SECTION 138 NEGOTIABLE INSTRUMENTS
ACT: CONDONATION OF DELAY IN FILING COMPLAINT
With a
view to lend credibility to cheque transactions Negotiable Instruments Act 1881
was amended in 1988 and penalty clause was inserted in the form of banking ,
Public Financial Institutions and Negotiable Instruments law (Amendment) Act
1988 and that was further amended vide Negotiable Instruments (Amendment &
Miscellaneous Provisions) Act 2002.
At the very onset the provision as contained in
Section 138 of Negotiable Instruments Act may be perused. The same is as under:
138. Dishonour
of cheque for insufficiency, etc. of funds in the account—
“Where any cheque drawn by a person on an account maintained by him
with a banker for payment of any amount of money to another person from out of
that account for the discharge, in whole or in part, of any debt or other
liability, is returned by the bank unpaid, either because of the amount of
money standing to the credit of that account is insufficient to honour the
cheque or that it exceeds the amount arranged to be paid from that account by
an agreement made with that bank, such person shall be deemed to have committed
an offence and shall, without prejudice to any other provision of this Act, be
punished with imprisonment for 3 [a term which may be extended to two years],
or with fine which may extend to twice the amount of the cheque, or with both:
Provided
that nothing contained in this section shall apply, unless—
(a) the cheque has been presented to the bank within a period of six
months from the date on which it is drawn or within the period of its validity,
whichever is earlier;
(b) the payee or the holder in due course of
the cheque, as the case may be, makes a demand for the payment of the said
amount of money by giving a notice in writing, to the drawer of the Cheque,
within thirty days of the receipt of information by him from the bank regarding
the return of the Cheque as unpaid; and
(c) the drawer of such Cheque fails to make the payment of the said
amount of money to the payee or, as the case may be, to the holder in due
course of the Cheque, within fifteen days of the receipt of the said notice.”
In the Negotiable
Instruments Act, Section
142 of the Act was inserted vide amendment in 2002 and that also puts a
limitation on the power of the Court to take cognizance of the offences, which
reads as under:
142. Cognizance of offences—Notwithstanding anything contained in the Code of
Criminal Procedure, 1973 (2 of 1974),—
(a) no court shall take
cognizance of any offence punishable under Section 138 except upon a complaint,
in writing, made by the payee or, as the case may be, the holder in due course
of the cheque;
(b) such complaint is
made within one month of the date on which the cause of action arises under
clause (c) of the proviso to
Section 138:
Provided that the cognizance of a complaint
may be taken by the Court after the prescribed period, if the complainant
satisfies the court that he had sufficient cause for not making a complaint
within such period.
(c) No Court inferior to
that of a Metropolitan Magistrate or a Judicial Magistrate of the First Class
shall try any offence punishable under Section 138.
The proviso to Section 142(b) of the Act
facilitates condonation of delay if the complainant satisfies the Court that he
had cogent reasons for not making the complaint within the limitation period.
In retrospect what is of significance is that
section 142(b) of the Act the proviso appended to clause (b) was inserted by
the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002
and the legislative intent was, no doubt, in order to overcome the technicality
of limitation period. The Statement of Objects and Reasons appended to the
Amendment Bill, 2002 suggests that the introduction of this proviso was to
provide discretion to the Court to take `cognizance of offence even after
expiry of the period of limitation. This was done with a view to obviate the
difficulties on the part of the Complainant, Parliament inserted the proviso to
clause (b) of Section 142 of the Act in the year 2002. It
confers a jurisdiction upon the Court to condone the delay.
Thus,
section 142 (b) of the Act relates to the power of the Courts of Magistrate to
condone the delay in filing complaint, which is deliberated herein. It is also
worth mentioning that the condonation shall only revolve around delay in filing
complaint and not for delay in sending notice etc.
SUPREME COURT ON CONDONATION OF
DELAY IN FILING COMPLAINT U/S 138 OF NEGOTIABLE INSTRUMENTS ACT
(1) Birendra
Prasad Sah Vs State of Bihar (2019) 7 SCC 273
The
Supreme Court has held in above case that the Magistrate is empowered to
condone delay in preferring complaint u/s 138 of the NI Act. It is further held
that the very fact that in complaint itself the necessary averments with regard
to delay and reasonable cause for its condonation was specified, the delay was
condoned taking note of that and rightly so even in absence of a separate
application to that effect.
