LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Atul Sohoni   01 December 2021

Stale cheque

Suit for money recovery of stale cheques filed, court wrongly held that cheques firstly should be presented in bank for encashment, then thereafter one can file suit for recovery.

Is this finding is proper as per negotiable instrument act sec 64, 72, and 84? 

Is this is proper finding of court ?



Learning

 2 Replies

Anaita Vas   01 December 2021

According to Section 64 of The Negotiable Instruments Act, 1881, promissory notes, bills of exchange and cheques must be presented for payment to the maker, acceptor or drawee thereof respectively, by or on behalf of the holder as hereinafter provided.

According to Section 72 of The Negotiable Instruments Act, 1881, Presentment of cheque to charge drawer. —Subject to the provisions of section 84] a cheque must, in order to charge the drawer, be presented at the bank upon which it is drawn before the relation between the drawer and his banker has been altered to the prejudice of the drawer.

According to Section 84 of The Negotiable Instruments Act, 1881, where a cheque is not presented for payment within a reasonable time of its issue, and the drawer or person on whose account it is drawn had the right, at the time when presentment ought to have been made, as between himself and the banker, to have the cheque paid and suffers actual damage through the delay, he is discharged to the extent of such damage, that is to say, to the extent to which such drawer or person is a creditor of the banker to a large amount than he would have been if such cheque had been paid.

Have you presented the cheque in the bank for encashment? If yes then file another case stating that you've presented it. If no, then you need to what has been instructed by the court.

 

Regards,

Anaita Vas

 

Atul Sohoni   23 May 2023

As per section 76 c) of NI act no presentment is necessary if the drawer promises to pay, in my case defendant promises to pay and directed to intimate so he can arrange funds for encashment, on request also he not given consent to deposit 4 cheques out of 13 cheques. 

In Ishar Alloys vs. Jayswal Neco (2001) 3 SCC 609 Apex court held that Non presention of cheque to the drawee bak may absolve the person issuing the cheque of criminal liability U/s 138 Of NI Act but he may otherwise be liable to pay the cheque amount to the payee in a civil action initiated under the law. 

Upon this proposition the recovery suit for 4 stale chques required to be decreed. 


Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register