Final Order 5

Order Details: Copy of Judgment
Pdf Text: MHMM180081752019 Received On : 11.11.2019
Registered on : 11.11.2019
Decided on : 11.05.2026
Duration : 06 Y 06 M 00 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.5801192/SS/2019
JUDGMENT Exh.40
(Delivered on 11th May, 2026)
Prosecution/
Complainant : M/s. Mattel Toys (India) Pvt. Ltd.
Through Mr. Manoj Kumar s/o
Mr. Nagendra Kumar Sinha, Company
Secretary and Legal Manager,
Age : 55 years, Having office at 5th Floor,
North Avenue – 4 Maker Maxity,
Bandra Kurla Complex (BKC),
Bandra (E), Mumbai – 400 051.
Represented by : Advocate Mr. N.S.Charipalli.
Accused : Mr. Alpesh Thakkar
Sole Proprietorship Concern
Age : 55 years, Occ. Business,
R/o.A1/704, Sanskruit Apartment
Next to Rajhans Cinema Dumas Road,
Pipold, Surat – 395007, Gujarat.
Represented by : Advocate Mrs. Yogini Gurav.
Part ‘B’
(Para 44(ii) of Chapter VI of Criminal Manual)
Date of Offence : 07-11-2019
Date of filing complaint : 11-11-2019
Date of Registration of Complaint : 11-11-2019
Date of Recording Plea : 24-08-2022
Date of Commencement of evidence : 04-06-2025
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Judgment Exh.40
Date on which Judgment is Reserved : 11-05-2026
Date of the Judgment : 11-05-2026
Date of sentencing order, if any : 11-05-2026
Accused Details
Ran
k of
the
Acc
use
d
Name of
Accused
Dat
e of
Arr
est
Date
of
Releas
ed on
bail
Offenc
e
charge
d with
Final
order
Sentence Period
of
detent
ion
under
gone
Alpesh
Thakkar
- 24.08
.2022
U/s.
138
of the
N.I.
Act,
1881
Conv
icted
Accused is sentenced
to undergo S.I. for 1
year and to pay fine of
Rs.54,12,000/-, I.d. of
payment of fine to
suffer further S.I. for 6
months.
-
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 Manoj Kumar Oral 14
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 – 19/CW01 Certified copy of Board Resolution
dated 15.12.2003
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Judgment Exh.40
2. Exhibit – 20/CW01 Original Consumer Product Licence
Agreement dated 15.12.2016
3. Exhibit – 21/CW01 Cheque No.768111
4. Exhibit – 22, 23/CW01 Cheque Return Memos
5. Exhibit – 24/CW01 Statutory Notice dated 15.10.2019
6. Exhibit – 25, 26/CW01 Postal Receipts dated 15.10.2019
7. Exhibit – 27, 28/CW01 Two Returned Envelops
8. Exhibit – 29, 30/CW01 India Post Track Reports
B) Defence -
Sr. No. Exhibit Number Description
1. Exhibit - /DW01 -
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 11th May, 2026)
Accused is tried for an offence punishable under section
138 of the Negotiable Instrument Act, 1881, for dishonor of cheque
alleged to be issued for liability of payment of total outstanding amount
of Royalty in availing complainant’s brand for manufacture and trading
products of the accused.
2. The case of complainant in nut shell is as follows:
That he is Company Secretary, Legal Manger and
Authorized Representative of complainant company. The accused is
proprietor of Proprietorship Firm and signatory of the disputed cheque.
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Pursuant to Consumer Products Licence Agreement dated 15.12.2016
accused has used complainant’s various brands to manufacture
products for a consideration by way of payment of Royalty. Subject
cheque is issued for entire outstanding balance under settlement letter
dated 01.07.2019. The cheque was dishonored and returned unpaid for
the reason ‘Drawers Signature Differs’ vide dishonor memo dated
19.09.2019. Thereafter, accused paid part amount of Rs.7 lakhs
keeping balance amount of Rs.27,06,000/-. Demand notice dated
15.10.2019 was sent by speed post calling upon the accused to clear
remaining balance. However, the Registered Post Envelop containing
notice returned with postal remark as ‘Unclaimed’ by the accused. In
short, accused failed to make payment within statutory period. 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.13 and claimed to be tried. The case was tried as
summons trial.
4. Statement of accused under section 313 of Code of
Criminal Procedure was recorded by his advocate at Exh.35. Accused
has taken defence of non existence of legal liability, not receiving
demand notice etc.
