Negotiable Instruments Act, 1881 | AD Cases

Negotiable Instruments Act [XXIV of 1881]

Section 6, 138, 141

We are of the view that the operation of section 138 of the Act, 1881 cannot be obstructed or, in any way, circumvented by the mere fact of filing of a suit by the drawer of the dishonoured cheque in civil Court whatever allegations may be in the plaint about the same and the relief prayed for therein, because such a device shall totally make the section itself nugatory. However, if a holder or the payee gets hold of a dishonoured cheque by fraudulent means or forgery, the drawer of the cheque shall have the liberty to take such defence during the trial. Consequently we find no reason to interfere with the impugned judgment and order passed by the High Court Division. This petition is dismissed. …Arif-Uz-Zaman(Md.) =VS= The State, (Criminal), 2020 (1) [8 LM (AD) 614]

Sections 79 & 80

Section 79 provides for interest when it is expressly made payable on a promissory note or a bill of exchange, and section 80 provides that the rate of interest would be 6% per annum, when no rate of interest is specified in the instrument. [Para-12J Sonali Bank Vs. M/S. Karnaphuli Works Ltd. 2 BLT (AD)-78

Section 118

Claim for recovery of money by Bank—Claim for recovery of money by a Banking Company whether can be decreed in the absence of any evidence as to actual payment of the amount—In view of the fact that title deeds were deposited with the bank along with all other usual documents, executed by the predecessor of the defendant Company .ind regular entries in the ledger and clean :ash book of the Bank in respect of the loan, the claim is established—There is also admission of the Managing Director of the defendant Company as to the liability to the Bank—Moreover there is presumption under he Negotiable instruments Act, Bankers Books of Evidence Act and Banking Companies Ordinance. Planters (Bangladesh) Ltd. Vs. Mahaluxmi Bank Limited and others 5BLD(AD)150.

Section 118,138

Dishonour of cheque,

Once there is admission of the execution of the cheque or the same is proved to have been executed, the presumption under section 118(a) of the Act is raised that it is supported by consideration. The category of “stop payment cheque” would be subject to rebuttal and hence it would be an offence only if the drawer of the cheque fails to discharge the burden of rebuttal. The accused person can prove the non-existence of a consideration by raising a probable defence. If the accused discharges the initial onus of prove showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the complainant. He will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to grant of relief on the basis of negotiable instrument . …Md. Abul Kaher Shahin Vs. Emran Rashid & anr., (Criminal), 14 SCOB [2020] AD 96

Sections 123A & 138

Crossed cheque–

The legislative mandate as used in clause (a) of sub-section (2) of section 123A of the Act, 1881 that when a cheque is crossed "account payee" shall cease to be negotiable means it cannot be negotiated or encashed with any other person except the person in whose favour the same was issued. To make it clearer, a crossed cheque "account payee" must be enchased through the account of the holder in whose favour it was issued. So, by no means, a crossed cheque "account payee" loses its character as a negotiable one within the meaning of section 138 of the Act, 1881. Moreover, section 138 of Act, 1881 which has defined "Negotiable instrument" has not made any distinction between crossed cheque "account payee" or cheque of other kind such as bearer cheque we ordinarily mean. Thus, we find that section 123A of the Act, in no way, creates any bar in proceeding with a case under section 138 of the Act, 1881. In other words, we do not see any nexus of section 123A with the proceedings to be initiated under section 138 of the Act. .....Sahab Uddin(Md.) =VS= The State, (Criminal), 2017 (2)– [3 LM (AD) 592]

Sections 123A and 138 - Crossed cheque.

The legislative mandate as used in clause (a) of sub-section (2) of section 123A of the Act, 1881 that when a cheque is crossed "account payee" shall cease to be negotiable means it cannot be negotiated or encashed with any other person except the person in whose favour the same was issued. To make it clearer, a crossed cheque "account payee" must be enchased through the account of the holder in whose favour it was issued. So, by no means, a crossed cheque "account payee" loses its character as a negotiable one within the meaning of section 138 of the Act, 1881. Moreover, section 13 of Act, 1881 which has defined "Negotiable instrument" has not made any distinction between crossed cheque "account payee" or cheque of other kind such as bearer cheque we ordinarily mean. Thus, we find that section 123A of the Act, in no way, creates any bar in proceeding with a case under section 138 of the Act, 1881. In other words, we do not see any nexus of section 123A with the proceedings to be initiated under section 138 of the Act. Md. Sahab Uddin -Vs. The State 3 ALR(2014)(1)(AD) 111

Section 138-Stop Payment-Since the cheques were returned by bank with the endorsement "payment stopped by the drawer" it is to be presumed that those were returned unpaid because the amount of money standing to the credit of that account was insufficient to honour of the cheque as envisaged in section 138 of the Act. Of course this is a rebuttable presumption. The defence can be considered at the time of holding trial and not in an application under section 561A of the Code. SM Redwan vs Md Rezaul Islam, 66 DLR (AD) 169

Section 138

There is no provision in the Negotiable Instruments Act or in any other law which stipulates that a drawer of a negotiable instrument cannot re-validate it. It is always open to a drawer to voluntarily revalidate a negotiable instrument, including a cheque.

AIR 2002 SC page 38- Veera Expert Vs T. Kalavathy

Section 138-Whether the Court shall examine the authenticity of the cheque only or it shall examine and consider the bonafide of the claim of the complainant and the defence case appeared in mate- rials available on record.

Chapter XXIII of the Code of Criminal Procedure consisting of sections 265A to 265L deal with the procedure to be followed when the case is tried. Those provisions cast a duty upon the Sessions Judge to apply his judicial mind in considering the materials and evidence adduced by the prosecution in order to come to a decision whether charge framed against accused person is proved or not. If after recording evidence and on perusal of the same and hearing the parties the Sessions Court considers that the evidence adduced by the prosecution are not sufficient and reliable to convict the accused, the Court shall record order of acquittal under section 265H of the Criminal Procedure Code. Since the case under section 138 of the Act is Sessions triable case, the trial Judge shall follow the aforesaid provisions of the Code of Criminal Procedure for holding trial. Md. Abul Kaher Vs. Emran Rashid and another (Criminal) 19 ALR (AD) 56-64

Section 138(IA) (c) -The notice has been served in the 'Daily Sangram' newspaper which is not a National Newspaper having wide circulation and whether is a violation of the provision as laid down under section 138(1A)(c).

The High Court Division held that whether a notice has been published in a daily Bangla National Newspaper having wide circulation or not is obviously a mat- ter of fact and can be decided on merit after taking evidence by the trial court. If a daily national newspaper is very much available in around the area where the accused usually resides or having business can be said to have wide circulation. However since this is absolutely a discretion of the trial court to determine the question about the wide circulation of the daily newspaper, High Court Division is of the view that this question of fact is out of the ambit of juris- diction under section 561A of the Code of Criminal Procedure, and can not be quashed. Mohammad Hasan Vs. The State and other (Criminal) 7 ALR (AD) 129- 132

Section 138 read with

Code of Criminal Procedure [V of 1898]

Sections 439A, 439 (1), 423, 426,427 and 428

Keeping in mind the sentencing principles let the Appellate Division consider whether the High Court Division is justified in enhancing the sentences of fine suo moto in the absence of filing revision petitions by the complainant. The petitioner was convicted in the cases pursuant to complaints made by the complainant. Section 417A empowers the complainant to prefer appeal to the appellate court against the sentence on the ground of its in adequacy. Sub- section (3) of Section 417A provides that when an appeal has been filed against sentence on the ground of its inadequacy, the appellate court shall not enhance the sentence except after giving to the accused reasonable opportunity of showing cause against such enhancement. The similar principle will be applicable in cases of inadequacy or reduction of sentence passed by the appellate Court in view of section 439(1) of the Code of Criminal Procedure (the Code) under which provision, the revisional court has been given all the powers conferred on a court of appeal by sections 423, 426, 427 and 428 of the Code. [আপীল আদালত দন্ডপ্রাপ্ত ব্যক্তিকে কারন দশানোর সুযোগ ব্যতিত সাজার মেয়াদ বর্ধিত করিবে না।] Shahidur Rahman Khadem-Vs-The State and others 6 ALR (AD) 2015 (2)218

Section 138- An offence under section 138 of the Negotiable Instruments Act is not compoundable, it being a special law. The ends of Justice will be sufficiently met if the sentence of the petitioner is reduced to imprisonment for the period already undergone by him in prison, and the sentence of fine is set aside. Md. Idris Chowkder Vs. The State 5 ALR (AD)2015(1) 83

Section 138- Section 138(1) empowers the trial Court to punish with imprisonment for a maximum period of one year, or with fine which may extend to thrice the amount of the cheque or both. The powers given to the Court is discretionary. The language used in the section is not such that the Court must impose fine thrice the amount of the cheque. The legislature has left the matter to the discretion of the trial Court. Shahidur Rahman Khadem -Vs.- The State 5 ALR (AD)2015(1) 144

Section 138 The allegations of bouncing of cheque simpliciter does not ipso facto constitute any offence as defined under section 115 of the Penal Code punishable under section 420 of the Penal Code and as such, framing of charge against the appellant under section 420 of the Penal Code suffered from serious illegality. M. A. Sukkur -Vs. Md. Zahirul Haque and another 5 ALR (AD)2015(1) 27

Sections 138 and 141(b)- Criminal proceeding should not be stifled before trial, when there is a prima facie case for going to the trial.

There was no violation of section 141(b) of the Negotiable Instrument Act. The High Court Division further found that the law is now settled on the point that a criminal proceeding should not be stifled before trial, when there is a prima facie case for going to the trial. M.K. Bazlur Rahman -Vs.- Md. Johurul Haque 3 ALR(2014)(1)(AD) 107

Section-138 Punishment for dishonour of cheque due to insufficiency of fund etc.

Dishonour of cheque by the bank due to fraudulent action of the drawer clearly brings him within the mischief of the offence u/s 138 of the Negotiable Instruments Act, 1881. 'Stopping of payment' by the drawer with oblique motive also brings him within the mischief of section 138 of the Act, although the drawer has the right to stop payment on genuine grounds. S.M. Redwan Vs. Md. Rezaul Islam and others 3ALR(2014)(1)(AD)62

Section 138 read with Penal Code [XLV of 1860]

Section 420-The ingredients of sec- tion 138(1) of the Negotiable Instruments Act were not present in the case. The High Court Division observed that the account on which the cheque was drawn was not maintained in the name of the accused-petitioner, rather it was main- tained in the name of her husband and that the cheque was not bounced because of insufficiency of fund.

