunday on 21.1.2018, and the cheque could
have been presented on the next working day as per Section 25
of the NI Act. It was laid down by this Court in Bhupender Kumar
Sharma vs Rattan Singh 2013 (2) ShimLC 780 that when the date
of maturity is a public holiday, it can be presented on the next
working day. It was observed:
5. Thus, Section 25 of the N.I. Act also applies to a cheque
and in case the day on which the cheque is at maturity, is
a public holiday, the instrument shall be deemed to be
due on the next preceding business day as in the present
case (please see K.S. Subbaraman v. lyyammal, 1998 CRI.L.J.
4758, Madras High Court).
30. A similar view was taken in P Narasmiha Reddy vs
State of Andhra Pradesh 2019 ACD 587 = 2019(1) Andh LD
(Criminal) 989 wherein it was observed:
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10. A reading of section 25 of the Negotiable Instruments
Act would clearly show that if the day on which the
cheque period expires is a public holiday, the cheque shall
be deemed to be due on the next preceding business day.
.
In the said section, the Explanation would indicate that
the expression "public holiday" includes Sunday.
11. Similar is the wording of section 10 of the General
Clauses Act, 1897 reads:
"10. Computation of time-(1) Where, by any Central
Act or Regulation made after the commencement of
this Act, any act or proceeding is directed or
allowed to be done or taken in any court or office on
a certain day or within a prescribed period, then, if
the Court or office is closed on that day or the last
day of the prescribed period, the act or proceeding
rshall be considered as done or taken in due time if it
is done or taken on the next day afterwards on
which the Court or office is open:
Provided that nothing in this section shall
apply to any act or proceeding to which the
Indian Limitation Act, 1877 (15 of 1877)
applies.
(2) This section also applies to all Central Acts and
Regulations made on or after the fourteenth day of
January, 1887."
31. Hence, even if the cheque was presented on
22.1.2018, it was presented within the period of limitation and
the Bank erred in dishonouring it on the ground 'instrument
outdated/stale.
32. Thus, it is apparent that the reason for dishonour of
the cheque given by the Bank is not correct. The complainant did
not lead any evidence to establish that the accused had
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insufficient funds on the date of dishonour, and the real reason
for the dishonour was the insufficiency of funds and not the
.
instrument being outdated/stale as mentioned in the memo.
Therefore, the learned Appellate Court had rightly concluded
that the provisions of Section 138 of the NI Act are not attracted
to the present case.
33. It was laid down by this Court in Rajinder Singh Verma
vs. B.K. Hanchnmani (30.04.2019 - HPHC): MANU/HP/0437/2019
that a computer-generated memo of dishonour not having the
official seal is inadmissible. It was observed: -
"9. Even if, assumingly, the complainant may, upon
recoursing to an appropriate remedy, be cast under the
provisions of Section 45 of the Indian Evidence Act,
rather could therethrough strive to prove the afore-
mentioned cheque, borne in Ex. CW1/A, carrying the
authentic signatures of the accused, (a) and, thereafter it,
was permissible for the complainant, to rely upon the
statutory provisions, cast under the provisions of Section
139 of the Negotiable Instruments Act, qua his holding it
in discharge, of, a contractual or other legal liabilities,
arising inter se him, and, the accused. Nonetheless,
dehors, the aforecurative recoursings, for, hence,
dispelling the effect of Ex. CW1/A, rather than being
feigned, in the testification rendered hence by the
complainant, to, hence assuredly contain the signatures
of the accused, also, the mandate, of Section 146 of the
Negotiable Instrument Act, provisions whereof stand
extracted hereinafter, was, also vis-a-vis, Ex. CW1/B, the
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purported return memo given, Ex. CW1/A, hence
enjoined, to be cogently satiated.
"146. Bank's slip prima facie evidence of certain
.
facts. The Court shall, in respect of every
proceeding under this Chapter, on production of a
bank's slip or memo having thereon the official
mark denoting that the cheque has been
dishonoured, presume the fact of dishonour of such
cheque, unless and until such fact is disproved.
Even though, the court is statutorily empowered, to, qua
the apposite return memo hence enunciating, the,
declining to honour the negotiable instrument concerned,
rather avail the apposite therewith presumption, as,
engrafted therein, (a) yet the afore presumption would be
aptly galvanized, upon, the memo evidently carrying
thereon, the official mark, and, seal, of the bank
concerned. However, the afore presumption, as occurring
therein, and, with a statutory coinage, "unless and until
such fact is disproved", is, rebuttable, only upon,
adduction into evidence, the return memo, (b)
whereupon hence, it would also stand proven qua it not
carrying the official mark or seal of the bank concerned.
The evidence in consonance with the afore-mentioned
statutory coinage, occurring in the last part of Section 146
of the N.I. Act is, prima facie, rather upsurging, given, Ex.
CW1/B evidently not carrying the seal or official mark of
the bank concerned, (I) AND, with one Naresh Kumar,
Accounts Officer from ICICI Bank, The Mall Shimla, upon
his stepping into the witness box, rather showing his
inability to bring the original of Ex. CW1/B, given, it not
being traceable in the apposite records, (ii) and, when
only on production, of the original in the Court of EX.
CW1/B, and, evident existence thereon, of the afore
statutorily mandated requirements, of it, hence carrying
the official mark or seal of the bank concerned, would,
hence enable, the, marshalling, of, the statutory
presumption qua the apposite cheque being declined, to
be honoured, to, rather hold the fullest conclusivity or
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sway, (iii) besides it would benumb any endeavour of the
defence, to rely, upon the afore statutory coinage,
occurring in the last part of Section 146 of the N.I. Act, (iv)
reiteratedly for want of production of the original of Ex.
.
CW1/B, this court is constrained to conclude qua the
statutory requirement of Ex. CW1/B on its presentation,
for its being honoured, hence, being declined to be
honoured, rather remaining, within the ambit of Section
146 of the N;l. Act, to be hence, disproven.
34. Madhya Pradesh High Court has also held in
Satyendra Tiwari v. State of M.P., 2014 SCC OnLine MP 6786: ILR
2014 MP 1679: (2014) 3 MP LJ 574 that when the memo of
dishonour does not bear the banker's seal, the same is not valid.
It was observed at page 1685: -
"Endorsement Memo
29. Another reason given by the learned court to acquit
the accused was that the complainant failed to prove the
submission of the cheque (Ex. P-1) in the bank.
30. When a cheque is drawn by a person on an account
maintained by him for payment of any amount or
discharge of liability or debt and is returned by the bank
with endorsement like (i) refer to drawer, (ii) exceeds
arrangement, (iii) instruction for stoppage of payment;
(iv) fund insufficient and like other usual endorsements,
it amounts to dishonour within the meaning of section
138 of the N.I. Act.
