Final Order 3

Order Details: Copy of Judgment
Pdf Text: MHMM180080762019 Received On : 16.10.2019
Registered on : 16.10.2019
Decided on : 06.10.2025
Duration : 05 Y 11 M 20 D
Part ‘A’
(Para 44(i) of Chapter VI of Criminal Manual)
IN THE COURT OF JUDICIAL MAGISTRATE, FIRST CLASS,
58TH COURT, BANDRA, MUMBAI
(Presided over by : Mahesh Prabhakar Saraf)
Summons Case No.5801135/SS/2019
(CNR : MHMM180080762019)
JUDGMENT Exh.50
(Delivered on 6th October, 2025)
Prosecution/
Complainant : A V Enterprises
Through its Proprietor Mr. Pankaj M. Sheth
having its office at G-1C, Gokul Building,
Baroda Street, Carnac Bunder,
Masjid (E), Mumbai – 400 009.
Represented by : Advocate Sanket Jayesh Shah
Accused : 1) S.S. STEEL TRADING
A Proprietary Concern.
Having office at Grand Shop No.62,
Durga Chawl, Pandit Lal Tiwari
Road, Kandivali(W), Mumbai-400 067.
2) CHAND JUMMANALI KHAN
Proprietor of S.S.Steel Trading,
Age : 43 years, Occ. Business,
Address : Grand Shop No.62, Durga Chawl,
Pandit Lal Tiwari Road, Kandivali(W),
Mumbai-400 067.
Represented by : Advocate M. K. Giri
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Judgment Exh.50
Part ‘B’
(Para 44(ii) of Chapter VI of Criminal Manual)
Date of Offence : 29-09-2019
Date of filing complaint : 16-10-2019
Date of Registration of Complaint : 16-10-2019
Date of Recording Plea : 14-02-2022
Date of Commencement of evidence : 01-06-2022
Date on which Judgment is Reserved : 06-10-2025
Date of the Judgment : 06-10-2025
Date of sentencing order, if any : 06-10-2025
Accused Details
Ra
nk
of
the
Acc
use
d
Name of
Accused
Da
te
of
Arr
est
Date
of
Releas
ed on
bail
Offen
ce
charg
ed
with
Final
order
Sentence Period
of
detent
ion
under
gone
1. S.S. STEEL
TRADING - -
Under
sectio
n 138
of the
N.I.
Act,
1881
Convi
cted -
2. CHAND
JUMMAN
ALI KHAN
14.02.
2022
Under
sectio
n 138
of the
N.I.
Act,
1881
Convi
cted
Accused No.2 is
sentenced to undergo
S.I. for 1 year and to
pay fine of
Rs.23,02,910/ in
default of payment of
fine to suffer further
S.I. for 6 months.
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Judgment Exh.50
Part C
(Para 44(iii) of Chapter VI of Criminal Manual)
List of Prosecution/Defence/Court Witnesses
A) Prosecution/Complainant’s Witnesses -
CW NAME Nature of
Evidence
Exhibits
01 Pankaj M. Sheth Oral 13
B) Defence Witnesses -
DW NAME Nature of
Evidence
Exhibits
01 - -
C) Court Witnesses, if any -
CW NAME Nature of
Evidence
Exhibits
01 - - -
List of Prosecution/Defence/Court Exhibits
A) Prosecution/Complainant -
Sr. No. Exhibit Number Description
1. Exhibit – 24 to
26/CW01
Original Tax Invoices dated
22.10.2018, 03.12.2018 and
07.12.2018
2. Exhibit – 45/CW01 Office copy of Delivery challans
3. Exhibit – 27 to
29/CW01
Office copy of E-Way Bills
4. Exhibit – 30/CW01 Extract of Ledger of accused
maintained in the books of
accounts of the complainant.
