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REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL     APPEAL     NO.        605            OF     2012   (Arising out of SLP (Crl.) No.5761 of 2010)

Yogendra Pratap Singh …Appellant

Versus

Savitri Pandey & Anr.       …Respondents

J     U     D     G     M     E     N     T   

1. Leave granted.

2. This appeal assails an order passed by the High Court  

whereby it has allowed a petition under Section 482 of the Cr.P.C.  

and quashed the order passed by the Magistrate taking cognizance  

of an offence punishable under Section 138 of The Negotiable  

Instruments Act, 1881.  The following two questions arise for  

consideration:

(i) Can cognizance of an offence punishable under  

Section 138 of the Negotiable Instruments Act 1881 be  

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taken on the basis of a complaint filed before the expiry  

of the period of 15 days stipulated in the notice  

required to be served upon the drawer of the cheque in  

terms of Section 138 (c) of the Act aforementioned?  

And,  

(ii) If answer to question No.1 is in the negative, can  

the complainant be permitted to present the complaint  

again notwithstanding the fact that the period of one  

month stipulated under Section 142 (b) for the filing of  

such a complaint has expired?

3. The questions arise in the following factual backdrop:     

The appellant filed a complaint under Section 138 of the Negotiable  

Instruments Act against respondent No.1 Smt. Savitri Pandey in the  

Court of Additional Civil Judge (J.D.)/Magistrate, Sonbhadra in the  

State of Uttar Pradesh.  The respondent’s case was that four  

cheques issued by the accused-respondent in his favour were  

dishonoured, when presented for encashment. A notice calling upon  

the respondent-drawer of the cheque to pay the amount covered by  

the cheques was issued and duly served upon the respondent as  

required under Section 138 (c) of The Negotiable Instruments Act,  

1881. No payment was, however, made by the accused till 7th  

October, 2008 when a complaint under Section 138 of the Act  

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aforementioned was filed before the Magistrate. Significantly  

enough the notice in question having been served on 23rd  

September, 2008, the complaint presented on 7th October, 2008  

was filed before expiry of the stipulated period of 15 days. The  

Magistrate all the same took cognizance of the offence on 14th  

October, 2008 and issued summons to the accused, who then  

assailed the said order in a petition under Section 482 of the  

Cr.P.C. before the High Court of Judicature at Allahabad. The High  

court took the view that since the complaint had been filed within  

15 days of the service of the notice the same was clearly premature  

and the order passed by the Magistrate taking cognizance of the  

offence on the basis of such a complaint is legally bad. The High  

Court accordingly quashed the complaint and the entire  

proceedings relating thereto in terms of its order impugned in the  

present appeal.

4. We have heard learned counsel for the parties at some  

length.  Section 138 of the Negotiable Instrument Act, inter alia,  

provides:  

“where any cheque  drawn by a person on an account  maintained by him with a banker for payment of any  amount of money to another person from out of that  account for the discharge, in whole or in part, of any  debt or other liability, is returned by the bank unpaid,  either because of the amount of money standing to the  credit of that account is insufficient to honour the  cheque or that it exceeds the amount arranged to be  paid from that account by an agreement made with  that bank, such person shall be deemed to have  committed an offence and shall without prejudice to  

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any other provisions of this Act, be punished with  imprisonment for a term which may extend to two  year, or with fine which may extend to twice the  amount of the cheque, or with both.”

5. Proviso to Section 138, however, is all important and  

stipulates three distinct conditions precedent, which must be  

satisfied before the dishonour of a cheque can constitute an offence  

and become punishable.  The first     condition   is that the cheque  

ought to 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  

its validity, whichever is earlier. The second     condition   is that the  

payee or the holder in due course of the cheque, as the case may  

be, ought to make a demand for the payment of the said amount of  

money by giving a notice in writing, to the drawer of the cheque,  

within thirty days of the receipt of information by him from the  

bank regarding the return of the cheque as unpaid. The third  

condition is that the drawer of such a cheque should have failed to  

make payment of the said amount of money to the payee or as the  

case may be, to the holder in due course of the cheque within  

fifteen days of the receipt of the said notice. It is only upon the  

satisfaction of all the three conditions mentioned above and  

enumerated under the proviso to Section 138 as clauses (a), (b)  

and (c) thereof that an offence under Section 138 can be said to  

have been committed by the person issuing the cheque.

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6. Section 142 of the Negotiable Instruments Act governs taking  

of cognizance of the offence and starts with a non-obstante clause.  

It provides that no court shall take cognizance of any offence  

punishable under Section 138 except upon a complaint, in writing,  

made by the payee or, as the case may be, the holder in due  

course and such complaint is made within one month of the date on  

which the cause of action arises under clause (c) of the proviso to  

Section 138.  In terms of sub-section (c) to Section 142, no court  

inferior to that of a Metropolitan Magistrate or a Judicial Magistrate  

of the first class is competent to try any offence punishable under  

Section 138.  

