Presumption Of Service Of Notice U/ S 27 Of General Clauses Act Applicable On Service Of Demand Notice U/S 138 Of NI Act: Tripura High Court

The Tripura High Court has held that once a demand notice, issued under the Negotiable Instruments Act, 1881 in case of dishonour of cheque is dispatched by post to the correct address, the part of the payee is over and the notice is deemed served on the defaulter as per the presumption under Section 27 of the General Clauses Act, 1897, unless proved to the contrary. A Bench of Justice SG Chattopadhyay relied on the High Court's decision in Keshab Banik vs. Shekhar Banik, (2013) 1 TLR 528, where it was held that where the sender has dispatched the notice by post with the correct address written on it, then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. The High Court reiterated that the presumption of service of notice under Section 27 of the General Clauses Act will be applicable in case of dishonour of cheque, as "any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice." [Section 27 of the General Clauses Act stipulates that where any Act authorizes or requires any document to be served by post, the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.] In Keshab Banik (supra) the High Court had held that even though Section 138 of the Act does not require that the notice should be given only by "post", nonetheless the principle incorporated in Section 27 can profitably be imported in a case where the sender has dispatched the notice by post with the correct address written on it. The present case pertained to a revision petition filed by one Nitai Majumder, against an order of the Sessions Judge, upholding the order of conviction passed against him by the CJM. Background The Petitioner was convicted under Section 138 of the NI Act, for dishonour of cheque. As per the facts of the case, the Petitioner-accused took a loan of Rs.3,50,000/- from the Respondent. The money not being repaid in time, the Respondent approached the petitioner and requested him for an early repayment of the same pursuant to which, the Petitioner issued Cheque in the name of the Respondent. When the cheque was presented for collection at the Bank, it was returned with an endorsement "insufficient funds". The Respondent then issued a demand notice to the Petitioner via registered post with AD, sent to his known residential address. It was alleged that the postman entrusted with the service of the notice visited the Petitioner's house on four occasions but every time, the house inmates refused to receive the registered letter and told the postman that the addressee was out of station. Consequently, the demand notice was returned to the Respondent. The question which arose for consideration of the Court was whether the Petitioner-accused deliberately did not receive the demand notice? Submissions as to service of notice The submission on behalf of the Petitioner- accused was that the Trial Court failed to appreciate the fact that the service of statutory after dishonor of the cheque was not proved. The Respondent on the other hand contended that law has been settled that in a case under NI Act, once the notice is dispatched to the correct address of the accused, the onus on the part of the complainant is discharged and the rest depends on the accused. Findings The Court, concurring with the stand taken by the Respondent, observed, "The object of statutory notice is to protect an honest drawer of the cheque by providing him a chance to make the fund sufficient in his bank account and correct his mistake. The accused petitioner could have availed this opportunity by accepting the demand notice instead of repeatedly avoiding its service. He could have accepted the notice and projected his case that he already made the repayment of the loan, had this case of him been true. Therefore, it can be safely held that the prosecution successfully discharged its burden in proving the case against the petitioner with the help of the statutory presumptions under the NI Act, and the accused has failed to rebut those presumptions and prove the contrary by offering provable explanation founded on proof." The Court was of the opinion that the Complainant-Respondent has led "convincing evidence" to prove that the postman visited the house of the accused at the known address on 4 dates. Every time the postman was told by the house inmates that he was out of station. The fact is proved by the report given by the postman. Thus, it concluded that from the overall conduct of the...

Presumption Of Service Of Notice U/ S 27 Of General Clauses Act Applicable On Service Of Demand Notice U/S 138 Of NI Act: Tripura High Court

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Presumption Of Service Of Notice U/ S 27 Of General Clauses Act Applicable On Service Of Demand Notice U/S 138 Of NI Act: Tripura High Court

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