5. Exhibit – 31 to
33/CW01
Cheque bearing Nos.093915,
093916 and 093917
6. Exhibit – 34 to Cheque Return Memos dated
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Judgment Exh.50
36/CW01 23.08.2019
7. Exhibit – 37/CW01 Demand Notice dated 11.09.2019
8. Exhibit – 38 and
39/CW01
Postal Receipts
9. Exhibit – 40 and
41/CW01
Acknowledgment Cards
10. Exhibit – 42/CW01 Postal Track Consignment Report
11. Exhibit – 43/CW01 I.T. Certificate
B) Defence -
Sr. No. Exhibit Number Description
1. Exhibit - /CW01 -
C) Court Exhibits -
Sr. No. Exhibit Number Description
1. Exhibit - /CW01 -
D) Material Object -
Sr. No. Material Object
Number
Description
1. - -
JUDGMENT
(Delivered on this 6th October, 2025)
The accused is tried for an offence punishable under
section 138 of Negotiable Instrument Act, 1881 for dishonor of cheques
issued towards payment of purchased materials.
2. The case of the complainant in nut shell is as follows:
Complainant is a Steel Trading Firm. Accused No.2 is
Proprietor of accused No.1. He had purchased Steel Tubes and other
material from the complainant time to time. As on 29.08.2019 an
amount of Rs.11,51,425/- was outstanding balance against the
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accused. In discharge of said liability accused issued subject three
cheques. All three cheques were dishonored and returned unpaid for
the reason ‘Funds Instrument’ vide dishonored memo dated
23.08.2019. Complainant received the intimation of dishonor from his
banker on 26.08.2019. Accused was called upon to pay the amount of
dishonored cheques vide notice dated 11.09.2019 issued by registered
post to the accused. Accused received the demand notice on
13.09.2019 but failed to comply the same. Hence, this complaint.
3. My Ld. Predecessor taken cognizance of the complaint and
issued process against the accused under section 138 of Negotiable
Instruments Act. On appearance of the accused, particulars of offence
were stated to him in vernacular to which the accused pleaded not
guilty vide Plea Exh.12 and claimed to be tried. The case was tried as
summons trial.
4. The statement of accused under section 313 of Code of
Criminal Procedure was recorded at Exh.46. The accused has taken
defence of not receiving the material. According to his defence
complainant obtained those cheques from him and has not supplied the
goods at all. In short, subject cheques were issued towards security.
5. Heard advocate Sanket Jayesh Shah for the complainant
and advocate M. K. Giri for the accused. Perused written notes of
arguments filed by both parties alongwith citations.
6. On hearing both sides following points arise for my
determination to which I have recorded my findings with reasons
thereto as follows-
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Sr.No. POINTS FINDINGS
1. Whether the accused has drawn disputed
cheques bearing No.093915 dated
12.06.2019 for Rs.50,5712/-, No.093916
dated 17.06.2017 for Rs.50,572/- and
No.093917 dated 21.08.2019 for
Rs.1,40,031/-, on Greater Bank, Malad(W)
Branch, Mumbai, in favour of the
complainant in discharge of legally
enforceable liability or other debt ?
: Yes.
2. Whether it is proved that cheques were
dishonored for the reason ‘Funds
Insufficient’ ? : Yes.
3. Whether it is proved that the accused has
received demand notice dated 11.09.2019,
issued u/sec.138(b) of the Negotiable
Instruments Act sent by the complainant
making demand of payment of said cheques
amount in writing within one month of
receipt of information from the bank
regarding dishonor of cheques?
: Yes.
4. Whether it is proved that despite service of
demand notice, the accused failed to pay the
cheques amount within statutory period of 15
days after receiving notice and thereby
committed an offence punishable under
section 138 of the Negotiable Instruments
Act?
: Yes.
5. What order? : Accused are
convicted.
REASONS
7. In order to prove averments made in the complaint,
complainant has examined himself as CW-01 at Exh.13 and relied upon
documentary evidence such as the invoices, delivery challans, E-Way
Bills etc. Accused has not entered into witness box nor adduced any
evidence. Accused has also not replied the statutory notice.
