Final Order 1

Order Details: Copy of Judgment .
Pdf Text: J u d g m e n t M/s.Ravi Steel Industries V/s.
C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
(Para 44(i) of Chapter VI of Criminal Manual)
MHMM1201
86582021 IN THE COURT OF JUDICIAL MAGISTRATE
(FIRST CLASS) 56th COURT, MAZGAON, MUMBAI
(Presided over by Avinash Walujkar)
(Date of the Judgment: 05/05/2025)
C.C.No.5600040/SC/2021
Offence punishable under Section 138 of the Negotiable
Instrument Act.
Complainant M/s.Ravi Steel Industries.
Add.223, Sant Tukaram Road,
Iron Market, Masjid Bunder(E), Mumbai,
Through its Partner Shri.Deepak Gigraj Agarwal
Represented
by
Adv.Jayesh Kanani
Accused 1.Mr.Anilkumar Shyamsunder Goyal,
Age: 65 years, Occ.Business,
Proprietor of accused No.2,
2.M/s. G.A. Industries,
Add.7/101, 1st Floor, Tulsidham near D.A.V. School,
Ghodbunder Road, Thane(W) AND
Godown No.42, Kalamboli Warehousing Complex,
Kalamboli, Navi Mumbai.
Represented
by
M/s.APS Law Associates
(Para 44(ii) of Chapter VI of Criminal Manual)
Date of offence 28/10/2021
Date of FIR 28/10/2021
Date of Charge sheet
Date of Framing of Charges / Plea 5/3/2022
Date of commencement of evidence 7/3/2024
Date on which judgment is reserved
Date of the Judgment 5/5/2025
Date of the Sentencing order, if any 5/5/2025
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
Accused Details
Rank of
the
Accuse
d
Name of
Accused
Date
of
Arrest
Date of
Release
on bail
Offence
charged
with
Whether
acquitted
or
convicted
Sentence
imposed
Period of
Detention
undergone during
Trial for purpose
of Section 428
Cr.P.C.
1 Anilkumar
Shyamsund
er Goyal.
--- U/s.138
of N.I. Act
Convicted Imprisonment
&
compensation
---
2 M/s.G.A.
Industries,
--- U/s.138
of N.I. Act
Convicted compensation ---
Para 44(iii) of Chapter VI of Criminal Manual)
LIST OF PROSECUTION / DEFENCE / COURT WITNESSES
A. Prosecution:
Rank Name Nature of Evidence
(Eyewitnesses, Police Witnesses, Expert
Witnesses, Medical Witnesses, Panch witnesses,
other witnesses)
1 Deepak Gigraj
Agarwal
The partner of the complainant (Exh.6)
B. Defence Witnesses, if any:
Rank Name Nature of Evidence
(Eyewitnesses, Police Witnesses, Expert
Witnesses, Medical Witnesses, Panch witnesses,
other witnesses)
C. Court Witnesses, if any:
Rank Name Nature of Evidence
(Eyewitnesses, Police Witnesses, Expert Witnesses,
Medical Witnesses, Panch witnesses, other witnesses)
-- -- --
LIST OF PROSECUTION / DEFENCE/ COURT EXHIBITS
A. Prosecution:
Sr.No. Exhibit No. Description
1 14 Authority Letter dated 1/09/2021.
2 15 Four Invoices
3 16 Four E-way bills
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
4 17 Four Transporter bills
5 18 Disputed Cheque
6 19 Cheque Return Memo
7 20 Demand Notice
8 21 Postal Receipts
9 22 Postal Envelopes
10 23 Postal Track Report
11 24 Certificate u/s.65-B
B. Defence:
Sr.No. Exhibit Number Description
C. Court Exhibits:
Sr.No. Exhibit Number Description
D. Material Objects:
Sr.No. Material Object Number Description
J U D G M E N T
(Delivered on 5th May, 2025)
“Cheque, though acknowledged as a bill of exchange under
the Negotiable Instruments Act and readily accepted in lieu of payment of
money and is negotiable, the fact remains that the cheque as a negotiable
instrument started losing its credibility by not being honoured on
presentation.”
Honourable Supreme Court of India
(Indian Bank Associations and others V.s Union of India and others)
2014(5) SCC 590
This is another such case where the cheque was dishonoured
on presentation and the drawer of the cheque i.e. accused was given an
opportunity to pay the cheque amount by issuing a demand notice, but
still, he did not pay. The accused is therefore prosecuted for the offence
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
made punishable under Section 138 of the Negotiable Instrument Act,
1881. (Hereinafter, referred to as
'N.I. Act' for the sake of brevity.)
