Case Note & Summary
The case involves a criminal revision application filed by the accused against his conviction under Section 138 of the Negotiable Instruments Act, 1881. The complainant, Margarida Miranda, alleged that she had invested money with the accused, Mahesh Mehta HUF and Mahesh G. Mehta, and in discharge of that liability, the accused issued two cheques dated 30 September 1999 for Rs.12,000 and Rs.4,00,000 drawn on Global Trust Bank. Upon presentation, both cheques were dishonoured with the remark 'Refer to drawer' due to insufficient funds. The complainant issued a legal notice dated 10 January 2000 by registered post, which was returned undelivered as the accused declined to collect it despite intimation. The accused did not pay the amount within 15 days, leading to the complaint. The trial court convicted the accused, and the appellate court confirmed the conviction. In revision, the accused argued that the notice was not served and that the cheques were issued as a loan for the complainant's daughter's marriage, not in discharge of any liability. The High Court held that the notice sent by registered post was deemed served under Section 27 of the General Clauses Act, 1897, and the accused's evasive replies in his Section 313 CrPC statement and failure to raise the loan defence earlier meant he failed to rebut the presumption under Section 139 of the NI Act. The court dismissed the revision, upholding the conviction and sentence.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Service of Notice - Where a legal notice is sent by registered post and returned undelivered, the presumption of service under Section 27 of the General Clauses Act, 1897 applies, and the accused is deemed to have been served. The court held that the complainant had complied with the requirement of notice under Section 138 of the NI Act. (Paras 3, 6) B) Negotiable Instruments Act - Presumption of Legally Enforceable Debt - Section 139 - The presumption under Section 139 that the cheque was issued for a debt or liability is rebuttable. The accused's evasive replies in his Section 313 CrPC statement and failure to raise the defence of loan in cross-examination or in his statement under Section 313 CrPC led the court to hold that the accused failed to rebut the presumption. (Paras 4-5) C) Criminal Procedure Code - Examination of Accused - Section 313 - Evasive replies by the accused in his statement under Section 313 CrPC can be used against him. The court noted that the accused gave evasive replies and did not take the defence that the cheques were issued as a loan until he examined himself as a witness. (Para 4)
Issue of Consideration
Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 is sustainable when the legal notice was returned undelivered and the accused claimed the cheques were issued as a loan.
Final Decision
The High Court dismissed the criminal revision application and upheld the conviction and sentence imposed on the accused under Section 138 of the Negotiable Instruments Act, 1881.
Law Points
- Presumption of service of notice under Section 138 NI Act when sent by registered post and returned undelivered
- Evasive replies in Section 313 CrPC statement can be used against accused
- Burden on accused to rebut presumption of legally enforceable debt under Section 139 NI Act