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AS TO POINT NO.1:-
8. Oral evidence of complainant depicts that he is proprietor
of complainant firm which deals with Trading of Steel pipes, tubes etc.
Accused No.1 is also a Steel Trading Firm of which accused NO.2 is
Proprietor and the sole incharge person responsible for day to day
transaction of the firm. As per order of the accused, complainant
supplied and delivered various Steel Tubes and materials time to time
to the accused through agent and broker Mr. Pravin Shah. Total amount
of Rs.11,51,455/- was outstanding towards the goods supplied to the
accused till upto 29.08.2019. In discharge of said liability accused
issued subject three cheques Exh.31 to 33 drawn on his account
maintained with the Greater Bombay Co-operative Bank Ltd. Malad,
Mumbai. On depositing all the cheques were dishonored and returned
unpaid vide dishonor memo dated 23.08.2019 Exh. 34 to 36. Accused
was duly served with the statutory notice Exh.37 by Registered Post but
neglected to make payment which constrained him to file complaint.
9. Accused has came with a defence that he has not received
said material. According to him the cheques were given towards
security of earlier transaction. However, there is nothing brought on
record either in cross examination of complainant or by way of
independent evidence to show that there were previous transactions in
between complainant and accused.
10. Accused has alternatively also taken defence that
complainant obtained above three disputed cheques in advance for the
purpose of security before supplying and delivering the steel material
but has not supplied the same actually. So far as said contention of
accused is concerned, it is hardly unbelievable. If it was so, a prudent
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man’s post conduct will indicate taking appropriate legal action against
complainant either by way of issuing notice, filing police complaint or
instructing the banker to make stop payment for the said cheques.
Nothing is done by the accused out of above three preponderance of
probabilities. The cheques are dishonored for the reasons ‘Funds
Insufficient’. Therefore, the defence of the accused appears improbable
and untrustworthy.
11. Complainant’s oral evidence is corroborated by the
documentary evidence of invoices Exh.24 to 26 which clearly shows
delivery of the Steel Materials to the accused No.1. Said invoices are
supported by three Delivery Challans commonly placed at Exh.45.
Furthermore, the E-Way Bills produced at Exh.27 to 29 also
corroborates the evidence of complainant as to delivering the goods to
the accused. The Ledger Account Extract Exh.30 clearly shows that
outstanding balance towards accused Firm. Complainant has produced
necessary certificate required under section 65(4)(b) of Indian
Evidence Act in respect of the electronically generated documents and
had left no room to doubt its authenticity.
12. The crucial evidence of subject cheques shows signature of
the accused which can be verified by naked eyes from the signature of
the accused on his plea Exh.12 and statement under section 313 of
Code of Criminal Procedure at Exh.46. So also accused has not
disputed issuing subject cheques. Therefore, obviously presumption
under section 139 of the Act would follow in favour of complainant.
Complainant has duly discharged his duty to prove said transaction and
issuance of cheques by the accused in discharge of legal liability.
Thereby, onus of burden of proof shifted upon the accused to prove his
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defence probable and trustworthy. However, accused has failed to rebut
the presumption of law under section 139 to support his defence.
13. In view of ratio laid down in the case of 'Bir Singh
V/s.Mukesh Kumar' (2019) 4 SCC 197, Hon'ble Supreme Court held
that,
“the presumption u/sec.139 of the Negotiable Instruments Act is
in favour of the complainant. It is the statutory presumption. The
burden of rebuttal is on the accused. If the ingredients are proved, the
Court is bound to draw the presumption in favour of the complainant”.
