SEC 138 of NIA Act and limitations
If my client had issued a blank check to party B as security for a loan of Rs 20,000 and then repays the entire amount in full. However, the Party B does not return the check but enters Rs 10 lakhs instead and presents it.
The check bounces, lets say on the 19 Aug 2009 and party B through his lawyer issues a notice on the 19th of Sept 2009 to pay the entire amount.
secondly, the party B writes the date on the check as 17 - 8-9 and presents the same.
Now my question is the following:
1. does the statute of limitations apply in the issuing of notice as it is more than the required 30 day period?
2. Can the date of the check deemed correct and legal as it should have been (17- 8- 09) and not the above.
3. The legal notice was not served on my client nor his family members.
Now, under the above situation, what would be the possible resultant of this case.
looking to hear from you
Himanshu
3 Replies
1. In your case, since the notice was issued within 30 days of receipt of information of dishonor, it fulfills the statutory requirement under Section 138(b) of the NI Act.
2. Its not of much difference. Wouldn’t be a big issue to raise since the bank slip would have the date written on it as the date on which it was presented and rejected.
3. The legal notice is required to be served by a registered A.D. So if the complainant has given the correct address and dispatched the notice within 30 days as under Section 138(b), then it will be deemed to have been delivered to you. This applies in the present case as well.
Hope this helps.
OOPs
The date of bounce of cheque was 19th Aug and the issue of notice was 20th Aug making it more than 30 days.
it is actually 31 days.
so,. is there a case in this please
There are various precedents laid down by the Supreme Court where small delays of 4-5 days are condoned. So 31 days is just fine.