January 23, 2002

‘7’

EFFECT OF REPEALING AND AMENDING ACT, 2001

BOUNCING OF CHEQUES CONTINUES TO BE PENAL OFFENCE

The Parliament has passed the Repealing and Amending Act, 2001, recently, which alongwith other Acts has also repealed the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988. The parent Act of 1881, the Negotiable Instruments Act, providing for punishment of one year imprisonment for bouncing of cheques continues to be in the statute book. Only the 1988 amendment in the principal Act of 1881 has been repealed.

    It has been brought to the notice of the Government by the Bounced Cheque Victims Grievances Forum that the Courts have stopped accepting new complaints on account of repeal of the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 by the Repealing and Amending Act, 2001. The Government wishes to clarify that the insertion of Chapter XVII on "OF PENALTIES IN CASE OF CERTAIN CHEQUES FOR INSUFFICIENCY OF FUNDS IN THE ACCOUNTS" by the Act of 1988 stands incorporated in the Negotiable Instruments Act, 1881 by virtue of the notification of March 29, 1989 which brought into force Section 4 of the 1988 Act by which the new provisions were inserted.

    Thus, after the intended changes were incorporated in the main statute, that is, the Negotiable Instruments Act, 1881 by incorporation of the Negotiable Instruments (Amendment) Act, 1988, in the parent Act of 1881, the continuance of the Amending Act of 1988 becomes unnecessary and accordingly the same has been repealed. Accordingly, the dishonour of cheques for insufficiency, etc. of funds in the account continues to be an offence under Sections 138 to 142 (both inclusive) of the Negotiable Instruments Act, 1881. Section 6A of the General Clauses Act, 1897 makes the position amply clear.

    Repealing and Amending Acts are enacted by the Legislature from time to time in order to repeal enactments which have ceased to be in force or have become absolete or the retention whereof as separate Acts is no longer necessary. Such Acts are intended only to remove dead matter from the statute book and to reduce its volume.