In the principal act, section 142 shall be numbered as subsection 1 thereof. Consequent upon the failure of the drawer to pay the money within the period of 15 days as envisaged under clause c of the proviso to section 8, the liability of the drawer for being prosecuted for the offence he has committed, arises, and the period of one month for filing the complaint under section 142 is to be reckoned accordingly. Section 142 of negotiable instruments act does not specifically state that the payee or holder in due course of the cheque shall lodge the complaint himself. Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from. That the accused is guilty of an offence under section 8 of the negotiable instrument act, 1881 and is liable to be punished under section 142 of the said act. But in section 1, it is also described that local extent, saving of usage relating to hundis, etc. Act delay of 25 days in filing complaint after issuing a hand note high court quashed the complaint as barred by limitation apex court held that since there is no opportunity for explaining delay as the complaint strongly believed that he filed complaint from statutory notice and since. Section 142 of the ni act provides a procedure and limitation period to file a complaint before the competent court. Banking public financial institutions and negotiable instruments clause amendment act. That the holder may refuse to take a qualified acceptance, and if he. According to section of the negotiable instruments act, a negotiable instrument means a promissory note, bill of exchange or cheque payable either to order or to bearer. Jurisdiction in cheque bouncing cases is changed by new. In 1988, the negotiable instruments act, 1881, was amended and section 8 was inserted making the bouncing of cheques a punishable offence amounting to a punishment of imprisonment of a term extendable to 2 years, or with fine extendable to double the amount of the cheque or both. The supreme court also observed that section 142 of the act opens as a nonobstante clause.
A bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument. About the act the negotiable instruments act 1881 was passed in 1882 and was amended in 1989 and 2002, before 1988 there was no provision to restrain the person issuing the cheque without having sufficient funds in his account. Negotiable instruments act, 1881 bare acts law library. Dishonour of chequegujarat hc explains the new law on. As per section 142 of the negotiable instrument act cognizance of offences a no court shall take cognizance of any offence punishable under section 8 except upon a complaint, in writing, made by the payee or, as the case may be the holder in due course of the cheque. Government has amended the negotiable instruments act, 1881 which may be called the negotiable instruments amendment act, 2018.
Insertion of new section sia after section 81 of the principal act, the following section shall be inserted, namely. This was done by making the drawer liable for penalties in case of bouncing of the cheque due to. The object of sections 8 142 of the negotiable instruments act, 1881 is to promote the efficacy of banking operations and to ensure credibility in transacting business through cheques. An act relating to negotiable instruments within the district of. Landmark supreme court judgment on sec 8 of negotiable. What are the changes brought in by virtue of negotiable instruments amendment act. Full text containing the act, negotiable instruments act, 1881, with all the sections. Effect of recent amendments in negotiable instruments act on the. To address these issues, there is a proposal to add two additional sections to the negotiable instruments act, 1881. Defence which may not be allowed in any prosecution under section 8. Amendment act, 1988 inserted section 8 and 142 to make out the dishonour of. Whether handwritten notice would constitute a valid notice under the provisions of section 8 of the negotiable instruments act, 1881.
What is negotiable instruments act 1881 and important sections. An ordinance further to amend the negotiable instruments. Liability of parties of negotiable instruments section 32 which provides about the liability of the maker of a note or the acceptor of a bill, is as follows. According to this, the negotiable instruments act, 2002, put in the ground, modified sections 8, 141 and 142 and offered new segments 143 to 147 in the said act. The first section in this aspect to be analyzed, would be s. Section 8 of the negotiable instruments act, 1881 blog. Conclusion a negotiable instrument is supposed to be dishonored when the drawee declined to receive it or to make sum upon it. Dishonour of a negotiable instrument legal steps to take. Dishonour of cheque is an offence under section 8 of the negotiable instrument act ni act. The president of india has promulgated the negotiable instruments amendment ordinance, 2015 6 of 2015 on 15 th june 2015.
The criminal liability of a drawer in case of dishonour of cheque is dealt in section 8 to section 142 of negotiable instrument act 1881. Instrument negotiable till payment or satisfaction. That the validity and negotiable character of an instrument. Notwithstanding anything contained in the code of criminal procedure, 1973 2 of 1974 no court shall take cognizance of any offence punishable under section 8 except upon a complaint, in writing, made by the payee or. According to section 142, only metropolitan magistrate or magistrate of the first class may take cognisance of the offence. Rules regulations notifications orders circulars statutory. States of america in congress assembled, that this act shall be known general provisions. Get latest news, breaking news about section 8 ni act page 1.