5. Heard advocate Mr. N.S.Charipalli for the complainant and
advocate Mrs. Yogini Gurav for the accused. Perused written notes of
arguments and citations filed by both parties.
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6. On hearing both sides following points arise for my
determination to which I have recorded my findings with reasons
thereto as follows-
Sr.No. POINTS FINDINGS
1. Whether the accused has issued cheque bearing
No.768111 dated 10.09.2019 for
Rs.34,06,000/- drawn on Yes Bank Andheri(W),
Mumbai, in favour of the complainant in
discharge of legally enforceable liability or other
debt?
: Yes.
2. Whether it is proved that cheque was
dishonored for the reason ‘Drawers Signature
Differs’ ?
: Yes.
3. Whether it is proved that the accused has
received demand notice dated 15.10.2019,
issued u/sec.138(b) of the Negotiable
Instruments Act sent by the complainant
making demand of payment of said cheque
amount in writing within one month of receipt
of information from the bank regarding
dishonor of cheque?
: Yes.
4. Whether it is proved that despite service of
demand notice, the accused failed to pay the
cheque 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 is
convicted.
REASONS
7. In order to prove averments made in the complaint,
complainant has examined its authorized representative as CW-01 at
Exh.14 by filing evidence affidavit under section 145 of the Act and
relied upon disputed cheque, cheque return memo, demand notice etc.
Accused has not adduced evidence.
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AS TO POINT NO.1:-
8. Complainant’s case is that accused issued subject cheque
against remaining outstanding amount of Royalty. The accused was to
pay Royalty for the use of brand of complainant in manufacturing and
trading products of the accused. The same was dishonored and
returned unpaid. Meanwhile before issuing demand notice accused
paid Rs.7 lakhs keeping balance amount of Rs.29,06,000/-. Accused
failed to make said payment etc. As against it, accused has came with a
vague defence of no liability and not receiving demand notice etc.
9. Evidence of CW-01 unfolds that he is given authority to
depose on behalf of complainant by virtue of Resolution dated
15.12.2003 placed at Exh.19. Advocate for accused submitted that CW-
01 has no legal authority to represent and depose on behalf of
complainant. Testimony of CW-01 on the point of his authorization is
corroborated by the certified True Copy of Resolution passed by Board
of Directors in the Meeting dated 15.12.2003 filed at Exh.19.
Therefore, even otherwise considering the legal status of CW-01 a
Company Secretary and Legal Manager, her arguments of no legal
authority are not acceptable.
10. On the point of existence of liability, oral evidence of
complainant states that he had claimed around Rs.27 lakhs balance
amount from the accused. Much emphasis is given on his admission as
to not producing invoices on the basis of which the amount is derived.
However, accused has admitted executing Consumer Product Licence
Agreement. The same is produced at Exh.20 by the complainant. Once
accused has admitted execution of said Agreement, the burden cast
upon accused to establish how much products he manufactured and
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sold under the brand of complainant. Therefore, merely on account of
not producing Invoices, the testimony of CW-01 can not be disbelieved.
12. Much emphasis is given on evidence of CW-01 as to
inability to tell whose hand writing is in cheque Exh.21 or not
remembering the date of giving said cheque etc. However, it will have
to be born in mind that the cheque is drawn on account of accused.
Complainant is holder of the cheque drawn on account of accused.
Therefore, even though there is mismatch or cheque returned unpaid
for the reason ‘Drawers Signature Differes’, the same will not make the
instrument invalid. At the same time, it will not take place of proof on
the part of accused to say that said cheque was not issued to the
complainant towards any liability.
13. Accused was issued demand notice by Registered Post. The
documents on record speaks for receiving demand notice by the
accused rather deliberately returning the postal envelops ‘Unclaimed’.
Accused has not taken any legal action in respect of his alleged cheque
against complainant even after his appearance in the case. Accused has
not adduced any evidence to prove alleged forgery of signature nor
such suggestion is given in the cross examination of CW-01 to believe
his defence probable on preponderance of probabilities. The same can
not be considered to disbelieve evidence and case of complainant.
14. 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”.
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15. 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. ”
16. 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
accused. Thereby, the burden shifts upon the accused to rebut the
presumption of law under section 139 of the Act.
