Friday, June 30, 2017

High Court absolves Son in cheque bouncing case as it was issued from his father’s account

Facts of the case:

a) In the recent case law, the accused – Son had issued a cheque in respect of loan outstanding against him. The said cheque was issued by the accused towards outstanding amount from his father’s account. However, the same cheque was dishonored for want of sufficient funds in the account.

b) Lender - bank has issued notice to accused for payment of dishonored cheque. As accused - Son failed to pay outstanding amount, the lender - bank filed a complaint before trial court which was dismissed by the magistrate.

c) Being aggrieved at the judgement of trial court, lender- bank preferred an appeal to the Bombay High Court.

The Bombay High Court held as under:

i. If cheque had been issued by the Son from the account of his father and it bounced, then the lender - bank could not file a criminal case against Son, as one of the ingredients of section 138 of the Negotiable Instrument Act for holding one guilty was not satisfied that cheque must have been issued from an account maintained by the accused. Therefore, the case would not fall within the ambit of Section 138 of the Negotiable Instrument Act. [2017] 82 taxmann.com 432 (Bombay)
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