NDLI: Don Ayengia Vs. The State of Assam & Anr

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	1881 Section 138 Dishonour of' cheque Negotiable Instruments Act
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Act(s) Referred	Negotiable Instruments Act, 1881 (26 of 1881)
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Disposed Off
Headnote	Negotiable Instruments Act, 1881; s.138 — Dishonour of cheque — Complainant entered into an agreement for construction - of building with one ‘N’ and paid him Rs.10 lakhs — Agreement did not materialise and was cancelled in terms of promissory note executed by ‘N’ in favour of complainant — Promissory note stipulated promise to pay Rs.10 lakhs within one month and further the clause that the amount was being refunded by the executant in terms of five post dated cheques — Promissory note further stipulated that the cheques were being issued as a security and shall be returned to ‘N' when the amount of Rs.10 lakhs is paid by him within a period of one month — Interest was also promised to be paid on Rs.10 lakhs — Payment not made within the prescribed time — Presentation of cheques after expiry of period of one month — Dishonour of cheques - Respondent no.2 appeared at this stage and indemnified the complainant by acknowledging that the cheques in question were actually issued by him and handed over to ‘N'— Cheques were again presented and got dishonoured — Complaint against respondent no.2 and 'N’--‘N’ expired meanwhile — Trial court found respondent no.2 guilty — High Court set aside the conviction — Held: The promissory note executed by ‘N' contained an unequivocal acknowledgement of not only the debt/liability but promised to liquidate the same within one month with interest at the bank rate - Five cheques handed over were to be returned but only upon payment of the amount in question — Such being the fact situation, it cannot be said that the cheques had nothing to do with any debt or other liability — Thus, there was direct relationship between the liability and the cheques issued in connection therewith — The endorsement made by the respondent on the promissory note that the cheques can be presented for encashment after a month clearly shows that the cheques issued by him were not ornamental but were meant to be presented if the amount in question was not paid within the extended period - High Court fell in error in upsetting the conviction recorded by the Courts below.
Judge	Honble Mr. Justice T.S. Thakur
Neutral Citation	2016 INSC 98
Petitioner	Don Ayengia
Respondent	The State Of Assam & Anr
SCR	[2016] 1 S.C.R. 405
Judgement Date	2016-01-28
Case Number	82-83

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Don Ayengia Vs. The State of Assam & Anr

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