Section 138 of n.i. act
Guest
(Querist) 14 June 2014
This query is : Resolved
Respected Experts,
A shop keeper supplied goods worth Rs 10000/- and received a cheque of the same amount from buyer. On the invoice it was mentioned that dishonor of cheque would attract penalty of Rs 200/-.
Cheque got dishonoured on presentation due to insufficient funds. Buyer issued a fresh cheque of Rs 10000 + 200 (penalty as per invoice) = 10200/-.
The cheque of Rs 10200/- also gets dishonoured.
Please advise that can a complaint, after notice, be made of the cheque amount of Rs 10200/- which as per terms and conditions of the invoice the buyer was under legal liability to pay. The doubt is just because of amount of Rs 200/- included as penalty for dishonour of previous cheque.
Anirudh
(Expert) 14 June 2014
Yes, the complaint can be for the entire cheque amount of Rs. 10200/-
Sudhir Kumar, Advocate
(Expert) 14 June 2014
penalty clause of Rs 200 does not mean that all other provisions of law will not operate. 138 can be there 420 can also be there.
There was o need to issue fresh cheque only the old cheque could be presented again if the funds were sufficient subsequently. If funds were not sufficient then even second cheque is issued with intention to avoid payment.
Dr J C Vashista
(Expert) 14 June 2014
It will be for the cheque amount, i.e., 10,200/-
vinay kumar
(Expert) 14 June 2014
The question is whether buyer under obligations to pay 10k or 10.2k.. To answer your query, I will suggest to make the payment of 10.2k as full and final settlement as per the terms and condition to avoid unnecessary litigation..and if possible make this payment by draft or some direct payment mode...
Advocate. Arunagiri
(Expert) 14 June 2014
You have discarded the first cheque and issued the cheque for Rs.10200/-, which got bounced, Now you have to pay Rs.10200 only.
ajay sethi
(Expert) 14 June 2014
your legal expenses will be more than the dishonour cheque amount . complaint would be for Rs 10,200 only
Rajendra K Goyal
(Expert) 14 June 2014
The claim would be less than the cost incurred time wise and money wise if proceed legally.
However, you have a good case in your favor.
ABDUL RAZIQUE
(Expert) 14 June 2014
I hope author be satisfied with experts answer.
Guest
(Querist) 14 June 2014
Thanks to all Respected Experts for their valuable advise.
V R SHROFF
(Expert) 14 June 2014
aNS: CLAIM 10200/-; ISSUE NOTICE, FILE 138; DO NOT COMPROMISE, YOU WILL BE PAID WITH ALL EXPENSES IN COMPROMISE.
[37TH QUERY]
malipeddi jaggarao
(Expert) 14 June 2014
Once notice is issued, they may come for compromise. I agree with expert Mr.Shroff to initiate action. You can think filing criminal case or not later.
Biswanath Roy
(Expert) 15 June 2014
You are legally entitle for the payment of Rs.10,200/- against bounced cheque u/s.138 NI Act plus all legal costs.
Guest
(Querist) 15 June 2014
Thanks Respected Experts.
T. Kalaiselvan, Advocate
(Expert) 15 June 2014
The demand notice should be for the cheque amount only and not for the invoice amount. So issue notice accordingly.
Guest
(Querist) 15 June 2014
Thanks Mr. T. Kalaiselvan
Guest
(Querist) 17 June 2014
Thanks Makkad Sir
Hemant Agarwal
(Expert) 18 June 2014
CONTRARY TO ALL ABOVE, INTROSPECT ON THIS KEY POINTS:
1. Invoice amount = 10000/-
2. Hence u/s 138 parameters, "legally enforceable liability" amount = 10000/-
3. Statutory Taxes if applicable is on 10000/-, and this amount will also reflect in the Complainants Balance Sheet. Invoice Amount of 10200/- is false and unteneable under Law (Sales Tax, Service Tax, Income Tax, other laws)
4. Subsequently Complainant shows receipt of 10200/- against invoice amount of 10000/-.
5. 200/- levied as Penalty for "dishonour of cheque" envisages mutual "Consent for Cheque Dishonor" .OR. "Compensation for Cheque Dishonor", within the parameters of Contract Act, due to the printed Penalty condition on the Invoice.
6. Point no. 5, above also means that Complainant also consents to the fact that for each dishonor of cheque, the agreed Penalty of 200/- shall become payable, WITHOUT ATTRACTING ANY OTHER LEGAL ACTION. The Invoice Clause also means that Pay "cheque dishonor penalty" (200/-) for every cheque dishonor AND circumvent the cheque bounce parameter under N.I.Act.
7. Accused has options of successfully contesting N.I.Act case, pleading it as contravention of the terms of Invoice. This means Accused has a very ripe case to contest and falsify the component (10200/-) of "legally enforceable liability".