The Appellate Division held that the High Court Division observed also that the facts and circumstances of the case prima facie showed that there were ingredients of cheating against both the accused-petitioner and her husband and that in view of the matter the complainant may initiate a criminal proceeding against them under section 420 of the Penal Code and may also go to the civil court to recover his loan amount of Tk. 30 lac by filing a money suit against the accused and her husband. Ap- pellate Division finds no reason to interfere with the above findings and decision of the High Court Division. Al-haj Abdun Nabi Ledu @ Abdun Nabi -Vs.- Shahnaj Begum Sumi Begum and another (Criminal) 10 ALR (AD) 267-268

Section 138-The convict respondent admitted about the loan, issuance of cheques by him and dishonour of cheques and that a notice under section 138(1)(b) has been given by the complainant. Thus, all the legal requirements are present to bring the offence under section 138 of the Negotiable Instruments Act. Amir Hossain vs MA Malek and others 56 DLR (AD) 146.

Section 138-Under section 138 of the Negotiable Instruments Act an offence is commit- ted if a cheque is dishonoured and if payment is not made within 15 days after receipt of a legal notice. It is a settled law that criminal proceeding can be proceeded independently of the civil suit. Monzur Alam vs State 55 DLR (AD) 62.

Section 138-Since the date of receipt is a question of fact to be ascertained at the time of trial non-disclosure of such fact in the complaint petition cannot render the proceeding liable to be quashed to the great prejudice of the complainant who is entitled to prove his case on evidence. Nizamuddin Mahmood vs Abdul Hamid Bhuiyan 60 DLR (AD) 195.

Sections 138 and 141-Taking of cogni- sance upon the petition of complaint filed by the Attorney upon due examination under section 200 of the Code of Criminal Procedure is "perfectly valid and appropriate". Hashibul Bashar vs Gulzar Rahman 56 DLR (AD) 17.

Section 138-Dishonour of a cheque may also be an offence not only under sec- tion 138 of the Negotiable Instruments Act but also under section 420 of the Penal Code. To constitute an offence punishable under section 138 an initial intention of cheating need not be established. It is sine qua non for an offence punishable under section 420 of Penal Code.

The Appellate Division held that disho- nour of a cheque may also be an offence not only under section 138 of the Negotia- ble Instruments Act but also under section 420 of the Penal Code. To constitute an of- fence punishable under section 138 an ini- tial intention of cheating need not be estab- lished. It is sine qua non for an offence pu- nishable under section 420 of Penal Code. The following are the essential ingredients of an offence under section 420 of the Penal Code:

(a) there should be fraudulent or dishon- est inducement of a person by de- ceiving him;

(b) the person so induced should be intentionally induced to deliver any property to any person or to consent that any person shall retain any property, or (c) the person so induced to do anything which he would not do or omit if he were not so deceived, and

(d) in cases covered by second part of clause (a), the act or omission should be one which caused or was likely to cause damage or harm to the person induced in body, mind or property.

For an offence of cheating there must be dishonest or fraudulent misrepresentation, that is to say, deception and inducement of the person deceived to part with the property must be established.

Md. Motaleb Hossain: Vs. Abdul Ha- que Limon and another: (Criminal) 11 ALR (AD) 105-110

Section 138-Whether the High Court Division in exercising its inherent power under section 561A of the Code can award cost to any of the party of the proceedings, particularly, the accused while discharging the Rule issued for quashing a criminal proceeding or not.

The Appellate Division held that there is nothing to authorize the High Court Divi- sion or any criminal Court to award costs in a criminal case against the accused or the informant/complainant as the case may be. Khondker Latifur Rahman Vs. The State, represented by the Deputy Com- missioner, Chittagong and another (Criminal) 12 ALR (AD) 6-11

Section 138- Since the entire amount as mentioned in the cheque has been deposited, the Appellate Division inclined to reduce the sentence of the pe- titioner. Accordingly, this review peti- tion is disposed of and the judgment and order dated 18.01.2018 passed in Criminal Petition for leave to Appeal No. 554 of 2017 is set aside.

The Appellate Division held that admit- tedly, the petitioner has deposited 50% of the amount mentioned in the cheque at the time of preferring the appeal in the trial Court and that he deposited the balance amount of the cheque amounting to Tk. 700,000/- by challan No. 146 of 20.02.2018. The fine of depositing Tk. 50,000/- to the treasury of the Government is exempted. Since the entire amount as mentioned in the cheque has been depo- sited, the Appellate Division inclined to reduce the sentence of the petitioner. Ac- cordingly, this review petition is disposed of and the judgment and order dated 18.01.2018 passed in Criminal Petition for leave to Appeal No. 554 of 2017 is set aside. The judgment and order dated 08.11.2015 passed by the High Court Divi- sion is modified and sentence of imprison- ment imposed upon the petitioner is re- duced to the period he has already under- gone in jail custody. Abdul Jalil. -Vs. The State and others. (Criminal) 13 ALR (AD) 175-176

Section 138 and 140
View of Indian Supreme Court about impleading the Director/s of the Company in a case under Section 138 read with 140 NI Act.
From a plain reading of all the cases referred to from the Indian jurisdiction, it is our understanding that in the cited cases there was no dispute about commission of an offence under Section 138 of the NI Act by the company and its director/s. So, in the cited cases, offence was there, the offenders were there and the offenders were named as the company and its BoD. But the Indian Supreme Court took the view that unless the complainant makes any averment about the responsibility of the director in the transaction in question, no cognizance is to be taken and no summon/warrant to be issued against the said director. In other words, the Indian Supreme Court laid down a principle that for taking cognizance of an offence under Sections 138 & 140 of the NI Act against a director of a company, there must be a specific allegation in the complaint-petition against a director specifying the accused-director’s nature of responsibility and duties in the said company. Engineer Sirajul Islam and another -Vs.- The State and another (Criminal) 2019 ALR (HCD) Online 230.

ধারা ১৩৮ এবং ১৪০
ধারা ১৩৮ এবং ১৪০ এনআই আইনের অধীনে মামলায় কোম্পানির পরিচালক/পরিচালকদের অন্তর্ভুক্ত করার বিষয়ে ভারতীয় সুপ্রিম কোর্টের মতামত।
ভারতীয় অধিক্ষেত্র থেকে উল্লেখিত মামলাগুলোর সরল পাঠ থেকে আমাদের বোঝা যায় যে, উল্লেখিত মামলাগুলোতে কোম্পানি এবং এর পরিচালক/পরিচালকদের দ্বারা এনআই আইনের ধারা ১৩৮ এর অধীনে অপরাধ সংঘটনের বিষয়ে কোনো বিতর্ক ছিল না। অর্থাৎ, উল্লেখিত মামলাগুলোতে অপরাধ ছিল, অপরাধীরা ছিল এবং অপরাধীদের নাম কোম্পানি এবং এর পরিচালনা পর্ষদ হিসেবে উল্লেখ করা হয়েছিল। তবে, ভারতীয় সুপ্রিম কোর্ট এই মত গ্রহণ করেছেন যে, অভিযোগকারী যদি সংশ্লিষ্ট লেনদেনের ক্ষেত্রে পরিচালকের দায়িত্ব সম্পর্কে কোনো বক্তব্য প্রদান না করেন, তবে কোনো বিচারগ্রহণ করা হবে না এবং সংশ্লিষ্ট পরিচালকের বিরুদ্ধে কোনো সমন/ওয়ারেন্ট জারি করা হবে না। অন্য কথায়, ভারতীয় সুপ্রিম কোর্ট একটি নীতিমালা প্রতিষ্ঠা করেছেন যে, একটি কোম্পানির পরিচালকের বিরুদ্ধে ধারা ১৩৮ এবং ১৪০ এনআই আইনের অধীনে অপরাধের বিচারগ্রহণ করতে হলে, অভিযোগপত্রে নির্দিষ্ট অভিযোগ থাকতে হবে যেখানে অভিযুক্ত পরিচালকের দায়িত্ব এবং কর্তব্যের প্রকৃতি স্পষ্টভাবে উল্লেখ থাকবে। ইঞ্জিনিয়ার সিরাজুল ইসলাম এবং অন্যজন বনাম রাষ্ট্র এবং অন্যজন (ক্রিমিনাল) ২০১৯ ALR (HCD) Online 230.

Section 138-Under section 138 of Negotiable instruments Act, 1881. After examination of P.W.1. the accused prayed for recalling the P.W.1 for cross examination. These facts prove that the respondent has been adopting dilatory tactics.

The Appellate Division observed that the trial court has completed the cross examination of the P.W.1 on 13-03-2014 and the- reafter, the case was fixed for examination of the accused under section 342 of Criminal Procedure Code. These facts prove that the respondent has been adopting dilatory tactics. The High Court Division did not apply its judicial mind in staying the pro- ceeding. The rule itself is not maintainable. Accordingly, the rule is discharged. The trial court is directed to complete the trial within 1 (one) month from the date of re- ceipt of the order. Borak Real Estate (Pvt. Ltd. -Vs.- Mr. Arifur Rahman and another (Criminal) 8 ALR (AD) 153-154

Sections 138(a) and 141 (b) read with General Clauses Act [X of 1897]

Section 9- Whether it is within six months from the date on which the che- que is drawn as provided in clause (a) of the proviso to section 138(1) or within thirty days of receipt of the information by the drawee from his bank regarding the return of the cheque unpaid?

The Appellate Division held that the dis- cretion is given to the drawee to present the cheque for encashment either on the day it was issued or within six months from the date on which it was issued. One of the conditions precedent to a prosecution under section 138 is that the payee or the holder in due course of the cheque must give a demand notice in writing to the drawer of the cheque. Clause (b) of section 138(1) fixes time-limit for giving such a notice providing that the said notice is to be given within thirty days of the receipt of infor- mation by him from the bank regarding the return of the cheque unpaid. Md. Motaleb Hossain: Vs.- Abdul Ha- que Limon and another: (Criminal) 11 ALR (AD) 105-110

Sections 138(a) and 141 (b) -A cheque can be presented any number of times to the bank within the period of its validity.

