C.C. ALAVI HAJI versus PALAPETTY MUHAMMED AND ANR

Citation: [2007] 7 S.C.R. 326 · Decided: 18-05-2007 · Supreme Court of India · Bench: K.G. BALAKRISHNAN · Disposal: Dismissed
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Judgment (excerpt)

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C.C. ALA VI HAJI 
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PALAPETTY MUHAMMED AND ANR. 
MAY 18, 2007 
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[K. G. BALAKRISHNAN, CJ. R. V. RA VEENDRAN AND DK JAIN, JJ.] 
Negotiable Instruments Act, 1881: 
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s. 138, Proviso, clauses (b) and (c )-Complaint uls 138-Requirement 
c of p0}1ee to make a demand for payment of money by giving notice to draw'er 
of cheque-HELD: When notice is sent by registered post by correctly 
addressing the drawer of the cheque, and statement to that effect in the 
complaint has been made, mandatory requirement of issue of notice in terms 
of clause (b) OJ proviso to s. 138 stands complied with-It is unnecessary to 
D further aver in the complaint that service of notice was evaded by accused 
or that he had a role to play in return of notice unserved-On facts, though 
there was no averment in the complaint to the effect that notice was sent at 
correct address of drawer by 'registered post acknowledgment due" but 
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returned envelope containing statement "the addressee lfos abroad", hm•ing 
been annexed to co111plaint, fofmed part thereof-Thus, requirements of s. 138 
E were sufficiently complied witl~Evidence Act, 1872-s. J 14-General Clauses 
Act, J897-s27. 
Words and Phrases: 
'giving notice ''-connotation of in the context of clause (b) of Proviso 
F to s.138 of Negotiable Instruments Act, 1881. 
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The instant appeal arose out ofa complainant under Section 138 of the 
Negotiable Instruments Act, 1881. The Di\:ision Bench before which the appeal 
came to be listed, felt that with regard to sen' ice of notice in terms of clause· 
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(b) of the proviso to Section 138.of the Act, the Supreme Court in Shivappa's 
case* did not take into consideration the presumption in respect of an official 
act as provided under Section 114 of the Evidence Act, 1872. In this view of 
the matter, the Bench referred the following question to be decided by a larger 
Bench: 
*D. l·'inodShivapha v. Nanda Belliapha, [2006} Supp. 2 SCR 1008 = [2006) 6 SCC 456. 
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326 
C.C. ALAVI HAJI v. PALAPETTY MUHAMMED 
327 
"Whether in absence of any averments in the. complaint to the effect A 
that the accused had a role to play in the matter of non-receipt of legal notice; 
or that the accused deliberately avoided service of notice, the same could have 
been entertained keeping in view the decision of this Court in Vinod 
Shivappa 's case.'' 
Dismissing the appeal, the Court 
HELD: 1. t. Section 138 of the Negotiable Instruments Act, 1881 was 
enacted to punish unscrupulous drawers of cheques who, though purport to 
discharge their liability by issuing cheque, have no intention of really doing 
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so. However, with a view to avert unnecessary prosecution of an honest drawer C 
of the cheque and with a view to give an opportunity to him to make amends, 
the prosecution under Section 138 of the Act has been made subject to certain 
conditions stipulated in the proviso to Section 138 of the Act. 
!Para 6) 1331-D, El 
1.2. Under Clause (b) of the proviso to s.138 of the Act, the payee or the D 
holder of the cheque in due course is required to give a written notice to the 
drawer of the cheque within a period of thirty days from the date of receipt of 
information from the bank regarding the return of the cheque as unpaid. 
Under Clause (c ), the drawer is given fifteen days time from the date of receipt 
of the notice to make the payment and only if he fails to make the payment. a 
complaint may be filed against him. The object of the proviso is to avoit." E 
unnecessary hardship to an honest drawer. Therefore, the observance of 
stipulations in Clause (b) and its aftermath in Clause (c) being a pre-condition 
for invoking Section 138 of the Act. giving a notice to the drawer before filing 
complaint under Section 138 of the Act is a mandatory requirement. 'Giving 
notice' in the context is not the same as 'receipt of notice'. GMng is a process F 
of which receipt is the accomplishment. It is for the payee to perform the 
former process by sending the notice to the drawer at the correct address 
and for the drawer to comply with Clause (c) of the proviso. 
(Para 6 and 711331-F, G; 332-B) 
1K. Bhaskaran ,., Sankaran Vaidyan Ba/an & Anr., (199717SCC510, G 
relied on 
2. t. Though Section 138 of the Act does not require that the notice 
should only be "post", yet in a case Where the payee has dispatched the notice 
I. 
[1999) Supp. 3 SCR 271. 
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328 
SUPREME COURT REPORTS 
(2007) 7 S.C.R. 
A by registered post with correct a
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