As a complainant in Section 138 of the Negotiable Instruments Act cases for cheque dishonour, is the burden of proof of service of legal notice of demand necessarily upon the complainant? How can the service be proved if the accused wilfully tries to avoid it in order to get the notice time-barred?
Answer: Yes, the burden to prove that the notice issued on the accused in a cheque dishonour case has been served on him, as required under clause (b) of the Proviso to Section 138 of the Negotiable Instruments Act, 1881, lies on the complainant, i.e., the person who has filed such complaint.
However, as mentioned in detail in the subsequent part of this answer, the legal principle is that a notice refused to be accepted by the addressee can be presumed to have been served on him. Likewise, once notice has been sent by registered post with acknowledgment due to a correct address, it may be presumed that the service has been made effective, though in such a case, the accused can show that he did not receive the notice. Therefore, if the complainant can prove these facts, the complainant can be presumed to have discharged his burden of service of notice, and then it is for the accused to show that he did not receive the notice.
In fact, as a general rule, in all criminal cases, the burden of proving the case lies on the prosecution, which includes all facts necessary to prove against the accused. In a cheque bouncing case, the complainant himself acts as the “prosecution” since it is a private complaint case. Therefore, the burden to prove all relevant facts necessary to prove the case of cheque dishonour against the accused lies on the complainant himself.
This general rule of the burden of proof being on the complainant or prosecution is not applicable only in those circumstances where the law itself has laid down the raising of a legal presumption against the accused for the proof of certain facts, in which case, the burden shifts to the accused to disprove that particular fact. For example, in the case of cheque dishonour itself, Section 139 of N.I. Act provides as under:
“139. Presumption in favour of holder.—It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability.”
Thus, the law itself lays down that it shall be presumed that the cheque, which has been dishonoured, had been issued by the accused “for the discharge, in whole or in part, of any debt or other liability” as is required under Section 138 of the Act. Therefore, the complainant does not have to prove this particular fact and a mandatory presumption is raised against the accused in this regard. The accused is required to rebut this presumption by showing that the cheque was not issued for the discharge of any debt or liability but was issued for some other purpose. However, the standard of proof that is required of the accused to rebut this presumption is not very heavy; he can show this merely by preponderance of probability and he is not required to prove it beyond all reasonable doubts.
As regards the proof of the fact that the notice has been served on the accused, there is no such presumption raised since there is no legal provision in that regard. Therefore, such burden will be upon the complainant to prove the fact of service of notice on the accused. This burden can, of course, be discharged by the complainant as mentioned above, and also, as mentioned in detail as under.
What if the accused deliberately avoids service of notice?
In this regard, I may point out that it is well settled that a notice refused to be accepted by the addressee can be presumed to have been served on him [see, (1) Harcharan Singh v. Shivrani, (1981) 2 SCC 535; (2) Jagdish Singh v. Natthu Singh, (1992) 1 SCC 647.].
In the case of Indo Automobiles v. Jai Durga Enterprises, (2008) 8 SCC 529, the Supreme Court has held that it is also well settled that once notice has been sent by registered post with acknowledgment due to a correct address, it must be presumed that the service has been made effective.
It is also pertinent to refer to Section 27 of the General Clauses Act, 1897:
“27. Meaning of service by post.—Where any Central Act or Regulation made after the commencement of this Act authorises or requires any document to be served by post, whether the expression ‘serve’ or either of the expressions ‘give’ or ‘send’ or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post, a letter containing the document, and unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.”
Replying upon the aforesaid Section 27 of General Clauses Act, the Supreme Court held in the case of K. Bhaskaran v. Sankaran Vaidhyan Balan, (1999) 7 SCC 510, as under:
“24. No doubt Section 138 of the Act does not require that the notice should be given only by “post”. Nonetheless the principle incorporated in Section 27 (quoted above) can profitably be imported in a case where the sender has despatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice.”
Thus, if the complainant dispatches the notice by (registered) post with the correct address written on it, it can be deemed to have been served, though in this case the accused can show that he did not, in fact, receive the notice.
In the case of State of M.P. v. Hiralal, (1996) 7 SCC 523, the Supreme Court held as under (though this case is not a case of cheque bouncing, the legal principle will be applicable in cheque bouncing cases also):
“In view of the office report, it would be clear that the respondents obviously managed to have the notice returned with postal remarks “not available in the house”, “house locked” and “shop closed” respectively. In that view, it must be deemed that the notices have been served on the respondents.”
Relying upon the aforesaid Hiralal case, in the case of from Sridhar M.A. v. Metalloy N. Steel Corpn., (2000) 1 SCC 397, held as under:
“Although, in appropriate case deemed service is to be accepted by the court, as indicated in the decision of this Court reported in State of M.P. v. Hiralal [(1996) 7 SCC 523] but it may also be noted that such presumption of deemed service is not a matter of course in all cases and deemed service is to be accepted in the facts of each case.”
These are only a few representative judgments, and there are certain other judgments too, in this regard.
Thus, the legal principle is that a notice refused to be accepted by the addressee can be presumed to have been served on him. Likewise, once notice has been sent by registered post with acknowledgment due to a correct address, it must be presumed that the service has been made effective, though in such a case, the accused can show that he did not receive the notice.
Now, a question may arise as to what is the correct address. In this regard, I am of the considered opinion that a registered post sent at the address of accused which is mentioned in his bank account details, from which bank account he has issued the cheque that has been dishonoured, should be considered to have been sent at the correct address.
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