Two situation
1. You buy a laptop for your own use
2. laptop is bought by the company and given to
you when you join
The laptop has started causing problem to you
1. Can you move to consumer court?
‘Consumer Sovereignty or Consumer is the King’.
Ordinary consumer had no other remedy but to initiate
action by way of a civil suit which involved lengthy legal
process proving to be too expensive and time consuming
for lay consumers.
Simpler, more accessible, quicker and less expensive.
The Consumer Protection Act, 1986, is an umbrella
legislation which has widened the scope of seeking
redressal of grievances of consumers without affecting the
common law remedies available to them.
An Act to make provision for the greater protection of
consumers, to establish a consumer protection commission
and for the functions and powers of that commission and
related matters.
The objective of the Act
1. Speedy and Inexpensive redressal
1.
2. To form consumer forums
2.
3. Promote and protect consumer rights
3.
(a) the right to be protected against marketing of goods
which are hazardous to life and property;
(b) the right to be informed about the quality, quantity,
potency, purity, standard and price of goods to protect the
consumer against unfair trade practices;
(c) the right to be assured, wherever possible, access to an
authority of goods at competitive prices;
(d) the right to be heard and to be assured that consumers
interests will receive due consideration at appropriate
forums;
(e) the right to seek redressal against unfair trade practices
or unscrupulous exploitation of consumers; and
(f) right to consumer education.
define who is consumer
d) "consumer" means any person who—
i) buys any goods for a consideration which has been paid or
promised or partly paid and partly promised, or under any
system of deferred payment and includes any user of such goods
other than the person who buys such goods for consideration
paid or promised or partly paid or partly promised, or under any
system of deferred payment when such use is made with the
approval of such person, but does not include a person who
obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any services for a consideration which has
been paid or promised or partly paid and partly promised, or
under any system of deferred payment and includes any
beneficiary of such services other than the person who 'hires or
avails of the services for consideration paid or promised, or
partly paid and partly promised, or under any system of deferred
payment, when such services are availed of with the approval of
the first mentioned person but does not include a person who
avails of such services for any commercial purposes ;
Explanation.— For the purposes of this
clause, “commercial purpose” does not
include use by a person of goods bought and
used by him and services availed by him
exclusively for the purposes of earning his
livelihood by means of self-employment.
1. Resale
2. Commercial purpose
Act deal with B2C transaction
Goods For Consideration (Payment)
1. Sale transaction between two parties Buyer
and seller
2. Goods as per Sec 2(7) of Sale of Goods Act,
1930
3. Consideration
Incudes person who uses the good with the
consent of buyer
‘commercial purpose’ -question of facts
If a person purchased a machine to operate it
himself for earning his livelihood, he would
be a consumer. If such person took the
assistance of one or two persons to assist
him in operating the machine, he would still
be a consumer. But if a person purchases a
machine and appoint or engage another
person exclusively to operate the machine,
then such person would not be a consumer.
2 (f) "defect" means any fault, imperfection
or shortcoming in the quality, quantity,
potency, purity or standard which is required
to be maintained by or under any law for the
time being in force under any contract,
express or implied or as is claimed by the
trader in any manner whatsoever in relation
to any goods;
A person is said to be consumer of services
1.Hires and excludes the person who is
providing services free of charge
2.under a contract of personal service
3.for any commercial purposes
( (o) "service" means service of any description
which is made available to potential users and
includes, but not limited to, the provision of
facilities in connection with banking, financing
insurance, transport, processing, supply of
electrical or other energy, board or lodging or
both, housing construction, entertainment,
amusement or the purveying of news or other
information, but does not include the rendering
of any service free of charge or under a contract
of personal service;
"deficiency" means any fault, imperfection,
shortcoming or inadequacy in the quality,
nature and manner of performance which is
required to be maintained by or under any
law for the time being in force or has been
undertaken to be performed by a person in
pursuance of a contract or otherwise in
relation to any service;
(r) "unfair trade practice" means a trade practice which,
for the purpose of promoting the sale, use or supply of any
goods or for the provision of any service, adopts any unfair
method or unfair or deceptive practice including any of the
following practices, namely;—
(1) the practice of making any statement, whether orally or
in writing or by visible representation which,—
(i) falsely represents that the goods are of a particular
standard, quality, quantity, grade, composition, style or
model;
(ii) falsely represents that the services are of a particular
standard, quality or grade;
(iii) falsely represents any re-built, second-hand, renovated,
reconditioned or old goods as new goods;
(iv) represents that the goods or services have sponsorship,
approval, performance, characteristics, accessories, uses or
benefits which such goods or services do not have;
(v) represents that the seller or the supplier
has a sponsorship or approval or affiliation
which such seller or supplier does not have;
(vi) makes a false or misleading representation
concerning the need for, or the usefulness of,
any goods or services;
(vii) gives to the public any warranty or
guarantee of the performance, efficacy or
length of life of a product or of any goods that
is not based on an adequate or proper test
thereof;
weight-loss company' print advertisement
showing fit female torso and product being
poured onto salad. "Need to lose 30 pounds? Try
Sensa free. Get a gym body without going to the
gym. Clinically proven. "The marketers of Sensa,
who exhorted consumers to "sprinkle, eat, and
lose weight"– will pay $26.5 million to settle
Federal Trade Commission charges that they
deceived consumers with unfounded weight-loss
claims and misleading endorsements. The
Federal Trade Commission will make these funds
available for refunds to consumers who bought
Sensa.