The Appellate Division held that Clause (a) to the proviso to section 138(1) does not put any embargo upon the payee to succes- sively present a dishonoured cheque during the period of its validity. It is the option of the payee to proceed with the next step or to negotiate with the drawer for payment. If the drawer assures him to present it in the next month, he may wait till he makes ar- rangement to honour the cheque. He may present the cheque on repeated occasions on the request of the drawer until the period of six months from the date of its issuance or within the period of its validity expires. On each occasion of dishonour of the cheque as per assurance of the drawer a distinct cause of action in respect of an of- fence punishable under the Penal Code will arise for intentional inducement and de- ception other than the one punishable under section 138(1). The cause of action for an offence punishable under sub-section (1) of section 138 will arise if the drawer fails to make payment within thirty days of the re- ceipt of notice under clause (b) of the pro- viso to section 138(1). And the drawee must file the criminal case within one month of the date on which the cause of action arises. Md. Motaleb Hossain: Vs. Abdul Ha- que Limon and another: (Criminal) 11 ALR (AD) 105-110

Sections 138 and 141 read with Cr. PC

Section 417-This is to be noted that in clauses (b) and (c) of the proviso to sub- section (1) of section 138, a period of 'thirty days' have been mentioned in both counts but in clause (b) of section 138(1) the period of one month has been men- tioned which is also significant. In the ear- lier case the period should be counted on days and in the latter case the period one month shall be counted according to calen- dar. Sections 138 and 141 are special laws similar to section 417 of the Code of Criminal Procedure which is also a special law and other provisions of the Code of Criminal Procedure are general law. Md. Motaleb Hossain: Vs. Abdul Ha- que Limon and another: (Criminal) 11 ALR (AD) 105-110

Sections 138, 140 and section 141

Section 141 (b) cannot take away the substantive right accruing to the beneficiary of a cheque to prosecute any number of subsequent presentation of the cheque on its dishonour. Similarly, each dishonour will give rise to a concomitant right to serve notice under proviso (b) to section 138 (1) of the Act and demand payment, failing which the bearer of the cheque will have the right to make a complaint in writing in accordance with section 141 (a) of the Act–

Section 138(1) and section 141(b). Sections 138 and 140 of the Act are substantive provisions of law giving details of the offence, when the offence is committed and who is liable; section 141 of the Act describes the procedure to be followed.

That the second and subsequent presentation of the cheque must be within six months from the date on which the cheque was drawn in order to be able to prosecute the drawer of the cheque criminally under section 138 of the Act. Upon subsequent presentation of the cheque for payment, if it is again dishonoured another opportunity will accrue to the beneficiary to take action as provided under section 138(1) of the Act, and again, in accordance with the provisions of section 141, the beneficiary of the cheque will be obliged to make complaint against such subsequent dishonour within a period of one month from the cause of action arising under proviso (c) to section 138 (1) of the Act. The offence is committed each time the cheque is dishonoured on presentation for payment.

The procedural limitation provided in section 141 (b) cannot take away the substantive right accruing to the beneficiary of a cheque to prosecute any number of subsequent presentation of the cheque on its dishonour. Similarly, each dishonour will give rise to a concomitant right to serve notice under proviso (b) to section 138 (1) of the Act and demand payment, failing which the bearer of the cheque will have the right to make a complaint in writing in accordance with section 141 (a) of the Act. It will be entirely up to the bearer of the cheque to proceed in respect of any particular dishonour of the cheque. …Nizam Uddin Mahmud Hossain =VS= The State, (Criminal), 2019 (2) [7 LM (AD) 259]

Section 138

Where the amount promised shall depend on some other complementary facts or fulfillment of another promise and if any cheque is issued on that basis, but that promise is not fulfilled it will not create any obligation on the part of the drawer of the cheque. As such dishonesty or fraud cannot be attributed to the respondent in giving stop payment instructions– The High Court Division being last court of facts upon elaborate consideration of the evidence both the oral and documentary has come to the conclusion that the complainant failed to take any step to sell the property of the respondent, rather the respondent and his brother and sister sold the said property to the U.S.A. Embassy and the complainant did not help the respondent in any way in that regard.

In his cross examination the complainant has said, "শর্তে উল্লেখ আছে বাজার মূল্যে ক্রেতা আনিতে পারিলে আমি (বাদী) কমিশন পাব।" There is no such averment, in the petition of complaint or in the evidence that the complainant has stated that he had brought any purchaser who offered market price of the property. From the evidence quoted above it appears that the condition under which the cheques were issued was not fulfilled by the complainant appellant. Thus, the respondent instructed the bank not to encash the impugned cheques. Accordingly, the bank returned the cheques with endorsement, “payment stopped by the drawer”. Where the amount promised shall depend on some other complementary facts or fulfillment of another promise and if any cheque is issued on that basis, but that promise is not fulfilled it will not create any obligation on the part of the drawer of the cheque or any right which can be claimed by the holder of the cheque. As such dishonesty or fraud cannot be attributed to the respondent in giving stop payment instructions. Consequently, the question of committing an offence by the accused respondent punishable under section 138 of the Act does not arise. All the appeals are dismissed. ...Abul Kaher Shahin(Md.) =VS= Emran Rashid, (Criminal), 2020 [9 LM (AD) 338]

Section 138

The Negotiable Instrument Act, 1881

Section 138

Artha Rin Adalat Ain, 2003

Section 6

Civil and criminal cases shall proceed in accordance with law– The final conclusion of the High Court Division is contradictory to several decisions of this Division wherein it has been clearly held that the pendency of a civil suit will not hinder proceeding of a criminal case and vice versa. In this regard, reference may be made to the cases of Monzur Alam (Md) vs State, 55 DLR (AD) 62, SAB Solaiman Ali vs Rangs Industries Limited, 2004 1 Law Guardian (AD) 20.

We are constrained to hold that the impugned judgements and orders of the High Court Division are palpably erroneous set aside. Accordingly, the criminal petitions for leave to appeal are disposed of with direction that both civil and criminal cases shall proceed in accordance with law. ...Eastern Bank Limited =VS= Sirajuddula(Md), (Criminal), 2020 [9 LM (AD) 566]

Sections 138, 141(b)

The Negotiable Instruments Act, 1881 (Amendment Act 1994)

Sections 138, 141(b)

The Code of Criminal Procedure, 1898

Sections 561A

It is the argument of the appellant that on the complainant’s own case the appellant must be fixed with notice for payment at least from 4-1-96 and after the expiry of 15 days from that date, i.e., from 19-1-96, the cause of action should be taken to have arisen due to non-payment within the said period and the complaint was required to be filed within one month from the said date (19-1-96) in compliance with clause(b) of section 141. Admittedly the petition of complaint was filed long after that date i.e., on 18-4-96 and thus cognizance could not be taken upon such complaint. Unfortunately, the High Court Division failed to appreciate this simple point raised before it and wrongly rejected the application for quashing summarily under a misconception. For the reasons this appeal is allowed and the impugned proceeding is quashed. .....SM Anwar Hossain =VS= Md. Shafiul Alam (Chand) , (Criminal), 2022(1) [12 LM (AD) 617]

Section 138

On the contrary Appellate Division reiterates that if any cheque is presented to the Bank twice or on many more times, within six months from the date it was drawn, computation of the period for prosecution under section 138 of the Negotiable Instrument Act should be done from which the cheque is lastly returned. .....Nizam Uddin Mahmood =VS= Abdul Hamid Bhuiyan, (Criminal), 2022(1) [12 LM (AD) 655]

Section 138

Non disclosure of the date as to receipt of notice by the accused and failure to mention any legal cause of action in the petition of complaint, so the proceeding cannot be allowed to continue and as such it is liable to be quashed– After considering the facts and circumstances and the law on the point Appellate Division finds substance in the submissions made on behalf of the respondent. In view of the non disclosure of the date as to receipt of notice by the accused and failure to mention any legal cause of action in the petition of complaint, this Division is of the view that the proceeding cannot be allowed to continue and as such it is liable to be quashed. In view of our discussion made above the ultimate order of the High Court Division in quashing the proceeding is found to be sustainable. .....Nizam Uddin Mahmood =VS= Abdul Hamid Bhuiyan, (Criminal), 2022(1) [12 LM (AD) 655]

Section 138

The Negotiable Instruments Act, 1881

Section 138

Code of Criminal Procedure, 1898

Section 561A

When the complainant stated that he had served a legal notice within 15 days from the date of the receipt of information of the return of the cheque, non-discloser of the date of service of notice in the complaint petition can not be a ground for quashing the proceeding– Appellate Division is of the view that the High Court Division in exercising its jurisdiction at the very first instance is not empowered to interfere with the trial proceedings by invoking jurisdiction under section 561A of Code of Criminal Procedure,1898. It has been consistently held by this Division that when the complainant stated that he had served a legal notice within 15 days from the date of the receipt of information of the return of the cheque, non-discloser of the date of service of notice in the complaint petition can not be a ground for quashing the proceeding. In this context reference may also be made to the decision of the case of Habibur Rahman Howlader -Vs- State and another reported in 53 DLR (AD) 111. This Division is of the view that the impugned judgment and order of the High Court Division is not sustainable in law. Accordingly, this Division finds merit in the appeal. Consequently the proceeding of C. R. Case No.3783 of 2004 under Section 138 of the Negotiable Instruments Act, 1881, now pending in the Court of Metropolitan Magistrate, Dhaka shall proceed in accordance with law. .....Alhaj Golam Rasul Belal =VS= Habibullah Shakir, (Criminal), 2022(1) [12 LM (AD) 672]

Sections 138, 141(C)

The legal notice was issued within time and the complaint case has also been initiated within time we do not find any illegality in the judgment and order passed by the High Court Division in discharging the Rule– There is no denial as to the dishonouring of the cheque issued by the accused petitioner and the fact of issuance of legal notice after the last occasion of dishonoring the cheque by the bank concern with the endorsement “not arranged for and refer to the drawar” and on the face of dishonour of the disputed cheque and non-response to the demand for payment against dishonoured cheque Appellate Division finds criminality as alleged and as the High Court Division has observed that the accused persons have been avoiding payment and that the legal notice was issued within time and the complaint case has also been initiated within time this Division does not find any illegality in the judgment and order passed by the High Court Division in discharging the Rule. The High Court Division on detailed discussions on the issues involved has arrived at its decision with cogent reasonings, which are in accordance with law and hence no interference is called for. .....Joynul Karim =VS= The State, (Criminal), 2022(1) [12 LM (AD) 686]

Section 138

Complainant failed to prove the case as made out in the complaint-petition against accused-respondent No. 1 beyond all reasonable doubt that the complaint was filed in order to harass respondent No. 1– The learned Sessions Judge, Bagerhat convicted appellant-respondent No. 1 under section 138 of the Negotiable Instruments Act, 1881 and sentenced her there under to suffer simple imprisonment for 6 (six) months with a fine of Tk. 10,00000/- (Ten lakh),in default, to suffer simple imprisonment for further 1(one) month more.