8. NOTE: Complaintant may have the cheque bounce case admitted for 10200/-. BUT at trial, the Invoice figure (10000/-) will indicate contrary amount of the "legally enforceable liability". Magistrate will have no jurisdiction to substantiate 10200/- as the "legally enforceable liability" against the invoice.
Keep Smiling .... Hemant Agarwal
http://hemantagarwal21.blogspot.in/?view=sidebar
Biswanath Roy
(Expert) 18 June 2014
I DIFFER WITH THE VIEWS OF MR. HEMANT AGARWAL. THE DISPUTE RELATES TO NEGOTIABLE INSTRUMENT ACT SO I REQUEST HIM TO LOOK AT THE PREAMBLES OF LAW AND PROPOSED BILL RELATED TO.
SOMADUTTA PUROHIT
(Expert) 18 June 2014
THE DEMAND NOTICE SHOULD BE ISSUED 1ST MENTIONING THE LIABILITY OF THE NOTICEE SEPARATELY OF RS.10,000/- & RS.200/-. I THINK THIS DISPUTE WILL BE SETTLED IN THE 1ST INSTANCE IT SELF WITH THE COST OF THE NOTICE.
THE ACCUSED DEFINITELY HAVE THAT MUCH OF COMMONSENSE THAT IF THERE SHALL BE ANY SUCH COMPLAINT WILL BE FILED HIS EXPENSES SHALL BE FAR MORE COMPARED TO THE AMOUNT OF LIABILITY.
WE SHOULD NOT GO TO THE DEPTH OF THE NI ACT, IN THIS CASE PARTICULARLY AS THE AMOUNT OF LIABILITY IS VERY LESS.
Raj Kumar Makkad
(Expert) 21 June 2014
I do agree with Sr. expert Biswanath Roy sir.
ABDUL RAZIQUE
(Expert) 21 June 2014
opinion of Biswanath sir is absolutely right.
Dr J C Vashista
(Expert) 22 June 2014
I agree the analytical approach of Mr. B N Roy ji.
prabhakar singh
(Expert) 22 June 2014
Oh yes! Correct.
And even if Mr. Agrawal finds a right clue on his own analogy the expression "legally enforceable liability" does not refer to amount of the cheque as it refers to enforcement of the right through court
of law.The jurisprudence is that a right never dies but right to enforce that right through process of court may be declared barred by legislation.
V R SHROFF
(Expert) 22 June 2014
CHEQUE WAS BOUNCED TWICE.
FOR First bounce, penalty of Rs. 200/- is accepted by buyer of goods, and amicably settled legally enforceable Liability of 10200/-[ accepted]
Second rebounce would hv liability of 10400/- if accepted.
Here it was not accepted, and 2nd offence with new cheque is clear cut Liability of 10200/- and will suceed in N.I Acxt. Accused have no valid defence..
Under the circumstances, I support views of
Mr. B N Roy ji., and supporting Experts e.g.Shri Rajkumarji, Dr, Shri Shigh ji, Shri Abdulji & all...
Hemant Agarwal
(Expert) 22 June 2014
MY PERCEPTIONS:
1. For Law purposes, a Cheque in itself (amount) is not a "Conclusive Proof" of a "Legally Enforceable Liability".
2. A cheque could be for any amount
3. A cheque could be given for any purposes (Bill, Gift, Donation, illegal Loan and so on .... ). Here a cheque CANNOT be taken for granted as given for a "Legally Enforceable Liability".
4. Conclusive Proof of a "Legally Enforceable Liability", is a supporting documentary evidences (eg. Bill of Purchase and so on.... ) AND not ONLY a cheque.
5. The amount of Cheque should be reflected in proper books of accounts, which in turn should substantiate and correspond to a "Legal Transaction" (eg. Bill of Purchase ).
6. Hence, the contention is hallucinating to assume that Cheque Amount itself MUST be construed as a "Legally Enforceable Liability".
7. In the present query, the bill is for 10,000/- and the FIRST cheque is for 10,000/- which for law purposes is a "Legally Enforceable Liability".
8. Even a partial payment cheque can be classified as a "Legally Enforceable Liability", subject to corresponding & relating "Legal Transaction" (eg. Bill of Purchase ), and accounting entries being supported.
9. In my perception, the second cheque for 10,200/- does not correspond to the "Legal Transaction" (eg. Bill of Purchase 10000/- ), and hence the second cheque does not qualify as a cheque amount for a "Legally Enforceable Liability".
10. The cheque amount for being a "Legally Enforceable Liability" has to be PROVED documentarily. There is nothing as "default", at the hands of the Complainant, subject to appropriate inclination of the Lawyer of the Accused.
Keep Smiling .... Hemant Agarwal
http://hemantagarwal21.blogspot.in/?view=sidebar