Delhi recently ruled that the ‘Fair & Handsome’
ads by Shahrukh Khan are misleading. Emami
played with the emotions of the complainant as
he purchased the product in order to get the
benefits as mentioned and claimed, which turned
out to be false claims, to award compensation of
Rupees Nineteen Lakh ninety thousand, as
punitive damages, in favor of the complainant
plus the litigation charges and other
transportation expenses of Rupees ten
thousand..
(ix) materially misleads the public concerning the price
at which a product or like products or goods or
services, have been or are, ordinarily sold or provided,
and, for this purpose, a representation as to price shall
be deemed to refer to the price at which the product or
goods or services has or have been sold by sellers or
provided by suppliers generally in the relevant market
unless it is clearly specified to be the price at which the
product has been sold or services have been provided
by the person by whom or on whose behalf the
representation is made;
(x) gives false or misleading facts disparaging the
goods, services or trade of another person.
The Central Consumer Protection Council.—(1) The
Central Government shall, by notification, establish
with effect from such date as it may specify in such
notification, a Council to be known as the Central
Consumer Protection Council (hereinafter referred to
as the Central Council).
(2) The Central Council shall consist of the following
members, namely:—
(a) the Minister in charge of the consumer affairs in
the Central Government, who shall be its Chairman,
and
(b) such number of other official or non-official
members representing such interests as may be
prescribed.
The objects of the Central Council shall be to promote and
protect the rights of the consumers such as,—
(a) the right to be protected against the marketing of goods
and services which are hazardous to life and property;
(b) the right to be informed about the quality, quantity,
potency, purity, standard and price of goods or services, as the
case may be so as to protect the consumer against unfair trade
practices;
(c) the right to be assured, wherever possible, access to a
variety of goods and services at competitive prices;
(d) the right to be heard and to be assured that consumer's
interests will receive due consideration at appropriate forums;
(e) the right to seek redressal against unfair trade practices or
restrictive trade practices or unscrupulous exploitation of con
sumers; and
(f) the right to consumer education.
The Consumer Councils are created to advise and
assist the consumers in seeking and enforcing
their rights. These councils work towards the
promotion and protection of consumers. They
make investigations and give publicity to the
matters concerning consumer interests, take
steps towards furthering consumer education
and protecting consumer from exploitation,
advice the Government in the matter of policy
formulation keeping consumer interest as pivotal
concern, etc. Although their suggestions are
recommendatory in nature, but they have
significant impact in policy making.
While deciding about the composition of
these councils, the State keeps in mind that it
should have proper representation from all
the possible areas affecting consumer
interests. Again the rules as to when should
these councils meet, what should they aim at,
how they conduct their business are framed
by the Government with a view to balance the
efficacy and practicability of its business.
Forum Value of the goods or Amendment bill
services and the 2018
compensation
District Forum Doesn’t exceed value Up to 1 crore
Rs. 20 lakhs
State Commission Above value Rs. 20 Between 1 crore to
lakhs but not up to one 10 crore
Crore
National Comission Above 1 crore Above 10 crore
• Professional services fall within the scope of the Act
Indian Medical Association vs V.P. Shantha & Ors on 13
November, 1995 (AIR 550, 1995 SCC (6) 651)
In deciding this case of deficiency of medical service,
the court held that the services rendered by a medical
professional fall within the ambit of ‘services’ under
the section 2(1)(o) of the Act. It rejected the
contention that a medical practitioner, being a
professional and falling under the scope of Indian
Medical Council Act, stands excluded from the CPA.