31. Cheque to be presented within six months from the
date of the cheque to the bank on which it was drawn, and
if it is presented beyond that time complaint is not
maintainable. In this case in hand the cheque (Ex.P-1)
was presented within time.
32. In fact, the learned trial Court initially committed a
grave mistake while issuing summons for the appearance
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of the accused on the assumption that the case had been
disclosed, while the bankers' seal was totally missing of
the bankers written memo in such circumstances the
summons was not required to issue against the accused.
.
33. Learned trial Court after scrutinising the statement of
the complainant in this regard and after examining the
cheque (Ex. P-1) with returning endorsement (Ex. P-2),
found that there is a lack of a banker's seal on the
endorsement memo (Ex. P-2).
34. It is pertinent to mention here that even after
committing initial error learned trial Court given
appropriate opportunity to the complainant to examine
Manager or any authorized Officer of the Punjab and
Sindh Bank, the Banker's who returned the Cheque
(Ex.P.-1) vide their endorsement memo (Ex.P.-2) under
the caption "Fund Insufficient", but the complainant fail
to comply. In such a situation, endorsement memo
(Ex.P.-2) has no evidentiary value as a public document,
but a mere piece of paper."
35. It was held in Krishnapal v. Hari Singh, 2024 SCC
OnLine MP 2516 that the Bank is required to prove the seal and
the signatures on the cheque returning memo as per the
guidelines issued by the RBI and in the absence of the seal and
the signatures, the memo does not carry a presumption under
Section 146 of the NI Act. It was observed: -
"5. Having gone through the record, it is found that the
said document Ex-P/2 has no seal of the said bank and
signature of the authority; therefore, it is in violation of
guidelines issued by the Reserve Bank of India vide its
letter No. RBI/2011-12/121 DPSS.CO. CHD NO.
120/03.06.01/2011-12 dated 25.07.2011. The said
guidelines are required to be and are hereby reproduced
hereunder:--
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"RBI/2011-12/121
DPSS.CO. CHD.No. 120/03.06.01/2011-12 July 25,
2011
.
The Chairman and Managing Director/Chief
Executive Officer
All Scheduled Commercial Banks, including RRBs
/Urban Co-operative Banks/State Co-operative
Banks/
District Central Co-operative Banks
Madam/Dear Sir,
Dishonour/Return of Cheques - Need to Sign/Initial
the Cheque Return Memo
Please refer to our circular DPSS. CO. CHD. No.
485/03.06.01/2010-11 dated September 1, 2010 on
Dishonour/Return of Cheques - Need to Mention the
'Date of Return' in the Cheque Return Memo, wherein
citing the criticality of the document in case of
recourse to legal action, it has been indicated that
instruments returned unpaid should have a
signed/initialed objection slip on which a definite and
valid reason for refusing payment must be stated, as
prescribed in Rule 6 of the Uniform Regulations and
Rules for Bankers' Clearing Houses (URRBCH).
Certain instances of banks not signing the Cheque
Return Memos stating that the Memos are computer-
generated and therefore no signature is necessary
have been brought to our notice. Such practices are a
violation of instructions contained in Uniform
Regulations and Rules for Bankers' Clearing Houses
(URRBCH), which is issued under the Payment and
Settlement Systems Act, 2007, read with Payment and
Settlement Systems Regulations 2008.
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Banks are, therefore, advised to strictly adhere to
the instructions and sign/initial the Cheque Return
Memos as laid down in Rule 6 of URRBCH.
.
Yours faithfully,
(Pankaj Ekka)
Deputy General Manager"
6. In view of the guidelines, it can be predicated that
not signing the cheque return memo by the Bankers
and issuing them without any signature will be a
violation of the instructions contained in the uniform
regulations and rules of bankers. Hence, the petitioner
cannot benefit from the law laid down in Guneet
Bhasin (Supra). On this aspect, the learned trial Court,
relying upon the judgment of this Court rendered
in Satyendra Tiwari (Supra), opined that a dishonour
memo of a bank without a seal has no evidentiary
value as a public document and it would be treated as
only a mere piece of paper. The aforesaid law laid
down in Satyendra Tiwari (Supra) still holds the field,
hence the contentions of the petitioner as to accepting
the endorsement memo (Ex. P/2) are evidently found
without merit."
36. Bombay High Court held in Vandana v. Abhilasha,
2018 SCC OnLine Bom 2086: (2019) 2 Mah LJ 645: 2018 ACD 950:
(2018) 4 Bom CR (Cri) 774 that a computer generated document
requires a certificate under Section 65(b)(4) and in the absence
of the certificate, the memo is not admissible. It was observed at
page 649: -
"9. In this context, section 146 of the aforesaid Act is
relevant, which reads as follows:
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"146. Bank's slip prima facie evidence of certain facts.
-- The Court shall, in respect of every proceeding under
this Chapter, on production of a bank's slip or memo
having thereon the official mark denoting that the cheque
.
has been dishonoured, presume the fact of dishonour of
such cheque, unless and until such fact is disproved."
10. The said provision states the manner in which a
complainant can prove dishonour of a cheque. The
complainant is required to produce a slip or memo having
an official mark on it, denoting that the cheque has been
dishonoured. If such a document is placed on record by
the complainant, it constitutes prima facie evidence of
dishonour and a presumption operates about the fact of
the dishonour of the cheque, unless and until such fact is
disproved. Thus, once such a memo or slip issued by the
bank bearing its official mark concerning dishonour of a
cheque is placed on record by the complainant, the
burden is clearly on the accused to disprove the fact of
dishonour of a cheque.
11. But, there cannot be any doubt about the fact that
section 146 of the said Act provides for one of the modes
of proving dishonour of cheques, and it certainly cannot
be the only mode of proving the same. In the present case,
the memo purportedly issued by the bank showing
dishonour of cheque, admittedly, does not bear the
official mark of the bank. It was for this reason that the
said document was not exhibited during the evidence.
Thus, the mode specified in section 146 of the said Act
was not satisfied in the present case, and consequently,
no presumption arose about the dishonour of the cheque
in question. In such a situation, the appellant claims that
the dishonour of the cheque was proved because a
statutory notice was issued by her to the respondent. It
was pointed out that specific pleadings were made in the
complaint filed before the Court stating dishonour of the
said cheque and that when the respondent had failed to
adduce any evidence in support of her defence, the
statements made by the appellant in this statutory notice
and the complaint were enough to prove dishonour of the
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cheque. It was submitted that when there was no denial
on the part of the respondent about the deposit and
dishonour of the cheque in question, the trial Court could
not have held that the appellant had failed to prove the
.
fact of dishonour of the cheque. It was further contended
that when the findings were rendered on the question of
discharge of legal debt and it was found by the trial Court
that the appellant had indeed advanced hand loan for the
amount stated in the cheque to the respondent, there was
no reason why the trial Court could have held that the fact
of dishonour of cheque was not proved by the appellant.