14. In the case of Rajesh Jain Vs. Ajay Singh, (2023)10 SCC
148, Hon’ble Apex Court has held that, “
Once the presumption arises
under section 139 of the Negotiable Instrument Act, the court ought to
have proceeded on the premise that cheque was indeed issued in
discharge of a debt or liability. The entire focus would then necessarily
have to shift on the case set up by the accused, since the activation of
the presumption has the effect of shifting evidential burden on the
accused. In such circumstances, the nature of inquiry would then be to
see whether the accused has discharged his onus of rebutting the
presumption. If he fails to do so, the court can straight way proceed to
convict the accused subject to satisfaction of other ingredients of
section 138 of the N.I. Act. However, if the court finds that the
evidential burden placed on the accused has been discharged,
complainant would have been expected to prove the said fact
independently and without taking aid of the presumption. ”
15. The ratio laid down by the Hon’ble Apex Court in catena of
Judgments states that once issuance of cheque is proved, the court has
to consider and follow the presumption of law under section 139 of the
Act in favour of complainant unless the same is rebutted by the
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accused. Thereby, the burden shifts upon the accused to rebut the
presumption of law under section 139 of the Act.
16. In the case in hand the initial burden to attract the
presumption which favors the complainant that the cheques were
issued in discharge of legal debt or other liability is validly discharged
by the complainant. Existence of legal liability to pay outstanding
amount towards purchase of Steel Materials by the accused is also
proved. Therefore, there is reason to believe issuing the cheques
voluntarily in discharge of legal liability to pay said amount.
17. A cheque is not mere piece of paper. In absence of any
probable and trustworthy defence, there is reason to believe that those
cheques were issued for making payment of outstanding amount by the
accused to the complainant towards purchase of Steel Materials.
Therefore, I answer point No.1 in the affirmative.
AS TO POINT NO.2 :
18. The complainant has produced two cheque return memos
dated 23.08.2019 produced at Exh.34 and 36 issued by HDFC Bank
Ltd., Mohd. Ali Road branch, Mumbai. It shows reason for dishonor of
the cheques, ‘Funds Insufficient’ in the account of accused. Accused has
not disputed the reason of dishonor of cheques. Therefore, in view of
presumption under section 146 of the Negotiable Instrument Act, I
answer the point No.2 in the affirmative.
AS TO POINT NO.3 :
19. Evidence on record shows that accused was issued
statutory notice dated 11.09.2019 placed at Exh.37 by Registered Post.
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The same was received and delivered to the accused on 13.09.2019.
Complainant has produced the Postal Receipts at Exh.38 and 39
alongwith Acknowledgment Cars Exh.40 and 41, Postal Track
Consignment Report Exh.42. Omnibus statement of not receiving
demand notice is of no use. The stand taken by the accused is without
proof and evidence.
20. In the case of
K. Bhaskaran Vs. Sankaran Balan, reported
in 1999, Cr.L.J.4606 and
CC Alavi Haji Vs. Palapetty Muhammed and
Anr. reported in 2007(3) Crimes 120(SC) The Hon’ble Apex Court has
elaborately discussed the scope of section 27 of General Clauses Act
and 114 of Indian Evidence Act. It has observed that,
“Section 27 gives
rise to a presumption that service of notice has been effected when it is
sent to the correct address by Registered Post addressing the drawer of
the cheque.”
21. Notice Exh.37 issued to the accused is replica of averments
made in complaint. A legal and valid demand is made as contemplated
under section 138(b) of the Negotiable Instrument Act. Hence, I answer
point No.3 in the affirmative.
AS TO POINT NOS.4 AND 5 :
22. Drawer of a cheque is deemed to have committed the
offence of cheque dishonor, if the following ingredients are fulfilled:
(i) A cheque is drawn for the payment of any amount of money
to another person;
(ii) The cheque is drawn for the discharge of the ‘whole or part’
of any debt or other liability, ‘Debt or other liability’ means
legally enforceable debt or other liability; and
(iii) The cheque is returned by the bank unpaid because of
insufficient funds or any other reason.