M/S. Spring Meadows Hospital & Anr vs Harjol
Ahluwalia 25 March, 1998
In this complaint of the minor child through his
parents before the National Commission. it was
contended that the child was admitted to the
appellant hospital as in-patient with diagnosis of
typhoid. The nurse asked the child's father to
purchase the injection Inj. Lariago recommended by
the Senior Pediatrician to be administered
intravenously. When the nurse administered the injection, the
child collapsed immediately. The resident doctor found that the
child had suffered cardiac arrest and he attempted to rescue the
child by manual pumping.
On advice.the child was shifted to the All India Institute of
Medical. sciences (AIIMS). The doctors at the AIIMS informed the
parents that the child was in a critical condition and even if he
survived he would live only in a vegetative state having suffered
irreparable damage to the brain. Based on the evidence, the
commission concluded that the child had suffered cardiac arrest
because of intravenous injection of an excessive dose of the
injection and that due to considerable delay in measures to
revive the heart, the child's brain had been damaged. The
Commission found that there was clear dereliction of duty on the
part of the nurse and that the hospital was negligent in having
employed an unqualified person as nurse and entrusting the
child to her care.
In a landmark case, on 5.5.1998, the supreme court of India
confirmed the order of the National Commission, which awarded
a compensation of 12.5 lacs (out of the said amount Rs.
12,37,500/- is to be paid by the Insurance Company) as
compensation to a minor and Rs. 5 lacs as compensation to the
parents
The Court also rejected the contention of the
hospital that the child's parents were not covered
within the definition of consumers in s. 2(1 )(d) of
the Act and could not be awarded compensation
separately. (Benefiacry)
It held that when a child was taken to a hospital by
his parents and the child was treated by a doctor,
the parents would come within the definition of
consumer having hired the services of the
hospital/doctor and the child would also be a
consumer under the inclusive part of the definition,
being a beneficiary of such services.
Therefore, both the parents and the child would be
'consumer' and could claim and be awarded
compensation.
The definition of service in section 2(1)(o) of CPA,1986 does not expressly
include ‘ housing construction’ before 1993.
Yet the supreme court held that, having regard to the object of the Act,
the authorities constituted under the Act could entertain a complaint by a
consumer for any defect or deficiency in relation to construction activity
against a private builder or a statutory authority. (Lucknow development
Authority v. M.K. Gupta AIR 1994 SC 787)
The Supreme Court in the case Chief Administrator, H.U.D.A. & Anr. v.
Shakuntla Devi ((2017) 2 SCC 301) made some essential observation which
are also rudimentary for awarding compensation and quantum of
compensation in consumer protection cases concerning real estate
matters.
In the case, the Respondent alleged that inspite of paying the full price of
the plot/allotment as per the terms and conditions of the allotment letter,
she was not given the possession of the plot by the Appellant.
In the case, the State Commission held that the Respondent had
established deficiency of service by the Appellants as there was delay in
handing over physical possession of the plot and was entitled to
compensation.
In appeal, the National Commission upheld the State Commission’s order.
Krishnan Kumar Bajaj v. Pepsi Co.
Vastrapur resident Krishan Kumar Bajaj
bought a packet of lay’s tangy twist which
was under weight. Bajaj brought this in
notice of Consumer Education Research
Society (CERS) which filed case against Pepsi
Co at consumer dispute redressal forum.
Before approaching forum Bajaj written
twice to manufacturer. To which company
did not pay serious heed.
Company refused to accept their fault and gave several
unsatisfactory explanations. The company asked for bill
of purchase, which Bajaj could not produce. The court
over-ruled the argument of not having bill. CERS in its
prayer had requested the court to direct PepsiCo to
immediately stop such unfair trade practice, deposit
Rs.2,00,000 in the Consumer Welfare Fund and award
Rs.2,75,250 as punitive damages. CERS had also
appealed to the court to order PepsiCo to
give Rs.75,000 as costs of litigation and also inform the
media. The court gave the order with the comment that
if Pepsi Co claims to be an international company, then
this kind of negligence is not acceptable.
The Pecuniary Jurisdiction of the Consumer Disputes
Redressal Agencies have been revised.
