Gauhati High Court: In a criminal appeal filed under Section 378, Criminal Procedure Code (CrPC), against the final judgment and order passed by the learned JFMC Kamrup, Guwahati in CR Case No. 2036(c) of 2017 under Sections 138 and 142, Negotiable Instruments Act, 1881 (NIA), a Single Judge Bench of Mitali Thakuria, J., affirmed the judgment and order passed after holding that the cheque number is the most essential part of the demand notice under Section 138, Negotiable Instruments Act, 1881 and without cheque number it cannot be considered proper legal demand notice.
Also Read: Section 138 of NI Act Explained: Cheque Bounce Notice, Procedure & Landmark Rulings
Background
The respondent, while discharging a lawful liability, issued a cheque of 6 lakhs in favour of the appellant, but the said cheque was dishonored on the ground of “insufficient funds” when appellant deposited the cheque in the account. To this, the appellant issued demand notice against the respondent demanding the amount within 15 days from the day of notice, i.e. on 30 May 2017. The respondent failed to reply to the notice even though received it on 21 June 2017, which led to a complaint filed by the appellant under Sections 138 and 142, Negotiable Instruments Act, 1881.
The appellant claimed that the cheque was dishonored due to insufficiency of funds so the demand notice was issued. On the contrary, the respondent said that there is no dispute regarding the cheque issued by respondent. It was the case of the respondent that he had taken a loan of rupees 1 lakh which had already been repaid, evident by the bank statement and the money receipt exhibited by him. He stated that 3 to 4 blank cheques were issued by him and no debt or liability existed for any subsequent cheque or amount which the appellant claimed.
After recording evidences, the trial court framed three issues — (i) whether the cheque was issued for the discharge of any legally enforceable debt or liability? (ii) whether the cheque was dishonored for the reason “insufficient funds” and (iii) whether the respondent received the demand notice issued by the complainant/appellant regarding dishonor of cheque?
The trial court decided Issues (i) and (iii) against the appellant and (ii) in favour of the appellant, thereby acquitting the respondent with the observation that the complainant could not prove the case and on the ground of benefit of doubt, the respondent got the order of acquittal.
Analysis
The Court observed that the signature in the cheque in question as well as receipt of demand notice from the appellant was not disputed. The issue raised was that while issuing the demand notice, the cheque number was not mentioned and demand was made for cheque dated 5 April 2014 wherein there was no existing liability. The appellant claimed to have corrected the inadvertent typographical mistake in the demand notice at the time of filing, which was not considered by the trial court.
The Court found that the typographical mistake was not corrected by the appellant and no fresh demand notice was filed. It also noted that the typographical error while typing the date 5 April 2014 instead of 5 April 2017 could have been corrected or taken into consideration if the proper cheque number was mentioned in the demand notice whereby 6 lakhs were demanded by the appellant. The cheque number is the most essential part of the demand notice. And the notice neither had the cheque number mentioned nor the correct date of the cheque.
The Court said that it is settled principle of law that notice has to be read as a whole and should include a cheque number or it will fall short of legal requirement.
In the light of these findings, the Court held that the notice cannot be considered a proper legal demand notice as it lacked the most essential thing which is the cheque number, along with the correct date of the cheque. Therefore, the demand notice cannot be considered a legal demand notice as required under Section 138, Negotiable Instruments Act, 1881, which clearly states in proviso (b) that the holder of cheque should make a demand for payment of an amount to the drawer of the cheque and it was an admitted fact that the demand notice did not bear the cheque number and the date of the cheque was also incorrect, so the the exact transaction against which such demand was made could not be understood.
Further, in the context of Section 139, Negotiable Instruments Act, 1881, the Court went on stating that it is settled position of law that an accused has to rebut the presumption under Section 139 of the Act and his standard of proof for doing so is that of preponderance of probabilities. The accused does not have to adduce evidence in his favour, but can also rely on the materials submitted by the complainant in order to raise defence under Section 139.
The Court found that the respondent not only relied on the materials submitted by the complainant but also adduced evidence and exhibited the documents to substantiate their plea of defence. Such exhibit being the demand notice with incorrect date of cheque without any cheque number.
Therefore, the Court stated that there is no scope for any correction of the demand notice at this stage and affirmed the order and judgment passed by the trial court while dismissing the appeal.
[Dhiraj Sarma v. Kakil Namasudra, Criminal Appeal 84 of 2019, 2026:GAU-AS:5925, decided on 29-4-2026]
Judgment authored by: Justice Mitali Thakuria
Advocates who appeared in this case:
For Petitioners: HK Sarma
For Respondents: R Das, S. Roy
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