2. PAWAN
KUMAR RALLI VERSUS MANINDER SINGH NARULA
CRIMINAL APPEAL NO. 1684 OF 2014
The Supreme Court had permitted the complainant
to file the application for condonation of delay in advanced stage. In the
first instance and at the time of instituting the complaint no application for
condonation of delay was preferred. Still, the Supreme Court permitted the
complainant to file the application to that effect even in the subsequent
stage. Though, it was made clear that the same was being done on the peculiar
facts of the case and should not be treated as precedent.
3. A corollary can also be
drawn from a F.I.R case reported as Rakesh Kumar Jain Vs. State (Through CBI) (2000) 7 SCC 656,
The
Supreme Court in the above case had considered the provisions of Section 473,
Cr.P.C. and held that the accused shall not be entitled to seek his discharge
on the ground of delay in preferring complainant. The operative paragraph are
as under:
“The mere fact that the complaint was filed 25
days after the expiry of the period of limitation did not entitle the accused
to seek his discharge under Section 245, Cr.P.C because the complainant has,
under law, a right to seek for extension of time under Section 473 Cr.P.C. The complainant
could satisfy the Magistrate on the facts and circumstances of the case that
the delay was explainable which was occasioned on account of their bona fide
belief to obtain the sanction for the purpose of filing the complaint”.
4. In Subodh S. Salaskar Vs. Jayprakash M. Shah (2008) 13 SCC 689] the Supreme Court has held :
“21. It is no doubt true that at the time of filing the complaint, the
Magistrate has to take cognizance of the complaint when it is within limitation
and in case of delay in filing the complaint, the complaint has to come up with
the application seeking condonation of delay”.
HIGH COURTS
In a matter reported as 2017
ALL MR (Cri) 3025 and captioned as Dharrmaraj Vs State of Maharashtra
& Anr, Bombay High Court has held in para 6 that:
“6.
Condonation of delay is within the discretion of the Magistrate. Nothing could
have been achieved by the complainant by not filing complaint in time. He filed
the complaint within eight days from the date of receipt of information from
the post office. Thus, even if it is presumed that the complaint was not filed
within 30 days from the date of expiry of period of 15 days given to the
accused under section 138 of the Act, the fact remains that the delay of around
2 months was caused due to aforesaid circumstances. There is the record and the
law is amended in view of the aforesaid probabilities and power is given to the
Magistrate to condone the delay. In view of the possibility mentioned, the
Court is expected to use this provision liberally. This Court holds that the
Sessions Court has not committed any error in holding that there was sufficient
cause for condonation of delay.”
In a matter
reported as A seating Vs Nandini Modulars 2022 SCC OnLine kar 725 it is
held by Karnataka High Court that the issue of delay in preferring complaint
can be raised even in the appellate stage, but the same should be remanded to
the Courts of Magistrate for deciding the issue in accordance with law. The
power of condonation of delay is vested in the courts of Magistrates as per the
Act, therefore, the apt course shall be that only the Magistrate should
exercise that discretion and not the appellate courts. What is of relevance
herein is that the magistrate is equipped with the power of condoning the delay
in terms of Section 142(b) and as per the proviso contained therein. Therefore,
if reasonable cause is shown for the delay caused in preferring complaint u/s
138 of Negotiable Instruments Act, the Magistrate is empowered to condone the
delay.
Therefore,
what is clear from the above discussion is that after the amendment in the
Negotiable instruments Act and in terms of Section 142 (b) of the Act along
with the appended proviso therein the Magistrate is empowered to condone the
delay in preferring complaint and the delay can be condoned, if reasonable
cause is shown to the satisfaction of Magistrate. It also emerges that before
condoning delay, the notice is required to be issued to the opposite
party/accused. Further, if discretion is applied by the Magistrate in condoning
delay in sync with the provision of law, the complaint could be proceeded with
in accordance with law. The aforesaid discussion also leads to another aspect
i.e whether the application for condonation of delay is required to be filed
along with the complaint? The Supreme Court in Birendra Sah (Supra) has held
that even mention in the complaint about delay and cause for delay should be
construed as enough. Yet another dimension of it is to a situation as regards
not filing of application for seeking condonation of delay in preferring
complaint and not raising the plea of condonation of delay by the accused,
whether such plea could be raised in the appellate stage? It transpires on the
basis of judgment/precd4ensts that even in appellate stage the issue of delay
in filing complaint u/s 138 of the NI Act and its condonation could be raised,
however, since the Magistrate is empowered to deal with that aspect, it is only
the Magistrate who should look into that and therefore, the complaint may not
be quashed on that premise and it is only the Magistrate, who may hear the plea
of condonation of delay in preferring complaint upon remand from the appellate
courts, since that is what is the scheme of the law.
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Anil K Khaware
Founder & Senior Associate
Societylawandjustice.com
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