Feeling aggrieved by and dissatisfied with the aforesaid impugned judgment and order passed by the High Court Division, the complainant as the leave-petitioner filed this criminal petition for leave to appeal before this Division.

Admittedly, accused-respondent No. 1 was given in marriage to the son of the complainant-leave-petitioner and as soon as respondent No. 1 divorced her husband, the complaint-petition was filed against respondent No. 1. Having gone through the record, Appellate Division is fully satisfied that the complaint-petition was filed in order to harass respondent No. 1 for divorcing the son of the complainant-leave-petitioner. This Division does not find any substance in this criminal petition. Accordingly, this criminal petition is dismissed. ...Sheikh Wahiduzzaman Dipu =VS= Tanima Afrin Kumkum, (Criminal), 2021(2) [11 LM (AD) 312]

Sec-138

Dishonoured due to insufficient fund–

We also find it difficult to accept that if the petitioner had in fact paid the money owed to the complainant in the year 2011, as alleged by him, that he did not take any steps to stop payment of the cheque issued by him earlier, especially when he himself states that the complainant told him that the cheque was lost, keeping in mind that anyone could attempt to encash that cheque. From 24.7.2011, when the petitioner apparently paid Tk.10 lac by Pay Order, till 18.09.2012 when the complaint was lodged, the petitioner did nothing to retrieve the cheque or to stop payment of the cheque. He admitted in his cross examination that he did not file any G.D. in respect of the non-return of the cheque. Moreover, we find from the deposition of the petitioner (D.W.1) that he admitted in cross examination of other transactions between himself and the complainant with regard to sale of land by the complainant and his wife and the payment of money in 2011. .....M.A. Azam Chowdhury =VS= A.B.M. Asaduzzamn & another, (Criminal), 2016-[1 LM (AD) 591]

Section 138

The trial court has completed the cross examination of the P.W.1 on 13-03-2014 and thereafter, the case was fixed for examination of the accused under section 342 of Criminal Procedure Code. These facts prove that the respondent has been adopting dilatory tactics. The High Court Division did not apply its judicial mind in staying the proceeding. The rule itself is not maintainable. Accordingly, the rule is discharged. The trial court is directed to complete the trial within 1 (one) month from the date of receipt of the order. .....Borak Real Estate (Pvt.) Ltd. =VS= Arifur Rahman(Mr.), (Criminal), 2017 (2)– [3 LM (AD) 543]

Section 138

The accused petitioner issued 60 post dated cheques in favour of complainant financial institution. As per provisions of Section 138 of the Negotiable Instrument Act, prima-facie case against the petitioner, had been made out. The High Court Division held that since there is no bar to get the loan amount realized by producing issued cheques for encashment, the instant proceedings were not liable to be quashed. .....Ehetasamul Haque =VS= The State, (Criminal), 2017 (2)– [3 LM (AD) 552]

Section 138

An offence under section 138 of the Negotiable Instruments Act is not compoundable, it being a special law. However, in view of the submissions made by the learned Advocates on Record, we are of the opinion that the ends of Justice will be sufficiently met if the sentence of the petitioner is reduced to imprisonment for the period already undergone by him in prison, and the sentence of fine is set aside. We note that the complainant appeared before us to say that he has received his money in full satisfaction. The criminal petition for leave to appeal is dismissed. The conviction of the petitioner under section 138 of the Negotiable Instruments act is affirmed with modification of the sentence as mentioned above. .....Idris Chowkder (Md.) =VS= The State, (Criminal), 2017 (2)– [3 LM (AD) 560]

Sections 138 and 141(b)

Criminal proceeding should not be stifled before trial, when there is a prima facie case for going to the trial– There was no violation of section 141(b) of the Negotiable Instrument Act. The High Court Division further found that the law is now settled on the point that a criminal proceeding should not be stifled before trial, when there is a prima facie case for going to the trial. .....M.K. Bazlur Rahman =VS= Md. Johurul Haque, (Criminal), 2017 (2)– [3 LM (AD) 586]

Section 138

The powers given to the Court is discretionary–

Section 138(1) empowers the trial Court to punish with imprisonment for a maximum period of one year, or with fine which may extend to thrice the amount of the cheque or both. The powers given to the Court is discretionary. The language used in the section is not such that the Court must impose fine thrice the amount of the cheque. The legislature has left the matter to the discretion of the trial Court. .....Shahidur Rahman Khadem =VS= The State, (Criminal), 2017 (2)– [3 LM (AD) 600]

Section 138

The Negotiable Instrument Act, 1881

Section-138 r/w

Code of Criminal Procedure, 1898

Section 561

The cheques were issued by the respondent which were returned with endorsement, "payment stopped by the drawer". Since the cheques were returned by bank with the endorsement "payment stopped by the drawer" it is to be presumed that those were returned unpaid because the amount of money standing to the credit of that account was insufficient to honour of the cheque as envisaged in Section 138 of the Act. Of course this is a rebuttable presumption. The defence can be considered at the time of holding trial and not in an application under Section 561A of the Code of Criminal Procedure. The judgment and orders of the High Court Division are hereby set aside. The concerned Courts are directed to proceed with the cases in accordance with law. .....S.M. Redwan =VS= Md. Rezaul Islam, (Criminal), 2017 (2)– [3 LM (AD) 605]

Section 138 & 140

If a case is instituted against a company alone, excluding the persons who were responsible to the affairs of the company’s, it can be prosecuted and punished–

The difference between sections 138 and 140 is that in respect of section 138 the offence is committed by human beings, that is to say, natural person and in section 140 though the expression “the person” is used which is qualified by a company which means “any body corporate and includes a firm or other association of individuals” which is a juristic person or not. It can be prosecuted for the offence under section 138. Section 140 of the Act, we are of the view that for proper and effective adjudication of the cases, the complainant (s) / drawee (s) may add the company as one of the accused in the case but for not impleading the company, the case will not fail. .....Mohammad Eusof Babu =VS= Jhon Provanjon Chowdhury, (Criminal), 2017 (2)– [3 LM (AD) 562]

Section 138

The order of conviction passed by the trial Court was in accordance with the law as by adducing evidence the complainant succeeded in proving that a cheque for Tk.7,00,000.00 given to him was, when duly presented, dishonoured and that before filing the complaint petition, he complied with the procedural requirements laid down in section 138 of the Act. So, this leave petition is dismissed as it is bound to be. The petitioner has in fact paid all the money due to the complainant. The complainant admitted that he had received the full amount of the cheque from the accused petitioner and that he had no further claim against him. In view of the fact that the leave petitioner has paid the full amount of the cheque, he is exonerated from paying any more and as he has already spent 3 months in prison, he need not go back to prison and the sentence of imprisonment is thus modified to the period already undergone by him in prison. .....Biplob (Md.) =VS= The State, (Criminal), 2018 (1) [4 LM (AD) 364]

Section 138

Realization of fine to be paid to the payee–

Complaint petition filed by an aggrieved person, i.e. the payee, not at the instance of the ‘State’; the State is not a ‘necessary’ party though it may be ‘proper’ party in case under the Act, 1881; the cheque bears the proprietary and pecuniary interest of the payee and the law provides for realization of fine to be paid to the payee, vide sub-section (2) of section 138; by way of amendment, done by Act No. III of 2006 (09.02.2006), section 138A has been inserted making provisions to deposit not less than 50% of the amount of the dishonoured cheque, in the trial Court, as a precondition to prefer appeal; there is no similar provision for preferring appeal by a person convicted under any other law; apparently, the Act, 1881 is a piece of beneficial legislation and distinct from other penal law; hence, in appropriate case, costs may be awarded in case under the Act, 1881. .....Khondker Latifur Rahman =VS= The State, (Criminal), 2018 (1) [4 LM (AD) 383]

Section 138

Two questions are involved in these appeals and petitions. The first question is whether if a company incorporated under the Companies Act commits an offence punishable under section 138 of the Negotiable Instruments Act, 1881 is excluded from prosecution, can a director, manager, secretary or other officer of the company be prosecuted for that offence, and secondly, whether if more than one cheques issued by the same drawer can be prosecuted in a single case. .....Mohammad Eusof Babu =VS= Johan Provanjon Chowdhury, (Criminal), 2018 (2) [5 LM (AD) 251]

Section 138

Cheque dishonour–

There is no legal bar of filing a single case against the drawer of the cheques if the notice is served within the period of limitation intimating the fact of dishonour of the cheques with a request to pay the amount involved in those cheques within a period of thirty days. .....Mohammad Eusof Babu =VS= Johan Provanjon Chowdhury, (Criminal), 2018 (2) [5 LM (AD) 251]

Section 138

Scope to cross-examine and also be at liberty to examine defence witness–

The High Court Division took the right view that the accused should be given scope to cross-examine PW1 allowing 2/3 dates as the Metropolitan Additional Sessions Judge, in the meantime, fixed the respective cases for examination of the accused under section 342 of the Code and accordingly, we endorse the same. We add by saying that the respective petitioners shall also be at liberty to examine defence witnesses, if they so desire, after their examination under section 342 of the Code. The trial Court is directed to conclude the trial as expeditiously as possible, but not later than 2(two) months from the date of receipt of this judgment. .....Majad Hossain =VS= The State, (Criminal), 2018 (2) [5 LM (AD) 318]

Sections 138, 140

The Negotiable Instrument Act, 1881

Sections 138, 140

The Code of Criminal Procedure

Section 561A

The disputed questions of facts which should be decided after appreciating the evidence at the trial–The High Court Division in disposing the application under the provision of section 561A of the Code does not require to formulate any disputed question of facts, rather, only to see whether the story of the F.I.R. or petition of complaint discloses the criminal offences or not. Therefore, the High Court Division exceeded the extraordinary jurisdiction by quashing the proceeding. Accordingly, the judgment of the High Court Division is set aside. ...Ashfaq Hossain =VS= The State, (Criminal), 2021(1) [10 LM (AD) 515]

Sections 138, 140

The Negotiable Instruments Act, 1881

Section 138, 140

The Evidence Act, 1872

Section 102

According to section 102 of the Evidence Act, 1872 the burden of proof is upon the respondent to prove that though she was the director of the company, the offence has been committed without her knowledge or that she was a non-executive director of the company and she was not involved in day-to-day affairs of the company etc.

