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can i file 138 case for "account inoperative/dormant"

Page no : 2



y.chinnayyadora (Advocate)     12 April 2011

Thanks, Mr.Janartanreddy you gave valuable judgement

y.chinnayyadora (Advocate)     12 April 2011

Dear Mr.Janardhanareddy garu, if you have any possiability please send N.I act amendment our mail, Thanks&Regards


Swaran Singh (Advocate)     27 April 2011

Sir, What is difference between cheque given as legally enforceable liability and cheque given as security in legally enforceable liability u/s 138 oa NI Act. Is there any decided case law on cheque as security does not attact section 138 of NIA.

M. Munikrishnan (Bank Executive (Retired))     30 April 2011

I am not a learned advocate.  But from my experience, let me share my point of view:

when cheque is returned due to closure of account, the intention of the drawer of the cheque in closing the account after issuing the cheque appears to cheat.   This itself proves 'insufficiency of funds'   and the account is closed with an intention to defraud.   

Dormant account is no reason for dishonouring a cheque if sufficient  balance is available in the account. This can also go to prove that there is insuffiency of funds in the account.   

In all such cases of Sec 138, the concerned Bank is made a party and the account statement of the customer will prove that there was no sufficient balance on the day the cheque was returned.  

Sidharth Aurora (Advocate)     01 May 2011

Law is common sense codified!!!!!!!!!!!

Assume you want to close your account........hwat will be the balance in your account when you close your account.........................NIL/around that.............!!!!!!!

Is it enough to pay the cheque amount............No!

So the moment the cheque is presented...does it fall within the ambit of Insufficient funds.........Exceeds arrangement...yes!!!!!.....hence 138 NIA attracted

Now go and contest your case..........


Dr. Sidharth Aurora



Hemant Agarwal ( Mumbai : 9820174108)     02 May 2011

1.  The legislature passed the N.I.Act (specifically section 138) giving jurisdiction to the Courts to prosecute cheque bounce offenders under  "ONLY TWO PROVISIONS",  namely :

a)  Insufficient funds
b)  Exceeds arangemment

There is no other provision u/s 138, wherein cheque bounce offender may be prosecuted  "OTHER THAN"   the above two provisions.   THIS IS MORE SO LAWFULLY RELEVANT (WITHOUT HALLUCINATED INTERPRETATIONS),  which was being illogically doled out by the Indian Courts, is more very specifically cleared in the two judge SC latest judgement in "Raj Kumar Khurana v/s State of (NCT of Delhi)"  (Criminal appeal no. 913 of 2009 decided on 5.5.2009)

For cheque bounce matters in all other reasons / provision, the prosecution can be preferred u/s 420 IPC  and under the CPC.

2.  The legislature DID NOT PROVIDE FOR the following provisions u/s 138AND these all are only individual Judicial Interpretations, namely :

a)   Account closed
b)   Signature difference
c)   Inoperative / dormant account
d)  Stop payment
e)  Security cheques
f)   scores of other reasons

THE ABOVE NON-PROVISIONS U/S 138,  ARE A RESULT OF HALLUCINATED INTERPRETATIONS OF VARIOUS JUDICIAL COURTS,  without proper application of mind,  which has caused a great deal of misinterpretation of law and piling up of N.I..Act cases.  The judges are under restricted jurisdiction to follow the Law as passed by the Legislature  AND NOT TWIST the words of the legislature to form their own interpretated laws,  as is evident from another 2 judge SC bench observation in another judgement, more specifically as described in the following link :

(specifically, Please read post daed 23 March, 2011)

The Judiciary have not yet been given jurisdiction by the legislature, to Interpret and/or twist the legislated  law provisions, at its own whims and fancies.

3.  The Supreme Court bench of justices Markandeya Katju and Gyan Sudha Mishra, have ruled the following : (key points)  (as in the above link)

a)  judges should  "NOT LEGISLATE"  as it would be violative of the basic democratic principles.
b)  Judges should " NOT INTERPRET"  a legislative provision (wordings), since otherwise then any number of interpretations can be put to a statutory provision, each judge having a free play to put his own interpretation as he likes.
c)  This would be destructive of judicial discipline, and also the basic principle in a democracy that it is not for the judge to legislate as that is the task of elected representatives of the people. Even if the literal interpretation results in hardship or inconvenience, it has to be followed,
d)  The language employed in a statute is the determinative factor of the legislative intent. The legislature is presumed to have made no mistake. The presumption is that it intended to say what it has said. 
e)  "Assuming there is a defect or an omission in the words used by the legislature, the court cannot correct or make up the deficiency,"

4.   The above SC ruling (at point no. 3, above),  effectively & lawfully means :


a)  For prosecution u/s 138, the N.I.Act has only two provisions (as enacted by Legislature) namely :
i)  Insufficient funds   .AND.    ii)  Exceeds arangemment


b)  The N.I.Act u/s 138,   "DOES NOT HAVE"   the following scores of provisions

i)   Account closed,  ii)  Signature difference,  iii)   Inoperative / dormant account,  iv)   Stop payment   v)   Security cheques,   vi)  scores of other reasons

Since the legislature did not include the above provisions, the Judiciary cannot hold trial under N.I.Act for the above non-existent provisions / reasons and neither the cheque bounce offenders may be prosecuted u/s 138.  This is of course if the judiciary strictly wants to  "lawfully"  follow the N.I.Act provisions, as enacted by the legislature.

IF the judiciary feels that they can make the other provisions themselves (amend / modify the law) and violate the intent and/or rights of the democratically represented legislature,  THEN as it is the judiciary is as it is doing what it thinks is right  AND NOT following the intent / words of the legislature.  We may as well have the Judges making the Laws / Rules / Provisions (like a dictator)  for the democratic citizens and there would be no need for the legislature to make / deliberate / amend any Law.

ANY & ALL comments are welcome,  BUT with appropriate reasonings and justifications.

Keep Smiling .... Hemant Agarwal

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