2. The complainant’s case in brief is that the complainant is a
partnership firm, engaged in the business of sale and supply of various
kinds of galvanised corrugated sheets, plain sheets and coils. It by
authority letter has authorized its partner Deepak Gigraj Agarwal to file
this complainant and prosecute the accused. The accused is the proprietor
of M/s. G.A. Industries. The accused placed verbal orders for purchase of
galvanised sheets. The complainant had sold and supplied galvanised
sheets to the accused vide invoices and E-way bills aggregating to
Rs.75,82,444/-. The accused claimed GST input credit for the said
material from GST authorities. As per the terms and conditions on the
invoices the accused is liable to pay interest at the rate of 36% per annum.
The accused after repeated reminders and request in discharge of said
liability to pay for the goods received issued the disputed cheque bearing
No.745028 dated 7/9/2021 of Rs.75,82,444/- drawn on Indian Overseas
Bank.
3. The complainant presented the said cheque on 5/10/2021 in
its bank i.e. ICICI Bank, Carnac Bunder branch, Mumbai. On 6/10/2021
the said cheque was dishonoured for the reason
“payment stopped by
attachment order” and the banker of the complainant issued a cheque
return memo. On 8/10/2021, the complainant issued the demand notice
and posted it on 9/10/2021 by registered post at the correct address of
the accused. On 13/10/2021, the notice was served on the accused. The
accused did not pay the demanded money within 15 days and
consequently, the complainant filed this compliant.
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
4. On presentation of the complaint under Section 200 of the
Code of Criminal Procedure, verification of the complainant was recorded.
On perusing the verification, complainant, evidence and documents filed
along with it, process was issued under Section 204 of the Code of
Criminal Procedure against the accused by order dated 17/11/2021 for
the offence punishable under Section 138 of Negotiable Instruments Act,
1881.
5. The particulars of the offence were read over and explained
to the accused in the vernacular on appearance. Plea of the accused is
recorded as per Section 251 of the Code of Criminal Procedure for the
offence made punishable under Section 138 of Negotiable Instruments
Act, 1881 at Exh.11. He adjured not guilty and claimed to be tried.
6. The complainant examined its partner at Exh.6. He has relied
on the above-mentioned documents and closed evidence by filing pursis.
7. The accused was remaining absent and avoiding to record the
statement of the accused under section 313 of the Code of Criminal
Procedure. Hence, in view of ratio laid down by the Hon’ble Bombay High
Court in the case of
Prakash Chimanlal Sheth V/s. T. Ramalingan Nadar
and others, 2022 SCC Online Bom 10161, the statement of accused
u/s.313 of Code of Criminal Procedure is dispensed with.
8. Considering the evidence on record and submissions
advanced at the bar, the following points arise for my determination, and I
have recorded my findings against them for the reasons mentioned
thereunder:
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
SR.No P O I N T S FINDINGS
1. Whether the complainant proved that it had complied
with requirements of Sec.138 and 142 of the N.I.
Act ?
In the
affirmative
2. Whether the accused proved the nonexistence of
debt/liability by a preponderance of probabilities by
referring to the ‘particular circumstances of the case’?
In the
negative
3. Whether the complainant proved that the cheque was
dishonoured for the reason
“payment stopped by
attachment order” from the account of accused?
In the
affirmative
4. What order? The accused are convicted.
R E A S O N S
As to point no.1:
9. The complainant is required to satisfy the following
ingredients for making out the case under Section 138 of the N.I. Act:
(a) The cheque(s) was/were drawn/issued by the accused
person(s) to the complainant on an account maintained by
him/her/them/it with the bank for discharge, in whole or in
part, of any debt or liability.
(b) the cheque(s) was/were presented to the bank within a
period of six months from the date on which it is drawn or
within the period of its validity, whichever is earlier;
(c) The cheque(s) so presented for encashment was/were
dishonored.
(d) the payee or the holder in due course of the cheque(s), as
the case may be, made a demand for the payment of the said
amount of money by giving a notice; in writing, to the drawer
of the cheque, within thirty days of the receipt of information
by him from the bank regarding the return of the cheque as
unpaid;
(e) the drawer of such cheque failed to make the payment of
the said amount of money to the payee or, as the case may be,
to the holder in due course of the cheque, within fifteen days
of the receipt of the said notice.
(f) The complaint was presented within 30 days after the
expiry of above fifteen days.
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
10. The partner of complainant has reiterated the contents of its
complaint by way of his examination-in-chief adduced as per Section
145(1) of N.I.Act. He has relied upon authority letter, invoices, e-way bills,
transporter bills, disputed cheque, cheque return memo, demand notice.