The innocence of the respondent No.1, the director, has to be proved before the Court by adducing evidence and thus, the director, respondent No.1 has to face the trial. Only after taking evidence during trial if the director, respondent No.1 herein, is found that she was not to be a person-in-charge of the affairs of the company at the relevant time of the issuance of the cheque only then she may be exonerated from the charge. ...Phoenix Finance and Investment Ltd. =VS= Yeasmin Ahmed, (Criminal), 2021(1) [10 LM (AD) 522]

Section 138

In order to make a person liable under section 138 the payee of a cheque has to give a notice in writing to the drawer of the cheque within 15 days of the receipt of information by hun from the Bank regarding the return of the chequer as unpaid in terms of clause (b) to the proviso. The drawer of the cheque is obliged to make the payment within 15 days of the receipt of the said notice failing which the cause of action for prosecution will arise under clause (c). [Para-7] S. M. Anwar Hossain Vs. Md. Shafiul Alam & Am: 7BLT (AD)-218

Section 138

In order to make a person liable under section 138 the payee of a cheque has to give a notice in writing to the drawer of the cheque within 15 days of the receipt of information by him from the Bank regarding the return of the cheque as unpaid in terms of clause (b) to the proviso. The drawer of the cheque is obliged to make the payment within 15 days of the receipt of the said notice failing which the cause of action for prosecution will arise under clause (c). S.M. Anwar Hossain Vs Md. Shafiqul Alam (Chand) and another, 19BLD(AD)166

Sections 138 and 141

read with

Code of Criminal Procedure, 1898 (V of 1898)

Section—561A

The cheque in question was issued by the appellant on 21.12.1995 which was presented for encashment on 23.12.1995 but it was dishonoured on the same day whereupon the complainant issued notice to the appellant on 24.12.1995 for payment of money for which the cheque was issued following the clause (b) to the proviso to section 138 of the Act. On receipt of the said notice the appellant in order to avoid payment fraudulently informed the complainant through a lawyer on 4.1.1996 that he had lost the cheque written in the complainants name and made a GD Entry in that behalf. The cause of action for prosecution will arise under clause (c) of the proviso to section 138 on the failure of the appellant to pay the amount within 15 days of the receipt of the notice of the complainant. Relying on the complainant’s own case it is contended on behalf of the appellant the accused-appellant must be fixed with notice for payment at least from 4.1.1996 and after the expiry of 15 days from that date i.e; from 19.1.1996 the cause of action should be taken to have arisen due to non-payment within the said period and complaint was required to be filed within one month from 19.1.1996 in compliance with clause (b) of section 141 of the Act. Admittedly the petition of complaint was filed long after that date i.e., on 18.4.1996 and thus cognizance could not be taken upon such complaint. The subsequent allegations will not save the limitation because the requirement under the law is that the complaint has to be filed within one month of the date on which the cause of action arises under clause (c) of the proviso to section 138 of the Act and hence the impugned proceeding is quashed. S.M. Anwar Hossain Vs Md. Shafiqul Alum (Chand) and another, 19BLD(AD)166

Sections 138 and 141

The cause of action for prosecution will arise under clause (c) of the proviso to section 138 of the Negotiable Instruments Act on the failure of the appellant to pay the amount within 15 days of the receipt of the notice of the complainant. In the present case, the cause of action arose on 19-1-96 and the petition of complaint was required to be filed within one month from 19-1-96 in compliance with clause (b) of section 141 of the Act which having not been done by the complainant the cognizance of the offence cannot be taken upon such complaint and hence the impugned proceeding is quashed. SM Anwar Hossain vs Shafiul Alam (Chand) & another 4BLC(AD) 106.

Section 138(1) (b)

Whether the notice was a demand notice or not as contemplated under section 138 (1) (b) of the Act is a disputed question of fact which could not be decided by the High Court Division while exercising jurisdiction under section 561A of the Code. Rashedul Alam Chowdhury vs ASM Shahajahan 17 BLC (AD) 39

Section 138

The complainant served a legal notice within 15 days of the receipt of the information of return of the cheques. So there is no valid ground for quashing the proceeding under section 138 of the Act. Habibur Rahman Howlader vs State 53 DLR (AD) 111.

Section 138

Under section 138 of the Negotiable Instruments Act an offence is committed if a cheque is dishonoured and if payment is not made within 15 days after receipt of a legal notice. It is a settled law that criminal proceeding can be proceeded independently of the civil suit. Manzur Alam (Md) vs State and another 55 DLR (AD) 62.

Section 138

The convict respondent admitted about the loan, issuance of cheques by him and dishonour of cheques and that a notice under section 138(1)(b) has been given by the complainant. Thus, all the legal requirements are present to bring the offence under section 138 of the Negotiable Instruments Act. Amir Hossain vs MA Malek and others 56 DLR (AD) 146.

Sections 138 & 141

Subsequent allegations will not save limitation for prosecution– The requirement under the law is that the complaint against non–payment of money has to be filed within one month of the date on which the cause of action arises–The High Court Division wrongly rejected the application for quashing. SM Anwar Hossain vs Md Shajiul Alam (Chand) and another 51 DLR (AD) 218.

Section 138

Filing the complaint by the attorney no illegality has been committed–– The complainant while in jail hajat, filed the complaint before the concerned Court of Magistrate through his attorney to avoid the limitation and satisfactory explanation has been furnished to that effect and as such Appellate Division cannot ignore this compelling circumstance in filing the complaint by the attorney. In the instant case, ‘the holder in due course of the cheque’ himself is the complainant and same was presented before the Court through the attorney. ––This Division have no hesitation to hold that in filing the complaint by the attorney no illegality has been committed and the learned Magistrate rightly took cognizance into the case against the accused petitioner having complied with the relevant provision of law. .....Kabir Reza =VS= Shah Mohammad Ashraf Islam, (Criminal), 2023(2) [15 LM (AD) 265]

Sections 138 & 141

Taking of cognisance upon the petition of complaint filed by the Attorney upon due examination under section 200 of the Code of Criminal Procedure is "perfectly valid and appropriate". Hashibul Bashar vs Guizar Rahman and another 56 DLR (AD) 17.

Section 138(1) (b) (c), 141.

It does not constitute any offence or no offence shall be deemed to have been committed as alleged and as such it would be manifestly unjust to allow process of the Court to continue and would infact be an abuse of process and, therefore the proceeding is liable to be quashed. Nizam Uddin Mahmood vs Abdul Hamid Bhuiyan (Amirul Kabir Chowdhury J)(Criminal) 2ADC 793

Section 138

A criminal proceeding can be quashed under section 561A of the Code of criminal procedure if the same does not disclose any case or it manifestly appears that there is a legal bar against the institution or continuation of the said proceeding or whether the facts disclose an offence or not can only be determined on evidence being adduced. Abdul Aziz vs Khaja Abdul Gani (K. M. Hasan C. J) (Criminal) J ADC 23

Section 138,141

We are, therefore, of the view that though the appellant presented the cheque on four dates but after the cheque was dishonoured for the last time on 26.10.2000, he served the required notice on 06.11.2000, well within statutory period and as such filing of the instant complaint on 11.12.2000 cannot be regarded as illegal. Munshi Md. Rashed Kamal vs Abdus Salam (Amirul Kabir Chowdhury J) (Criminal) 2ADC 798

Section 138,141

Section 138,141(b)

Section 241A of the Code of Criminal Procedure praying to discharge him but the learned Magistrate rejected the appli- cation and then the accused filed Criminal Miscellaneous Case No.5518 of 2001 under Section 561A of the Code of Criminal Procedure praying to quash the proceeding and the High Court Division by the judgment and order dated 25.06.2002 made the rule absolute quashing the proceeding. Nizamuddin Mahmood vs. Abdul Hamid Bhuiyan (Md. Abdul Matin J) (Criminal) 5ADC 891

Section 138

That though the appellant presented the cheque on four dates but after the cheque was dishonoured for the last time on 26.10.2000, he served the required notice on 06.11.2000, well within statutory period and as such filing of the instant complaint on 11.12.2000 cannot be regarded as illegal. It is clear that the High Court Division took a contrary view on an erroneous interpretation of the law and quashed the proceeding. The impugned judgment is bad in law and as such is not sustainable. Munshi Md. Rashed Kamal vs. Abdus Salam and another (Amirul Kabir Chowdhury J) (Criminal) 4ADC 357

Section 138

For non-compliance with the requirement of Section 138(1) (b) and (c) of the Act no offence has been constituted or deemed to have been committed and as such as the proceeding has correctly been quashed. Nizam Uddin Mahmood vs. Abdul Hamid Bhuiyan and another (Amirul Kabir Chowdhury J) (Criminal) 4ADC 446

Sections 138 and 140

The Negotiable Instruments Act, 1881

Sections 138 and 140

The Code of Criminal Procedure

Sections 435, 426(2A) and 561A

There is a specific provision in the Code of Criminal Procedure for preferring revisional application against the order of rejection of the bail petition filed under Section 426(2A) of the Code of Criminal Procedure–– Appellate Division’s view is that there are specific provision in Sections 426 and 435 of the Code of Criminal Procedure for bail of a convicted person and if bail petition filed by a convicted person under Section 426(2A) of the Code of Criminal Procedure is rejected, then the remedy lies under Section 435 of the Code of Criminal Procedure in “Revisional Jurisdiction”.

It appears that the High Court Division without appreciating the scope of Section 561A of the Code of Criminal Procedure and without applying its judicial mind exceeded its jurisdiction in passing the order in exercise of inherent power vide impugned judgment and orders dated 25.10.2022 which calls interference by this Division.

The convict Md. Lutful Hasan is in jail custody, it is felt that justice would be best served if he is given an opportunity to file a revisional application in the competent court of jurisdiction under Section 435 of the Code of Criminal Procedure against the impugned orders dated 26.09.2022 passed by the learned Joint Metropolitan Sessions Judge, 5th Court, Chattogram. Accordingly, the convict person i.e. Md. Lutful Hasan may file a revisional application under Section 435 of the Code of Criminal Procedure, if so advised, against the impugned orders dated 26.09.2022 within 30 (thirty) days from the date of receipt a copy of this judgment and order. .....Sajjad Hossain = Md. Lutful Hasan, (Criminal), 2023(1) [14 LM (AD) 599]

Section 138 (1)

Section 138 (1) is not a compoundable one. Since both the parties have settled matter amicably and the complainant received the half of the amount of the dishonoured cheque in cash and the rest of the amount was deposited with the Sessions Court filing the appeal before the High Court Division. So the sentence awarded against the petitioner is reduced to the period undergone. .....Subhash Chandra Sarker =VS= The State, (Criminal), 2023(1) [14 LM (AD) 450]

Section 138

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–

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. ...Mohammad Alauddin =VS= The State, (Criminal), 2019 (1) [6 LM (AD) 124]

Section 138

The cheque is filled up and presented to the bank, the person who had drawn the cheque cannot avoid criminal liability–

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. 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.

