S.138 Neg.Ins.Act
Rahul Singh
(Querist) 03 December 2010
This query is : Resolved
I am appearing for the accused in the case.
The case of the complainant is that the Ch.has been bounced by the bank on a/c of Innsuficient funds in the account of the accused.Whereas the account of the accused was fully closed two years back(the said fact has also been proved in evidence)than submission of the Ch. for collection.So the offence u/s.138 to me is not made out.I want furthur clarification on the point and ruling to defend as it is totally a false case against my client.
adv. rajeev ( rajoo )
(Expert) 03 December 2010
You have got a good defense that if account is closed long back and bank has returned the cheque for want of sufficient fund. Lead the evidence of the bank and ask the questions regarding the closure of account. The endorsement given by the bank itself is contrary to the real fact. So take this defense you have got good chance.
Devajyoti Barman
(Expert) 03 December 2010
The closure of the account would be of defence if iit is proved that the cheque was issued much later from the date of the closure of the account. If it could be shown that the cheque was drawn before and not after the closure of the account, then only it would be of help to the accused person.
Advocate. Arunagiri
(Expert) 03 December 2010
I differ. The closure of the account and dishonour of the cheque will not help the accused. As per the SC if the account is closed, the account holder withdraws all the money from his account and there is no money in the account. Under the circumstances, the dishonor will be treated as "dishonored due to insufficient funds" as defined in the NI Act.
Normally the banks will not close the accounts if the account holder does not return the unused cheques.
malipeddi jaggarao
(Expert) 04 December 2010
The question is when the cheque was issued? Whether prior to closure of account or after closure of account. If the cheque was issued prior to closure of account and was presented by the payee after closure of the account, bank would give reason : Account closed (or) refer to drawer. Before filing a case the payee would have given a notice to your client demanding payment. He should have admitted that the account was closed and paid the money. If the cheque was issued after closure of account, the apparant intention is not proper and in such case your client is liable under section 138. I do not find any valid reason for defence because of the above two points. You can not bank upon the instance that the bank has returned the cheque with a wrong reason. Whatever reason the Bank has given, it is a fact that there are no funds available with the Bank to meet the payment of the cheque. If the account is closed after issue of cheque and before its presentation, when the payment is demanded by notice, the matter should have been settled at that pointof time.
ashish lal
(Expert) 04 December 2010
i agree with Mr. Jaggarao
DEFENSE ADVOCATE.-firmaction@g
(Expert) 04 December 2010
In general it is always easy for accused to win any NI 138 case but it will depend on tactics and not completely on law.
In present case Mr Arunagiri has put the legal position. And accused can not escape legal liability.
Still how the cases are won by accused because the complainant as rule make procedural mistakes and the defense advocate must do hard work to get its benefit.
vijayan
(Expert) 04 December 2010
In short, accused has to prove how the cheque reached in hands of the complainant.
Why the cheque issued to complainant?
When it is issued?
If the cheque is possessing and used by the complainant illegally, what steps taken to repossess it?
On closing the account in which a cheque is issued prior to or after the issuance of the cheque, an accused is expected to answer many aspects and prove it before the court to corroborate the fact of closure of the cheque otherwise the accused may face prosecution U/S 420 also.
Sri Vijayan.A
(Expert) 05 December 2010
Yes, I agree with Mr.Arunagiri and Jagga Rao.
The reason by the bank cant be the defence.
If the cheque is given by the accused after closing the a/c to the complainant, this proves the wrong intention of the accused.
To the queriest,
Try to get the answers for questions posted by Mr.Vijayan.
If u find anything in favour of accused, u may win.
Advocate. Arunagiri
(Expert) 05 December 2010
If the cheque was issued after the closure of the account, the accused can be prosecuted for cheating as well as cheque bounce.
Arun Kumar Bhagat
(Expert) 05 December 2010
Closure of account attracts action u/s 138 N.I.Act .See the case law of Modi Cement Ltd-Vs-Kuchil Kr. Nandi.