11. The disputed cheque, in this case, is dated 7/9/2021. The
same was returned unpaid by the bank on 6/10/2021. It is therefore
apparent that the cheque was presented within the period of its validity
and Section 138(a) of N.I. Act is complied with. The demand notice, in
this case, was issued on 8/10/2021, as is evident from Exh.20 and it was
posted on 9/10/2021, as is depicted from postal receipts Exh.21. It is
therefore established that the complainant/payee made a demand for the
payment of the cheque amount by giving a demand notice in writing to
the drawer of the cheque within 30 days from the date of receipt of
information from the bank about the return of cheques as unpaid and
accordingly Section 138(b) of the N.I. Act is abide by. The postal track
report Exh.23 goes on to show that the notice was received on
13/10/2021. The accused/drawer of the cheque was to make the payment
of the cheque amount within 15 days from the date of receipt of notice
i.e.28/10/2021. The accused had not made any payment within the
stipulated time. The complainant has established the fulfillment of
requirements of Section 138(c) of the N.I. Act. The complaint is filed by
the complainant in writing on 28/10/2021, which is within a period of
one month from the date of cause of action i.e.28/10/2021. The
complainant has accordingly complied with the requirements of Section
142(1)(a)(b) of the N.I.Act. The complainant has proved the technical
requirements of Section 138 of N.I.Act. Hence, I answer point No.1 in the
affirmative.
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
As to point no.2:
12. The burden is upon the accused to prove that there existed no
liability on his part to pay the cheque amount. The accused is not required
to discharge the burden beyond reasonable doubt but is sufficient if the
accused to the extent of preponderance of probabilities established that
there existed no such debt or liability. Then, the onus will shift on the part
of the complainant to again prove his case. The accused has not adduced
his evidence in this case and therefore, the particular circumstances of this
case and the cross-examination of the complainant have to be considered
to see if the accused has proved the nonexistence of debt or liability.
Therefore, in view of presumption u/s.118 and 139 of the N.I. Act and the
law laid down by the Honourable Supreme Court in the case of Rajesh
Jain V/s. Ajay Singh (2023) INSC 803 in para No.56, the point No.2
accordingly framed and taken up for discussion.
56. At the stage when the courts concluded that the signature
had been admitted, the Court ought to have inquired into
either of the two questions (depending on the method in
which accused has chosen to rebut the presumption): Has the
accused led any defense evidence to prove and conclusively
establish that there existed no debt/liability at the time of
issuance of cheque? In the absence of rebuttal evidence being
led the inquiry would entail: Has the accused proved the
nonexistence of debt/liability by a preponderance of
probabilities by referring to the ‘particular circumstances of
the case’?
13. The accused appeared and pleaded not guilty on 5/3/2022. In
this respect, it would be fruitful to refer to the Judgment of the Hon’ble
Supreme Court in the case of
Indian Bank Association and others V/s.
Union of India and other MANU/SC/0387/2014, wherein, it is directed
that when the accused appears to furnish a bail bond to ensure his
appearance during trial, the accused must be asked to take notice u/s.251
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
of Cr.P.C. to enable him to enter his plea of defence and fix the case for
defence evidence, unless, an application is made by the accused
u/s.145(2) for recalling the witness for cross-examination.
14. The accused, in this case, failed to make an application to
recall the complainant and cross examine the complainant. Hence, no
cross order was passed on 7/3/2024.
15. The case of complainant that the complainant had sold and
supplied goods i.e. galvanised sheets to the accused. The complainant
raised four invoices and E-way bills. The invoices and E-way bills have
GST number of the accused. The accused claimed input tax credit on the
said invoices. The accused failed to establish the contrary. The accused in
discharge of his liability to pay for the goods received had issued the
disputed cheque. This evidence of the complainant has gone
unchallenged. The complainant proved that the cheque belongs to the
account of accused. The signature of the accused on the cheques is not
disputed. There is initial presumption u/s.139 of the N.I. Act, which
favours the complainant. It is an example of reverse onus clause that has
been included in furtherance of legislative objective of improving the
credibility of negotiable instrument. In this respect, reliance can be placed
on the Judgment of the Hon’ble Supreme Court in the case of
Rangappa
V/s. Srimohan, MANU/SC/0376/2010.
16. Hence, I hold that the accused failed to disprove that the
disputed cheque was not issued in discharge of his liability in favour of the
complainant before the Court. Hence, I answer point No.2 in the negative.
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
As to point No.3: -
17. Deepak Gigraj Agarwal (P.W.1) deposed that the complainant
had deposited the cheque (Exh.18) in its bank and the same was
dishonoured on 6/10/2021 for the reason
“payment stopped by
attachment order” from the account of the accused. The complainant has
placed on record the cheque return memo Exh.19. The cheque return
memo demonstrates that the cheque of the account of the accused was
dishonoured and returned for the reason
“payment stopped by attachment
order” . In view of Section 146 of the N.I. Act, the cheques return memo
gives rise to the presumption of the fact of dishonour of the cheque.