12. While examining the said contentions raised on behalf
of the appellant, it is necessary to keep in mind that the
present case concerns criminal liability alleged against
the respondent. Although proceedings under the
aforesaid Act are quasi criminal in nature, the fact is that
when the offence under section 138 of the said Act is said
to have been proved, criminal liability is fixed upon the
accused (respondent in the present case) and therefore,
the evidence on record and the burden of proof have to be
analyzed on the touchstone of proof beyond reasonable
doubt. The burden of proof clearly lies upon the appellant
in the present case to prove basic facts that would
constitute an offence under section 138 of the aforesaid
Act. Under the said provision, the offence is deemed to
have been committed the moment the cheque in question
is returned by the bank unpaid. Therefore, it is necessary
that there is proof of return or dishonour of the cheque in
question before it can be said that an offence under
section 138 of the Act has been committed.
13. When the complainant (appellant in the present case)
asserted that the cheque was returned or dishonoured, it
was for her to prove this basic fact, section 146 of the said
Act provides that if the complainant places on record a
slip or memo issued by the bank having official mark of
the bank thereon, denoting that the cheque was
dishonoured, it would be presumed that such cheque was
dishonoured until such fact was disproved. Thus, if such a
document were placed on record by the appellant in the
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present case, it would constitute prima facie evidence of
dishonour of the cheque, and the burden would have been
entirely on the respondent to disprove such a fact. But,
when the memo produced in the present case by the
.
appellant did not bear the official mark of the bank, there
was no document as contemplated under section 146 of
the said Act to presume that the fact of dishonour of the
cheque had been proved by the appellant. The burden
continued to lie on the appellant to prove the basic fact of
dishonour of the cheque, in the facts and circumstances
of the present case.
14. In such a situation, a mere statement made in the
statutory notice and the complaint filed before the Court
would not constitute proof of dishonour of cheque, unless
further evidence to corroborate the same was placed on
record on behalf of the appellant. The appellant is not
justified in claiming that such statements would suffice
as proof of dishonour of the cheque because the
respondent failed to enter the witness box in support of
her defence. As the complainant, it was for the appellant
to prove the fact of dishonour of the cheque by cogent
evidence. The appellant could have examined the bank
official to prove that the cheque had indeed been
dishonoured, but she failed to do so.
15. The appellant could have placed on record a certificate
contemplated under section 65-B of the Indian Evidence
Act, 1872, in respect of the memo of the Bank, which was
allegedly a computer-generated electronic record. But no
such evidence was placed on record. The trial Court has
also held that there was a lack of evidence to show even
the deposit of the cheque because the deposit slip was not
placed on record by the appellant. But, a perusal of the
cheque in question (Exhibit-21) does show that the stamp
of the bank in which the cheque was deposited is very
much present on the cheque. To that extent, the trial
Court was not right in holding that even the proof of
deposit of the cheque was not on record. Yet, this fact
alone does not take the case of the appellant any further
because the stamp affixed on the cheque shows only the
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name of the bank, and there is nothing to signify the date
on which the cheque was deposited in the bank. Even as
per the case of the appellant, the cheque in question was
deposited twice, and it is clear that there is no cogent
.
evidence placed on record by the appellant to show
dishonour of the said cheque.
16. When the basic fact of dishonour of cheque was not
proved by the appellant and the burden was not
discharged offence under section 138 of the said Act could
not be said to have been committed by the respondent.
Another important aspect of the present case is that when
there is lack of evidence to show dishonour of cheque and
consequently the date when the cheque was dishonoured,
there is no reference point to ascertain as to whether the
notice for demand of payment was issued by the appellant
to the respondent within the period of 30 days of receipt
of information from the bank regarding return of cheque
as unpaid, as provided under proviso (b) to section 138 of
the said Act. This is the reason why the trial Court has
held that the appellant failed to prove that she made a
demand for payment of the amount within the statutory
period, as the statutory period could not be computed in
the facts of the present case.
17. Analysis of the provisions of the said Act, particularly
sections 138, 142 and 146 thereof, shows that cognizance
of the offence under section 142 of the said Act could not
have been taken by the Court in the present case because
the basic fact of dishonour of cheque could not be proved
by the appellant. The appellant failed to prove dishonour
of the cheque by any mode other than the one provided
under section 146 of the said Act. The memo of return of
cheque in the present case admittedly did not bear the
official mark of the Bank, due to which presumption in
favour of the appellant did not arise. Therefore, the
complaint in the present case was correctly rejected by
the trial Court, thereby acquitting the respondent.
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37. It was laid down in Tejendrasingh v. Ravindrakumar,
2019 SCC OnLine Bom 60: (2019) 3 Mah LJ 612: 2019 ACD 229:
.
(2019) 2 RCR (Cri) 475: PLR (2019) 193 IJ 14: (2019) 1 Bom CR (Cri)
900 that when the document does not bear the official mark/
seal, the presumption under Section 146 of the NI Act cannot be
drawn. It was observed:
"ii. Admittedly, the UCO Bank representative is not
examined. The Trial Court refused to accept the bank
memo issued by that bank. It does not bear the seal of
the bank. I agree with the trial Court. The presumption
under section 146 of the N.I. Act will not come to his
rescue. There has to be a seal on the bank slip before
the presumption as to dishonour can be drawn. I could
have given the benefit of this lacuna even if a proper
person from SBI, that is the signatory of the letter,
could have been examined. It seems that while
conducting the prosecution, these minor procedural
aspects are overlooked."
38. The Hon'ble Supreme Court also held in Arjun
Panditrao Khotkar v. Kailash Kushanrao Gorantyal, (2020) 7 SCC 1:
(2020) 4 SCC (Civ) 1: (2020) 3 SCC (Cri) 1: (2020) 2 SCC (L&S) 587:
2020 SCC OnLine SC 571 that the certificate under Section 65(b)
(4) of the Indian Evidence Act is mandatory, in the absence of
which the computer-generated document cannot be relied upon.
It was observed at page 27: -
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"23. Section 65-B(1) opens with a non obstante clause,
and makes it clear that any information that is contained
in an electronic record which is printed on a paper,
stored, recorded or copied in optical or magnetic media
.
produced by a computer shall be deemed to be a
document, and shall be admissible in any proceedings
without further proof of production of the original, as
evidence of the contents of the original or of any facts
stated therein of which direct evidence would be
admissible. The deeming fiction is for the reason that
"document" as defined by Section 3 of the Evidence Act
does not include electronic records.