Any manufacturer or service provider who causes a false or
misleading advertisement to be made which is prejudicial
to the interest of consumers shall be punished with
imprisonment for a term which may extend to two years
and with fine which may extend to INR 1 Million, for the
first offence; and for every subsequent offence, be
punished with imprisonment for a term which may extend
to five years and with fine which may extend to INR 5
Million. It also provides for prosecution of celebrities
endorsing products with misleading claims, including
fines.
Establishment of a Central Consumer Protection Authority,
whose task is to promote, protect and enforce the rights of
consumers; make interventions when necessary to prevent
consumer detriment arising from unfair trade practices
and to initiate class action including enforcing recall,
refund and return of products, etc. This fills an
institutional void in the regulatory regime extant.
InExclusive provisions have been proposed for reference of a dispute to
Mediation as an Alternate Dispute Resolution Mechanism. The Bill states
that if it appears to the Consumer Forum that there exist elements of a
settlement which may be acceptable to the parties, it may direct the
parties to give in writing consent to have their dispute settled by
mediation in accordance with the provisions of the Act. The Bill further
provides for the establishment of Consumer Mediation Cell and also
enumerates the procedure for mediation.
The Bill also proposes for a complaint to be filed electronically. Also, the
admissibility of the complaint shall ordinarily be decided within 21 days
from the date on which the complaint was filed. If it is not decided
within 21 days, the complaint shall be deemed accepted.
The Bill further proposes that if the party is found guilty of adulteration
and results in the death of a consumer, the offender is liable with
imprisonment for a term which shall not be less than 7 years, but which
may extend to imprisonment for life and with fine which shall not be less
than INR 1 Million.
Law has been developed on the basis of
customary practices used by merchants in
their daily transaction
Documents which can be easily negotiated-
transferred easily. It carries payment security
Though the definition includes three things
but if two conditions are satisfied the other
things like Share warrant,
1. instrument should be freely transferable
(by delivery or by endorsement) by the
custom of the trade;
2. the person who obtains it in good faith
and for value should get it free from all
defects, and be entitled to recover the
money of the instrument in his own name.
Section 13 (a) means a promissory note, bill of
exchange or cheque payable either to order
or to bearer, whether the word “order” or “
bearer” appear on the instrument or not.”
In general we can say that negotiable
instrument means a written document which
creates a right in favour of some person and
which is freely transferable
1. Title of the document
2. Transferability- bearer-by mere delivery;
instrument -by endorsement and delivery
3. Unconditional order to pay-definite time,
sum
4. Negotiation
5. Presumptions (sec 118-119)- date, time of
acceptance, consideration, endorsement,
holder in due course
Section 4 of the Act defines, “A promissory
note is an instrument in writing (note being a
bank-note or a currency note) containing an
unconditional undertaking, signed by the
maker, to pay a certain sum of money to or to
the order of a certain person, or to the bearer
of the instruments.”
Parties-Maker, Payee, holder-it the payee or
someone whom he authorizes,
Endorser- holder transfers or endorses
Endorsee- in whose favour the bill is endorsed
Must be in writing
Must be a express promise or clear
understanding to pay
Must be unconditional
I promise to pay B or order Rs.500
I promise to pay B or order Rs.500 at my
convenience
Signed by the maker
Maker and the Payee must be certain
Promise is to pay money and only money
Section 5 of the Act defines, “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”.
So we can say that A bill of exchange,
therefore, is a written acknowledgement of
the debt, written by the creditor and
accepted by the debtor. There are usually
three parties to a bill of exchange drawer,
acceptor or drawee and payee. Drawer
himself may be the payee.
B buys good on credit from A payment is to
be made within six months A will get a bill of
exchange executed by B in favour of any
other person or himself
A is a Drawer
B is a Drawee
If payment is made to A than he is also payee
(1) It must be in writing.
(2) It must be signed by the drawer.
(3) The drawer, drawee and payee must be
certain.
(4) The sum payable must also be certain.
(5) It should be properly stamped.
(6) It must contain an express order to pay
money and money alone.
(7) The order must be unconditional.
Promissory Note Bill of Exchange
Number of Two- Maker and the Three-Drawer, Drawee,
Persons Payee Payee
Promise/ order Unconditional Promise Unconditional Order to Pay
to Pay
Acceptance Not required Must accept the bill
Debtor/ maker Drawer
Creditor
Liability Maker- Primary and Drawer- Secondary and
absolute conditional
Section 6 of the Act defines “A cheque is a
bill of exchange drawn on a specified
banker, and not expressed to be payable
otherwise than on demand”.
