Adv. Suryanarayan M. Nadar
Advocate enrolled with the Bar Council of Maharashtra & Goa (MAH/4247/2012), practising from Malad West, Mumbai.
Practice area: matters under Section 138 of the Negotiable Instruments Act, 1881 — including the statutory notice, complaint, trial and appellate stages, appearing before the Magistrate and Sessions Courts and the Bombay High Court.
The information on this site is provided for general reference only. It is not an advertisement, an offer of services, or a solicitation of work.
Finding Your Way Around This Site
This website sets out general information about the law under Section 138 of the Negotiable Instruments Act, 1881. Depending on your situation, the pages below explain, in plain language, what the Act provides. This is information only, and not legal advice.
If a cheque you hold has been dishonoured
What Section 138 requires, the thirty-day demand notice, the statutory periods, and the stages through which a matter passes.
If you have received a notice or summons
What a demand notice and a summons mean, the presumptions under Sections 118 and 139, and the defences the law recognises.
Every matter turns on its own facts. For advice on your own situation you should consult an advocate; the chambers' contact particulars are on the Contact page.
At a Glance
Information Furnished Under the Proviso to Rule 36
The proviso to Rule 36 of the Bar Council of India Rules (Part VI, Chapter II, Section IV), introduced by Bar Council of India Resolution No. 50/2008, permits an advocate to furnish on a website only certain prescribed particulars. Those particulars are set out below. Their publication is not an advertisement and is not a solicitation of work.
Name & Enrolment
Chambers & Contact
Area of Practice
The particulars stated above are true and genuine, and are furnished solely in the form and to the extent permitted by the proviso to Rule 36 of the Bar Council of India Rules. Nothing on this website is intended to be, and nothing should be read as, an advertisement, a solicitation of work, or an inducement of any kind.
What Section 138 Actually Requires
The dishonour of a cheque is not, by itself, an offence. The offence under Section 138 of the Negotiable Instruments Act, 1881 is constituted only when a series of statutory conditions are cumulatively satisfied. In K. Bhaskaran v. Sankaran Vaidhyan Balan, (1999) 7 SCC 510, the Supreme Court described the offence as being made up of five distinct components. They are summarised below for general information only.
1 · Drawing of the Cheque
The cheque must be drawn by the drawer on an account maintained by him with a banker.
The account must be one maintained by the drawer himself — a point considered in Jugesh Sehgal v. Shamsher Singh Gogi, (2009) 14 SCC 683.
2 · Presentation to the Bank
The cheque must be presented within its period of validity, and must be issued for the discharge, in whole or in part, of a legally enforceable debt or other liability.
An advance, a loan, an unpaid invoice or an instalment may each constitute a debt or other liability, depending on the facts.
3 · Return of the Cheque Unpaid
The cheque must be returned unpaid because the amount standing to the credit of the account is insufficient, or because it exceeds the arrangement made with the bank.
Reasons such as “account closed” and “stop payment” have been held to fall within the section: NEPC Micon Ltd v. Magma Leasing Ltd, (1999) 4 SCC 253; Modi Cements Ltd v. Kuchil Kumar Nandi, (1998) 3 SCC 249.
4 · Demand by Written Notice
The payee or holder in due course must make a demand for payment by a notice in writing, given within thirty days of receipt of information from the bank about the return of the cheque.
On the question of deemed service of a correctly addressed notice, see C. C. Alavi Haji v. Palapetty Muhammed, (2007) 6 SCC 555.
5 · Failure to Pay Within Fifteen Days
The drawer must fail to make payment of the amount within fifteen days of receipt of the notice. It is only on the expiry of that period that the cause of action arises.
The complaint must then be made within one month of the date on which the cause of action arises, subject to the power to condone delay under the proviso to Section 142(b).
The Character of the Offence
Although Section 138 creates a criminal offence, the Supreme Court has observed that it is regulatory in character and that the gravamen of the matter is frequently compensatory rather than punitive.
