Sanchayita Lahkar

The High Court of Karnataka Single Bench of Justice Shivashankar Amarannavar set aside the conviction and sentence imposed under Section 138 of the Negotiable Instruments Act, 1881, on the ground that the complaint had been filed prematurely—before the expiry of the statutory 15-day notice period. The Court held that the complaint “is not a complaint in the eye of law” and accordingly quashed the trial and appellate court decisions. The complainant was granted liberty to file a fresh complaint within one month, with the benefit of delay deemed to be condoned under Section 142 of the NI Act.

The matter arose from a financial transaction in which the accused issued a cheque for ₹1,00,000 in favour of the complainant as repayment of a hand loan. The cheque, drawn on Canara Bank, was dated 10 December 2015. Upon presentation, the cheque was dishonoured for insufficiency of funds as reflected in the bank's return memo dated 21 December 2015.

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Following the dishonour, a statutory legal notice dated 30 December 2015 was issued by the complainant and served on the accused on 1 January 2016. The complainant, however, proceeded to file a criminal complaint under Section 138 of the Negotiable Instruments Act before the expiry of the mandatory 15-day period stipulated under the law. The complaint was filed on 13 January 2016, while the 15-day period following service of notice would have lapsed only on 16 January 2016.

The trial was conducted before the XIX Additional Chief Metropolitan Magistrate, Bengaluru, in Criminal Case No. 8433 of 2016. The complainant was examined as PW1 and relied on documentary evidence including the dishonoured cheque, bank return memo, legal notice, and postal acknowledgment. The accused entered defence evidence and marked two exhibits. The trial court convicted the accused and sentenced him to pay a fine of ₹1,75,000, with a default sentence of six months' simple imprisonment.

The accused preferred Criminal Appeal No. 649 of 2017 before the LXVI Additional Sessions Judge, Bengaluru, which resulted in a dismissal on 20 September 2017. The accused then approached the High Court in Criminal Revision Petition No. 1021 of 2017, contending that the complaint was filed prematurely and therefore legally untenable.

During proceedings before the High Court, the complainant conceded that the complaint had been filed before the expiry of the statutory 15-day period. He sought liberty to file a fresh complaint by seeking condonation of delay, if any.

The Court recorded the sequence of events from cheque dishonour to the filing of the complaint and observed that the complaint was indeed filed before the lapse of the 15-day statutory period post-service of notice as mandated by Section 138(c) of the Negotiable Instruments Act.

“This fact is not in dispute that the petitioner – accused has received the said legal notice on 01.01.2016… The respondent – complainant filed a complaint under Section 138 of the N.I. Act against the petitioner accused on 13.01.2016.”

The Court examined the statutory framework under Sections 138 and 142 of the NI Act, citing the authoritative precedent laid down in Yogendra Pratap Singh v. Savitri Pandey, (2015) AIR (SC) 157. Quoting directly from the Supreme Court, the Court noted:

“No complaint can be filed for an offence under Section 138 of the NI Act unless the period of 15 days has elapsed. Any complaint before the expiry of 15 days from the date on which the notice has been served on the drawer/accused is no complaint at all in the eye of law.”

Further referring to the same judgment, the Court quoted: “It is not open to the Court to take cognizance of such a complaint merely because on the date of consideration or taking cognizance thereof a period of 15 days from the date on which the notice has been served on the drawer/accused has elapsed.”

The Court also cited Gajanand Burange v. Laxmi Chand Goyal, 2022 LiveLaw (SC) 682, where the Supreme Court confirmed that a complaint filed before the 15-day period is legally non-maintainable but allowed the filing of a fresh complaint with the benefit of condonation under the proviso to Section 142(b) of the NI Act.

Summarizing the binding precedents, the Court recorded:“It is apparent that in a case where the complaint was filed before the expiry of 15 days stipulated in the notice… the Court cannot take cognizance thereof. However, second complaint on the same cause of action has been held to be maintainable.”

On the issue of technicality, the Court held:“Drawer of the cheque cannot be allowed to escape from prosecution merely on a technical count that a premature complaint was filed against him before expiry of the statutory period of 15 days as per the mandate of Section 138(c) of N.I. Act.”

It was further stated:“Such drawer of the cheque is liable to be prosecuted in a second successive complaint filed on the same facts by the holder of the cheque.”

The Court concluded by setting aside the orders of both the trial and appellate courts, recording: “Following the judgments passed by the Hon’ble Apex Court in the case of Yogendra Pratap Singh and Gajanand Burange it can be safely held that the impugned judgments passed by the trial Court and the appellate Court are not sustainable in the eye of law and the same are liable to be set aside and they are hereby set aside.”

The conviction judgment passed by the XIX Additional Chief Metropolitan Magistrate, Bengaluru, was modified as follows: “Granting liberty to the respondent – complainant to file a fresh complaint against the petitioner – accused within a period of 1 month from today. In case such complaint is filed… the delay in filing the complaint would be condoned under proviso to Section 142 of the N.I. Act.”

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It added: “It is expected from the trial Court to decide the said complaint after affording due opportunity of hearing to the petitioner – accused expeditiously as early as possible, preferably within a period of 6 months thereafter.”

Additionally, the Court directed: “The trial Court is further directed to return all the original / certified documents to the respondent – complainant after retaining the certified copies of the same on record.”

The Court also specified: “Amount in deposit, deposited by the petitioner – accused, shall be kept in Fixed Deposit in Karnataka Bank, CMM Court Branch, in the name of the Deputy Registrar for a period of 6 months with auto renewal and successful party is entitled to the said amount in deposit.”

It clarified that the trial Court, in any subsequent proceedings, “would not be influenced by any of the observations made hereinabove while deciding the complaint.”

Advocates Representing the Parties

For the Petitioner: Sri Praveen C., Advocate

For the Respondent: Sri B.C. Rajanna, Advocate

Case Title: Arumugam v. Ananda

Neutral Citation: 2025: KHC:21074

Case Number: CRL.RP No. 1021 of 2017

Bench: Justice Shivashankar Amarannavar

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