Cause of action in case of dishonour of cheque on issue of n

cause of action in case of dishonour of cheque on issue of notice second time

If the decision in Sadanandan Bhadran’s case (supra) is correct, there is no option for the holder to defer institution of judicial proceedings even when he may like to do so for so simple and innocuous a reason as to extend certain accommodation to the drawer to arrange the payment of the amount. Apart from the fact that an interpretation which curtails the right of the parties to negotiate a possible settlement without prejudice to the right of holder to institute proceedings within the outer period of limitation stipulated by law should be avoided we see no reason why parties should, by a process of interpretation, be forced to launch complaints where they can or may like to defer such action for good and valid reasons. After all, neither the courts nor the parties stand to gain by institution of proceedings which may become unnecessary if cheque amount is paid by the drawer.

https://www.lawweb.in/2012/09/cause-of-action-in-case-of-dishonour-of.html

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4 Replies

R Trivedi (advocate.dma@gmail.com) 01 October 2012

Now the number of cases actually may go up and chances of compromise will be less.

Why because complainant will get fully frustrated depositing cheque again and again and giving notice again and again, and then finally will be in the mode... I will teach you the lesson....

-- The honorable Supreme Court must issue a solid guidelines to settle this case... majority such cases can be solved in a maximum of 5 dates.... instead of issuing proper guidelines, Supreme Court takes everything in adhoc manner.

-- There was a great order regarding compoundability even if the case is in front of Supreme Court, implementation of that order is not clear even to best of the judicial brains.

-- It is comedy that almost around a crore cases under S.138 are pending with trial courts and each case takes years. One simple guideline and 50% cases are out in a single day. That is regarding blank cheque issued years back as security. Blank cheque is not a cheque, a blank cheque leaf cannot be a security for anything, it is non mortgagable stuff, any writing on a blank cheque without consent is material alteration in US/UK law, our law is silent on this aspect as S.20 of NI Act is not applicable on cheques. Admitted Blank cheque without subsequent written consent or proved blank cheque, in both cases matter must end then and there. Atleast 50% cases will be off in a day.

But I feel Supreme Court wants government and Public to feel that they are overburdened, so that actual incompetence of trial courts can remain hidden.

My learned friend would know that matter regarding validity of SPA / GPA or competence of complainant go to High Courts and Supreme Courts again and again after prolonged trial.....this syndrome of going back to higher appellate court is called not learning by experience... why can't Supreme Court issue clear guidelines on this matter... atleast 10% cheque bounce cases will be off on a singel day.

The trial court does not understand the meaning of words Company, Partnership firm and proprietorship firm, despite thousands of order proprietorship firm is treated as company by many trial courts, another 5% cases will go off the radar in a day.

And finally it is our bread and butter that more cases come to the court so that already crowded lawyer community can get more business from helpless client, even if cheque is of Rs.10000, case must be fought.

(No disrespect to judiciary is meant by above statements, it is the bringing forward the sorry state of affairs at lower trial courts.)

LAXMINARAYAN - Sr Advocate. ( solve problems in criminal cases. lawproblems@gmail.com) 01 October 2012

Following is the extract from last para of actual SUPREME COURT judgment validating one than one notice thus over rulling earlier Judgement.

33. In the result, we overrule the decision in

Sadanandan Bhadran’s case (supra) and hold that

prosecution based upon second or successive dishonour of

the cheque is also permissible so long as the same satisfies

the requirements stipulated in the proviso to Section 138 of

the Negotiable Instruments Act. The reference is answered

accordingly. The appeals shall now be listed before the

regular Bench for hearing and disposal in light of the

observations made above.

………….………………….…..……….J.

………….………………….…..……….J.

(R.M. LODHA)

………….……………………..…….…J.

(T.S. THAKUR)

………….………………….…..……….J.

(ANIL R. DAVE

New DELHI dated September 26, 2012

Amit (Student) 01 October 2012

Suppose if in a current matter of 138, the notice of dishonourfor one cheque was previously given and then again the cheque was presented in the bank with some other cheques from the same party and all of them are dishonured becase of insufficiency of fund. After this a consolidated action for all of the cheques is initiated. However one of the Cheque is been quashed because of multiple cause of action. And the proceeding for other cheques is pending before the court.

In this matter my question is, on the basis of this recent judgment can we again claim for the amount of the cheque which was quased by the court? And what are the other probabilities in this matter?

Please advice.