7. A conjoint reading of Sections 138 and 142 makes it  

abundantly clear that  a complaint under Section 138 can be filed  

only after the  cause of action to do so accrues to the complainant  

in terms of clause (c) of the proviso to Section 138 which as  

noticed earlier happens only when the drawer of the cheque in  

question fails to make the payment of the cheque amount to the  

payee or the holder of the cheque within 15 days of the receipt of  

the notice required to be sent in terms of clause (b) to the proviso  

to Section 138.

8. The upshot of the above discussion is that a complaint filed in  

anticipation of the accrual of the cause of action under clause (c) of  

the proviso to Section 138 would be a premature complaint. The  

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complainant will have no legal justification to file such a complaint  

for the cause of action to do so would not accrue to him till such  

time the drawer of the cheque fails to pay the amount covered by  

the cheque within the stipulated period of 15 days from the date of  

the receipt of the notice.  It follows that on the date such a  

premature complaint is presented to the Magistrate the same can  

and ought to be dismissed as premature and hence not  

maintainable. That is, however, not what happened in the case at  

hand. In the present case, the Magistrate took cognizance of the  

offence on 14th October, 2008 by which time the stipulated period  

of 15 days had expired but no payment towards the cheque  

amount was made to the complainant even upto the date the  

cognizance was taken.  The commission of the offence was thus  

complete on the date cognizance was taken, but the complaint on  

the basis whereof the cognizance was taken remained premature.   

9. The question in the above backdrop is whether the  

subsequent development namely completion of the third  

requirement for the commission of an offence under Section 138  

could be taken note of for purposes of cognizance under Section  

142 of the Act. The complaint filed by the appellant was in our view  

plainly premature. The fact that subsequent to the filing of the  

complaint an offence under Section 138 had been committed was  

no reason for the court to ignore the fact that the complaint on the  

basis of which it was taking cognizance of the offence was not a  6

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valid complaint. We say so because Section 142 of the Negotiable  

Instruments Act forbids taking of cognizance of any offence  

punishable under Section 138 except upon a complaint, in writing,  

made by the payee or the holder of the cheque in due course.  

Such a complaint in order to be treated as a complaint within the  

contemplation of Section 142 ought to be a valid complaint. This in  

turn means that such a complaint must have been filed after the  

complainant had the cause of action to do so under clause (c) of  

the proviso to Section 138. A complaint, that is, premature was no  

complaint in the eyes of law and no cognizance could be taken on  

the basis thereof.

10. Having said that, we must refer to two decisions of this Court  

that were cited at the Bar by learned counsel for the parties in  

support of their respective submissions.  In Narsingh Das  

Tapadia v. Goverdhan Das Partani and Anr. (2000) 7 SCC  

183, a similar question arose before a two-Judge Bench of this  

Court. That was also a case where on the date the complaint was  

filed the complainant had no cause of action but by the time  

cognizance of the offence was taken by the Magistrate, the  

stipulated period of 15 days had expired and the commission of the  

offence was complete. This Court drew a distinction between  

“taking cognizance of an offence” and ”the filing of a complaint by  

the complainant”.  This Court held that while there was a bar to the  

taking of a cognizance by the Magistrate, there was no bar to the  7

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filing of a complaint and that a complaint filed even before the  

expiry of the period of 15 days could be made a basis for taking  

cognizance of the offence provided cognizance was taken after the  

expiry of the said period.  This Court observed:

“Mere presentation of the complaint in the court cannot  be held to mean that its cognizance had been taken by  the Magistrate. If the complaint is found to be  premature, it can await maturity or be returned to the  complainant for filing later and its mere presentation at  an earlier date need not necessarily render the  complaint liable to be dismissed or confer any right  upon the accused to absolve himself from the criminal  liability for the offence committed.”

11. The other decision pressed into service before us was also  

delivered by a two Judge Bench of this Court in Sarav Investment  

& Financial Consultancy Private Limited and Another v. Llyod  

Register of Shipping Indian Office Staff Provident Fund and  

Anr. (2007) 14 SCC 753. There this Court held that Section 138  

of the Negotiable Instruments Act contains a penal provision and  

creates a vicarious liability. Even the burden of proof to some  

extent is on the accused. Having regard to the purport of the said  

provision and the severe penalty sanctioned by it, the same  

warrants a strict construction.  The Court further held that service  

of a notice in terms of Section 138 proviso (b) of the Act is a part of  

the cause of action for lodging the complaint under Section 138 and  

that service of a notice under clause (b) of the proviso to Section  

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138 was an essential requirement to be complied with before a  

complaint could be filed.

