The issue as to whether the legal notice sent under Section 138 of N.I.Act,1881 will be considered as served when it is returned unclaimed but not refused has had been dealt by various courts of law from time to time. But , this interesting issue has various inbuilt factors whic can be understood as below :
A. The words in Clause (b) of the proviso to Section 138 of the Act show that payee has the statutory obligation to ‘make a demand’ by giving notice. The thrust in the clause is on the need to ‘make a demand’. It is only the mode for making such demand which the legislature has prescribed. A payee can send the notice for doing his part for giving the notice. Once it is dispatched his part is over and the next depends on what the sendee does.
B. In Bhaskaran’s case (supra), the notice issued in terms of Clause (b) had been returned unclaimed and not as refused, the Court posed the question:
‘Will there be any significant difference between the two so far as the presumption of service is concerned?’
It was observed that though Section 138 of the Act does not require that the notice should be given only by ‘post’, yet in a case where the sender has dispatched the notice by post with correct address written on it, the principle incorporated in Section 27 of the General Clauses Act, 1897 (for short ‘G.C. Act’) could profitably be imported in such a case.
It was held that in this situation service of notice is deemed to have been effected on the sender unless he proves that it was not really served and that he was not responsible for such non-service
C. In Vinod Shivappa’s case (supra). Elaborately dealing with the situation where the notice could not be served on the addressee for one or the other reason, such as his non availability at the time of delivery, or premises remaining locked on account of his having gone elsewhere etc;
it was observed that if in each such case, the law is understood to mean that there has been no service of notice, it would completely defeat the very purpose of the Act. It would then be very easy for an unscrupulous and dishonest drawer of a cheque to make himself scarce for sometime after issuing the cheque so that the requisite statutory notice can never be served upon him and consequently he can never be prosecuted.
It was further observed that once the payee of the cheque issues notice to the drawer of the cheque, the cause of action to file a complaint arises on the expiry of the period prescribed for payment by the drawer of the cheque. If he does not file a complaint within one month of the date on which the cause of action arises under Clause (c) of the proviso to Section 138 of the Act, his complaint gets barred by time.
Thus, a person who can dodge the postman for about a month or two, or a person who can get a fake endorsement made regarding his non availability, can successfully avoid his prosecution because the payee is bound to issue notice to him within a period of 30 days from the date of receipt of information from the bank regarding the return of the cheque as unpaid. He is, therefore, bound to issue the notice, which may be returned with an endorsement that the addressee is not available on the given address.
This Court held: (SCC p.463, para 15)
“15. We cannot also lose sight of the fact that the drawer may by dubious means manage to get an incorrect endorsement made on the envelope that the premises has been found locked or that the addressee was not available at the time when postman went for delivery of the letter. It may be that the address is correct and even the addressee At Present In Kalamba Jail vs Gautam Umed Parmar on 3 April, 2013 is available but a wrong endorsement is manipulated by the addressee. In such a case, if the facts are proved, it may amount to refusal of the notice.
If the complainant is able to prove that the drawer of the cheque knew about the notice and deliberately evaded service and got a false endorsement made only to defeat the process of law, the Court shall presume service of notice. This, however, is a matter of evidence and proof.
D. Thus even in a case where the notice is returned with the endorsement that the premises has always been found locked or the addressee was not available at the time of postal delivery, it will be open to the complainant to prove at the trial by evidence that the endorsement is not correct and that the addressee, namely the drawer of the cheque, with knowledge of the notice had deliberately avoided to receive notice. Therefore, it would be premature at the stage of issuance of process, to move the High Court for quashing of the proceeding under Section 482 of the Code of Criminal Procedure. The question as to whether the service of notice has been fraudulently refused by unscrupulous means is a question of fact to be decided on the basis of evidence. In such a case the High Court ought not to exercise its jurisdiction under Section 482 of the Code of Criminal Procedure.”
It is, thus, trite to say that where the payee dispatches the notice by registered post with correct address of the drawer of the cheque, the principle incorporated in Section 27 of the G.C. Act would be attracted; the requirement of Clause (b) of proviso to Section 138 of the Act stands complied with and cause of action to file a complaint arises on the expiry of the period prescribed in Clause (c) of the said proviso for payment by the drawer of the cheque. Nevertheless, it would be without prejudice to the right of the drawer to show that he had no knowledge that the notice was brought to his address.
E.Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business.
This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement ‘refused’ or ‘not available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee not in station’, due service has to be presumed. [Vide Jagdish Singh v. Natthu Singh, AIR 1992 SC 1604; State of M.P. v. Hiralal and Ors. At Present In Kalamba Jail vs Gautam Umed Parmar on 3 April, 2013 , [1996] 1 SCR 480 and V. Raja Kumari v. P. Subbarama Naidu and Anr., 2005 Cri.L.J. 127]. It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved.
F. In Kalamba Jail vs Gautam Umed Parmar , CRIMINAL REVISION APPLICATION NO.435 OF 2011 decided on 3 April, 2013, The Honourable High Court of Bombay laid down teh following ratio’s as below :
a. when the notice is sent by registered post by correctly addressing the drawer of the cheque, the mandatory requirement of issue of notice in terms of Clause (b) of proviso to Section 138 of the Act stands complied with.
b. It is needless to emphasize that the complaint must contain basic facts regarding the mode and manner of the issuance of notice to the drawer of the cheque.
c. It is well settled that at the time of taking cognizance of the complaint under Section 138 of the Act, the Court is required to be prima facie satisfied that a case under the said Section is made out and the afore noted mandatory statutory procedural requirements have been complied with.
d.It is then for the drawer to rebut the presumption about the service of notice and show that he had no knowledge that the notice was brought to his address or that the address mentioned on the cover was incorrect or that the letter was never tendered or that the report of the postman was incorrect.
e.In our opinion, this interpretation of the provision would effectuate the object and purpose for which proviso to Section 138 was enacted, namely, to avoid unnecessary hardship to an honest drawer of a cheque and to provide him an opportunity to make amends.
Further , the honourable court concluded that In the facts of the present case, there is no dispute about service of the notice in terms of Section 27 of the General Clauses Act, 1897 and Section 28 of the Bombay General Clauses Act, 1904. The notice was issued and served, but the Applicant did not receive it personally. It was her husband who received it. In these circumstances, both the Courts below did not commit any error in holding that the notice is duly served and received as well. Once it is duly served and received and there is no compliance with the requisitions contained therein, then, the offence is committed. Once the offence is committed, then, the conviction and sentence is valid, legal and proper. There is no evidence to rebut the presumption in favour of the Complainant of service of the notice and its receipt.
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