Section 138 of NI ACT

Querist : Anonymous (Querist) 15 October 2010 This query is : Resolved
Can i be charged u/s 138 for stopping the payment of issued cheque, as per the agreed conditions,n in failure of that condition,notice is issued not to present the issued cheque,still the cheque was presented,and returned as STOP PAYMENT on the memo,while i had sufficient funds to cover the cheque amount in the bank.

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R.Ramachandran (Expert) 15 October 2010
The opposite party, if it wishes can definitely file a case u/s. 138 N.I.Act, but it is for you to defend with whatever facts and reasons that you for having stopped the payment.

Akhilesh Kumar (Expert) 15 October 2010
Mens rea is essential part for committing the crime U/s. 138 of the N.I Act.

you have to prove that why you have stopped the payment where you have issued the cheque?

if you have valid reason then no charge will made.

DEFENSE ADVOCATE.-firmaction@g (Expert) 15 October 2010
Yes case can be filed , mens rea will be at defending cross stage.

Querist : Anonymous (Querist) 15 October 2010
I hereby thank the panel for answering my question,but still the logic does not accept because there is an agreement with specific condition which was not complied with also notice is served not to present.
Sufficiency of funds also becomes irrelevant
Therefore,only legal liability becomes prime factor in the case u/s 138.Is the definition of the act is thus,only theoretical?

R.Ramachandran (Expert) 15 October 2010
Dear Mr. Anonymous,
What is the logic that you are talking about?
You said that if you stopped payment of cheque, whether the other party can file a case u/s. 138 N.I. Act.
It was replied that the other party can definitely file a case, but you can defend it with whatever justification / reason / facts that are in your favour. (Whether there is an agreement with specific condition, or whether you intimated the party not to present the cheque etc., will have to be told to the court in the defence, in case the other party files a case.)
CAN YOU STOP OTHER PARTY FROM FILING A CASE? All that one says is nobody can stop a person from filing a case. Whether that person would win that case ultimately or not would depend upon the defence put up by defendant.
When this is the way that the law works, why do you say that the definition in the act is only theoritical etc.?

adv. rajeev ( rajoo ) (Expert) 15 October 2010
When notice is served not to present even though he can file complaint u/s 138 of NI Act by hiding the true facts. ONly you can take as defense, but you cannot avoid 138 if he files the case.

Basavaraj (Expert) 15 October 2010
yes I agree

Sukhija (Expert) 15 October 2010
u shd give reply to the notice sent to u in detail.
I agree with above views.

ashish lal (Expert) 15 October 2010
If you haven't received a notice of demand from the other side, then you should immediately send a legal notice to him. If you have received the notice then give reply.

But prima facie a case is made out in the other party favour U/s 138.