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138-a ni act funds insufficient and drawers signature differs

(Querist) 01 December 2011 This query is : Resolved 
Dear Experts my question when cheque presented for collection same was dishonored on two grounds one is FUNDS INSUFFICIENT AND DRAWERS SIGNATURE DIFFERS. In such case offence under Sec 138-a NI act would made out or not please suggest me with any reference and supreme court citation
V R SHROFF (Expert) 01 December 2011
"Any cheque" in Law include ur cheque
Fund Insufficient , no question arise. it is certain ground.
Sign differ, will be decided by trial court.
Weather it was intentional to deceive, by him , or signed by different person??
What is reply of ur demand notice u/s 138?
In all case, the case is made out. u r advised to file complaint after compliance of legal notice requirement, [hope u have proof of legal liability/ any transaction with payee]
Raj Kumar Makkad (Expert) 01 December 2011
Ground for 138 has been made out in the light of given facts but you have now to issue a legal notice to pay the amount of cheque and if within 15 days of receipt of notice, you do not get payment from the defaulter only then offence under section 138 shall be established.
Shailesh Kr. Shah (Expert) 01 December 2011
I would like to slightly correction typing error in reply of Mr.Makkad that read 30 days and rest is agree.
DEFENSE ADVOCATE.-firmaction@g (Expert) 01 December 2011
well case can be filed but accused can get aquited unless the complaint can prove by solid evidence that knowingly the signatures have been made by the accused.There are many gray areas in this matter and no definite conviction.
Deepak Nair (Expert) 01 December 2011
I agree with Mr. Makkad. You have to issue a notice withini 30 days of dishonour and wait for 15 days for payment. You can file a case within 30 days after the expiry of the siad 15 days.
"Funds Insufficient" is a sufficient ground for initiating proceedings under Sec.138.
H. S. Thukral (Expert) 01 December 2011
Mr. Makkad reply is correct. Cause of action starts after 15 days of notice and not thirty days as suggested by Mr. Shah.
If the signature differs a case under section 420 IPC can also be pleaded.
Shailesh Kr. Shah (Expert) 01 December 2011
Thanks Shri Deepak Nair and Shri Harbhajan Singh ji for correcting me.
ajay sethi (Expert) 01 December 2011
if cheque had bee dishonoured only on grounds of signature differs then it would have been difficult to make out a case for complaint under section 138 of Ni .

however in your case the cheque has been dishonoured aslo on grounds of funds insufficent. under circumstances if inspite of legal notice accused fials to make payment then complaint would be maintanable .
DEFENSE ADVOCATE.-firmaction@g (Expert) 01 December 2011
In trial at evidence stage from the bank the first question will about signature difference and if bank evidence in positive further evidence will have no value about want of funds.

Yes only exception is that complainant has to conclusive prove that the accused made wrong signature and that too before a witness.

Because again wrong signatures can be back dated and the cheque was not meant for the complainant.
Rajeev Kumar (Expert) 01 December 2011
I agree with experts
Rajeev Kumar (Expert) 01 December 2011
Agree with experts
Advocate. Arunagiri (Expert) 01 December 2011
If the signature differs, there is no case made out.

If you can prove the signature is correct, then you can file the case, with proof to so the signature is correct.
Raj Kumar Makkad (Expert) 02 December 2011
Arunagiri G, cheque has been dishonoured on two reasons.
Advocate. Arunagiri (Expert) 02 December 2011

Let us assume the case,

Funds available, but signature differs. The cheque can not be encashed.

When the signature mismatch, the banker can not proceed further.

That is why I have said only if the complainant can prove the signature is correct, he can initiate prosecution.

If the complainant fails to prove the signature the offense is not made out.
Shonee Kapoor (Expert) 02 December 2011

moot point, case u/s 138 is maintainable.


Shonee Kapoor
DEFENSE ADVOCATE.-firmaction@g (Expert) 02 December 2011
Yes Arunagiri has put the proper situation.Unless you can prove by hard evidence that the signature forged by accused and that too the custody of cheque has come from accused till than no case or conviction.
Devajyoti Barman (Expert) 03 December 2011
Yes I agree.
Surendra Gupta (Expert) 04 December 2011
The reason for dishonouring the cheque mentioned by the bank in "cheque Returning Memo" is importatnt. It is rare that the returning bank mentions two reasons for return of the cheque. It would be safe to present the cheque again and see what the bank mentions in the returning memo

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