24. Section 65-B(2) then refers to the conditions that
must be satisfied in respect of a computer output, and
states that the test for being included in conditions 65-
B(2)(a) to 65-B(2)(d) is that the computer be regularly
used to store or process information for purposes of
activities regularly carried on in the period in question.
The conditions mentioned in sub-sections (2)(a) to (2)(d)
must be satisfied cumulatively.
25. Under sub-section (4), a certificate is to be produced
that identifies the electronic record containing the
statement and describes the manner in which it is
produced, or gives particulars of the device involved in
the production of the electronic record to show that the
electronic record was produced by a computer, by either a
person occupying a responsible official position in
relation to the operation of the relevant device; or a
person who is in the management of "relevant activities"
-- whichever is appropriate. What is also of importance is
that it shall be sufficient for such matter to be stated to
the "best of the knowledge and belief of the person
stating it". Here, "doing any of the following things ..."
must be read as doing all of the following things, it being
well settled that the expression "any" can mean "all"
given the context (see, for example, this Court's
judgments in Banwarilal Agarwalla v. State of
Bihar [Banwarilal Agarwalla v. State of Bihar, (1962) 1 SCR
33: AIR 1961 SC 849: (1961) 2 Cri LJ 12: "3. The first
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contention is based on an assumption that the word "any
one" in Section 76 means only "one of the directors, and
only one of the shareholders". This question as regards
the interpretation of the word "any one" in Section 76
.
was raised in Chief Inspector of Mines v. Lala Karam Chand
Thapar, AIR 1961 SC 838 : (1961) 2 Cri LJ 1and it has been
decided there that the word "any one" should be interpreted
there as "every one". Thus, under Section 76, every one of the
shareholders of a private company owning the mine, and
every one of the directors of a public company owning the
mine, is liable to prosecution. No question of violation of
Article 14 therefore arises." (SCR p. 35: AIR p. 850, para 3)
(emphasis supplied)] and Om Parkash v. Union of
India [Om Parkash v. Union of India, (2010) 4 SCC 17 :
(2010) 2 SCC (Civ) 1, "70. Perusal of the opinion of the Full
Bench in B.R. Gupta-1 [Balak Ram Gupta v. Union of India,
1987 SCC OnLine Del 227: AIR 1987 Del 239] would
clearly indicate with regard to interpretation of the word
"any" in Explanation 1 to the first proviso to Section 6 of the
Act which expands the scope of stay order granted in one case
of landowners to be automatically extended to all those
landowners, whose lands are covered under the notifications
issued under Section 4 of the Act, irrespective of the fact
whether there was any separate order of stay or not as
regards their lands. The logic assigned by the Full Bench,
the relevant portions whereof have been reproduced
hereinabove, appears to be reasonable, apt, legal and
proper." (SCC p. 43, para 70)(emphasis supplied)] ). This
being the case, the conditions mentioned in Section 65-
B(4) must also be interpreted as being cumulative.
39. In the present case, the memo of dishonour
specifically mentions that it is a computer-generated document
and does not require signatures. It does not bear any certificate
or the official seal of the bank; hence, it cannot be admitted in
evidence to conclude that the cheque was dishonoured.
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40. It was submitted on behalf of the complainant that
the accused did not object to the exhibition of the memo of
.
dishonour, and it is impermissible to raise an objection before
this Court. This submission has some force. A perusal of the
record shows that the affidavit (Ex.CW1/A), cheque (Ex.CW1/B),
memo (Ex.CW1/C), notice (Ex.CW1/D) and receipt (Mark-A) were
produced in the presence of the accused, and no objection was
raised to their exhibition. It was laid down by the Hon'ble
Supreme Court in R.V.E. Venkatachala Gounder v. Arulmigu
Viswesaraswami & V.P. Temple, (2003) 8 SCC 752 that an
objection to the admissibility of the evidence should be taken
when it is tendered and not subsequently. When secondary
evidence is being led and no objection is raised, the same is
deemed to be waived and cannot be taken during the appeal. It
was observed:-
20. The learned counsel for the defendant-respondent
has relied on Roman Catholic Mission v. State of
Madras [AIR 1966 SC 1457] in support of his submission
that a document not admissible in evidence, though
brought on record, has to be excluded from consideration.
We do not have any dispute with the proposition of law so
laid down in the abovesaid case. However, the present one
is a case which calls for the correct position of law being
made precise. Ordinarily, an objection to the admissibility
of evidence should be taken when it is tendered and not
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subsequently. The objections as to the admissibility of
documents in evidence may be classified into two classes:
(i) an objection that the document which is sought to be
.
proved is itself inadmissible in evidence; and (ii) where the
objection does not dispute the admissibility of the
document in evidence but is directed towards the mode of
proof alleging the same to be irregular or insufficient. In
the first case, merely because a document has been
marked as "an exhibit", an objection as to its
admissibility is not excluded and is available to be raised
even at a later stage or even in appeal or revision. In the
latter case, the objection should be taken when the
evidence is tendered and once the document has been
admitted in evidence and marked as an exhibit, the
objection that it should not have been admitted in
evidence or that the mode adopted for proving the
document is irregular cannot be allowed to be raised at
any stage subsequent to the marking of the document as
an exhibit. The latter proposition is a rule of fair play. The
crucial test is whether an objection, if taken at the
appropriate point of time, would have enabled the party
tendering the evidence to cure the defect and resort to
such mode of proof as would be regular. The omission to
object becomes fatal because, by his failure, the party
entitled to object allows the party tendering the evidence
to act on an assumption that the opposite party is not
serious about the mode of proof. On the other hand, a
prompt objection does not prejudice the party tendering
the evidence, for two reasons: firstly, it enables the court
to apply its mind and pronounce its decision on the
question of admissibility then and there; and secondly, in
the event of finding of the court on the mode of proof
sought to be adopted going against the party tendering
the evidence, the opportunity of seeking indulgence of
the court for permitting a regular mode or method of
proof and thereby removing the objection raised by the
opposite party, is available to the party leading the
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evidence. Such practice and procedure is fair to both
parties. Out of the two types of objections referred to
hereinabove, in the latter case, failure to raise a prompt
.
and timely objection amounts to a waiver of the necessity
for insisting on formal proof of a document, the
document itself which is sought to be proved being
admissible in evidence. In the first case, acquiescence
would be no bar to raising the objection in a superior
court.
