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B.M. Basavaraj Versus Srinivas S. Datta

Complaint under Section 138 of the Negotiable Instruments Act, 1881 - dishonor of cheques - Held that:- Once the appellant files a complaint on the basis that he was holding the cheques as holder in due course which were admittedly given by the respondent to the appellant and the said cheques were dishonoured when they were presented for encashment to the Bank and he, further, is able to establish that due notice of the dishonour of the said cheques was given to the respondent as provided in law .....

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e case was founded on the dishonour of the two cheques and not on the basis of the said agreement.Further, it was not a civil suit which was filed on the basis of the said agreement or any demand was raised for money on the ground that the agreement had been fulfilled.The case is that the payment was not released.It is here where the High Court has fell in legal error.

We are, therefore, of the opinion that the dishonour of the aforesaid cheques in the aforesaid manner clearly establi .....

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sions under Section 138 of the Act.The respondent shall pay to the appellant the amount due with interest at the rate of 9 per cent from the date of filing of the complaint within two months - Criminal Appeal No. 306 OF 2016 (Arising out of SLP (Criminal) No. 1587 of 2013) - Dated:- 5-4-2016 - MR. A.K. SIKRIAND MR. R.K. AGRAWAL, JJ For the Petitioner : Mr. Sushil Kr. Jain, Sr. Adv. Mr. Ashwin Kothemath, Adv. Mr. Abhinav Gupta, Adv. Mr. Manu Maheshwari, Adv. Ms. Ankita Gupta, Adv. Ms. K. V. Bhara .....

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letion of certain project which was undertaken by the respondent.It was further stated that the respondent was supposed to make payment in terms of the said agreement as under: Payment 1. ₹ 25,000.00 at the time of release of Purchase Order 2. ₹ 25,000.00 at the time of Board Level Demonstration. 3. ₹ 25,000.00 at the time of Road Triais. 4. ₹ 50,000.00 at the time of supply of units. 5. Balance ₹ 50,000.00 plus the taxes applicable within 45 days from the date of s .....

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unt due for the work undertaken and completed by the appellant for the respondent, as under: (1) Cheque No. 795553 dated 22.11.2004 for ₹ 50,000/drawn on Canara Bank. (2) Cheque No. 795554 dated 15.12.2004 for ₹ 75,000/drawn on Canara Bank. Both the cheques were again returned by the Bank uncleared with the endorsement 'Insufficient Funds'. The appellant thereupon issued legal notice dated 18.12.2004 to the respondent in which, inter alia, the following averments were made: Y .....

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akki Layout Branch, Bangalore stating the reason as INSUFFICIENT FUNDS as per the endorsement i.e. memorandum of cheques unpaid, dated 10.12.2004 and 16.12.2004 respectively. Thus you have committed an offence under Section 138 of the Negotiable Instruments Act read with section 420 of the IPC. And hence I hereby issue the following; You hereby take this notice that the cheques issued by you in favour of my client dated 22.12.2004 and 15.12.2004 bearing number 795553 and 795554 respectively, tow .....

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ad not furnished any document to prove that it had actually supplied the material to the respondent as per the agreement.This finding is upheld by the High Court also vide the impugned judgment. A neat submission which is made by Mr. Sushil Kumar Jain, learned senior counsel appearing for the appellant, is that once the cheques were given by the respondent to the appellant, there was a presumption in law that the dues were payable by the respondent to the appellant.He had pointed out that this i .....

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the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability. Once the appellant files a complaint on the basis that he was holding the aforesaid cheques as holder in due course which were admittedly given by the respondent to the appellant and the said cheques were dishonoured when they were presented for encashment to the Bank and he, further, is able to establish that due notice of the dishonour of .....

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