Considering the oral evidence of P.W.No.1 Deepak along with documentary
evidence i.e. the cheque return memo and presumption under section 146
of the N.I. Act, I hold that the complainant has proved that the cheque at
(Exh.18) was dishonoured from the account of the accused for the reason
“payment stopped by attachment order”. Hence, I record my finding in
answer to point no.3 in the affirmative. Accordingly, I hold the accused
guilty for the offence punishable under Section 138 of N.I. Act.
As to point no.4: -
18. The accused is absent. In view of Section 143 (3) of the
Negotiable Instrument Act, 1881 every trail under this section shall be
conducted as expeditiously as possible and endeavour shall be made to
conclude the trial within six months from the date of filing of the
complaint. There is no provision under Chapter XX of the Code of Criminal
Procedure to hear the accused on the point of sentence as found in
Chapter IXX Section 248 (2) of the Code of Criminal Procedure. However,
all the mitigating factors in favour of the accused are considered. In this
respect reliance can be placed upon the judgment of Honourable Bombay
High Court in the case Navneet Singh Gogia Vs. The State of Maharashtra
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
2025:BHC-AS:3054
19. Learned Advocate for the complainant argued that the
transaction in question is commercial. The accused in spite of receving
demand notice did not pay the amount. Instade the accused delayed the
case at all possible ocassion and made the complainant run pillar to post
to get the cheque amount. The case is old. Hence, prayed for maximum
punishment be awarded.
20. The punishment provided for the offence under Section 138
of the Negotiable Instrument Act is imprisonment for the term which may
extend to two years or with a fine which may extend to twice the amount
of cheque or with both. The Hon'ble Supreme Court in the case of R.
Vijayan V/s. Baby and another (2012 AIR SC 528), has held that
“As the provisions of Chapter XVII of the Act strongly lean towards grant
of reimbursement of the loss by way of compensation, the courts should,
unless there are special circumstances, in all cases of conviction, uniformly
exercise the power to levy fine upto twice the cheque amount (keeping in
view the cheque amount and the simple interest thereon at 9% per annum
as the reasonable quantum of loss) and direct payment of such amount as
compensation”.
Also the Hon'ble Supreme Court in the case of Meters and Instruments Pvt.
Ltd. And another V/s. Kanchan Mehta (2018) 1 SCC 560, where in para
18 it is held that
“18(iv)- Procedure for trial of cases under Chapter XVII of the Act has
normally to be summary. The discretion of the Magistrate under second
proviso to Section 143, to hold that it was undesirable to try the case
summarily as sentence of more than one year may have to be passed, is to
be exercised after considering the further fact that apart from the sentence
of imprisonment, the Court has jurisdiction under Section 357(3) Cr.P.C. to
award suitable compensation with default sentence under Section 64 IPC
and with further powers of recovery under Section 431 Cr.P.C. With this
approach, prison sentence of more than one year may not be required in
all cases”.
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
21. Considering the fact that the transaction in this is commercial
and the accused is educated businessmen and knew the consequences of
issuing cheque the benefit of the Probation of Offender Act 1958 cannot
be extended to the accused. Considering the age of the accused,
dependent family members at the most a lenient view in respect of
imprisonment can be taken. On the other hand, if the complainant had
sold the goods to some other person, it could have earned profits on the
same. Hence imposing a sentence to suffer simple imprisonment for six
months and a compensation amount equal to the cheque amount with 9%
interest per annum from the date of complaint till realization as
compensation would meet the ends of justice. Hence, I pass the following
order: -
O R D E R
1. The accused 1.Mr.Anilkumar Shyamsunder Goyal,Proprietor
of accused No.2 and 2.M/s. G.A. Industries are convicted for the offence
punishable under Section 138 of Negotiable Instrument Act 1881 vide
section 255 (2) of the Code of Criminal Procedure, 1973 and accused No.1
is sentenced to suffer simple imprisonment for six months.
2. The accused are further sentenced to pay a compensation of
Rs.75,82,444/-(Rupees Seventy Five Lakhs, Eighty Two Thousand, Four
Hundred, Forty Five only) along with 9% simple interest per annum from
the date of filing of complaint till its realization, to the complainant within
one month and in default of payment of compensation the accused No.1
shall undergo simple imprisonment for six months.
3. The accused No.1 to surrender the bail bond.
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C.C. No.5600040/SC/2021 Mr.Anilkumar Shyamsunder Goyal and other
4. Copy of this judgment shall be given to the accused free of
costs.
(Dictated and pronounced in open Court.)
Place: Mazgaon. (Avinash A. Walujkar)
Date: 05/05/2025. Judicial Magistrate (First Class)
56th Court, Mazgaon, Mumbai.
Dictated on 05/05/2025.
Typed on 05/05/2025.
Ready on 05/05/2025.
Signed on 05/05/2025.
Rgz.
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