NI Act | Notice Deemed To Be Served If Proved To Be Sent By Registered Post On Correct Address: Allahabad High Court

The Allahabad High Court has held that in the ordinary course of business, notice is deemed to be served if it has been proved to be sent through registered post to the correct address.While deciding the issue of the date of service of demand notice under the Negotiable Instruments Act, of 1881, Justice Jyotsna Sharma held“In the instant case, the trial court seems to have drawn a presumption of law as regard service of demand notice. In my opinion, even if the track consignment report is not filed, the court may presume service of notice in ordinary course of business, if it was shown that the same was sent by registered post on correct address.”A complaint was filed under Section 138 of the Negotiable Instruments Act, 1881 against the accused. The Court below summoned the accused under Section 138 of the NI Act. The evidence before the Court included a cheque of Rs. 2,75,000/-, which was returned by the Bank on 02.04.2019 with a remark of "funds insufficient", the return memo and the demand notice dated 22.02.2019. Revisional court upheld the order of the trial court and dismissed the revision.Approaching the High Court under Article 227 of the Constitution of India against the summoning order, the petitioner contended that the fact that demand notice was served upon the petitioner was not proved by the complainant, therefore, an essential condition for taking cognizance, as provided under section 138 clause (c) read with section 142(1)(b) of the NI Act was not fulfilled.Per Contra, the respondent argued that though there was no mention of the date on which the demand notice was received, the track consignment report of the postal department was considered by the revisional authority. Hence, the order of the Court below cannot be faulted.Relying on the decision of the Allahabad High Court in Deepak Kumar and Another vs. State of U.P. held “the date of the receipt of notice is very much important but it is not necessary that any particular date as regard receipt of demand notice should mandatorily be mentioned in the complaint itself. The day of receipt of demand notice can very well be inferred from the documents/evidence on record.”Further reliance was placed on Ajeet Seeds Limited vs. K. Gopala Krishnaiah, wherein the Supreme Court discussed the nature of presumptions under Section 114 of the Evidence Act read with Section 27 of the General Clauses Act to employ them while considering the question of service of notice under Section 138 of the NI Act. The Apex Court held that “It is thus clear that Section 114 of the Evidence Act enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. Section 27 of the GC Act gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It is not necessary to 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."Accordingly, while dismissing the case, Justice Sharma held that in the ordinary course of business, notice is deemed to be served if it is proved to be sent by registered post on the correct address. Case Title: Top Filling Point Proprietor Rakesh Agrawal vs. State of U.P. and Another 2023 LiveLaw (AB) 406 [MATTERS UNDER ARTICLE 227 No. - 7011 of 2023]Case Citation: 2023 LiveLaw (AB) 406Counsel for Petitioner : Amrendra Nath Rai, Sanjay Singh Counsel for Respondent : G.A., Abhishek Tiwari, Mahendra Pratap Singh, Rohit SinghClick Here To Read/Download Order

NI Act | Notice Deemed To Be Served If Proved To Be Sent By Registered Post On Correct Address: Allahabad High Court

Upasna Agrawal

Tags