Thus, a cheque is a bill of exchange with two
additional qualifications, namely: (i) it is
always drawn on a banker, and (ii) it is
always payable on demand. A cheque being
a species of a bill of exchange, must satisfy
all the requirements of a bill; it does not,
however, require acceptance.
A cheque generally involves the following parties :
1. Drawer The person who makes the cheque
2. Drawee The bank of the drawer on whom
the cheque is drawn
3. Payee The person who is to receive the money
stated in the cheque
4. Holder A person who is in the possession of a
cheque and is entitled to receive or recover
the amount thereon.
5. Endorser The maker, drawee, payee or
endorsee can endorse a cheque by signing on the
back of it. The endorser of a cheque has the
status of a new drawer.
6. Endorsee The transferee or the person in whose
favour the instrument has been endorsed.
Essentials of a Cheque
It is always drawn on a banker.
It is always payable on demand.
It does not require acceptance. There is, however, a custom
among banks to mark cheques as good for purposes of
clearance.
A cheque can be drawn on bank where the drawer has an
account.
Cheques may be payable to the drawer himself. It may be
made payable to bearer on demand unlike a bill or a note.
The banker is liable only to the drawer. A holder has no
remedy against the banker if a cheque is dishonoured.
A cheque is usually valid for fix months. However, it is not
invalid if it is post dated or ante-dated.
No Stamp is required to be affixed on cheques.
Point of
S.N
Differen Bill of Exchange Cheque
o.
ce
1. Drawee A bill can be drawn on A cheque is always drawn on
any person (i.e., upon an a banker.
individual as well as a
banker)
2. Payable It may be drawn payable It can only be drawn payable
on demand, or on the on demand, and within six
expiry of a certain period months of the date mentioned
or days after sight or on the cheque.
3. Grace A grace of 3 days is No grace is given in case of
period allowed in the case of a cheque for payment for
payment of bill the sole reason that a
payable after sight or cheque is payable on
date. demand.
4. Acceptan Acceptance by the It does not require any
ce drawee is must before acceptance and is intended for
payment can be immediate payment.
demanded in respect of a
bill.
5. Payable A bill cannot be made A cheque can be made
to bearer payable to bearer on payable to the bearer on
demand demand. Contd.
6. Estoppel The drawer cannot Banker or the drawee is
of stop payment of a empowered to stop payment
payment bill. In other words of a cheque if all the related
a bill of exchange formalities are not adhered
cannot be to.
countermanded.
7. Presentm The drawer of a bill is The drawer of a cheque is
ent for discharged (i.e., not discharged only if he suffers any
payment liable to pay), if it is loss or damage due to delay in
not presented for its presentment for payment and
payment he shall be discharged to the
extent of such damage.
Contd.
8. Notice of Notice of dishonour If a cheque gets
dishono of a bill is necessary dishonoured, insufficiency
ur in order to charge its of funds in the drawer’s
drawer. account is sufficient and
appropriate evidence to
charge him.
9. Crossing The Act contains no A cheque may be crossed.
provision for ‘crossing’
of a bill of exchange.
Section 9 states that a holder in due course is
(i) a person who for consideration, obtains
possession of a negotiable instrument if
payable to bearer, or
(ii) the payee or endorsee thereof, if payable to
order, before its maturity and without having
sufficient cause to believe that any defect
existed in the title of the person from whom
he derived his title.
He must be the holder of the instrument.
He should have obtained the instrument for
value or consideration.
He must have obtained the negotiable
instrument before maturity.
The instrument should be complete and
regular on the face of it.
The holder should take the instrument in
good faith.
Every person capable of contracting according to law to which he is
subject, may bind himself and be bound by making drawing,
acceptance, endorsement, delivery and negotiation of a promissory
note, bill of exchange or cheque.
Thus, minors, lunatics, idiots, drunken persons, and people otherwise
disqualified from contracting are not competent to be a party to a
negotiable instrument. It should, however, be noted that if some of
the parties to a negotiable instrument are incompetent to contract,
the instrument is void only as against such incompetent parties
while other competent parties shall remain bound under it.