The Court observed:

“16. Section 138 of the Act contains a penal provision.  It is a special statute. It creates a vicarious liability.  Even the burden of proof to some extent is on the  accused. Having regard to the purport of the said  provision as also in view of the fact that it provides for  a severe penalty, the provision warrants a strict  construction. Proviso appended to Section 138 contains  a non obstante clause. It provides that nothing  contained in the main provision shall apply unless the  requirements prescribed therein are complied with.  Service of notice is one of the statutory requirements  for initiation of a criminal proceeding. Such notice is  required to be given within 30 days of the receipt of the  information by the complainant from the bank  regarding the cheque as unpaid. Clause (c) provides  that the holder of the cheque must be given an  opportunity to pay the amount in question within 15  days of the receipt of the said notice. Complaint  petition, thus, can be filed for commission of an offence  by a drawee of a cheque only 15 days after service of  the notice. What are the requirements of service of a  notice is no longer res integra in view of the recent  decision of this Court in C.C. Alavi Haji v. Palapetty  Muhammed”

12. It follows that a complaint filed before the expiry of the  

stipulated period of 15 days was not a valid complaint for purposes  

of Section 142 of the Act.  To that extent, therefore, the view taken  

in the two decisions referred to above are at variance with each  

other. That apart, the decision in Narsingh Das Tapadia (supra)  

does not, in our opinion, correctly state the legal position and may  

require a fresh look by a larger Bench of this Court. The cleavage in  

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the judicial opinion on the question does not appear to be confined  

to the judgments of this Court alone.

13. Judicial opinion on the question is split even among the High  

Courts in the country. For instance, the High Court of Calcutta in  

Sandip Guha v. Saktipada Ghosh 2008 (3) CHN 214, High  

Court of Orissa in Niranjan Sahoo v. Utkal Sanitary, BBSR, [Crl.  

Misc. Case No.889 of 1996, decided on 13th February, 1998],  

High Court of Bombay in Rakesh Nemkumar Porwal v. Narayan  

Dhondu Joglekar and Anr. 1994 (3) Bom CR 355, High Court of  

Punjab and Haryana in Ashok Verma v. Ritesh Agro Pvt. Ltd.  

1995 (1) Bank CLR 103 and the High Court of Andhra Pradesh in  

N. Venkata Sivaram Prasad v. Rajeswari Constructions 1996  

Cri.L.J. 3409 (A.P.) have taken the view that a complaint filed  

within 15 days of the notice period was premature and hence liable  

to be quashed.   

14. The High Court of Allahabad on the other hand has taken a  

contrary view in Smt. Hem Lata Gupta v. State of U.P & Anr.  

2002 Cri.L.J. 1522 (All) and held that cognizance taken on the  

basis of a complaint filed within 15 days of the notice period was  

perfectly in order if such cognizance was taken after the expiry of  

the said period.  To the same effect are the decisions of High Court  

of Allahabad in Ganga Ram Singh v. State of U.P. & Ors. 2005  

Cri.L.J. 3681 (All), High Court of Gauhati in Yunus Khan v.  

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Mazhar Khan, [2004 (1) GLT 652], High Court of Rajasthan  

(Jaipur Bench) in Mahendra Agarwal v. Gopi Ram Mahajan,  

[RLW 2003 (1) Raj 673], High Court of Delhi in Zenith Fashions  

Makers (P) Ltd. v. Ultimate Fashion Makers Ltd. and Anr.,  

[121 (2005) DLT 297], High Court of Madhya Pradesh, Indore  

Bench in Bapulal v. Krapachand Jain, 2004 Cri.L.J. 1140, High  

Court of Himachal Pradesh in Rattan Chand v. Kanwar Ram  

Kripal and Anr. 2010 Cri.L.J. 706  and High Court of Madras in  

I.S.P. Solutions India (P) Ltd. and Ors. v. Kuppuraj, 2006  

Cri.L.J. 3711.

15. It is noteworthy that the same High Court has in certain cases  

taken different views on the subject. For instance the High Court of  

Jammu and Kashmir has in Harpreet Hosiery Rehari v. Nitu  

Mahajan, 2000 Cri.L.J. 3625 held that dismissal of complaint on  

ground of that the same is premature is valid; while in S. Janak  

Singh v. Pritpal Singh, 2007 (2) J.K. 91, it has held that  

cognizance taken on a complaint filed before expiry of 15 days of  

the notice, after the expiry of the said period is permissible. A  

similar difference of opinion can also be seen in two decisions of the  

Karnataka High Court in Ashok Hegde v. Jathin Attawan, 1997  

Cri.L.J. 3691 and Arun Hegde and Anr. v. M.J. Shetty, ILR  

2001 Kar 3295. The conflict in the judicial pronouncements  

referred to above, therefore, needs to be resolved authoritatively.  

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16. The second question formulated earlier may arise only in case  

the answer to the first question is in the negative.  If no cognizance  

could be taken on the basis of a complaint filed prematurely, the  

question would be whether such a complaint could be presented  

again after the expiry of 15 days and beyond the period of one  

month under the clause (b) of Section 142 of the Act. Whether or  

not the complainant can in a situation like the one in the case at  

hand invoke the proviso to clause (b) and whether or not this Court  

can and ought to invoke its power under Section 142 to permit the  

complainant to file a complaint even after the expiry of period of one  

month stipulated under Section 142 are incidental questions that  

may fall for determination while answering question no.2.  

17. In the light of the above, we deem it fit to refer the two  

questions formulated in the beginning of the judgment to a three-

Judge Bench of this Court.  The Registry shall place the file before  

the Chief Justice for constitution of an appropriate Bench.

……………………….……..……J. (T.S. THAKUR)

………………………….…..……J. (GYAN SUDHA MISRA)

New Delhi April 3, 2012

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