"Allahabad High Court Upholds Timely Filing of Complaint under Negotiable Instruments Act"
The cause of action for filing a complaint under Section 138 of the Negotiable Instrument Act arises only after the expiry of 15 days from the date of service of the demand notice. The complainant then has one month to file the complaint.
Dinesh Kumar v. The State of UP and another
WP 20471/2024
Before the Allahabad High Court
Heard by Hon'ble Mr. Anish Kumar Gupta J
In the present case, the Allahabad High Court dismissed the application filed by the petitioner Dinesh Kumar, holding that the complaint was filed within the statutory period, and no interference was warranted.
Background:
Petitioner-Dinesh Kumar issued two cheques on 18.10.2020 and 20.10.2020 to Rajveer Singh. The cheques were presented for encashment on 21.01.2021 but were dishonored on 22.01.2021 with the remark "payment stopped by the drawer."
As such a legal demand notice was issued by Rajveer Singh on 18.02.2021, which was served on Dinesh Kumar on 19.02.2021. Rajveer Singh filed a criminal complaint on 02.04.2021 under Section 138 of the Negotiable Instruments Act.
Legal Issue:
Whether the complaint filed by Rajveer Singh was time-barred?
Argument of the parties:
Petitioner's Argument
The complaint was filed beyond the one-month period prescribed under Section 142(1)(b) of the Negotiable Instruments Act, 1881.
The complaint is time-barred as it was filed on 02.04.2021, which was beyond one month from the date of service of the demand notice (19.02.2021).
Respondent's Argument:
The State, contended that the complaint was filed within the limitation period.
According to Section 142(1)(b) of the Negotiable Instruments Act, the complainant has one month to file the complaint from the date the cause of action arises, which is after the expiry of 15 days from the service of the demand notice.
In this case, the cause of action arose on 07.03.2021, giving the complainant time till 07.04.2021 to file the complaint, making the filing on 02.04.2021 timely.
Observation of the Court:
Under Section 142(1)(b) of the Negotiable Instruments Act, the complainant has one month time to file the complaint from the date the cause of action arises, which is after the expiry of 15 days from the service of the demand notice.