The Supreme Court has observed that a complaint under Section 138 of
the Negotiable Instruments Act is maintainable when there is dishonour
of cheques issued under and in pursuance of the agreement to sell.
In
Ripudaman Singh vs. Balkrishna,
a couple entered into an agreement to sell with the accused, who paid
some amount in cash and towards balance, issued two post dated cheques,
each in the
amount of Rs 25 lakhs. When presented after the due
dates, these cheques got dishonoured and legal notice was issued to the
accused. As they did not pay the amount, complaint was filed under
Section 138 of the Negotiable Instruments Act.
The accused
moved the High Court which quashed the complaint holding that cheques
had not been issued for creating any liability or debt but for the
payment of balance consideration.
In appeal, the Apex court bench comprising of
Justice DY Chandrachud and Justice Hemant Gupta
observed that admittedly the cheques were issued under and in
pursuance of the agreement to sell. Though an agreement to sell does not
create any interest in immovable property, it nonetheless constitutes a
legally enforceable contract between the parties to it, the court
added.
While setting aside the High Court order, the bench said:
"We
find ourselves unable to accept the finding of the learned Single
Judge of the High Court that the cheques were not issued for creating
any liability or debt, but 'only' for the payment of balance
consideration and that in consequence, there was no legally enforceable
debt or other liability. Admittedly, the cheques were issued under and
in pursuance of the agreement to sell. Though it is well settled that
an agreement to sell does not create any interest in immoveable
property, it nonetheless constitutes a legally enforceable contract
between the parties to it. A payment which is made in pursuance of such
an agreement is hence a payment made in pursuance of a duly enforceable
debt or liability for the purposes of Section 138."