M/S. SIL IMPORT, USA versus M/S. EXIM AIDES SILK EXPORTERS, BANGALORE

Citation: [1999] 2 S.C.R. 958 · Decided: 03-05-1999 · Supreme Court of India · Bench: K.T. THOMAS · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
B 
M/S. SIL IMPORT, USA 
v. 
M/S. EXIM AIDES SILK EXPORTERS, BANGALORE 
MAY 3, 1999 
[K.T. THOMAS AND M.B. SHAH, JJ.] 
Negotiable Instruments Act, 1988-Sections 138, 142-Prosecution for 
dishonour of cheques-Appellant issuing a cheque to Respondent-Returned 
by Bank for want of funds-Respondents sending notice by fax-Subsequent 
C notice also sent by registered post-Complaint filed within 30 days after 
receipt of registered notice but beyond limitation after receipt of fax notice-
Whether barred by time-Held, yes-The cause of action arose on receipt of 
fax notice, Hence the court 1has no jurisdiction to take cognizance of the 
complaint. 
D 
Interpretation of Statutes 
Negotiable Instruments Act, 1988-Sections 138, 142-Whether notice 
by fax is compliance with legal requirement of "Notice in Writing"-Held, 
yes-The legislature must be presumed to have been aware of the modern 
E devices and equipment already in vogue and also in store for future. 
The appellant owed a huge sum of money to the Respondent towards· 
export sale consideration of finished silk products on the orders placed by 
them. The appellant issued two post-dated cheques to Respondent. On 
presentation they were returned for want of sufficient funds. The respondent 
p 
sent a notice to appellant by fax on 11.6.1996 and on the next day the notice 
was again sent by registered post which was served on 25.6.1996. The 
respondent then filed a complaint before the Magistrate's Court on 8.8.1996. 
After process was served, the appellant filed a petition to quash the complaint 
and the Magistrate dismissed the complaint on the ground of delay. 
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The revision petition filed before the High Court by the Respondent 
was allowed. The High Court held that the cause of action would arise only 
after expiry of 15 days from date of receipt of registered notice and therefore 
the complaint was filed within time. 
On appeal the appellant contended that the magistrate .tias no 
H jurisdiction to take cognizance of the offence after expiry of 30 days from 
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SILIMPORT, USA v. EXIM AIDES SILK EXPORTERS 
959 
the date of cause of action and in the present case the respondent's complaint A 
is barred by time, and that if the notice sent by fax is to be treated as the 
notice in writing contemplated under the provisions of the Act the period of 
limitation expired on 26. 7.1996. 
The respondent contended that 15 days can be counted only from the 
date when the appellant received the notice sent by registered post, and that B 
the complaint was therefore within time. 
Allowing the Appeal, the Court 
HELD : 1. On the date when the notice sent by fax reached the drawer 
of the cheque the period of 15 days has started running and on the expiry C 
of that period the offence is completed unless the amount has been paid in 
the meanwhile. If no complaint was filed within one month therefrom the 
payee would stand forbidden from launching a prosecution thereafter, due to 
the clear interdict contained in Section 142 of the Act. In this case the 
complainant has admitted the fact that written notice was sent by fax. The D 
appellant has admitted its receipt on the same date. The last day when the 
respondent could have filed the complaint was 26-7-1996. But the complaint 
was fded only on 8-8-1996. So the court has no jurisdiction to take cognizance 
of the offence on the said complaint. [966-E-G] 
2. The High Court's view that the sender of the notice must know the E 
date when it was received by the sendee, for otherwise he would not be in a 
position to count the period in order to ascertain the date when cause of 
action has arisen is fallacious. As per the clause (c) of Section 138, the 
starting date of "the receipt of the said notice". Once it starts, the offence 
is completed on the failure to pay the amount within 15 days therefrom. 
Cause of action would arise if the offence is committed. If a different F 
interpretation is given, the absolute interdict incorporated in Section 142 of 
the Act that no court shall take cognizance of any offence unless the complaint 
is made within one month of the date on which the cause of action arises, 
would become otiose. (964-G; 965-A-B] 
Sadanandan Bhadran v. Madhavan Sunil Kumar, (1998] 6 SCC 514, 
referred to. 
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3. When the legislature contemplated that notice in writing should be 
given to the drawer of the cheque, the legislature must be presumed to have 
been aware of the modern devices an equipment already i
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