I. FOUNDATIONAL CONCEPTS (Case Studies 1–10)
1. Post-dated cheque dishonour
Case: A issues a post-dated cheque to B. On presentation after date, cheque bounces.
Answer: ✔️ Section 138 applies if other ingredients are fulfilled.
2. Cheque issued as security
Case: Cheque given as security; liability arises later; cheque dishonoured.
Answer: ✔️ Section 138 applies if enforceable debt existed on date of presentation
📌 ICDS Ltd. v. Beena Shabeer
3. Cheque without signature
Case: Cheque dishonoured due to missing signature.
Answer: ❌ Section 138 does not apply — no valid cheque.
4. Cheque filled by payee
Case: Blank signed cheque filled by payee and dishonoured.
Answer: ✔️ Valid under Section 20 NI Act.
5. Cheque for time-barred debt
Case: Cheque issued to repay time-barred debt.
Answer: ✔️ Section 138 applies — cheque is a promise under Section 25(3) Contract Act.
6. Cheque stolen and misused
Case: Cheque stolen and presented.
Answer: ❌ No offence — absence of legally enforceable debt.
7. Stop payment instruction
Case: Drawer issues stop-payment before presentation.
Answer: ✔️ Section 138 applies
📌 Modi Cements v. Kuchil Kumar Nandi
8. Cheque dishonour due to account closed
Case: Account closed before cheque presentation.
Answer: ✔️ Section 138 applies.
9. Cheque returned with “refer to drawer”
Case: Bank returns cheque with this remark.
Answer: ✔️ Presumed dishonour — Section 138 applies.
10. Oral loan
Case: Cheque issued for oral loan without written proof.
Answer: ✔️ Presumption under Sections 118 & 139 applies.
II. NOTICE & LIMITATION (Case Studies 11–20)
11. Delay in issuing notice
Case: Legal notice sent after 30 days.
Answer: ❌ Complaint not maintainable.
12. Incorrect address of notice
Case: Notice sent to old address.
Answer: ✔️ Valid if drawer deliberately avoided service.
13. Notice refused
Case: Drawer refuses notice.
Answer: ✔️ Deemed service.
14. Notice sent by email
Case: Notice sent only by email.
Answer: ⚠️ Valid if proved receipt; safer with RPAD.
15. Partial payment after notice
Case: Drawer pays part amount.
Answer: ✔️ Complaint maintainable for balance.
16. Multiple presentations
Case: Cheque dishonoured twice; notice after second dishonour.
Answer: ✔️ Valid
📌 MSR Leathers v. Palaniappan
17. No demand of cheque amount
Case: Notice does not specifically demand payment.
Answer: ❌ Defective notice.
18. Complaint filed before 15 days
Case: Complaint filed within 15 days of notice.
Answer: ❌ Premature and not maintainable.
19. Cause of action date
Case: When does cause of action arise?
Answer: On expiry of 15 days from receipt of notice.
20. Notice by advocate
Case: Notice issued by advocate.
Answer: ✔️ Valid.
III. DEFENCES & PRESUMPTIONS (Case Studies 21–30)
21. Rebuttal of presumption
Case: Accused denies liability.
Answer: Burden on accused to rebut on preponderance of probabilities.
22. Friendly loan without ITR entry
Case: Loan not shown in ITR.
Answer: ✔️ Still enforceable.
23. Cheque for illegal consideration
Case: Cheque issued for gambling debt.
Answer: ❌ No offence — debt unenforceable.
24. Alteration in cheque
Case: Material alteration without consent.
Answer: ❌ Cheque void.
25. Difference in ink
Case: Different ink used for date and amount.
Answer: ✔️ No automatic invalidity.
26. Financial capacity of complainant
Case: Accused questions lender’s capacity.
Answer: Accused must raise probable defence.
27. Presumption under Section 139
Case: Whether mandatory?
Answer: ✔️ Yes, rebuttable.
28. Non-mention of loan date
Case: Complaint lacks loan date.
Answer: ✔️ Not fatal if liability proved.
29. Accused does not enter witness box
Case: Accused only cross-examines.
Answer: ✔️ Permissible defence method.
30. Cheque amount higher than debt
Case: Excess amount filled.
Answer: ❌ Section 138 fails.
IV. PROCEDURE & TRIAL (Case Studies 31–40)
31. Jurisdiction
Case: Where to file complaint?
Answer: Where payee’s bank is located
📌 Dashrath Rupsingh Rathod (as amended)
32. Summary trial
Case: Nature of trial?
Answer: Summary trial preferred under Section 143.
33. Compounding
Case: Can offence be compounded?
Answer: ✔️ At any stage
📌 Damodar S. Prabhu
34. Power to award compensation
Case: Can court award compensation?
Answer: ✔️ Under Section 357 CrPC.
35. Interim compensation
Case: Can interim compensation be ordered?
Answer: ✔️ Up to 20%
📌 Section 143A
36. Appeal deposit
Case: Appellant directed to deposit amount?
Answer: ✔️ Minimum 20% under Section 148.
37. Evidence by affidavit
Case: Complainant evidence by affidavit?
Answer: ✔️ Permitted.
38. Company accused
Case: Who is liable?
Answer: Company + persons in charge
📌 Section 141
39. Director without role
Case: Non-executive director made accused.
Answer: ❌ Not liable without specific averments.
40. Death of complainant
Case: Complainant dies during trial.
Answer: ✔️ Legal heirs may continue.
V. ADVANCED & TRICK CASES (41–50)
41. Cheque issued by minor
Answer: ❌ Not enforceable.
42. Joint account
Case: Cheque signed by one holder.
Answer: ✔️ Signatory liable.
43. Cheque drawn on closed firm
Answer: ✔️ Partners liable if in charge.
44. Foreign cheque
Case: Cheque drawn outside India.
Answer: ❌ NI Act not applicable.
45. Cash loan above ₹20,000
Answer: ✔️ Enforceable despite Income-Tax violation.
46. Compromise during appeal
Answer: ✔️ Permissible.
47. Mediation
Answer: ✔️ Encouraged by courts.
48. Limitation condonation
Answer: ✔️ Delay may be condoned under Section 142(b).
49. Acquittal due to technical defect
Answer: ✔️ Common in notice defects.
50. Burden of proof
Answer:
-
Complainant: Foundational facts
-
Accused: Probable defence