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However, unless the stipulations in the proviso are fulfilled the offence
is not deemed to be committed. The conditions in the proviso are as
follows:
(i) The cheque must be presented in the bank within six months
from the date on which it was drawn or within the period of
its validity;
(ii) The holder of the cheque must make 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 from
the receipt of the notice from the bank that the cheque was
returned dishonored, and
(iii) The drawer of the cheque fails to make the payment of the
‘said amount of money’ within fifteen days from the receipt of
the notice.
23. Complainant has satisfactorily proved all the above
ingredients constituting an offence under section 138 of the Negotiable
Instrument Act, beyond all reasonable doubt. Complaint is filed within
statutory period after arising cause of action to file complaint.
Therefore, it is crystal clear that accused has committed an offence
punishable under section 138 of Negotiable Instrument Act, 1881.
Hence, I answer point No.4 in the affirmative.
24. The act of the accused to dishonor the cheques and neglect
to make payment despite calling upon by the complainant is an offence
punishable under section 138 of The Negotiable Instrument Act.
Therefore, the accused is liable for punishment. The accused is held
guilty of the offence punishable under section 138 of The Negotiable
Instrument Act, 1881.
25. Complainant and advocate absent. Accused and advocate
present. Heard accused on the point of sentence. Accused reiterated
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that he has not committed any offence. Heard, advocate for accused
who submitted to award minimum sentence.
26. The main object of the Act is to raise faith in the
transactions done by way of negotiable instruments. Showing leniency
will pass a wrong message in the society. It will encourage the
defrauders to use the negotiable instruments as a protracting tool.
Nobody would trust making transaction on the basis of negotiable
instruments. The transaction in between parties is a commercial
business transaction. Accused has not paid interim compensation.
Complainant needs to be compensated for the delayed payment against
dishonored cheques. The proceeding being of quasi criminal nature, it
will not be just and proper to show leniency in awarding punishment.
27. In view of evidence and findings on record, I pass
following order.
ORDER
1. Accused No.1) S.S. STEEL TRADING, A Proprietary Concern
and accused No.2) CHAND JUMMANALI KHAN, Proprietor of
S.S.Steel Trading, Age : 43 years, address at Kandivali(W),
Mumbai, are hereby convicted vide section 255(2) of The
Criminal Procedure Code and Section 278(2) of the Bhartiya
Nagarik Suraksha Sanhita, 2023 for the offence punishable
under section 138 r/w.141 of the Negotiable Instrument Act,
1881 and accused No.2 is sentenced to undergo simple
imprisonment for 1 (One) year and to pay fine of
Rs.23,02,910/- (Rupees Twenty Three Lakhs Two Thousand
Nine Hundred and Ten only) in default of payment of fine to
suffer further simple imprisonment for 6 (Six) months.
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2. If fine is paid the complainant shall be given compensation of
Rs.23,02,910/- (Rupees Twenty Three Lakhs Two Thousand
Nine Hundred and Ten only), out of the same under section
357(1)(b) of Code of Criminal Procedure and under section
395(1)(b) of the Bhartiya Nagarik Suraksha Sanhita, 2023.
3. Accused to surrender his bail bond.
4. The copy of Judgment be supplied to the accused free of cost.
(Judgment is dictated and pronounced in the open Court).
( M. P. Saraf )
Judicial Magistrate(First Class),
Date : 06.10.2025. 58th Court, Bandra, Mumbai.
J.O.Code: MH01362
CERTIFICATE
I affirm that the contents of this P.D.F. file Judgment are same, word to word as per
the original Judgment.
Name of Stenographer : Mrs.Aditi Ravikiran Dalvi
Court : Judicial Magistrate(First Class), 58th Court,
Bandra, Mumbai.
Dictated in open court on : 06.10.2025.
Transcribed and Typed on : 06.10.2025.
Judgment printed and Signed on : 06.10.2025.
Judgment Uploaded on : 06.10.2025.
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