21. The Privy Council in Padman v. Hanwanta [AIR 1915 PC
111: 19 CWN 929] did not permit the appellant to take
objection to the admissibility of a registered copy of a Will
in appeal for the first time. It was held that this objection
should have been taken in the trial court. It was observed:
(AIR p. 112)
"The defendants have now appealed to His
Majesty-in-Council, and the case has been argued
on their behalf in great detail. It was urged in the
course of the argument that a registered copy of the
Will of 1898 was admitted in evidence without
sufficient foundation being laid for its admission.
No objection, however, appears to have been taken
in the first court against the copy obtained from the
Registrar's office being put in evidence. Had such
an objection been made at the time, the District
Judge, who tried the case in the first instance,
would probably have seen that the deficiency was
supplied. Their Lordships think that there is no
substance in the present contention."
22. Similar is the view expressed by this Court in P.C.
Purushothama Reddiar v. S. Perumal [(1972) 1 SCC 9 : (1972)
2 SCR 646]. In this case, the police reports were admitted
as evidence without any objection and the objection was
sought to be taken in appeal regarding the admissibility
of the reports. Rejecting the contention, it was observed:
(SCC p. 15, para 19)
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"19. Before leaving this case, it is necessary to refer
to one of the contentions taken by Mr Ramamurthi,
learned counsel for the respondent. He contended
.
that the police reports referred to earlier are
inadmissible in evidence as the Head Constables
who covered those meetings have not been
examined in the case. Those reports were marked
without any objection. Hence, it is not open to the
respondent now to object to their admissibility --
see Bhagat Ram v. Khetu Ram [AIR 1929 PC 110] ."
41. This judgment was followed in Dayamathi Bai v. K.M.
r to
Shaffi, (2004) 7 SCC 107, wherein it was observed:-
"13. We do not find merit in this civil appeal. In the
present case, the objection was not that the certified copy
of Ext. P-1 is in itself inadmissible, but the mode of proof
was irregular and insufficient. The objection as to the
mode of proof falls within procedural law. Therefore,
such objections could be waived. They have to be taken
before the document is marked as an exhibit and
admitted to the record (see Order 13 Rule 3 of the Code of
Civil Procedure). This aspect has been brought out
succinctly in the judgment of this Court in R.V.E.
Venkatachala Gounder v. Arulmigu Viswesaraswami & V.P.
Temple [(2003) 8 SCC 752] to which one of us, Bhan, J.,
was a party vide para 20 : (SCC p. 764)
"20. The learned counsel for the defendant-
respondent has relied on Roman Catholic
Mission v. State of Madras [AIR 1966 SC 1457] in
support of his submission that a document not
admissible in evidence, though brought on record,
has to be excluded from consideration. We do not
have any dispute with the proposition of law so laid
down in the above-said case. However, the present
one is a case which calls for the correct position of
law being made precise. Ordinarily, an objection to
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the admissibility of evidence should be taken when
it is tendered and not subsequently. The objections
as to the admissibility of documents in evidence
.
may be classified into two classes : (i) an objection
that the document which is sought to be proved
is itself inadmissible in evidence; and (ii) where the
objection does not dispute the admissibility of the
document in evidence but is directed towards
the mode of proof alleging the same to be irregular
or insufficient. In the first case, merely because a
document has been marked as 'an exhibit', an
objection as to its admissibility is not excluded and
is available to be raised even at a later stage or even
in appeal or revision. In the latter case, the
objection should be taken when the evidence is
tendered and once the document has been admitted
in evidence and marked as an exhibit, the objection
that it should not have been admitted in evidence or
that the mode adopted for proving the document is
irregular cannot be allowed to be raised at any stage
subsequent to the marking of the document as an
exhibit. The latter proposition is a rule of fair play.
The crucial test is whether an objection, if taken at
the appropriate point of time, would have enabled
the party tendering the evidence to cure the defect
and resort to such mode of proof as would be
regular. The omission to object becomes fatal
because, by his failure, the party entitled to object
allows the party tendering the evidence to act on an
assumption that the opposite party is not serious
about the mode of proof. On the other hand, a
prompt objection does not prejudice the party
tendering the evidence, for two reasons: firstly, it
enables the court to apply its mind and pronounce
its decision on the question of admissibility then
and there; and secondly, in the event of finding of
the court on the mode of proof sought to be adopted
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going against the party tendering the evidence, the
opportunity of seeking indulgence of the court for
permitting a regular mode or method of proof and
.
thereby removing the objection raised by the
opposite party, is available to the party leading the
evidence. Such practice and procedure are fair to
both parties. Out of the two types of objections
referred to hereinabove, in the latter case, failure to
raise a prompt and timely objection amounts to a
waiver of the necessity for insisting on formal proof
of a document, the document itself which is sought
to be proved being admissible in evidence. In the
first case, acquiescence would be no bar to raising
the objection in a superior court."
r (emphasis in original)
14. To the same effect is the judgment of the Privy Council
in the case of Gopal Das v. Thakurji [AIR 1943 PC 83: 47
CWN 607] in which it has been held that when the
objection to the mode of proof is not taken, the party
cannot lie by until the case comes before a court of appeal
and then complain for the first time of the mode of proof.
When the objection to be taken is not that the document
is in itself inadmissible but that the mode of proof was
irregular, it is essential that the objection should be taken
at the trial before the document is marked as an exhibit
and admitted to the record. Similarly, in Sarkar on
Evidence, 15th Edn., p. 1084, it has been stated that where
copies of the documents are admitted without objection
in the trial court, no objection to their admissibility can
be taken afterwards in the court of appeal. When a party
gives in evidence a certified copy, without proving the
circumstances entitling him to give secondary evidence,
the objection must be taken at the time of admission, and
such objection will not be allowed at a later stage.
15. In the present case, when the plaintiff submitted a
certified copy of the sale deed (Ext. P-1) in evidence and
when the sale deed was taken on record and marked as an
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exhibit, the appellant did not raise any objection. Even
execution of Ext. P-2 was not challenged. In the
circumstances, it was not open to the appellant to object
to the mode of proof before the lower appellate court. If
.
the objection had been taken at the trial stage, the
plaintiff could have met it by calling for the original sale
deed, which was on record in collateral proceedings. But
as there was no objection from the appellant, the sale
deed dated 14-11-1944 was marked as Ext. P-1 and it was
admitted to the record without objection."
42. A similar view was taken in Lachhmi Narain Singh v.
r to
Sarjug Singh, (2022) 13 SCC 746, wherein it was observed:-
"21. In such a scenario, where no protest was registered
by the probate applicant against the production of a
certified copy of the cancellation deed, he cannot later be
allowed to take up the plea of non-production of the
original cancellation deed in the course of the appellate
proceeding. As already noted, the main contention of
probate applicants was that the mode of proof of the
cancellation deed was inadequate. However, such was not
the stand of the probate applicants before the trial court.