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. All the appeals and petitions are dismissed. ...Mohammad Alauddin =VS= The State, (Criminal), 2019 (1) [6 LM (AD) 124]

Section 138-Trial Court by its judgment and order convicted the peti- tioner u/s 138 of N. I. Act and sentenced him to suffer simple imprisonment and to pay a fine, on appeal High Court Di- vision upholding the conviction, in the meantion the petitioner paid entire fine, Appellate Division reduced to the period of sentence already undergone by him.

The Appellate Division observed that the High Court Division did not commit any error in upholding the conviction of the pe- titioner under section 138 of the Negotiable Instrument Act, 1881. It is pertinent to quote here Order 14 dated 29.04.2012 of the Court of Metropolitan Sessions Judge, Chittagong as under: আদেশ নং-১৪, তাং-২৯-০৪- ১২ইং। পূর্ববর্তী আদেশ মোতাবেক জরিমানার অবশিষ্ট টাকা বিধি মোতাবেক জমা প্রদান করে আসামী পক্ষ চালানের কপি দাখিল করেছে। দেখলাম। চালানের ফটোকপি নথির সামিল রাখা হোক। স্বাঃ/ এস, এম, মজিবুর রহমান মহানগর দায়রা জজ চট্টগ্রাম। Having gone through the order, it appears that the leave-peti- tioner has already paid the entire amount on account of fine imposed on him. Having considered all aspects of the case, Appel- late Division is of the view that on facts and circumstances of the case, the sentence of the leave-petitioner should be reduced to the period of imprisonment already under- gone by him. Accordingly, this criminal petition for leave to appeal is disposed of and the sentence imposed on the leave-pe- titioner is reduced to the period of sentence already undergone by him. Alim Uddin Babu. Vs. The State and another. (Criminal) 12 ALR (AD) 171- 173

Sections 138 and 141-Whether for the deception of the drawer a cheque is dishonoured will such deception give the extension of the period of limitation or due such act of deception the payee will be debarred from filing a case under sec- tion 138 of the Negotiable Instruments Act.

The Appellate Division held that section 141 starts with the word 'notwithstanding'. It is no doubt a non-obstante clause and thus, the provisions of the Code of Crimi- nal Procedure for the purpose of taking cognizance will not apply. It is equivalent to saying that inspite of the provision, the enactment following it will have its full op- eration. A non-obstante clause is used as a legislative device to modify the ambit of the provision of law mentioned in the non- obstante clause or to override it in specified circumstance. However, it does not debar the payee to seek redress to an ordinary criminal court to take cognizance in respect of a distinct offence committed for willful deception by the drawer. Even if a crimi- nal offence punishable under section 138 is barred, the drawee or payee's remedy for realization of the amount represents in the cheaque will not be barred. He can realize the said amount through the process of the civil court in view of sub-section (3) of section 138. Apart from the civil cases, the drawee/payee can also file criminal case punishable under the Penal Code other than the one mentioned above. Md. Motaleb Hossain: -Vs.- Abdul Ha- que Limon and another: (Criminal) 11 ALR (AD) 105-110

Sections 138 and 140-Whether the proceedings are maintainable without impleading the Companies as the prin- cipal offenders.

The Appellate Division is of the view that for proper and effective adjudication of the cases, the complainant(s) /drawee (s) may add the Company as one of the ac- cused in the case but for not impleading the Company, the case will not fail. Moham- mad Eusof Babu and others. Mustaque Alam Chowdhury and others. -Vs.- Jhon Provanjon Chowdhury. (Criminal) 11 ALR (AD) 111-113

Sections 138

As per provisions of section 138 of the Negotiable Instruments Act, prima-facie case against the petitioner had been made out. Since there is no bar to get the loan amount realized by producing issued cheques for encashment, the instant proceeding were not liable to be quashed.

The Appellate Division observed that it is not disputed that the petitioner issued cheques. The objects of issuance of those cheques were to pay the loan amount. Definitely, the petitioner issued those cheques in favour of the complainant to recover the outstanding by producing those cheques in the Bank for encashment. Accordingly in order to realize the loan, the complainant produced the cheques in the Bank for encashment which were bounced by the Bank. In such situation, the complainant issued legal notice giving the petitioner an opportunity to pay the de- faulted amount but the petitioner failed to pay the same within the stipulated period. Thus, as per provisions of section 138 of the Negotiable Instruments Act, prima- facie case against the petitioner had been made out. The High Court Division held that since there is no bar to get the loan amount realized by producing issued cheques for encashment, the instant proceeding were not liable to be quashed. The Appellate Division does not find any illegality in the judgment and order of the High Court Division which calls any interference by the Appellate Division. Accordingly, all the petitions are dismissed. Ehetasamul Haque -Vs. State and another (Criminal) 20 ALR (AD) 156-157

Section 138-The cheque was dishonoured with the endorsement "payment stopped by the drawer", a clear prima-facie case of the commission of the offence punishable under section 138 of the Act, has been made out against the accused. Ahmed Lal Mia vs State, 66 DLR (AD) 204

Section 138-It is true that in the judgment sought to be reviewed, there has been no detailed discussions as to the point raised before the High Court Division that the respective petition of complaint having been filed before expiry of the statutory period as stipulated in clause (c) of the proviso to section 138(1) of the Act, was barred by law, this Division having affirmed the judgment and order passed by the High Court Division which took the view that though the respective petition of complaint was filed before expiry of thirty days from the date of receipt of the notice issued under clause (b) of the proviso to section 138, was maintainable in law, in fact, gave the answer. Sarwar Hossain Moni (Md) vs State, 66 DLR (AD) 283

Section 138-Once a cheque is drawn and handed over to the drawee and the latter has presented it in his account for encashment and thereafter, if the cheque is returned to him with an endorsement that the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid for that account or that t was dishonoured because of 'stop payment instructed by the Bank, an offence punishable under the section would constitute provided that if the drawee fulfills the conditions provided in the proviso to sub-section (1). If the drawer of the cheque is a Company, firm or an association of individuals the said money, firm or association of individuals would also be prosecuted for commission of offence under section 138 subject to the fulfilment of the conditions. (PER SK SINHA, CJ MAJORITY) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 138-Onus The onus on the part of the drawee is primary being based on the maxim e.i.: 'incumbit probatio qui dicit, non qui negat' this is because the liability envisaged in sub-section (1) is on the person in-charge of, and was responsible to the business of the company is fixed by the legislature because he is directly responsible for the offence. (Per SK Sinha, CJ majority) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 138-The dishonour of a cheque does not itself constitute an offence under section 138. If the drawer of such cheque fails to make payment of the amount of money to the payee within thirty days of receipt of the notice, the cause of action for constituting the offence will arise, and if a complaint is filed within one month of the date on which the cause of action arises, the court shall take cognizance of the offence. So, the cause of action will arise if the drawer fails to make payment to the payee. Now, if the same drawer fails to make payment of the amount of money covered by the cheque (s) within the stipulated time, does it constitute the cause of action? It does. If it does constitute the cause of action, there will be no legal bar to file a case for prosecuting the drawer for the cause of action. Here the cause of action is not distinct but the same. (PER SK SINHA, CJ MAJORITY) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 138-The complainant(s)/ drawee(s) of the cheques may, if so advised, arraign by adding the Companies in the category of accused if they feel that for getting effective relief in the cases the presence of the companies is necessary in the cases. (PER SK SINHA, CJ MAJORITY) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Sections 138 and 140-Sections 138 and 140 of the Act do not make the directors principal offenders but accessories before the fact or liable vicariously. It is the company which is the principal offender, which has indeed committed the offence by issuing the cheques that were bounced, and hence question of choice is out of context. (PER AHM SHAMSUDDIN CHOUDHURY, J DISSCUSTING) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Sections 138 and 140-Prosecution minus the company was not maintainable, I find no necessity to consider other grounds the appellants/ leave petitioners have aired. So, the issue before me is very narrow indeed, but the flare and the dimension of it is too extensive and pervasive. Eusof Babu (Md) vs State, 68 DLR (AD) 298

Sections 138 and 140-The difference between sections 138 and 140 is that in respect of section 138 the offence is committed by human being that is to say, natural person and in section 140 though the expression "the person" is used which is qualified by a company which means "any body corporate and includes a firm of other association of individuals" which is a juristic person or not. It can be prosecuted for the offence under section 138. (PER SK SINHA, CJ MAJORITY) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 138(1)-Service of notice-If a notice is issued upon the Managing Director of the company who is in-charge of the affairs of the Company and signed the cheque on behalf of the company, the service of notice upon the Managing Director is sufficient to infer that the company has received the notice. This will fasten the company as well as the commis- sion of the offence. This is because the Managing Director being the chief executive of the company his knowledge may be deemed to be the knowledge of the company. (PER SK SINHA, CJ MAJORITY) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 138(1)-Section 138(1) empowers the trial Court to punish with imprisonment for a maximum period of one year, or with fine which may extend to thrice the amount of the cheque or both. The powers given to the Court is discretionary. The language used in the section is not such that the Court must impose fine thrice the amount of the cheque. The legislature has left the matter to the discretion of the trial Court while awarding the sentence of imprisonment and fine. Shahidur Rahman Khadem vs State, 64 DLR (AD) 103

Section 138(b)(c)-Legislature has not created any absolute bar in filing a petition of complaint before expiry of thirty days of the receipt of the notice issued under clause (b) of the proviso to section 138 as created in case of filing a petition of complaint after expiry of one month of the date on which the cause of action arises under clause (c) of the proviso to section 138. Prematurity shall be cured the moment the period of thirty days expires and the payment of the dishonoured cheque is not made within the said period. Zahidul Islam (Md) vs Md Kamal Hossain, 66 DLR (AD) 180

Section 138

The complainant-leave-petitioner failed to prove the case as made out in the complaint-petition against accused- respondent No. 1 beyond all reasonable doubt and as such, the impugned judgment and order of conviction and sentence called for interference.

