Cognizance Of Section 138 NI Act Offence By Magistrate Will Not Automatically Result In Decree In Civil Suit For Cheque Dishonour : Delhi High Court

The Delhi High Court has held that if the Metropolitan Magistrate takes cognizance of an offense under Section 138 of the Negotiable Instrument Act, 1881, it is not that a decree against the respondent/defendant will follow automatically. The Court rejected the argument that that mere cognizance of an offence by a MM in Section 138 NI Act proceedings should automatically lead to passing of a decree in a civil suit based on the very cheques. Rejecting the petitioner’s argument, Justice Asha Menon noted that cognizance leads to a trial where the accused can also get acquitted.