The objection as to the admissibility of a registered
document must be raised at the earliest stage before the
trial court, and the objection could not have been taken in
appeal, for the first time. On this, we may draw support
from observations made by Ameer Ali, J.
in Padman v. Hanwanta [Padman v. Hanwanta, 1915 SCC
OnLine PC 21] wherein the following was set out by the
Privy Council: (SCC OnLine PC)
“The defendants have now appealed to His
Majesty-in-Council, and the case has been argued
on their behalf in great detail. It was urged in the
course of the argument that a registered copy of the
will of 1898 was admitted in evidence without
sufficient foundation being laid for its admission.
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No objection, however, appears to have been taken
in the first court against the copy obtained from the
Registrar’s office being put in evidence. Had such
.
an objection been made at the time, the District
Judge, who tried the case in the first instance,
would probably have seen that the deficiency was
supplied. Their Lordships think that there is no
substance in the present contention.”
22. A similar view was taken by George Rankin, J. in the
decision of Privy Council in Gopal Das v. Sri
Thakurji [Gopal Das v. Sri Thakurji, 1943 SCC OnLine PC 2]
where it was held that objection as to the mode of proof
must be taken when the document is tendered and before
it is marked as an exhibit. It cannot be taken in appeal.
The objection as to the mode of proof should be taken
before a document is admitted and marked as an exhibit.
In the present case, the probate applicant never raised
any objection in regard to the mode of proof of the
cancellation deed before the trial court, as is evident from
a perusal of the records, and this must be held against
him.
23. In support of our above conclusion, we may usefully
refer to the ratio in R.V.E. Venkatachala
Gounder v. Arulmigu Viswesaraswami & V.P. Temple [R.V.E.
Venkatachala Gounder v. Arulmigu Viswesaraswami & V.P.
Temple, (2003) 8 SCC 752] where Ashok Bhan, J. while
dealing with the aspect of disallowing objection as to
mode of proof at appellate stage as a rule of fair play to
avoid prejudice to the other side, said as follows : (SCC p.
764, para 20)
“20. … In the latter case, the objection should be
taken when the evidence is tendered and once the
document has been admitted in evidence and
marked as an exhibit, the objection that it should
not have been admitted in evidence or that the
mode adopted for proving the document is irregular
cannot be allowed to be raised at any stage
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subsequent to the marking of the document as an
exhibit. The latter proposition is a rule of fair play.
The crucial test is whether an objection, if taken at
.
the appropriate point of time, would have enabled
the party tendering the evidence to cure the defect
and resort to such mode of proof as would be
regular. The omission to object becomes fatal
because, by his failure, the party entitled to object
allows the party tendering the evidence to act on an
assumption that the opposite party is not serious
about the mode of proof. On the other hand, a
prompt objection does not prejudice the party
tendering the evidence, for two reasons: firstly, it
enables the court to apply its mind and pronounce
its decision on the question of admissibility then
and there; and secondly, in the event of finding of
the court on the mode of proof sought to be adopted
going against the party tendering the evidence, the
opportunity of seeking indulgence of the court for
permitting a regular mode or method of proof and
thereby removing the objection raised by the
opposite party, is available to the party leading the
evidence. Such practice and procedure are fair to
both parties. Out of the two types of objections,
referred to hereinabove, in the latter case, failure to
raise a prompt and timely objection amounts to a
waiver of the necessity for insisting on formal proof
of a document, the document itself which is sought
to be proved being admissible in evidence.”
24. This Court, in the opinion written by S.H. Kapadia, J.
in Dayamathi Bai v. K.M. Shaffi [Dayamathi Bai v. K.M.
Shaffi, (2004) 7 SCC 107] has similarly held that the
objection as to the mode of proof falls within procedural
law. Therefore, such objections could be waived.
Moreover, the objection is to be taken before the
document is marked as an exhibit and admitted in Court.
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25. In view of the foregoing discussion, it is clear that a
plea regarding the mode of proof cannot be permitted to
be taken at the appellate stage for the first time, if not
.
raised before the trial court at the appropriate stage. This
is to avoid prejudice to the party that produced the
certified copy of an original document without protest by
the other side. If such an objection was raised before the
trial court, then the party concerned could have cured the
mode of proof by summoning the original copy of the
document. But such an opportunity may not be available
or possible at a later stage. Therefore, allowing such an
objection to be raised during the appellate stage would
put the party (who placed a certified copy on record
instead of an original copy) in jeopardy and would
seriously prejudice the interests of that party. It will also
be inconsistent with the rule of fair play as propounded
by Ashok Bhan, J. in R.V.E. Venkatachala [R.V.E.
Venkatachala Gounder v. Arulmigu Viswesaraswami & V.P.
Temple, (2003) 8 SCC 752].
43. It was held in Ronald Rao vs Dhanraj 2020 ACD 508=
AIROnline 2020 Bom 639 that when no objection was raised to
the memo of dishonour at the time of its exhibition, such an
objection cannot be taken in appeal. It was observed:
“6. It is true that Section 146 of the N.I. Act is included in
N.I. Act for the purpose of facilitating early disposal of the
case. It is also for the purpose of dispensing with the
attendance of the bank witnesses. The presumption under
Section 146 of the N.I. Act can be drawn if certain
formalities are completed. One is that the bank slip
should contain the official mark denoting that the cheque
has been dishonoured. This presumption is a rebuttable
presumption. The accused is at liberty to prove to the
contrary. The trial Court, more specifically in paragraphs
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under Section 146 of the N.I. Act. The trial Court has also
emphasised on failure of the complainant to examine the
bank witnesses.
.
7. It is true that Section 146 of the N.I. The Act contains a
special provision. But what I find is that the complainant
wants to rely more on the conduct of the accused than onthis presumption. I have perused the additional affidavit
as well as the cross-examination. On 07-10-2016, an
additional affidavit was recorded. The cheques, as well as
relevant cheque return memos, were exhibited. It is verywell true that at that time the accused had not objected. I
have also perused the cross-examination. Learned
Advocate Shri Anthony for the appellant brought to my
notice certain answers given by the complainant. Thecomplainant deposes that “he has intimated the accused
about bouncing of cheque on the telephone”. But I did not
find anywhere in the evidence that the accused pointed
out the lacunae in those memos. That is to say, it does not
bear the seal or signature of the banker. I do not find anysuggestion given that the complainant has not proved the
reason for the dishonour of cheques. Here, I find there is
some lapse on the part of the accused.