The Appellate Division held that admittedly, accused-respondent No. 1 was given in marriage to the son of the complainant-leave-petitioner and as soon as respondent No. 1 divorced her husband, the complaint-petition was filed against respondent No. 1. Having gone through the record, the Appellate Division is fully satisfied that the complaint-petition was filed in order to harass respondent No. 1 for divorcing the son of the complainant-leave- petitioner. In the light of the findings made before, the Appellate Division does not find any substance in this criminal petition. Accordingly, this criminal petition is dis- missed. Sheikh Wahiduzzaman Dipu. -Vs.- Tanima Afrin Kumkum and another. (Criminal) 21 ALR (AD) 44-46

Section 138

The Appellate Division has already settled that there is no legal bar of filing a single case against the drawer of the cheques if the notice is served within the period of limitation intimating the fact of dishonour of the cheques with a request to pay the amount involved in those cheques within a period of thirty days. As observed above, the dishonour of a cheque does not itself constitute an offence under section 138. If the drawer of such cheque fails to make payment of the amount of money to the payee within thirty days of receipt of the notice, the cause of action for constituting the offence will arise, and if a complaint is filed within one month of the date on which the cause of action arises, the court shall take cognizance of the offence. So, the cause of action will arise if the drawer fails to make payment as above to the payee. Now, if the same drawer fails to make payment of the amount of money covered by the cheque(s) within the stipulated time, does it constitute no cause of action? It does. If it does constitute a cause of action, there will be no legal bar to file a case for prosecuting the drawer for the said cause of action. Here the cause of action is not distinct but the same. Similar fact was involved in Bilakchand Gyanchand Co. V. A. Chinnaswami, (1999) 5 SCC 693. In that case, the accused did not even challenge the propriety of filing of one case against the dishonour of six cheques. Six cheques were issued by the Shakti Spinners Ltd. and were signed by its Managing Director. The cheques were dishonoured with an endorsement that 'sufficient funds were not available and exceed arrangement'. After service of notice the drawee filed a complaint and consequently, process was issued against the Managing Director. On an application moved for quashing the proceedings, the High Court quashed the proceedings on the ground that no notice was served upon the company. The Supreme Court set aside the judgment on the ground that the High Court fell in error in quashing the proceedings, inasmuch as, there is no 'infirmity in the notice issued under section 138 addressed to A. Chinnaswami, who was a signatory of the cheques'. Therefore, the Appellate Division finds no merit in these appeals. The Appellate Division would, however, like to observe that the complainant(s)/drawee(s) of the cheques may, if so advised, arraign by adding the Companies in the category of accused if they feel that for getting effective relief in the cases the presence of the companies is necessary in the cases. The appeals and the petitions are dismissed without, however, any order as to costs. Mohammad Eusof Babu and others Vs. Johan Provanjon Chowdhury (Criminal) 23 ALR (AD) 58

Section 138

Whether if a company incorporated under the Companies Act commits an offence punishable under section 138 of the Negotiable Instruments Act, 1881 is excluded from prosecution, can a director, manager, secretary or other officer of the company be prosecuted for that offence, and secondly, whether if more than one cheques issued by the same drawer can be prosecuted in a single case. Mohammad Eusof Babu and others -Vs.- Johan Provanjon Chowdhury (Criminal) 23 ALR (AD) 58

Section 138-It is well settled that the enumeration of specific matter "without prejudice to the generality" of a particular provision does not restrict the general application of that provision to the matters enumerated because the words "without prejudice" have the effect of preserving the full effect of the general provisions and also because the Rule of ejusdeme generis has no universe application. Those words clearly indicate that the provision of section 138 did not make any embargo in the application of other provisions of the Act.

The Appellate Division observed that the High Court Division being last court of facts upon elaborate consideration of the evidence both the oral and documentary has come to the conclusion that the complainant failed to take any step to sell the property of the respondent, rather the respondent and his brother and sister sold the said property to the U.S.A. Embassy and the complainant did not help the respondent in any way in that regard. It is relevant here to quote the evidence of the complainant which he adduced before the trial court as P.W.1 which are as follows:

"আমি অত্র মামলার বাদী। আসামী ইমরান রশীদের সাথে ১৩/৩/১২ খ্রিঃ তারিখে রেজিঃকৃত Memo বা Agreement যার নম্বর ১৮৯৮/১২। আসামী ডকে উপস্থিত নাই। উক্ত Agreement এর শর্তানুযারী আগামী ১/৭/১৩ খ্রিঃ তারিখে ১টা cheque দেয় ১ কোটি টাকা। যার নম্বর ০৫৫৯৫৭০ ইহা আমার নামীয় ব্যাংক Account এ বিগত ১৮/৭/১৩ খ্রিঃ তারিখে জমা দেই। কিন্তু stop payment এর কারনে Dishonour হয়। ২৫/৭/১৩ খ্রিঃ তারিখে ইহা পুনরায় জমা দিলে অনুরুপভাবে Dishonour হয়। উক্ত বিষয়ে আমি ১৩/৮/১৩ খ্রিঃ তারিখে আসামীর প্রতি Legal Notice প্রদান করি। কিন্তু আসামী পাওনা পরিশোধ না করার কারণে অত্র মামলা দায়ের করি। অতঃপর ১০/৯/১৩ খ্রিঃ অত্র মামলা দায়ের করি। এই নালিশ (Ext-1) আমার স্বাক্ষর (Ext-1-1) এই সেই cheque (Ext-2), এই সেই দুইটা Dishonour slips (Ext-3 series), এই সেই Legal Notice with postal receipts (Ext 4 series), এবং এই আমার Memo of Agreement (Ext-5) মুল কপি দায়রা ৩০৭৯/১৩ মামলায় দাখিল আছে।"

Nowhere in his examination-in-chief the complainant claimed that in terms of agreement (Ext-5) he had brought the purchaser to sell the respondent's property and, accordingly, the same was sold. In his cross examination, the complainant has admitted the fact saying, "আমার memo. of understanding এর ১নং শর্তে উল্লেখ আছে ৯০ কার্যদিবসের মধ্যে" positive out coming নিয়ে আসতে হবে। ২(ধ) শর্তে উল্লেখ আছে বাজার মূল্যে ক্রেতা আনিতে পারিলে আমি (বাদী) কমিশন পাব। (emphasis supplied) He further said that, "কথিত শর্তের কারণে আসামী গং $5.25 M dollar এ ঐ plot বিক্রির প্রস্তাব দেয় মার্কিন দূতাবাসের নিকট।" He further said that, "০৩/০৭/১৩ খ্রিঃ তারিখে sale deed (deed of transfer) সম্পাদন ও রেজিস্ট্রি হয়। তেজগাঁও Registry office Registration nq| H deed এ আমি উপস্থিত ছিলাম না।" That is accused respondent offered the proposal to sell their property to the American Embassy and even, at the time of execution and regis- tration of sale deed, the appellant was not present in the Sub-Registrar's office. Ext.5 would create a liability of the respondent to pay commission under the agreement only when the appellant secured net market price of the res respondent's property by sale what did not happen in this case. In his cross examination the complainant has said, "২(ধ) শর্তে উল্লেখ আছে বাজার মূল্যে ক্রেতা আনিতে পারিলে আমি (বাদী) কমিশন পাব।" There is no such averment, in the petition of complaint or in the evidence that the complainant has stated that he had brought any purchaser who offered market price of the property. From the evidence quoted above it appears that the condition under which the cheques were issued was not ful- filled by the complainant appellant. Thus, the respondent instructed the bank not to encash the impugned cheques. Accordingly, the bank returned the cheques with endorsement, "payment stopped by the drawer". Where the amount promised shall depend on some other complementary facts or fulfillment of another promise and if any cheque is issued on that basis, but that promise is not fulfilled it will not create any obligation on the part of the drawer of the cheque or any right which can be claimed by the holder of the cheque. As such dishonesty or fraud cannot be attributed to the respondent in giving stop payment instructions. Consequently, the question of committing an offence by the accused respondent punishable under section 138 of the Act does not arise. Thus, the Appellate Division is of the view that these appeals do not deserve any consideration. Accordingly, all the appeals are dismissed. Md. Abul Kaher -Vs.- Emran Rashid and another (Criminal) 19 ALR (AD) 56-64

Sections 138 and 141(1)(b)-Whether the proceeding initiated under section 138 of the Negotiable Instruments Act 1881 against the accused petitioner is barred by section 141(1)(b) of the Negotiable Instruments Act, 1881 as the complainant earlier issued legal notice in the 'Daily Azadi' on 14.07.2011 for dishonour of the cheques on 28.06.2011 but the complainant without taking recourse to the appropriate remedy within the time fixed under section 141(b) of the Negotiable Instruments Act, 1881 again issued legal notice published in the daily 'Jugantor' on 17.11.2011 for dishonour of self same cheques on 02.11.2011 and filed the instant case on 21.11.2011 under section 138 of the Negotiable Instruments Act, 1881 on the basis of second notice published in the daily 'Jugantor' long after the expiry of the period of limitation. The procedural limitation provided in section 141 (b) cannot take away the substantive right accruing to the beneficiary of a cheque to prosecute any number of subsequent presentation of the cheque on its dishonour. Similarly, each dishonour will give rise to a concomitant right to serve notice under proviso (b) to section 138 (1) of the Act and demand pay- ment, failing which the bearer of the cheque will have the right to make a complaint in writing in accordance with section 141 (a) of the Act. It will be entirely up to the bearer of the cheque to proceed in respect of any particular dishonour of the cheque, keeping in mind that each step of the process has to be taken within the period stipulated by the law.

