Tuesday, March 31, 2020 | ePaper

Negotiable Instruments Act

Putting larger amount in cheque than actual liability is a fraud

  • Print
(From previous issue) :
11. For prosecuting a person for an offence under Section 138 of the Act, it is inevitable that the cheque is presented to the banker within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier. When a post-dated cheque is written or drawn, it is only a bill of exchange and so long the same remains a bill of exchange, the provisions of Section 138 are not applicable to the said instrument. The post-dated cheque becomes a cheque within the meaning of Section 138 of the Act on the date which is written thereon and the 6 months period has to be reckoned for the purposes of Proviso (a) to Section 138 of the Act from the said date.
12. The views of the Indian Supreme Court is that if a cheque is issued as an advance payment for purpose of the goods and for any reason purchase order is not carried out, the cheque cannot be said to have been drawn for an existing debt or liability and dishonour of such cheque does not amount to an offence under Section 138 of the Act. Drawing of a cheque in discharge of an existing or past adjudicated liability is sin aqua non for brining an offence under Section 138 of the Act. [ref. Indus Airways Pvt. Ltd., vs Magnum Aviation Pvt. Ltd., reported in 12 SCC 539]. That interpretation is not acceptable for us in view of the amendment of law mentioned above. The present position in view of the amendment of 2000 stood that once the loan was disbursed and installments have been taken due on the cheque as per the agreement, dishonour of such cheques would fall under Section 138 of the Act.
13. Section 138 of the Act has been incorporated with a specific object of making special provision to facilitate to prevent smooth functioning of any transaction between the drawer and the payee. The law relating to the Negotiable Instruments is the law relating to commercial world legislated to facilitate the activities in trade and commerce making the provision of giving sanctity to the instruments of credit which would be deemed to be converted into money and easily passable from one person to another. The offence under Section 138 of the Act is not a natural crime like hurt or murder. It is an offence created by a legal fiction in the statute. It is a civil liability, transformed into a criminal liability under restricted conditions by way of an amendment of the Act. Before amendment, offending acts referred to Section 138 of the Act constituted only a pure and civil liability.
Act is significant. The commencement of section stands with the words, 'where any cheque'. Those three words are of more significance, in particular, by reason of the user of the word 'any'-the first three words suggest that in fact for whatever reson if a cheque is drawn on an account maintained by him with a banker in favour of another person for whatever reason it may be, the liability under this provision cannot be avoided, if the same stands returned by the banker unpaid.  
15. Another important issue is issuance of a blank cheque without mentioning the date and amount will come within the definition on cheque or not. If the cheque is not drawn for a specified amount it would not fall within the definition of bill of exchange. Filling up amount portion and date are material. Any alteration without the consent of the party who issued the cheque rendered the same invalid. However, question of issuance of blank cheque and fraudulent insertion of larger amount than actual liabilities is a question of fact. Insertion of larger amount in blank cheque than actual liability is an ingredient of fraud which cannot be approved since fraud goes to the root of the transaction. Where there is an intention to deceive and means of the deceit to obtain an advantage there is fraud.
16. The High Court Division on an application under Section 561A of the Code of Criminal Procedure is not authorized to quash a proceeding adjudicating a disputed question of fact. Once issuance of cheque and signature thereon are found to be genuine, the court shall proceed with the proceeding. Question of fraud or fraudulent insertion can only be determined by recording and considering evidence by the trial Court after holding trial. However, if blank cheque is issued towards liability or as security, when the liability is proved, if the cheque is filled up and presented to the bank, the person who had drawn the cheque cannot avoid criminal liability.
17. In view of the aforesaid facts and circumstances our considered opinion is that the disputed question of fact as to the issuance of the cheque as 'security' or 'advance' or 'post dated' can only be decided upon recording evidence. Accordingly, we do not find any substances in the appeals and petitions.
Thus, all the appeals and petitions ate dismissed.
(Concluded)

More News For this Category

Transnational and organized crime in Bangladesh

Taimur Alam Khondaker :Bangladeshi men and women migrate willingly to Saudi Arabia, Bahrain, Kuwait, the United Arab Emirates (UAE), Qatar, Iraq, Lebanon, Malaysia, Liberia, and other countries for work, are

Appeal invalid against sentence unless 50pc cheque amount deposited

High Court Division (Criminal Appellate Jurisdiction) Md. Badruzzaman JAbdul Kader (Md) alias Karim …..……………….Convict-Appellant                     vs State…………opposite-Party Judgment June 13th, 2019 Negotiable Instruments Act (XXVI of 1881) Section 138ASince the

Steps in case failure of an investigating officer

Appellate Division :(Criminal) Syed Mahmud Hossain CJ Hasan Foez Siddique J Zinat Ara J Md Nuruzzaman J Anti-Corruption Commission (Duduk), represented by its Chairman, Dhaka ..............Petitioner vsMd Shafiul Alam

'Audi alteram parterm' should be adhered to before judgment

High Court Division :(Special Original Jurisdiction) Moyeenul Islam Chowdhury J Khandaker Diliruzzaman J Ruhul Amin Khan Lipton (Md) ……….Petitioner                      vs Rajdhani Unnayan Katripakkhya (RAJUK) Represented by its Chairman,

Retiree to get benefits as determined by the Syndicate

High Court Division  :(Special Original Jurisdiction) Gobinda Chandra Tagore JMohammad Ullah J Dr Md Zahed Uddin……Petitioner                     vsGovernment of Bangladesh represented by the Secretary, Ministry of Education, Bangladesh Secretariat,

Clerical or arithmetical mistake in Judgment may be corrected

High Court Division :(Civil Revisional Jurisdiction) Soumendra Sarker J  Rezia Khatun and others…………Plaintiff-Opposite-Party-Petitioners                      vs Jahangir Hossain and others.....DefendantPetitioner-Opposite-Parties.JudgmentNovember 30th, 2017 Code of Civil Procedure (V of 1908) Section 152 There

Mortgaged ejmali property can be sold to realize decretal amount

High Court Division :(Special Original Jurisdiction)JBM Hassan J Md Khairul Alam J Pubali Bank Limited…………..Petitioner                          vs Judge, Artha Rin Adalat, Cox's Bazar and others…Respondents.Judgment January 3rd, 2019  Artha Rin Adalat

Material evidence on record to be proved unanimously

High Court Division :(Criminal Appellate Jurisdiction) Obaidul Hassan JSM Kuddus Zaman JChitta Gain ………………    Accused-Appellant           vsState………..RespondentJudgment     May 20th. 2019Arms Act (XI of 1878)Section 19A        The informant, members

Causes of quashing a case

High Court Division :(Criminal Miscellaneous Jurisdiction) ANM Bashir Ullah J Mustafa Zaman Islam J    Farook (Md) alias Kazi Farook and others….Accused-Petitioners                  vsState………….Opposite-Party. Judgment October 16th, 2018 Code of

Court should not invoke its jurisdiction

High Court Division :(Special Original Jurisdiction)  Md Nazrul Islam Talukder JKM Hafizul Alam J Nurul Islam Moni……..Petitioner              vs Government of Bangladesh represented by the Secretary, Ministry of Law, Justice