WC Act or MV Act applicable
DK SHANKAR
(Querist) 09 January 2010
This query is : Resolved
One "X" borrowed a sum of Rs. 5,00,000/- from One "A" and deposited his documents of title. Later when "A" demanded payment for the debt "X" gave a cheque for Rs.5,50,000/- towards full satisfaction of the debt. When the cheque was presented for collection it was returned with an endorsement that "In sufficient Funds". Mr. "A" sent a statutory notice under Section 138 of N.I.Act demanding payment. "X" received the notice and sent a reply that he did not borrow the money he gave the documents to his relative "Y" for his bank loan and MR. "A" got the document from "Y" using rowdy elements, and now used the documents and cheque to unlawfully enrich, and "X" does not has a account in the bank and the cheque issued is not his Account. "X"'s relative "Y" is also one of the debtors to Mr."A". "Y" and his father one year back sent a letter admitting that Y borrowed the debt and debt of "X" also. "A" has sent a notice to the "X"'s bank that the chueque was returned for the reasons insufficent funds and not as signature differs? but x states that it is not his A/c. Bank sent a reply that the Account is a Company cheque and "Y" is the authorised person issuing the cheque. It is Now clear that both "X" and "Y" inorder to avoid their liablity "X" issued "Y's" cheque by puting "X" signature to cheated Mr."A". In the mean time 30 days lapsed and now shall i file a complaint against "X" eventhough the cheque was belong to "Y" A/c or file a cheating case under Sec 420 I.P.C against both X and Y. Advice me in this regard.
Dk Shankar
H. S. Thukral
(Expert) 10 January 2010
In my opinion no case under section 138 of NI Act shall lie against X. The cheque has not been issued from his account. The section 138 opens with that stipulation that the cheque should be drawn on account maintained by him. It can be a case of cheating under section 420 IPC beside a regular civil suit.