Read all latest updates on and about section 8 ni act. Section 142 in the negotiable instruments act, 1881. Essentially the liability of the parties to a negotiable instrument has it statutory provisions under sections 30, 32 and 35 of the negotiable instruments act 1881. There were total 142 sections in the negotiable instruments act 1881 when came into force. The main purpose of the amendment is to strengthen the peoples faith in such instruments and also to reduce the. Negotiable instruments amendment act, 2015 to amend ni. In the aforesaid circumstances it is most respectfully prayed that your honour may graciously be pleased to take cognizance of the matter and issue process against the accused person under section 8 read with section 142 of the negotiable instruments act 1881, as amended uptodate and pass such other order or orders as your honour may deem fit and proper. Analysis of section 142 and section 142 a of the negotiable instruments amendment act, 2015 26 of 2015 dealing with the territorial jurisdiction aspect. Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge. Section 142 2 of negotiable instruments amendment act, 2015 is. Section 2d, section 2n and section 190 of the code.
Analysis of section 142 and section 142a of the negotiable instruments amendment act, 2015 26 of 2015 dealing with the territorial. Negotiable instrument act the negotiable instruments amendment act, 2018 amendment received the assent of the president on 2nd august 2018. Cognizance of offences notwithstanding anything contained in the code of criminal procedure, 1973 2 of 1974, a no court shall take cognizance of any offence punishable under section 8 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course. It is, therefore, prayed that the accused person be proceeded against and punished in accordance with law as envisaged under section 142 of the negotiable instrument act in accordance.
In the negotiable instruments act, 1881 hereinafter referred to as the principal. So, now a cheque dishonour case under section 8 of the negotiable instruments act, 1881, will have to be filed in a court at a place as per the provisions of section 142 2 of the negotiable instruments act, which has been inserted by this new ordinance, and even all pending cheque bouncing cases will also be transferred to the courts as per. It extends to the whole of india but nothing herein contained affects the indian paper currency act, 1871, 3 of 1871. Dealing with the nature of sections 142 and 142a of the negotiable instrument act, 1881, the court held that section 142 2a, amended through the negotiable instruments amendment second ordinance, 2015, vests jurisdiction for initiating proceedings for the offence under section 8 of the negotiable instruments act, inter alia in the territorial jurisdiction of the court. In the principal act, section 142 shall be numbered as sub section 1 thereof and after. Section 142 in the negotiable instruments act, 1881 indian kanoon. Complaint us 8 of ni act download format of complaint. Section 8c of the negotiable instruments act, 1881.
In short, the supreme court held that the scope of section 142 is more comprehensive than the provisions of the crpc. The banking, public financial institutions and negotiable instruments laws amendment act, 1988 inserted in the negotiable instruments act, 1881 hereinafter called the said act, a new chapter xvii, comprising sections 8 to 142 with effect from 1st april, 1989. Act, after section 143, the following section shall be inserted. According to section 1 of the negotiable instruments act, 1881ni act, a negotiable instrument means a promissory note, bill of exchange or cheque payable either to order or to bearer. Section 142 of the negotiable instruments act, 1881. Section 5 of the negotiable instruments act defines a bill of exchange as follows. The negotiable instrument act, 1881 legislative department. As per the provisions of section 142 of the negotiable instruments act, a complaint can be made about the offence of cheque bounce under section 8 of the act, within one month of the expiry of 15 days period from receipt of above notice by the drawer of the cheque if no payment is made within those 15 days. Format of criminal complaint us 8 of negotiable instruments act against return of cheque. The act was amended and amendment act inserts five new sections from 143 to 147 touching various limbs of the parent act and cheque truncation through digitally were also included and the amendment act has been recently brought into force on feb. Effect of recent amendments in negotiable instruments act. The amendments to the negotiable instruments act, 1881 the ni act are focused on clarifying the jurisdiction related issues for filing cases for offence committed us 8 of the ni act. Sections 8 and 141 of the negotiable instruments act.
The apex court in a recent judgement held that any failure to include the company as an accused in the complaint, filed under section 8 of the negotiable instruments act, 1881 of dishonour of a cheque issued by a company, would be fatal to the prosecution of such company even if the complaint filed against the signatory of the cheque has been. In the negotiable instruments act, 1881 hereinafter referred to as the principal act, after section 143, the following section shall be inserted, namely. As per section 142 of the negotiable instrument act cognizance of offences a no court shall take cognizance of any offence punishable under section 8. The provisions of this act do not apply to negotiable instruments made and delivered prior to the taking effect hereof. Presentment for payment of instrument payable after date or sight. Notwithstanding anything contained in the code of criminal procedure. Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the. The indian law on negotiable instruments is governed by the negotiable instruments act of 1881. Draft format for filing criminal complaint under section 8 of negotiable instruments act is given below to get idea to prepare the complaint.
This act may be called the negotiable instruments act, 1881. Notice format under section 8 negotiable instruments act pdf download we provide all services of drafting and vetting of legal formats, legal documents. Amendment of section 142 in section 142 of the principal act, after clause b, the. Whether demand of interest along with the cheque amount in the statutory notice under section 8 of the negotiable instruments act, 1881 would make the statutory notice faulty. Notice format under section 8 negotiable instruments act. Instrument acquired after dishonor or when overdue. A promissory note is an instrument in writing not being a banknote or a currencynote containing an unconditional undertaking signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument.
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