It is the considered view of the Appellate Division that there is no conflict between proviso (c) to section 138(1) and section 141(b). Sections 138 and 140 of the Act are substantive provisions of law giving details of the offence, when the offence is committed and who is liable; section 141 of the Act describes the proce- dure to be followed. The intention of the legislature in enacting section 141(b) is to provide a time limit within which the complaint against the defaulting drawer of the cheque is to be made. This section does not preclude the holder of the cheque from presenting the cheque to the bank again for payment, subject only to the condition that the second and subsequent presentation of the cheque must be within six months from the date on which the cheque was drawn in order to be able to prosecute the drawer of the cheque criminally under section 138 of the Act. Upon subsequent presentation of the cheque for payment, if it is again disho- noured another opportunity will accrue to the beneficiary to take action as provided under section 138(1) of the Act, and again. in accordance with the provisions of section 141, the beneficiary of the cheque will be obliged to make complaint against such subsequent dishonour within a period of one month from the cause of action arising under proviso (c) to section 138 (1) of the Act. The offence is committed each time the cheque is dishonoured on presentation for payment. There is nothing in section 141(b) to suggest that the cause of action cannot arise more than once under clause (c) of the proviso to section 138(1). The procedural limitation provided in section 141 (b) cannot take away the substantive right accruing to the beneficiary of a cheque to prosecute any number of subsequent presentation of the cheque on its dishonour. Similarly, each dishonour will give rise to a concomitant right to serve notice under proviso (b) to section 138 (1) of the Act and demand payment, failing which the bearer of the cheque will have the right to make a complaint in writing in accordance with section 141 (a) of the Act. It will be entirely up to the bearer of the cheque to proceed in respect of any particular dishonour of the cheque, keeping in mind that each step of the process has to be taken within the period stipulated by the law. Hence, the Appellate Division holds that decision in the case of Dr. Md Mofizur Rahman and ors vs Md Bashirullah and another, 55 DLR 630 was incorrect and is accordingly overruled. In view of the above discussion, the opinion of the Appellate Division is that the appeals have no merit and are accordingly dismissed. For the same reasons the criminal petition for leave to appeal is also dismissed. Nizam Uddin Mahmud Hossain Vs. The State and another (Criminal) 16 ALR (AD) 3-11

Section 138 and 140

Monaben Ketanbhai Shah & Another v. State of Gujarat & Others (2004) 7 SCC 15. In the said case, this court observed as under:-

".....The primary responsibility is on the complainant to make necessary averments in the complaint so as to make the accused vicariously liable. For fastening the criminal liability, there is no presumption that every partner knows about the transaction. The obligation of the appellants to prove that at the time the offence was committed they were not in charge of and were not responsible to the firm for the conduct of the business of the firm, would arise only when first the complainant makes necessary averments in the complaint and establishes that fact. The present case is of total absence of requisite averments in the complaint."

In State of Haryana v. Brij Lal Mittal & Others (1998) 5 SCC 343, it was held that the vicarious liability of a person 8 for being prosecuted for an offence committed under the Act by a company arises if at the material time he was incharge of and was also responsible to the company for the conduct of its business. Simply because a person is a director of the company it does not necessarily mean that he fulfils both the above requirements so as to make him liable. Conversely, without being a director a person can be incharge of and responsible to the company for the conduct of its business. From the complaint in question we, however, find that except a bald statement that the respondents were directors of the manufacturers, there is no other allegation to indicate, even prima facie, that they were incharge of the company and also responsible to the company for the conduct of its business

K.P.G. Nair v. Jindal Menthol India Ltd. (2001) 10 SCC 218 was a case of this court under the Negotiable Instruments Act, 1881 and it was found that the allegations in the complaint did not either in express words or with reference to the allegations contained therein make out a case that at the time of commission of the offence the appellant was in charge of and was responsible to the company for the conduct 9 of its business. It was held that the requirements of Section 141 of the Negotiable Instruments Act, 1881 were not met and the complaint against the accused was quashed. The same view has been taken in Katta Sujatha (Smt.) v. Fertilizers & Chemicals Travancore Ltd. & Another (2002) 7 SCC 655.

The respondent placed reliance on the case of S.M.S. Pharmaceuticals Ltd. (supra), wherein this Court has held as under:

"19. In view of the above discussion, our answers to the questions posed in the reference are as under:

(a) It is necessary to specifically aver in a complaint under Section 141 that at the time the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential requirement of Section 141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of Section 141 cannot be said to be satisfied.

(b) The answer to the question posed in sub- para (b) has to be in the negative. Merely being a director of a company is not sufficient to make the person liable under Section 141 of the Act. A director in a company cannot be deemed to be in charge of and responsible to the company for the conduct of its business. The requirement of Section 141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as 10 there is no deemed liability of a director in such cases.

(c) The answer to Question (c) has to be in the affirmative. The question notes that the managing director or joint managing director would be admittedly in charge of the company and responsible to the company for the conduct of its business. When that is so, holders of such positions in a company become liable under Section 141 of the Act. By virtue of the office they hold as managing director or joint managing director, these persons are in charge of and responsible for the conduct of business of the company. Therefore, they get covered under Section 141. So far as the signatory of a cheque which is dishonoured is concerned, he is clearly responsible for the incriminating act and will be covered under sub- section (2) of Section 141."

In Sabitha Ramamurthy and Another v. R.B.S. Channabasavaradhya (2006) 10 SCC 581 this court held there was absence of requisite averments in the complaint not containing any statement that the appellants were in charge of the business of the company at the material time. The statement of witness also did not specifically allege that the appellants were in charge of the business of the company. This Court held that requirement of section 141 of the Negotiable Instruments Act was not complied with and the complaint was liable to be quashed.

In K.K. Ahuja v. V.K. Vora and Another (2009) 10 SCC 48, this court observed that the averment in a complaint that an accused is a director and that he is in charge of and is responsible to the company for the conduct of the business of the company, duly affirmed in the sworn statement, may be sufficient for the purpose of issuing summons to him. But if the accused is not one of the persons who falls under the category of 'persons who are responsible to the company for the conduct of the business of the company', then merely by stating that 'he was in charge of the business of the company' or by stating that 'he was in charge of the day to day management of the company' or by stating that he was in charge of, and was responsible to the company for the conduct of the business of the company', he cannot be made vicariously liable under Section 141(1) of the Act.

Section 138 -Whether a commercial bank can file a case under section 138 of the Negotiable Instruments Act (in short, the Act) in respect of dishonour of a post dated cheque taken from a borrower despite taking collateral security from the borrower.

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.

The Appellate Division held that the 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. In view of the aforesaid facts and circumstances the Appellate Division 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, the Appellate Division does not find any substances in the appeals and petitions. Thus, all the appeals and petitions are dismissed. Mohammad Alauddin Vs. The State, represented bythe Deputy Commissioner, Chittagong and others: (Criminal) 16 ALR (AD) 113-117

Section 140-The directors only signed the company's cheques and thereby acted as the fuel injectors in the Company's commission of the offence. Section 140 of the Act made them vicariously liable as per me decision of the larger Bench of the Indian Supreme Court. Question is not founded on the applicability of the civil law principle of non-joinder but that of the criminal jurisprudence which ordains that a criminal proceeding is non-est for aiders or abettors if the principal offender is not booked. (PER AHM SHAMSUDDIN CHOUDHURY, J DISSCUSTING) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 140-Section 140 does not contain that the prosecution of company is indisputable for the prosecution of the other categories of persons. If the company is not prosecuted, the other two categories of persons cannot, on that ground alone, escape from criminal liability. (Per SK Sinha, CJ majority) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Section 140-Company is a distinct personality, independent of its Directors and share-holders and it is the company who is liable for offence committed by it and that the directors who steer the affairs of the company are not liable as the principal offenders but either vicariously or as aiding or abetting agents. For this view I take in aid observations expressed in re- Sir Dinshai Petit, supra, to the effect that when a company is duly incorporated the Court should start with the presumption that it is a separate entity from the individuals. (PER AHM SHAMSUDDIN CHOUDHURY, J ) Eusof Babu (Md) vs State, 68 DLR (AD) 298

Sections 140 and 141

If for any reason the company is not prosecuted, the other persons who are in charge of the affairs of the company or in the management of the company or have knowledge about the affairs of the company can not escape from criminal liability if they are served with the notice.

The Appellate Division after approving the views and observation of the Supreme Court of India held that the infirmity of not making the company as accused which could be removed by affording the complainant to add the company M/S Modi Industries Ltd. in the case were termed as obiter dictum by the Supreme Court in India in Anil Hada V. Indian Acrylic Ltd, (2000) 1 SCC 1 and approved the views taken by Chinnappa Reddy, J. in Sheoratan Agarwal (Supra). This case is in respect of an offence under the Negotiable Instruments Act. The Indian provision is identical to our provision with the variation that section 140 of our Act corresponds to section 141 of the Indian Act. It was held in that case that if the offence was committed by a company it can be punished only if the company is prosecuted. But instead of prosecuting the company if a payee opts to prosecute only the persons who are responsible in the conduct of the business of the company, the payee can succeed in the case only if he succeeds in showing that the offence was actually committed by the company. The court summed up by observing that 'if a company is not prosecuted due to any legal snag or otherwise, the other prosecuted persons can not, on that score alone, escape from criminal liability created through legal fiction envisaged in section 141 of the Act." Mohammad Eusof Babu and others -Vs.- Johan Provanjon Chowdhury (Criminal) 23 ALR (AD) 58

Section 141(b)

If a notice is issued upon the Managing Director of the Company who is in charge of the affairs of the Company and signed the cheque on behalf of the company, the service of notice upon the Managing Director is sufficient to infer that the company has received the notice. This will fasten the company as well for the commission of the offence. This is because the Managing Director being the chief executive of the company his knowledge may be deemed to be the knowledge of the company. Mohammad Eusof Babu and others -Vs.- Johan Provanjon Chowdhury (Criminal) 23 ALR (AD) 58

Section 141

If a company is not prosecuted due to any legal snag or otherwise, the other prosecuted persons can not, on that score alone, escape from criminal liability created through legal fiction envisaged in section 141 of the Act.’ .....Mohammad Eusof Babu =VS= Johan Provanjon Chowdhury, (Criminal), 2018 (2) [5 LM (AD) 251]

Section 141(b)

The subsequent allegations will not save the limitation—the requirement unçler the law is that the complaint has to be filed within one month of the date on which the cause of action arises under clause(c) of the proviso to section 138. [Para- 10] S. M. Anwar Hossain Vs. Md. Shafiul Alam & Am: 7BLT (AD)-218

Where the amount promised...

Where the amount promised shall depend on some other complementary facts or fulfillment of another promise and if any cheque is issued on that basis, but that promise is not fulfilled it will not create any obligation on the part of the drawer of the cheque or any right which can be claimed by the holder of the cheque. …Md. Abul Kaher Shahin Vs. Emran Rashid & anr., (Criminal), 14 SCOB [2020] AD 96

A person issuing the cheque cannot escape...

A person issuing the cheque cannot escape liability even if there is a stoppage of payment of cheque, unless he disproves the same for the other reasons. In case a cheque issued by a person in favour of another is dishonoured by the bank for want of funds, the holder of the cheque is entitled to the amount as reflected in the cheque since cheque is a negotiable instrument governed under the Act. …Md. Abul Kaher Shahin Vs. Emran Rashid & anr., (Criminal), 14 SCOB [2020] AD 96

Case Reference

সার্চ ইন্টারফেসে আপনাকে স্বাগতম

Negotiable Instruments Act, 1881 | AD Cases | Case Reference

Negotiable Instruments Act [XXIV of 1881]

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