8. It is true that the trial under Section 138 of the N.I.Act is
quasi-criminal only. So I do not find any objection inconsidering the ratio laid down by the Hon’ble Apex Court
in the two above-referred judgments. In both these
judgments, the Hon’ble Apex Court has categorised thetypes of objections. One is about the inadmissibility of
documents, and the second is about how to prove the
documents. The Hon’ble Apex Court has also opined on
what will be the consequences if the objection is not taken
at the proper time and under which contingency it can be
taken later on. If there is an objection about the
inadmissibility of documents, the party is at liberty to
take such objection at that particular stage. The Hon’ble
Apex Court has observed that this cannot be the situation
wherein the objection pertained to the mode of proof.
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Hon’ble Apex Court insisted that the objection about the
mode of proof has to be taken at that juncture only.
It is true that there are two consequences for not taking
objection at that juncture. One is to prohibit the person.
from taking objection at the subsequent stage. The other
is the party relieved upon the documents is relieved from
taking further steps to prove that document. I think theratio laid down in these judgments applies to the facts of
this case.
9. It is very well true that while not taking the objection at
least on two occasions as referred above, the accused hasrelieved the complainant from proving those memos in
other way.”
44. It was held in Chandrabhan Sudam Sanap v. State of
Maharashtra, 2025 SCC OnLine SC 174 that when no objection
regarding the exhibition of computer-generated document was
taken before the Trial Court, such an objection cannot be taken
at the appellate stage. It was observed:
40. In Sonu @ Amar v. State of Haryana, (2017) 8 SCC 570,
(delivered on 18.07.2017), the following paragraphs, beingcrucial, are extracted hereinbelow: —
“30. In R.V.E. Venkatachala Gounder [R.V.E. Venkat-
achala Gounder v. Arulmigu Viswesaraswami & V.P.
Temple, (2003) 8 SCC 752], this Court held as follows :
(SCC p. 764, para 20)“20. … Ordinarily, an objection to the admissibility
of evidence should be taken when it is tendered and
not subsequently. The objections as to admissibility
of documents in evidence may be classified into two
classes : (i) an objection that the document which is
sought to be proved is [Ed. The matter between two
asterisks has been emphasised in the original.] it-
self inadmissible [Ed. The matter between two as-
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terisks has been emphasised in the original.] in evi-
dence; and (ii) where the objection does not dispute
the admissibility of the document in evidence but is
directed towards the [Ed. The matter between two.
asterisks has been emphasised in the original.]
mode of proof [Ed. The matter between two aster-
isks has been emphasised in the original.] allegingthe same to be irregular or insufficient. In the first
case, merely because a document has been marked
as “an exhibit”, an objection as to its admissibility
is not excluded and is available to be raised even ata later stage or even in appeal or revision. In the
latter case, the objection should be taken when the
evidence is tendered and once the document has
been admitted in evidence and marked as an ex-
hibit, the objection that it should not have been ad-
mitted in evidence or that the mode adopted for
proving the document is irregular cannot be al-
lowed to be raised at any stage subsequent to the
marking of the document as an exhibit. The latterproposition is a rule of fair play. The crucial test is
whether an objection, if taken at the appropriate
point of time, would have enabled the party tender-
ing the evidence to cure the defect and resort to
such mode of proof as would be regular. The omis-
sion to object becomes fatal because, by his failure,
the party entitled to object allows the party tender-
ing the evidence to act on an assumption that theopposite party is not serious about the mode of
proof. On the other hand, a prompt objection does
not prejudice the party tendering the evidence, for
two reasons: firstly, it enables the court to apply its
mind and pronounce its decision on the question of
admissibility then and there; and secondly, in the
event of finding of the court on the mode of proof
sought to be adopted going against the party ten-
dering the evidence, the opportunity of seeking in-
dulgence of the court for permitting a regular mode
or method of proof and thereby removing the ob-
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jection raised by the opposite party, is available to
the party leading the evidence. Such practice and
procedure are fair to both parties. Out of the two
types of objections referred to hereinabove, in the.
latter case, failure to raise a prompt and timely ob-
jection amounts to waiver of the necessity for in-
sisting on formal proof of a document, the docu-
ment itself which is sought to be proved being ad-
missible in evidence. In the first case, acquiescence
would be no bar to raising the objection in the su-
perior court.
31. It would be relevant to refer to another case decided
by this Court in P.C. Purushothama Reddiar v. S. Peru-
mal [P.C. Purushothama Reddiar v. S. Perumal, (1972) 1
SCC 9]. The earlier cases referred to are civil cases,while this case pertains to police reports being admit-
ted as evidence without objection during the trial. This
Court did not permit such an objection to be taken at
the appellate stage by holding that : (SCC p. 15, para
19)
“19. Before leaving this case, it is necessary to refer
to one of the contentions taken by Mr. Ramamurthi,learned counsel for the respondent. He contended
that the police reports referred to earlier are inad-
missible in evidence as the Head Constables who
covered those meetings have not been examined in
the case. Those reports were marked without any
objection. Hence, it is not open to the respondent
now to object to their admissibility.”
32. It is nobody’s case that CDRs, which are a form of
electronic record, are not inherently admissible in evi-
dence. The objection is that they were marked before
the trial court without a certificate as required by Sec-
tion 65-B(4). It is clear from the judgments referred to
supra that an objection relating to the mode or method
of proof has to be raised at the time of marking of the
document as an exhibit and not later. The crucial test,
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as affirmed by this Court, is whether the defect could
have been cured at the stage of marking the document.
Applying this test to the present case, if an objection
was taken to the CDRs being marked without a certifi-
.
cate, the Court could have given the prosecution an
opportunity to rectify the deficiency. It is also clear
from the above judgments that objections regarding
the admissibility of documents which are per se inad-
missible can be taken even at the appellate stage. Ad-
missibility of a document which is inherently inad-
missible is an issue which can be taken up at the ap-
pellate stage because it is a fundamental issue. The
mode or method of proof is procedural, and objec-
tions, if not taken at the trial, cannot be permitted at
the appellate stage. If the objections to the mode of
proof are permitted to be taken at the appellate stage
by a party, the other side does not have an opportunity
of rectifying the deficiencies. The learned Senior
Counsel for the State referred to statements under
Section 161 CrPC, 1973 as an example of documents
falling under the said category of inherently inadmis-
sible evidence. CDRs do not fall into the said category
of documents. We are satisfied that an objection that
CDRs are unreliable due to violation of the procedure
prescribed in Section 65-B(4) cannot be permitted to
be raised at this stage, as the objection relates to the
mode or method of proof.”
As rightly pointed out by Mr. Raja Thakare, learned Addi-
tional Solicitor General, it was held in Sonu (supra) that
objection about Section 65-B(4) of the Indian Evidence
Act, not being complied, cannot be taken at the appellate
stage since that will deny an opportunity for the prosecu-
tion or the opposite party to rectify the defect. It was also
held that the documents were not inherently inadmissible
in evidence.