The penal provisions contained in Sections 138 to 142
of the Act have been enacted to ensure that obligations
undertaken by issuing cheques as a mode of deferred
payment are honoured. Section 138 of the Act provides
for circumstances under which a case for dishonour of
cheques is filed.
Cheque is returned by the bank unpaid, either because
of the amount of money standing to the credit of that
account is insufficient to honour the cheque or that it
exceeds the amount arranged to be paid from that
account by an agreement made with that bank, such
person shall be deemed to have committed an offence
and shall be punished with imprisonment for a term
which may be extended to two years, or with fine which
may extend to twice the amount of the cheque, or with
both
a person must have drawn a cheque for payment of money
to another for the discharge of any debt or other liability;
that cheque has been presented to the bank within a
period of three months;
that cheque is returned by the bank unpaid, either because
insufficient of funds or that it exceeds the amount
arranged to be paid from that account by an agreement
made with the bank;
the payee makes a demand for the payment of the money
by giving a notice in writing to the drawer within 15 days
of the receipt of information by him from the bank
regarding the return of the cheque as unpaid;
The drawer fails to make payment to the payee within 15
days of the receipt of the notice.
A legal notice is to be issued to the drawer
(issued the cheque) within 15 days of dishonor of
cheque by registered post with all relevant facts.
The drawer is given a time of 15 days to make
the payment, if the payment is made then the
matter is served and the issue is settled.
On the other hand if the payment is not made
then the complainant is to file a criminal case
process under Section 138 of the Act, against the
drawer within 30 days from the date of expiry of
15 days specified the notice, with the concerned
magistrate court within the jurisdiction.
The complainant or his authorized agent should appear in
the witness box and provide relevant details for filing the
case. If the court is satisfied and finds substance in the
complainant, then summons will be issued to the accused
to appear before the Court.
If after being served with the summons the accused
abstains himself from appearing then the court may issue
a bailable warrant. Even after this if the drawer does not
appear a non-bailable warrant may be issued.
On appearance of the drawer/accused, he may furnish a
bail bond to ensure his appearance during trial. After
which the plea of accused is recorded. In case he pleads
guilty, the court will post the matter for punishment. If the
accused, denies the charges then he will be served with the
copy of complaint.
The Complainant may present his evidence by way of
affidavit and produce all documents including the original
in support of his complaint. The complainant will be cross
examined by the accused or his counsel.
The accused will be given an opportunity to lead
his evidence. The accused will also be afforded
an opportunity to submit his documents in
support of his case, as well as witnesses in his
support. Accused and his witnesses will be cross
examined by the complainant.
The last stage of the proceeding is that of the
arguments after which the court will pass a
judgment. If the accused is acquitted then the
matter ends, but the complainant can go on
further appeal in the High Court, similarly if the
accused is convicted he can file an appeal in the
Sessions Court.
The Negotiable Instruments (Amendment) Act, 2018
which came into effect from September 1, 2018
allows the Court trying an offence related to cheque
bouncing, to direct the drawer to pay interim
compensation not exceeding 20% of the cheque
amount to the complainant within 60 days of the trial
court's order to pay such compensation.
This interim compensation may be paid either in a
summary trial or a summons case where the drawer
pleads not guilty to the accusation made in the
complaint; or upon framing of charge in any other
case.
Furthermore, the Amendment also empowers the
Appellate Court, hearing appeals against conviction
under s. 138, to direct the appellant to deposit a
minimum 20 % of the fine/compensation awarded, in
addition to interim compensation.
n 2017, Delhi High Court in Dayawati v. Yogesh
Kumar Gosain took into account the question
whether an offence under Section 138, which is a
criminally compoundable case, could be settled
by mediation. The Court held that even though
an express statutory provision enabling the
criminal court to refer the complainant but still
the proceedings under Section 138 of the Act is
distinct from other criminal cases and are really
in the nature of a civil wrong which has been
given criminal overtones.
Notice of dishonour refers to formal communication,
oral or written, of the fact of dishonour. When a
negotiable instrument is dishonoured either by non-
acceptance or non-payment, the holder should give
notice of the dishonour to all the parties, he seeks
to hold liable. A notice of dishonour has its own
significance. If it is not given to the drawer and
endorsers, it will discharge them all from liability
not only on the bill or pro-note but also with regard
to the original consideration. Such notice also
enables a person (drawer) so notified to protect
himself/herself as against the drawee or acceptor
who has illegitimately dishonoured the instrument
issued by him/her.