17. In the case in hand, the initial burden to attract the
presumption which favors the complainant that the cheque was issued
in discharge of legal debt or other liability is validly discharged by the
complainant. Existence of legal liability to pay an outstanding amount
towards Royalty by the accused is also proved. Therefore, there is
reason to believe issuing the cheque voluntarily in discharge of legal
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liability to pay said amount. A cheque is not mere piece of paper. Even
if cheque is presumed to be issued towards security, once legal
obligation is established, the same also becomes valid instrument for
payment of amount of liability. In absence of any probable and
trustworthy defence, there is reason to believe that the cheque was
issued for making payment of outstanding amount of Royalty to the
complainant. Therefore, I answer point No.1 in the affirmative.
AS TO POINT NO.2 :
18. Accused has not disputed reason of dishonor of the cheque.
Complainant has produced the dishonor memo dated 18.09.2019 at
Exh.23. In view of 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 on his two addresses that address of office as well as
residence. The submission of advocate for accused as to sending notice
on incorrect address appears correct considering discrepancy of office
number. The office number is mentioned in notice as B-2015. The office
number mentioned in the Agreement is B-205. Except the discrepancy
in the number rest of the address is correct. The envelop sent on said
address by Speed Post is returned with postal remark ‘Left’ and not ‘no
such person or incorrect address’. Second envelop which was sent on
residential address of the accused is returned with postal remark
‘Unclaimed’. In the facts and circumstances, there appears no legal
substance in the contention of accused that he had not received
demand notice. The return of Registered Post Envelop with remark
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‘Unclaimed’ and ‘Left’ is as good as deemed service. Therefore, I have
no hesitation in drawing inference that accused deliberately returned
the postal envelop.
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.” A legal and valid demand as to only remaining amount
which is lesser than cheque amount 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 :
21. 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.
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:
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(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.
22. 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.
23. The act of the accused to dishonor the cheque and neglect
to make payment despite calling upon by the complainant is an offence
punishable under section 138 of The Negotiable Instrument Act. The
accused is held guilty of the offence punishable under section 138 of
The Negotiable Instrument Act, 1881.
24. Accused absent. Exemption application rejected. Heard
advocate for accused on the point of sentence. She submitted that
accused be shown leniency in awarding punishment. Heard advocate
for complainant. He prayed for maximum sentence as per law
considering span of more than seven years litigation and outstanding
amount towards accused.
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25. The complainant has right of speedy trial. The law
mandates to conclude the trial within six months from the
commencement of hearing under section 143(3) of the Negotiable
Instrument Act, 1881. Considering the matter of year 2019 pending on
the file of this Court, the Judgment is delivered in absence of accused
taking recourse to section 353(6) of Code of Criminal Procedure and
section 392(6) of Bharatiya Nagarik Suraksha Sanhita, 2023.
26. Main object of the Act is to raise faith in the transactions
done by way of negotiable instruments. If leniency is shown, it will
encourage the defrauders to use cheques as a protracting tool. The
transaction in between parties is commercial transaction. Accused has
paid Rs.7 lakhs out of balance amount. The same would have to be
deducted while considering existing liability. In order to serve the
object of statute and do justice, accused needs to be punished with
substantive sentence as well as fine double the amount of remaining
balance amount and not the amount mentioned in cheque, so as to
compensate the complainant. Hence, I pass following order.
ORDER
1. Accused Mr. Alpesh Thakkar, Age : 55 years, R/o. Pipold, Surat,
Gujarat is convicted vide section 255(2) r/w. 353(6) of The
Criminal Procedure Code and Section 278(2) r/w.392(6) of the
Bhartiya Nagarik Suraksha Sanhita, 2023 for the offence
punishable under section 138 of the Negotiable Instrument Act,
1881 and sentenced to undergo simple imprisonment for 1
(One) year and to pay fine of Rs.54,12,000/- (Rupees Fifty Four
Lakhs Twelve Thousand 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 same be given to the complainant as
compensation under section 357(1)(b) of Code of Criminal
Procedure and under section 395(1)(b) of the Bhartiya Nagarik
Suraksha Sanhita, 2023.
3. Bail Bond of accused stands cancelled.
4. Issue warrant for arrest under section 418(2) of Code of
Criminal Procedure and under section 458(2) of the Bhartiya
Nagarik Suraksha Sanhita, 2023 against accused for the
purpose of forwarding him to the jail.
5. The copy of Judgment be supplied to the accused free of cost as
and when arrested and brought before this Court.
(Judgment is dictated and pronounced in the open Court).
( M. P. Saraf )
Judicial Magistrate(First Class),
Date : 11.05.2026. 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 : 11.05.2026.
Transcribed and Typed on : 11.05.2026.
Judgment printed and Signed on : 11.05.2026.
Judgment Uploaded on : 11.05.2026.
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