45. In the present case, the objection relates to the mode
of proof and not to the admissibility. Once an objection was not
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raised regarding the admissibility of the document, it is
impermissible to raise such an objection during the present
.
proceedings. Hence, the submission on behalf of the
complainant has to be accepted as correct, that by not raising
the objection before the learned Trial Court, the accused has
waived the objection.
46. Reliance was also placed upon the judgment of V. Velu
(supra); however, para 21 of the judgment shows that the
complainant had filed an application for proving the memo of
dishonour. In the present case, no such application was filed,
and this judgment will not assist the complainant. In Guneet
Bhasin v. State (NCT of Delhi), 2022 SCC OnLine Del 3967, it was
held that the cheque return memo is not a document covered
under Section 4 of the Bankers’ Book Evidence Act and any
infirmity in the cheque return memo will not render the trial
illegal. It was observed:-
9. The cheque return memo is a memo informing the
payee’s banker and the payee about the dishonour of a
cheque. When the cheque is dishonoured, the drawee
bank immediately issues a cheque return memo to the
payee’s banker, mentioning the reason for non-payment.
The purpose of the cheque return memo is to give the
information of the holder of the cheque that his cheque
on presentation could not be encashed due to the variety
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of reasons as mentioned in the cheque return memo. As
per section 146 of the NI Act, the cheque return memo on
presentation presumed the fact of dishonour of the
cheque unless and until such fact is disapproved. Neither
.
section 138 nor section 146 of the NI Act has prescribed
any particular form of cheque return memo. Section 138
of the NI Act does not mandate any particular form of
cheque return memo, which is nothing but a mere
information given by the Banker of the due holder of a
cheque that the cheque has been returned as unpaid. If
the cheque return memo does not bear any official stamp
of the bank, it does not render the cheque return memo
invalid or illegal. The cheque return memo is not a
document which is not required to be covered under
section 4 of the Bankers’ Book (Evidence) Act, 1891. If
there is any infirmity in the cheque return memo, it does
not render the entire trial under section 138 of the NI Act
as nullity.
47. This judgment dealt with the quashing of the
complaint, and it left open for the complainant to prove the
document as per the law, as is apparent from the following
observations:
“10. The perusal of the alleged cheque return memo,
which is under challenge, reflects that the cheque bearing
no. 000192 dated 15.04.2019, amounting to Rs.
47,53,519/- could not be encashed due to the “account
blocked”. If it is presumed that there is any irregularity or
illegality in the format of the said cheque return memo, then
it can be addressed during the course of the trial. The
petitioner has not disputed the issuance of the cheque
under his signature and the dishonour of the cheque by
the concerned Banker.” (Emphasis supplied)::: Downloaded on – 11/07/2025 21:28:55 :::CIS
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48. In the present case, the Trial is over, and the cited
judgment will not apply to the present case. Further, this Court
.
is bound by the judgment of Rajinder Singh Verma (supra), and
cannot follow the judgment of the Delhi High Court.
49. It was submitted that the memo of dishonour was
issued by Punjab National Bank and not by HDFC Bank, the
banker of the accused. However, this will not make any
difference. It was laid down in Surendrapal Singh Chawla vs. State
of Gujarat and Ors. (14.07.2009 – GUJHC): MANU/GJ/0518/200940
that in core banking and online bank systems, any bank can
verify the record. Hence, the issuance of the cheque return
memo need not be by the banker of the accused. It was
observed:-
9. It appears from the above deposition that there exists a
system of ‘core-banking and on-line banking system’ bywhich it is very easy to verify on the day of presentation
of cheque issued from any corner of the country as to
whether there was any sufficient fund in the account of
the drawer of a cheque or not. The said version is proved
through the deposition of the Bank Officer, wherein he
has specifically stated that as per the online banking
system, the cheque in original is not required to be sent to
the concerned Branch from where it was issued because
of the core-banking and development of the computer
network system. Without sending the cheque to the
concerned Bank, the Branch in which the cheque is
presented can also verify as to whether sufficient funds::: Downloaded on – 11/07/2025 21:28:55 :::CIS
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2025:HHC:22352are available in the account of the drawer of the cheque or
not. In the present case, the cheque was issued by the
ICICI Bank, Kanpur Branch, and presented in the ICICI
Bank, Gandhinagar Branch, and because of the core.
banking system, Gandhinagar Branch, on verifying the
record, wrote the endorsement of ‘insufficient funds’. In
view of the above, non-examination of the Officer who
dealt with the cheque or non-production of the
counterfoil of pay-in-slip showing deposit of cheque
does not mean that the cheque was not presented to the
Bank, nor does it create any doubt in the mind of the
Court about the version given by the complainant. The
applicant, therefore, would not be entitled to any benefit
out of the afore-referred judgments relied on by the
learned Advocate for the applicant.
50. I respectfully agree with the judgment and hold that
the mere issuance of the memo of dishonour by the bank of the
complainant will not invalidate the same.
51. The complainant stated that he issued the notice
(Ex.CW1/D) to the accused. The receipt (Mark-A) was placed on
record. This receipt is a carbon copy and does not contain the
address of the accused. It only mentions the name and Varanasi
without giving the complete address. This document was also
not exhibited by examining a competent official from the courier
services. Therefore, this document was not legally proven and
could not have been relied upon.
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52. The judgment in Gimpex Private Limited (supra) deals
with the ingredients of the offence punishable under Section 138
.
of the NI Act. The judgments in N Paraeswaran Unni (supra), CC
Alavi Haji (supra), and M/s Ajeet Seed (supra) deal with the
presumption of service of notice. Judgments in Rohitbai Jivanlal
Patel (supra), Rajesh Jain, Budh Dev (supra), T Vasant Kumar,
Dattatraya (supra), Chunni Lal (supra), Muddasani Venkata
(supra) dealt with the presumption under Sections 118 (a) and
139 of the NI Act and the manner of its rebuttal. These are not
relevant for the adjudication of the controversy pending before
this Court.
53. In the present case, no evidence was produced before
the Court to show the true reason for the dishonour; therefore,
the complaint was not maintainable under Section 138 of the NI
Act, and was rightly dismissed by the learned Appellate Court.
This was a reasonable view which could have been taken based
on the material placed before the learned Appellate Court, and
no interference is required with the judgment passed by the
learned Appellate Court.
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54. In view of the above, the present appeal fails, and the
same is dismissed.
.
55. Records of the learned Courts below be sent back
forthwith, along with a copy of this judgment.
(Rakesh Kainthla)
Judge
11th July, 2025
(Chander)
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