Conviction U/S 138 NI Act Not One Affecting Person's Conduct, Can't Deny Pension On Such Conviction: Madras High Court

The Madras High Court has held that recently held that a conviction under Section 138 of the Negotiable Instruments Act was not one affecting the future conduct of a person and such a conviction could not be taken as a ground for denying pension. Justice K Kumaresh Babu held that the offence under Section 138 of the Negotiable Instruments Act arises out of a contractual dispute between the parties. The court noted that as per the Pension Rules, a person who failed to have good future conduct would be disentitled from receiving a pension. The court observed that the conviction under Section 138 of the NI Act would affect the person's good conduct. “The Pension rules provides that a person failure to have future good conduct would disentitle him from receiving the pension. Section 138 of Negotiable Instruments Act arises out of contractual dispute between the parties. Involvement cannot be said to be an offence which affect the conduct of the person. Such conduct cannot be also implied to affect his good conduct,” the court observed. The court was hearing a petition filed by a man who retired from the police department on superannuation. He submitted that Assistant Treasure Officer had passed an order under Rule 8 of the Tamil Nadu Pension Rules 1978, stopping his pension, without offering an opportunity to explain. The petitioner informed that he had been convicted under Section 138 of the NI Act, but that it cannot be termed as a punishment for an offence involving the moral turpitude. It was thus submitted that no action could be initiated against him for conviction under the NI Act that too, without following the due process of law. The Special Government Pleader, on the other hand, submitted that the petitioner had been convicted thrice for offence under Section 138 of the NI Act and the same would amount to a grave misconduct. He argued that there was no error in the order. it was also argued that the present case did not require any enquiry as the petitioner had suffered the order of conviction. The court noted that the courts had previously held that a conviction under Section 138 of the NI Act could not be termed as an offence involving moral turpitude and had held that the charge memo issued on that ground was unreasonable. The court followed this view and quashed the order of Assistant Treasure Officer. The court directed that respondent authorities to release the petitioner's pension and also to pay arrears of pension, if any, within a period of 12 weeks. Counsel for Petitioner: M/s. R. Karunanidhi Counsel for Respondents: Mr. F. Deepak Special Government Pleader Case Title: Srinivasan v. The Director and Others Citation: 2025 LiveLaw (Mad) 393 Case No: W.P.(MD)No.24101 of 2025Click Here To Read/Download The Judgment

Conviction U/S 138 NI Act Not One Affecting Person's Conduct, Can't Deny Pension On Such Conviction: Madras High Court

Upasana Sajeev

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