See Kaushalya Devi Massand v. Roopkishore Khore, (2011) 4 SCC 593; the offence is compoundable under Section 147.
The above is a simplified statement of the law, published at the visitor's own request for general information. It is not legal advice, is not exhaustive, does not refer to any identifiable party or matter, and must not be acted upon without independent advice on the particular facts.
The Statutory Clock
The periods prescribed by the Act are strict, and the point from which each begins to run matters as much as its length. The outline below is general and does not describe any particular matter.
Day Zero
The cheque is returned unpaid and the bank issues its return memo. Time runs from the date on which the payee receives that information — not from the date of dishonour.
Within 30 Days
The written demand notice must be given to the drawer under proviso (b). The period is prescribed by the statute and cannot be enlarged by consent.
15 Days to Pay
The drawer has fifteen days from receipt of the notice to make payment. The cause of action arises only when that period expires without payment.
Within 1 Month
The complaint must be made within one month of the accrual of the cause of action, subject to the court's power to condone delay on sufficient cause being shown.
Principles the Courts Have Settled
A short selection of reported decisions on Section 138, reproduced here in summary only. The summaries are the author's own and are not a substitute for the reports themselves.
The Presumption Under Section 139 Extends to the Existence of a Legally Enforceable Debt
How the Presumption May Be Rebutted
A Signed Cheque Voluntarily Handed Over
Expeditious Trial of Section 138 Cases
The judgments summarised above are reported decisions of the Supreme Court of India and are in the public domain. They are cited for the general propositions of law they lay down. No representation is made that the advocate appeared in any of them, and nothing above is a representation or assurance as to the outcome of any matter.
What You Will Find Here
This website is an informational website only. It is made available to a visitor who has, of their own accord and at their own request, sought general information about the advocate and about the law relating to the dishonour of cheques.
About
The particulars of the advocate permitted by the proviso to Rule 36 — enrolment, qualifications, area of practice, and the working method followed in the chambers.
Open →Services
A description of the stages at which a matter under Section 138 ordinarily arises. A description of an area of practice, not an offer of services.
Open →Legal Principles
How recurring defences in cheque-dishonour matters are treated under settled law, stated in general terms and without reference to any identifiable matter.
Open →Resources
A glossary of the terms used in the Act, the statutory scheme in outline, and general articles on procedure under Section 138.
Open →FAQ
Frequently asked questions on notice, complaint, evidence, presumptions, settlement, sentence and appeal — answered in general terms.
Open →Judgments
Summaries of reported decisions of the Supreme Court and the High Courts on Section 138 of the Negotiable Instruments Act, 1881.
Open →Contact
The address of the chambers, office hours, and the means by which the advocate may be contacted by a person who wishes to do so.
Open →Client Portal
A secure area for existing clients of the chambers to review the status of a matter. Access is by credentials issued by the chambers.
Open →A Note on This Website
Rule 36 of the Bar Council of India Rules, framed under Section 49(1)(c) of the Advocates Act, 1961, prohibits an advocate from soliciting work or advertising, whether directly or indirectly. The proviso to that rule, introduced by Bar Council of India Resolution No. 50/2008, permits an advocate to furnish on a website only the particulars prescribed in the Schedule to the resolution, and requires that those particulars be true and genuine.
This website has been prepared on that footing. Everything on it falls into one of two categories: a particular expressly permitted by the proviso to Rule 36, or a neutral statement of statutory law and reported judgments, published for the visitor's general information at the visitor's own request.
Accordingly, this website carries no claim of superiority or comparative merit, no testimonial or endorsement, no statement of results obtained in any matter, no reference to any client or any case in which the advocate has been engaged, and no promise, assurance or prediction of any outcome.
The Framework Applied
Nothing on this website constitutes legal advice, and no lawyer–client relationship arises from reading it or from communicating through it. A person with a legal question should obtain independent advice from a qualified legal practitioner on their own facts. Statutory provisions and judicial decisions referred to on this website are stated as they were understood at the time of writing and may since have been amended, overruled or explained.