Case Note & Summary
The petitioners, Lalit Tarekar, Motiram Wasnik, and Rajesh Jaiswal, filed a criminal writ petition under Article 227 of the Constitution of India and Section 482 of the Code of Criminal Procedure, 1973, seeking quashing of the order dated 29.9.2008 passed by the Judicial Magistrate, First Class, Court No.2, Nagpur in Summary Criminal Case No.10475/2008. The Magistrate had issued process against the petitioners under Section 138 of the Negotiable Instruments Act, 1881 (N.I. Act) based on a complaint filed by the respondent, Mahadev Mohta. The dispute arose from a development agreement executed in June 2007 for the sale of agricultural land at Mouza Pipla, Nagpur, for a consideration of Rs.1,11,00,000. The respondent alleged that four postdated cheques were issued by the petitioners towards the consideration, but when presented, they were dishonoured due to stop payment instructions. The petitioners contended that they discovered the land was reserved for a National Park and therefore instructed their bank to stop payment. They also claimed that the demand notice under Section 138 was not properly served on them. The court examined the service of the demand notice and found that the complainant had not produced the postal acknowledgment or proved that the notice was sent to the correct address. The court held that proper service of the demand notice is a mandatory requirement under Section 138 of the N.I. Act, and without it, the offence is not made out. Consequently, the court quashed the order issuing process and the criminal proceedings against the petitioners.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Demand Notice - Proper Service - The court considered whether the demand notice was properly served on the accused. The complainant failed to prove service of notice as the postal acknowledgment was not produced and the notice was sent to an incorrect address. Held that without proper service of demand notice, the essential ingredient of Section 138 is not satisfied, and the process issued is liable to be quashed. (Paras 4-6)
Issue of Consideration
Whether the issuance of process under Section 138 of the Negotiable Instruments Act, 1881 can be sustained when the demand notice was not properly served on the accused.
Final Decision
The court allowed the petition and quashed the order dated 29.9.2008 issuing process against the petitioners in Summary Criminal Case No.10475/2008.
Law Points
- Section 138 Negotiable Instruments Act
- 1881
- demand notice
- proper service
- deemed service
- quashing of process
